Carbon Trading in Australia

Australian Prime Minister John Howard received the final report of the Emissions Trading Task Group last week, which suggested a carbon trading scheme could be up and running by 2012.

The report recommends a cap and trade system, in which polluters are issued permits and trade them according to their emissions. Companies could buy pollution permits if they cannot keep their emissions under a certain level. The report says the system would take four years to develop. Setting a carbon price would be up to the market…The study warns cutting emissions has a cost: higher energy prices.

But what happens from now until 2012? Do we keep doing what we’re doing and make the situation worse? Australian scientist and conservationist Professor Tim Flannery and The Climate Institute agree that climate change won’t wait. Industry would like a solution to be implemented years down the track. Origin Energy managing director Grant King said,

We do need to start gradually and introduce the targets through time, so industries can adjust both in terms of applying the technology that’s necessary to achieve those targets and secondly, to cope with the impact of that change.

Prime Minister Howard gets back to his favourite topic by adding,

The Government will only support targets for cutting greenhouse gas emissions which do no damage the economy.

Some people are worried about the increased price of energy under an emissions trading scheme, but

The Climate Institute energy and economic modelling has shown that an early and effective price signal on carbon matched with clean energy targets and energy efficiency will ease the economic costs and limit the price increases for consumers and industry.

John Connor, The Climate Institute Chief Executive said,

Without targets to reduce emissions no climate change policy has credibility….The measures outlined by Prime Minister will not meet the targets that have been set by Australia’s best scientists. CSIRO advised the Prime Minister’s Task Group that countries like Australia must cut emissions by 60-90% by 2050 if dangerous climate change is to be avoided.

John Connor discussed some of the likely consequences of setting no targets for emissions reduction,

We risk locking into at least 3 degrees of warming which would devastate the Great Barrier Reef, halve the flow of water in to the Murray River and result in the extra deaths of 3000 to 5000 Australians every year from heat stress. The Australian economy is on a collision course with climate change. More droughts, water shortages, health impacts and loss of natural assets and agricultural productivity will mean serious job losses and serious economic impact.

Drastic climate change would hurt the economy a bit more than increasing energy prices. The government’s scheme doesn’t sound like a solution to me, rather a sweetener to help the ruling party stay in power following the upcoming Australian federal election.

Federal opposition environment spokesman Peter Garret agrees and said,

he doubts John Howard will act with any urgency…[Howard’s past behaviour] does not give great confidence that he’s going to take this issue forward with the degree of serious conviction and vigour required.

=^.^=

2 thoughts on “Carbon Trading in Australia

  1. The Australian government can kick start the process of adjustment whenever it likes. It can do this by using taxation instruments to encourage investment in efficient technologies and can also provide direct subsidies from taxes if necessary.

    The public should accept the latter only if strictly monitored and only as a support taxation instruments.

    It appears to me that the Australian government is showing that it knows it has to produce reports but, that it is purposely dragging its feet when it comes to action.

  2. To put the Australian Prime Minister’s very late and inadequate response into perspective, as little as 18 months ago he and many of his senior ministers were saying that there was no global warming and the whole climate change debate was a beat up.

    As little as 9 months ago they were saying there “maybe” a climate change occurring, but it was all natural and nothing to do with man made pollution.

    Howard was only dragged and kicking into this debate because the public took it up, and this is an election year with his internal polling showing he would lose if he didn’t take control of the debate.

    This all under the umbrella of him having a relative high up in the coal industry and the polluting energy lobby groups being heavy contributors to his party, and Australia being the biggest per capita polluter in the world.

    He has deliberately held off on setting anything in concrete until after the election, and if he is true to form will drop the matter as soon as the election is over if he wins.

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