Australia's Carbon Pricing to Herald a Clean Energy Future

Australia's Clean Energy Future image

Image: Australian Government

Australia has put a price on carbon dioxide. $23 AUD a tonne. The country's 500 biggest polluters will, as off 1 July 2012, be required to pay effectively a tax on the CO2 they create. They will, of course, pass on this encumbrance to their customers, which government modelling suggests will end up as $9.90 weekly impost on household budgets. To get the populace on side in the transition to a lower carbon economy the government will take 15 billion from the taxes collected and funnel that back to households as compensation equal to an average of about $10.10 a week. Unless, you earn more than $80,000 per annum, a figure deemed wealthy enough that you can pay your own carbon way without need of income tax relief.

Settling a carbon price, (to be superseded by a Emissions Trading Scheme or 'cap and trade' system in 2015), is, depending on who's telling the story, the most significant fiscal policy in Australia in a generation, or sheer folly. Certainly there is much at stake. Carbon dioxide, equivalent to taking 43 million cars off the road is one outcome. An injection of adrenaline to the local renewable energy industry is another. But not everyone is full of cheer.The coal industry is forecasting thousands of jobs lost, mines closed and coal fired power stations closed down. Conversely the renewable sector see billions of dollars in investment and thousands of new employment places.

Passed By Parliament Before September 2011
Such polarisation is especially evident in politics. Australia's federal election last year saw voters express their disatisfaction with the major parties leading to a hung parliament with neither side having the numbers to form government in their own right. The Labor party managed to woo the Green party and several independents to form a minority government. These same players, each with their own (often divergent) vested interests have nutted this new carbon pricing scheme, after all compromised in some way. Labor already have the numbers support they need to push this legislation through parliament by about September of this year.

But the opposition parties aren't throwing in the towel. They're kicking and screaming to get their point of view heard. And part of their rhetoric is that they'll rescind the whole shebang if they win the next election. And if such a vote was held tomorrow their current standing with the electorate would probably give them a mandate to do so. But the government are currently doing so badly in the polls partly because the opposition Liberal and National parties have filled the news vacuum preceding Sunday's long awaited carbon pricing announcement with fear and negativity.

Now that Labor and its key minority government players have laid their cards clearly on the table, some of the wind may be taken out of the opposition sails. Maybe. A federal election is not due for another 2.5 years, so the big sell is now on. (One thing is for sure, if this package doesn't become law this year, then Australia's chances of proactively embracing a low carbon economy will look very dim indeed.)

New Renewable Energy Agencies
Part of that sell includes support for renewables via industry assistance, including the establishment of a $10 billion Clean Energy Finance Corporation, the $3.2 billion Australian Renewable Energy Agency (ARENA) who'll help with research, development and commercialisation of renewable energy technologies in their early stages, plus the $200 million Clean Technology Innovation Program.

Additionally, a new independent body, the Climate Change Authority, which as the Sydney Morning Herald reports, "Most importantly, though, the CCA will set intermediate targets for greenhouse gas emissions, advising on the best path toward the target of eventually cutting emissions by 80 per cent by 2050, just as the RBA [federal Reserve Bank of Australia] sets a target for inflation as the best way to achieve full employment."

The ABC also have a bunch of quick look infographics if you glaze over at yet more words written on climate change action.

See the full report, or fact sheets on who'll be affected and who compensated, at the new Cleaner Energy Future website.

More Australian Politics and Climate Change
Australia: The Politics of Environment - A Brief Round-Up
Australia, Drunk on Coal, Remains World's Largest Carbon Emitter
Australia's Prime Minister May Fall on Climate Change Sword
Australia's New Prime Minister on Climate Change
Australian Politician Draws Gabrielle Giffords Parallels Over Carbon Price Debate

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