Australia Unveils Carbon Tax

11 Jul Australia Unveils Carbon Tax

by Ben Williams

Australia is joining climate action leaders such as New Zealand and the European Union by unveiling a nationwide plan to tax CO2 emissions at $23 per metric ton.

With an economy significantly reliant on extraction industries, and the nation as a whole overly dependent on abundant coal reserves, Australia is one of the world’s largest per capita polluters.

The tax will be introduced July 1, 2012, and is applied only to the largest polluters.  But a market-based trading scheme is expected to be introduced as early as 2015 to replace the tax, enabling a carbon exchange similar to the model being piloted by the Green Gondola Campaign.

There have been no reports as yet as to what the tax-generated revenue will be used for.  The tax is aimed at reducing nationwide emissions by simply making it more expensive to pollute. 

The trickle down effects are hard to quantify, but opposition to the tax is mounting alongside predictions of increased energy costs (the BBC reports 1% increases) and food costs hitting consumers during one of the largest economic downturns the world has seen.

But what are the costs of unchecked business-as-usual?  With runaway climate collapse on the radar, those costs could be infinite.

Importantly, Australia’s actions will provide a model case study.  The tax really just shows a step in the right direction – the carbon exchange will be the true mover.

The Green Gondola Campaign tries to address some of the problems with a top-down approach like a nationwide carbon tax.  Such a tax increases the costs of production across the board.  Despite other tax cuts aimed at placating rising costs, and no tax levied on transport and agriculture, producers will still likely pass the tax-increased costs of electricity and manufacturing to the citizenry.

Furthermore, there’s no guarantee that the $23 per ton of CO2 will go to actually offset CO2, so there’s no guarantee new renewable energy development will result.  At present, it’s merely a way to disincentivize pollution.  The Green Gondola Campaign, however, incentivizes renewable energy development voluntarily. 

When you donate $314 to the Green Gondola Campaign, you can be sure your donation will offset one metric ton of CO2.  That means something – and new renewable energy will result.

Nonetheless, Australia’s carbon tax is a bold action, one that will further the climate cause for the betterment of future generations.  There will be an adjustment period.  But the time for action has never been more urgent.

Keeping an eye on Australia’s GDP over the latter half of 2012 through the next five years will certainly offer an important case study.  In the meantime, check out www.greengondola.org to find out how you can make an impact in our community’s emissions and help engender the new energy economy right here, right now.