A decade after it was first seriously discussed in Australian politics, and on its fourth attempt to make its way through a hostile parliament, Australian is now poised to finally implement a carbon pricing regime. by Giles Parkinson
The passage of 19 bills through the House of Representative on Wednesday, propelled and finally approved by two country independents and a single Greens member, means that the passing into law of Clean Energy Future package is now a mere formality, as the government and the Greens have the numbers in the Senate.
There is no doubt that this signals the start of one of the greatest transformations of the Australian economy, ranking alongside the floating of the currency, the introduction of the GST and other major policy initiatives. But will this transformation be sudden and dramatic, or will it be a slow burn? Climate Spectator asked leading business people, advisors, politicians and lobbyists for their take. This is what they said:
Grant King, managing director of Origin Energy: As a long-time supporter of an emissions trading scheme, we welcome the passage today of the bills necessary to make it happen. The trading scheme at the heart of the Clean Energy package benefits from years of work by Australia’s experts in designing a market based approach to reducing emissions, and is very solid in itself.
Surrounding the trading scheme are a number of related policy choices. With large amounts of money available to some parts of the energy industry through the Clean Finance Corporation and other new sources, a lot of the success of the package in the long term will depend on setting up tight governance and clear principles for spending that money. In the electricity market, the biggest driver of change over the next ten years will be whether or not the government reaches a deal for closure of a coal-fired power plant. The Review processes established in the Package are very important and we look forward to more detail on these as they are established, especially in so far as they relate to compensation for EITEs.
Rob Murray-Leach, CEO of the Energy Efficiency Council: This is a historic day for Australia – the carbon price package will unleash a wave of investment and make our economy fighting-fit for the 21st Century. Improving the energy efficiency of homes and businesses will save Australians over $5 billion a year.
Global prices for coal, gas and oil are rising due to economic growth in Asia, which means that companies need to become more efficient to stay competitive. Australian businesses currently waste huge amounts of energy, and that puts our economy at risk. A carbon price has a relatively small impact on energy prices, and actually helps businesses by providing the certainty they need to invest in changes that are long overdue.
The carbon price won’t damage the economy – it will make Australian businesses more efficient and boost their global competitiveness. …[It] will unleash billions of dollars of investment to improve businesses’ efficiency. …Forget what some companies have been telling the papers – behind the scenes they’re gearing up to become lean and efficient. Companies might lobby for special deals, but many of them are getting on with the job of responding to the carbon price.
Matthew Wright, executive director of Beyond Zero Emissions and 2010 Young Environmentalist of the Year: The passing of the government’s Clean Energy Future bills reflects the politics of climate change, not the science. …It is small first step towards transitioning Australia from a 19th Century fossil fuel economy to a 21st Century renewable-powered cleantech economy. …But the heavy lifting needs to be done by policies that have been shown to work globally in getting significant amounts of renewable energy deployed.
The Australian government must establish a feed-in tariff for large-scale renewables – which has delivered 80 per cent of non-hydro renewables globally. Without a feed-in tarriff, the main result of the Clean Energy Future bills will be a large increase in new gas power plants. Besides locking in an unacceptable level of emissions for the next 50 years, it will tie Australian electricity prices to volatile and increasing global gas prices as the huge LNG developments come on line over the next few years.
A national FiT will help Australia catch up with the rapid pace of renewable energy deployment in the world’s powerhouse economies like Germany and China. It will result in meaningful cuts in our emissions, and lock in lower energy costs for Australian consumers. Now that the carbon price has passed, political leaders must get onto the real job of a strong large-scale renewable energy feed-in tariff.
Source: For the full story, visit the Climate Spectator website.
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