Essays by Eric Worrall
Carbon Tax Round 2 – Once declared in 2020, a carbon tax is no longer required, Australian Prime Minister Albanese decided to offer top emitters an “opportunity” to pay a carbon price of $75/ton, with the aim of reducing emissions by 5% per year, to meet the government’s 43% reduction target by 2020. 2030.
Carbon price capped at $75, but will increase with inflation
John Kehoe economic editor
Updated January 10, 2023 – 3:40 p.m., first published at 2:07 p.m.SaveShare
Major industrial emitters have been offered a carbon price cap starting at $75 a ton that will increase with inflation to provide business certainty about the maximum compliance costs of the decarbonization plan. of the Albanian government.
More than 200 of the country’s largest industrial emitters will need to cut their emissions by an average of nearly 5% each year through 2030, to help the government meet its 43% reduction target.
The carbon reform plan for industrial emitters, proposed by Energy and Climate Secretary Chris Bowen on Tuesday, provides support for businesses and areas exposed to trade to decarbonize through over $600 million from the $1.9 billion Regional Energy Supply Fund.
The government made a compromise between setting site-specific emissions limits and benchmarking industry averages, settling on a combined approach.
“Baselines will be assessed against site-specific levels at the start of the program and transition to average industry benchmarks by 2030,” the government stance report said. .
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Read more (with wall fee): https://www.afr.com/policy/energy-and-climate/emission-targets-for-big-polluters-released-20230110-p5cbh6
Back in 2020, on the eve of the 2022 election, Albanese declared a carbon price was no longer needed.
I guess he changed his mind.
The price of carbon is no longer needed: Albanese
Via Katie Burgess
update June 24, 2020 – 5:06 pm, first published at 4:15 pm…
However, Mr Albanese told the Press Club that a carbon price is no longer needed.
“The problem with our position in 2007… was that renewable energy at that time needed to be supported by the market mechanism. In fact the cheapest form of new energy in this country [today] is renewable energy. It is solar and wind power. Circumstances have changed.
“Renewables today are looking for a different framework. So, if you ask us if we should go back to the old system, the answer is no. We are looking forward, not backward. And we are looking for a mechanism that will drive that change through the economy.”
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Read more: https://www.canberratimes.com.au/story/6804384/carbon-price-no-longer-needed-albanese/
A recently commissioned government report upheld the integrity of the nation’s carbon credit market.
Carbon credit program review rejects criticism as flawed, recommends changes to improve transparency
According to a political reporter Hitchhiking Georgia
An independent review of the government’s carbon credit program dismissed suggestions that it was fundamentally flawed, but made a series of recommendations to improve its transparency and integrity. it.
Main attractions:
- Reviews show that the program was “basically” well-designed when it was first introduced
- The panel recommended that data on credits be made public
- Critics say it’s puzzling that the report claims the plan is working but recommends significant governance changes.
The scheme works by providing carbon credits, officially known as Australian Carbon Credit Units (ACCUs) for each tonne of greenhouse gases avoided or stored by registered projects.
These credits are purchased by the government and are geared towards meeting emissions reduction targets, but an increasing number are sold into the private market to businesses looking to offset their own emissions.
Last year, a number of criticisms were made about the plan, including by old industry insiders have stated that it has become a game of rort and some industry players who argued that the rules did not encourage any additional emissions reductions.
The review panel, chaired by former chief scientist Ian Chubb, noted that the integrity of the plan was questioned.
“It has been suggested that the extent of the reductions have been overstated, so that the ACCUs are not what they are meant to be, so the policy is not effective,” the report said.
“The Council does not share this view.
“Despite much criticism, the Council concluded that the ACCU plan was essentially well designed when it was introduced.”
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Read more: https://www.abc.net.au/news/2023-01-09/australian-carbon-credit-units-review-report/101836478
It’s funny how the cheapest form of energy needs a lot of government help to stay afloat.
I doubt the Chubb Report on the Integrity of Carbon Credits will solve or change anything. The stench of fraud will always haunt carbon credit programs, because unlike other forms of fraud, there is no financial incentive to report carbon credit fraud when it occurs.
Both sellers and buyers benefit financially from fraudulently selling carbon credits.
Criminals selling carbon credits don’t make any money. Buyers who turn a blind eye to criminals will either polish their green certificates or meet mandatory carbon credit purchase requirements, at a steep discount from the actual carbon credit purchase price.
Simple market forces create an overwhelming financial incentive to produce, buy, and sell fake carbon credits.
Keeping the market for carbon credits honest is like trying to balance an egg at its point – just let your guard down a little, and everything will fall apart. The cheat credits undercut and remove the real credits, and in the blink of an eye, everyone still involved is in the game.
Even if we accept the dubious claim in my view that existing carbon credit schemes are honest, I doubt this supposed integrity will survive, once real money is introduced. system.
As for the impact of the carbon tax on the Australian economy, I suspect the reintroduction of the carbon tax has been priced in line with market expectations. Many of Australia’s maneuverable energy suppliers have closed stores as quickly as possible when they were able to organize an orderly withdrawal from the Australian energy market.. Confirming their worst fears, by introducing an “opportunity” to buy carbon credits, simply increases their incentive to pack up and leave.
Even parts salvaged from dilapidated coal plants will be welcome in poor countries struggling to industrialise.
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