Is the carbon tax really about getting people to switch off the beer fridge and get rid of the second car?
The elasticities of demand for electricity and motor fuels are typically low, suggesting that to a large extent Australians will cover the price increase by reducing other consumption instead. So it is not the reduction in electricity usage so much as the substitution to alternative forms of electricity generation that will be the real achievement of the carbon tax. Lifting the price of cheap and dirty brown coal electricity generation opens the door for the more expensive, greener options: carbon capture, wind, geothermal and solar.
Philip Adams, Janine Dixon and Peter Dixon.
How successful will this strategy be? Here is Chart 5.5 from the Treasury modelling without all the confusing bumph.
Domestic carbon pricing will not achieve any target by 2050 – let alone by 2020. The effect of the tax isn’t that Australia will substitute from a cheaper source of power to more expensive sources of power but rather that we’ll be exporting capital through the purchase of carbon credits. We’ll be paying foreigners for the right to use our own natural resources.
Clean natural gasEvil fracking is the future.Infidel Tiger
5 Aug 12 at 12:38 am
Our target is a reduction of some 160 million tons? Meanwhile, Germany is building 24 new coal plants with emissions expected to be 150 million tons from those plants alone.
Stupidity reins.
Gab
5 Aug 12 at 12:51 am
reigns even.
Gab
5 Aug 12 at 12:51 am
That’s what looking after the national interest has sunk to, and all who have supported this big scam are accessories to a heinous deception bordering on treason.
Blogstrop
5 Aug 12 at 7:18 am
And no means of defending ourselves or our resources, “fan bloody tastic”
Swot
5 Aug 12 at 8:11 am
And here we have more of,
The Gold, That Matters:
How We Won
true lilly
5 Aug 12 at 8:36 am
Only bordering? IMO it is treason, and those responsible should face court for it.
perturbed
5 Aug 12 at 8:45 am
The carbon tax has nothing to do with reducing power consumption or adopting alternative energy sources.
It is pure income redistribution with an aspect of green washing.
The ALP core working class constituency tend to live in places that require more air conditioning & heating. They have less than efficient houses, less than efficient appliancies & big arse TVs. Their power bills tend to be high than people who live in leafy coastal areas.
There is no way in the world that the ALP (or the Greens for that matter) are going to tell working class people to turn off their airconditioners or buy more efficient appliancies. Better to steal more money from productive efficient people.
People who are energy efficient already are being penalised but there is not much motivation to invest in alternative energy sources (because their energy bills are relatively low already)
I wish these people would be at least honest that they are more interested in stealing money than suppoosedly doing anything for the environment.
Richard D
5 Aug 12 at 9:05 am
Treasury was silent on what that ‘abatement sourced from overseas’ was. See section 5.2.2. They didn’t analyse the effect of everyone in the world trying to buy the same unicorn flatus all at once. But unicorn fumes never run short and you can price them at whatever you like.
That report told me two things (a) Treasury is now hopelessly politicised and (b) their employees have mush for brains. No one in industry would expect to get money from a banker with a report lacking a detailed and transparent pricing analysis of the crucial input.
Bruce of Newcastle
5 Aug 12 at 9:06 am
Oh For Father’s Sake!
I’m sure ‘they’ won’t quit until 90-95% of the world has Starved, Flooded and Burned itself to Death:
Scientist blames climate change for heat
Now remember the ’70′s, when ‘they’ CONvinced us to rip up non-native Fire Resistant, Multi-Use Trees, and go insanely planting Forests of Fire Fuel?
It was the same time ‘they’ CONvinced us not to build any more Killer Fire and Flood Preventing dams:
Fiery times likely after wet years
true lilly
5 Aug 12 at 9:53 am
Pretty much no government regulation has any science behind it, it’s purely political to establish rent seekers of one sort or another.
Diesel is 30ML/liter. A 30% efficient generator results in a cost of 36c/kwhour.
Labor regulations have made it almost viable to drop off the grid:
-government prices distribution costs based on the cost of infrastructure, so this has caused gold plating of the grid, with the most expensive and ridiculous green building plan layouts used and everything built for ridiculous peak power demands.
-carbon tax on top of state schemes which over charge non solar customers to subsidies solar power.
Mundi
5 Aug 12 at 12:13 pm
Would that be the same Treasury modelling that has unified global action by 2015 or some-such and Carbon Capture and Storage by 2030?
Hans Christian Andersen could have done a better job.
H B Bear
5 Aug 12 at 12:13 pm
By how much did Australia’s CO2 emissions decline in July?
Tim Curtin
5 Aug 12 at 1:54 pm
The elasticities of demand for electricity and motor fuels are typically low
Only with a further caveat, except at the time of purchase of a new energy consuming product like a car where people become very flexible due to price.
kelly liddle
5 Aug 12 at 2:20 pm
Tons, Tim, tons. In fact the CO2 tax is sooo effective that Australia’s emissions declined 0.3% 2009 over 2008 and declined 1.5% 2010 over 2009, according to the IEA.
Gab
5 Aug 12 at 2:40 pm
City’s power plan could benefit state, says council
ELECTRICITY consumers would benefit from the scrapping of rules that block small-scale, localised electricity production but protect big vested interests in the power sector, the City of Sydney council says.
A “level-playing field for small-scale energy generators and suppliers” was needed, it told a Productivity Commission inquiry into the regulation of electricity distribution in Australia.
The council plans to install the nation’s first major “trigeneration” network run on natural or renewable gases to supply city-owned and private buildings with low-carbon electricity and zero-carbon heating and cooling.
A University of Technology Sydney study found the project could achieve savings of $1.5 billion by 2030 in deferred electricity network costs and new power station capacity.
SteveC
5 Aug 12 at 6:35 pm
Gab, how are those emissions reduction related to carbon pricing?
SteveC
5 Aug 12 at 6:37 pm
And the penny has almost dropped, c’mon stevec, just let it happen.
Jumpnmcar
5 Aug 12 at 6:45 pm
It’s the magical power of the CO2 tax. Even just thinking about the tax causes emissions to decrease. Much like thinking about Gillard caus….never mind.
Australia will save the planet!
Gab
5 Aug 12 at 6:48 pm
AS the target is a reduction on 1990 levels, we have a very long way to go.
SteveC
5 Aug 12 at 6:52 pm
I admire your optimism, Jump.
Gab
5 Aug 12 at 6:57 pm
It’s what separates us from them Gab.
Jumpnmcar
5 Aug 12 at 7:12 pm
Ta.
Jumpnmcar
5 Aug 12 at 7:13 pm
1.3 billion pies in the sky by 2030. Give it up Steve. You’re a shameless shyster.
blogstrop
5 Aug 12 at 8:11 pm
Anyone else find this highly objectionable?
I call bullshit.
.
5 Aug 12 at 11:12 pm