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Carbon Price: Australia Govt Announces Plan For Mid 2012 Price

coal pile

Australian Prime Minister Julia Gillard has announced that Australia will set a carbon price from July 1, 2012 as an interim measure. An emissions trading scheme is intended to be introduced three to five years after that.

A review one year before the end of the fixed carbon price period would determine if a move to a cap-and-trade scheme should be delayed further, or go ahead. The blueprint was agreed to by a multi-party parliamentary committee.

Gillard has compared the need for a price on carbon to early adopters during the information technology revolution of the 1980s and 1990s. Gillard said Australia has to adapt and innovate along with the rest of the world, or risk being left behind. Gillard said,

“I do not believe Australia needs to lead the world on climate change, but I also do not think we can afford to be left behind,”

“Carbon pollution is a threat to our country, and a threat to our future prosperity,”

The carbon price will apply to the energy sector, transport, industrial emissions and waste, but not to the agricultural sector.

The plan has the support of key Green and independent MPs in the lower house of parliament. The Gillard minority government needs support from one Green and three independent MPs to pass legislation through the lower house. It also has to face the upper house Senate.

Tony Windsor, key independent MP, said he supported a carbon price and a later move to an emissions trading scheme, but more needed to be worked through before his vote could be guaranteed. Another key independent MP, Rob Oakeshott, said “I would vote for this tomorrow”.

Australia is the world’s biggest exporter of coal and one of the highest emitters per-capita in the world. Most of Australia’s electricity generation currently comes from burning coal.

The government has promised to cut emissions by five percent of 2000 levels by 2020, and wants to have a price on carbon to encourage business to cut greenhouse gas pollution.

“A carbon price is a price on pollution. It is the cheapest and fairest way to cut pollution and build a clean energy economy,” Gillard said.

No doubt a lively debate will begin again in Australia in relation to the planned carbon price. The Opposition is expected to oppose the carbon price, having already labeled such a move a “great big new tax”.

What is your opinion on this planned move to a carbon price mid next year? Is this going to be a good incentive for a move to a clean economy for Australia, or a “great big new tax” that won’t achieve much?

Images CC licensed by p.Gordon

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