EVER since she was elected prime minister six weeks ago, Julia Gillard has been under pressure to restore the ruling Labor Party's credibility on climate change. Relying on coal to generate about 80% of its electricity makes Australia one of the biggest greenhouse-gas emitters per head. Labor's decision to abandon an earlier pledge for a European-style emissions-trading scheme (ETS) cost it seats at an election in August. Ironically it also left Ms Gillard relying on support from the Australian Greens to form a minority government.

Ms Gillard has now ditched a much-lampooned election promise to establish a “citizens' assembly” to discuss climate change. Instead, she has appointed a multiparty parliamentary committee to decide how Australia should make its worst carbon polluters pay. A report this week by the Climate Institute, a Sydney-based think-tank, suggests how hard that will be: comparing Australia with five of its main trading partners, only South Korea has done less to factor the cost of carbon emissions into its electricity prices.

The Greens are claiming credit for Ms Gillard's new climate concern. Some also detected their influence when she announced on October 18th a more moderate approach to another divisive election issue: the increasing numbers of asylum-seekers arriving in Australia by boat. Those with children will no longer be incarcerated, but allowed to live freely while their claims are assessed. The Greens have long called for such a change; Ms Gillard claimed it as her party's idea.

The climate committee must decide by late 2011 the best way to put a price on greenhouse-gas emissions: an ETS, a carbon tax or a hybrid of both. The Greens have two representatives on it, including Bob Brown, their leader. Tony Windsor and Rob Oakeshott, two independents whose price for supporting Ms Gillard included a revival of climate-change action, are also on the committee. Only the opposition Liberal-National coalition is absent. Its leader, Tony Abbott, rejected Ms Gillard's invitation to join. He has previously dismissed climate science as “crap” and the mooted mitigation measures as just a “great big tax”. Yet this populism has left him looking suddenly rather isolated.

To help it think through the economic impact of a carbon tax, or similar measure, the government is consulting many of the country's top businessmen—including former allies of Mr Abbott. This is encouraging, but the task of greening Australia is huge. According to the Climate Institute, Australia is the G20 country that is worst-prepared to compete in a low-carbon economy. Its report compares the additional costs imposed on electricity producers in six countries by anti-warming strategies, including carbon taxes, emission-trading schemes and clean-energy subsidies.

In Australia, such measures represented an effective carbon tax of $1.70 per tonne—a figure 17 times lower than in Britain and eight times lower than in China, on the basis of a perhaps-generous interpretation of China's efforts to make its coal-fired power stations more efficient. Only South Korea's hidden carbon price of 70 cents was lower. One of the report's authors, Cameron Hepburn, reckons that China will “almost certainly” adopt a national ETS or some alternative measure before Australia does.