Contrary to its campaign pitch of emission reduction by up to 20 per cent, the ruling Australian Labour Party could opt for a relatively moderate cut in greenhouse gas emissions, say, ranging from five to 15 per cent.
It has also gone back on its plan to present a 2020 emissions reduction target to UN climate talks in Poland opening Monday, provoking criticism that it would prefer to see what other nations have to say before committing itself on the issue.
People should not expect concrete greenhouse gas reduction targets to come from the Poland meet, Climate Change Minister Penny Wong said.
The UN summit is a major stepping stone towards a fresh global deal on reducing emissions.
The current Kyoto deal runs out in 2012 and a replacement is to be inked at the UN's Copenhagen summit next year.
But countries are arguing about who should do the most to cut emissions, and there is a growing schism between developing and developed countries.
Senator Wong made no bones about how hard it was.
"I think it is an enormously difficult task and it's an enormous challenge."
"I don't think we can underestimate the effect of the global financial crisis on this policy area... it's extraordinarily difficult times in terms of the world's financial system."
Yet Senator Wong has not given up.
She pointed to some positive signals, saying there was a growing global recognition of the need to act.
When asked if she felt optimistic about the chances of forging an effective climate pact, Senator Wong was restrained.
"I think I'm more focused on what has to be done, I think I'll leave whether or not I'm optimistic."
She also said that the election of US president-elect Barack Obama, who had vowed to take action on global warming, was extremely important.
And Australians still wanted action on climate change, despite the economic crisis.
"All I can tell you is what I see. I see that people are keen, they do want us to... take action on climate change."
But the Australian Greens are skeptical and charge the Federal Government is deliberately holding back progress on a global climate treaty by refusing to take a greenhouse gas emissions target to Poland.
The Australian delegation is chairing meetings of a faction including the United States, Japan, Canada and Saudi Arabia at the Poznan conference.
Tasmanian Greens Senator Christine Milne claims the group is delaying progress by not announcing bold greenhouse gas emissions targets.
"The rest of the world is already disgusted that Australia is not announcing its target and not taking a target to Poznan," she said.
"South Africa is saying that countries like Australia will scuttle the global negotiations and hold things up if they don't adopt [a cut of] at least 25 per cent."
Besides the national target set to be announced Dec.15 has made the greens see red, and they seem to insinuate the Labour is selling out to the industry lobby. But Senator Wong rubbishes such claims and insists it is all above board.
"We've had a lot of negotiations, dialogue and interaction with industry, both the trade exposed sector as well as the non-trade exposed, as well as non-government organisations and the community," she said.
"There are a whole range of views... the government has to take in account."
However, she refused to speculate on what the targets would be.