Malcolm Turnbull once said he didn’t want to lead a party that wasn’t as committed to climate action as he was. Now he does.

Climate policy cost Turnbull the Liberal leadership in 2009 when he backed Kevin Rudd’s emissions trading scheme. He had to promise not to try to reintroduce an emissions trading scheme to gather the support he needed to win it back.

Back then he described the Coalition’s current climate policy as “a recipe for fiscal recklessness on a grand scale” and “a very expensive charge on the budget in the years ahead”. That’s his policy now, even though most experts think it has no chance of meeting new 2030 greenhouse gas reduction targets Australia has promised in the lead up to the UN meeting in Paris.

But the solution to his dilemma is hidden in the details of the Direct Action policy, details which allow the policy to be “dialled up” into a baseline and credit emissions trading scheme that has a better chance of actually reducing Australia’s output of greenhouse gases.

The key lies in the “safeguards” the government is finalising to make sure businesses that are not seeking money from the “Direct Action” fund don’t increase their emissions and undo all the reductions the government is buying.

The idea is to set baselines that emitters are not allowed to exceed. The tougher the baselines, the bigger reductions in emissions. At the moment they are so lax that the Reputex analytics firm has calculated Australia’s 20 biggest emitters would be able to significantly increase emissions and almost no big emitters would be required to reduce them.

The policy also says that companies that promise a certain quantity of reductions in return for money from the $2.5bn emissions reduction fund, but then don’t manage to live up to their promises, could buy credits from companies that reduce emissions by more than they had envisaged.

Both those scenarios involve trading – and a carbon price. And depending on how the baselines were drawn, they would give Australia a good chance of deeper, cost-effective emission reductions within the existing Direct Action legislation.

The scheme would be more credible still if some of the emissions reduction fund was set aside to buy cheaper international carbon permits if Australia looked like missing its target – something that business wants but Abbott at first vetoed and then said he might consider in the future. (He once described buying international permits as being like sending “money … offshore into dodgy carbon farms in Equatorial Guinea and Kazakhstan”.)

Business is already factoring in that this will have to happen. Most major business groups support some kind of carbon price. Their main concern has been the lack of certainty that was created by the previous untenable policy settings. Business groups recently joined with welfare and environment groups to plead for some kind of policy certainty. Done carefully, “dialling up” Direct Action would not meet significant business resistance.

Abbott dragged down Turnbull’s leadership because of his support for emissions trading. Abbott’s alternative policy could help Turnbull restore some semblance of credibility to its policy on climate change and still keep his party happy.