If the world achieves this agreement, Australia will meet this 25% target by connecting the CPRS, the expanded Renewable Energy Target, and with substantial investment in clean, renewable energy and energy efficiency and strategic investment in carbon capture and storage.

Up to 5% points of this target can be met by purchasing international credits, such as avoided deforestation credits, using CPRS revenue no earlier than 2015.

In the White Paper, the Rudd Government emphasized clearly that the agreement to stabilize levels of CO2 equivalent at 450 parts per million or lower by mid century will be squarely in Australia’s national interest.

At that time, the government committed to playing its full and fair part in an agreement, but assessed prospects for such an ambitious deal in the near term were challenging.

Since then, international developments have improved prospects.

US President Obama has toughened his election commitments to mid and long term carbon pollution reduction goals and to introduce an emissions trading system similar to the CPRS.

The President’s Major Economies Forum on Energy and Climate is helping drive progress in UN negotiations for a global agreement.

Recently, the UK has also announced a strengthening of its 2020 target for reducing carbon pollution.

Nevertheless, achieving an ambitious global agreement will still be very tough.

It will require a significant further shift in negotiating dynamics so that all advanced and major developing economies take serious action to restrain and then reduce emissions.

The Government will retain its White Paper target range of:

An unconditional commitment to reduce carbon pollution by 5% by 2020; and

A commitment to reduce carbon pollution by 15% by 2020 if there is an agreement where major developing economies commit to substantially restrain emissions and advanced economies take on commitments comparable to Australia’s.

A Ratification Review will be established in addition to the Joint Standing Committee on Treaties (JSCOT) Process to assess whether the terms of any global agreement meet the conditions set out for Australia to adopt the 25% target.

Should the world achieve this ambitious agreement, the Government would seek a new election mandate for increased 2050 targets.

Crucially, this new target reinforces the need to secure passage of the Carbon Pollution Reduction Scheme for 2009.