For related articles and more information, please visit OCA’s Environment and Climate Resource Center page.

Australia’s enormous coal deposits long seemed like an unmitigated gift in an expansive land of sweltering summers. On the planet’s driest inhabited continent, fossil fuel delivered cheap, reliable electricity through both extreme heat and torrential storms.

But drought, rampant wildfire in the outback, and the degradation of the treasured Great Barrier Reef have forever altered how Australia views its energy endowment. Facing a future as one of the places on Earth most vulnerable to climate change, and one of the nations with the world’s highest per capita carbon emissions, Australia has taken steps to change its fate. (See interactive: “Four Ways to Look at Global Carbon Footprints“)

This week the government issued its first ever carbon emissions permits, a milestone in implementation of a new climate and energy law that is expected to give Australia the world’s most comprehensive carbon cap-and-trade system by 2015. (Related: “IEA Outlook: Time Running Out on Climate Change“)

Climate activists have hailed the law as a hopeful sign that even one of the world’s most carbon-intensive economies can commit to a different future. But the work is only beginning.  In just one indication of the long road ahead, an International Energy Agency fuel economy report last week ranked Australia’s new car fleet as worst among the world’s major economies in carbon emissions per kilometer. Emblematic of Australia’s failure to invest in energy efficiency, it has no binding automobile fuel economy standards. (Related Pictures: “A Rare Look Inside Carmakers’ Drive for 55 MPG“) Historically, only the United States has surpassed Australia in its appetite for powerful engines. And this year, as U.S. drivers have begun flocking to smaller, more efficient cars, Australia has seen an SUV boom. SUVs made up 28 percent of Australia’s new vehicle sales in August, compared to just below 25 percent a year earlier.