Green groups have been predictably critical of the Rudd Government for not going far enough, but the options paper on emissions trading issued yesterday marks a quantum shift in this nation's response to climate change.

The Government could have imposed a tighter trading scheme on industry. It could have been less sympathetic to the wider Australian public in how across-the-board costs would impact on them. And it could have acted with greater haste, given the accelerating pace of global warming.

However, the softly, softly approach may prove to be the wiser course, particularly as we are in such uncharted territory.

For a start, no-one really knows how an emissions trading scheme will play out economically and socially, here and abroad.

But while the details of new measures are complex, the people of this region should have a great interest because of the presence of BlueScope Steel.

The Government is proposing free "permits to pollute" which initially give big emitters free credits for up to 90 per cent of emissions. Compensation is also likely for companies in internationally-competitive markets.

This would have been a cause for significant relief, if not celebration, in the boardroom of BlueScope, one of Australia's largest carbon dioxide emitters. It is said that on a carbon price of $20 a tonne, and without any credits, BlueScope stood to lose a third of its gross profit.

One does not have to be an economist to conclude this would be a serious threat to keeping the steelmaker on these shores. We cannot afford to lose such a vital industry, one that is fundamentally changing its way of business to meet new environmental expectations. BlueScope's planned co-generation plant is a case in point.

The world needs steel and the legislative structure should be conducive to ensuring it can always be produced at Port Kembla.

It would seem the Federal Government has taken such a considered view.

But, make no mistake about it, just as the BlueScopes of the world are going to have to bear some pain and adapt for the good of the environment, so too will all individuals have to make amends for what we, collectively, have done to the planet.