We have only just begun to erradicate carbon taxes

I have an article with Quadrant this morning which traces the rise of taxation of carbon over the past 20 years and the misinformation that has led to it. 

Included in this misinformation is the notion that Australian carbon consumption is excessive - in fact once adjustments are made for exports and imports, Australians’ carbon dioxide emissions are no greater than those in other countries with comparable living standards.   

There is also the false claim that we stand out by doing less than others to staunch emissions.  Treasury Secretary Martin Parkinson claimed that countries producing 83% of global emissions had pledged to undertake climate-change action, adding that, “unless we all act, we all lose in the end.” Treasury estimated we need a carbon tax at $80 per tonne to meet the 2020 goals and Garnaut estimated we need $250 per tonne to meet our 2050 goals. 

Leaving aside the question about the need for such action, the claim that we have pledges from 83% of emitters represents a severe salting of the sample.  It includes India, where the “carbon tax” is a revenue-raising royalty of about $2 per tonne; Japan, where the carbon tax is $3.30 per tonne;Switzerland, with a $61 per tonne carbon tax that applies to just 5 per cent of electricity supply; Canada, which simply walked away from commitments when they became painful; and New Zealand, where mostelectricity is hydro/geothermal and where concessions mean the nominal $11-per-tonne carbon tax is actually only $2.

And in the US, though the Obama Administration is using regulatory measures to impede coal plants, the Senate voted 95-0 against climate-abatement action.  Even California has a carbon price at only half the level of the repealed Australian measure.

That leaves the EU, where the carbon price is currently around $8 per tonne.

Australia’s savings from the repeal of carbon tax are partly offset by the Renewable Energy Target (RET).  If this remains, its costs will rise because removal of the carbon tax means a lower electricity price and this will require an offsetting price increase for the renewable energy certificates that all electricity retailers must buy.  The cost of the RET, according to Deloittes, is an impost on consumers of at least $29 billion. 

There is, in addition, the subsidies to carbon-lite energy through the $2 billion a year “Clean Energy Finance Corporation” and direct budgetary spending favoured by Environment Minister Greg Hunt under the Commonwealth’s Direct Action program.     

The repeal of the carbon tax still leaves much to do in removing the burden imposed on us as consumers and taxpayers, and in redressing the critical impact of regulatory-induced excessive energy costs that are plaguing business competitiveness.

 

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26 Responses to We have only just begun to erradicate carbon taxes

  1. Up The Workers!

    On the scrupulously fact-free Fauxfacts-owned 3AW lately, they have been running advertisements extolling the money-saving virtues of parking your car at Tullamarine Airport.

    Apparently all these paid thespians who are members of Actors Equity (and are therefore PAID to act enthusiastic about the money-gouging rip-off charges extracted by the mercenary rogues who operate the highest airport car-park charges in Australia) are deliriously happy about being ripped off, cheated and overcharged.

    Not much difference between blatantly lying about how “cheap” the Tullamarine airport car park charges are, or telling pensioners who are freezing because they can no longer afford home heating, that they are being “warmed to death” and therefore need to pay higher taxes to lower global temperature.

    And STILL, Fauxfacts wonders why nobody accords them any credibility?!

  2. incoherent rambler

    Why is there any argument about regressive taxes based on a lie?
    Get rid of the RET and other subsidies, now.

  3. H B Bear

    Why Parkinson is still Treasury Secretary 12 months after the Liberals took government is one of life’s great mysteries. Under Gillard and The Goose, the Treasury ETS modeling was some of the most dishonest propaganda ever issued out of Canberra.

  4. nick (natural genius) gray

    The Greens will go on objecting, of course, which seems to be the only thing they do.
    Has anyone else noticed that the Greens always seem to have exactly 11% of any Q+A audience? The other parties vary, but the Greens (when Q+A is done from the Sydney studio) seem to have a fixed quota. Do they have allocated seats, or something else?

  5. blogstrop

    Parkinson said that and he’s still there.

  6. .Dr.Sir Fred Lenin

    Just a small digression mthe Canberra Town Council has just culled 1,500 or so Kangaroos, animal rights Activites are furious,a green spokes person of indeterminate gender said” this is a War Crime as bad as the Israelis killing hamas kids,we prefer the Kangaroos to starve to death naturally,just as we prefer criminal illgal migrants to drown rather than forbid entry to Australia as is their right “.Julie Ann browside has launched a Taxpayer funde appeal to the peepils decromatic high court.”the unelected untidy nayshuns world guvmint is right behind this assault on gerbil worming ” said Julie Ann.

  7. Andrew

    Under Gillard and The Goose, the Treasury ETS modeling was some of the most dishonest propaganda ever issued out of Canberra anywhere on the planet.

  8. entropy

    Under Gillard and The Goose, the Treasury ETS modeling was some of the most dishonest propaganda ever issued out of Canberra.

    That is so true. How that modelling was constructed wasn’t incompetence, they knew exactly what they were doing. They knew what the impact of the assumptions they chose would be, and how it was skewing the result. They knew, but did it anyway. They knew.

  9. Andrew

    Treasury Secretary Martin Parkinson claimed that countries producing 83% of global emissions had pledged to undertake climate-change action

    Don’t know what he’s worried about. If the only thing you need to do is “pledge” climate action, we’re in the 97%. We have “pledged” to continue with a non-zero RET, and undertake some amorphous “Direct Action” (much of which might be good policy, like energy efficiency capex and farming practices).

    After all, even Flim Flammery claimed that “soil sequestration” was good farming AND good CO2 abatement – right up until the point when Abbott666SatanMonster adopted it as part of DA and it became the stupidest expression of climate denialist policy ever conceived.

    South Korea “pledge” to have an Enormous Trading Scam in 2015, maybe, if they can’t find any flaws in the policy. Japan pledged $3/t on coal.

    India’s carbon tax was 50c at one stage – just enough to get them inside the ETS tent and collect $billions in bullshit carbon credits (but I repeat myself) from the gullible warmies (but I repeat myself).

    I’m told on good authority that many of China’s massive windfarms are just demonstration plants – they’re not even connected to the grid! They’re just there to sell turbines. (There’s one next to the parking lot at the Great Wall near Beijing – worth a look to see if there’s any sign of transmission wires from it.) So China’s “pledge” is clearly about selling stuff to us, although they certainly have a lot of hydro.

  10. cohenite

    I don’t see why we have to do anything; dirt sequesters CO2. If people believe in this crap they can roll in dirt and then work around sequestering all the CO2 they can.

  11. Baldrick

    Good luck with those fake conservatives/Labor lites in Canberra to do any more. As far as the public is concerned the carbon (dioxide) tax is gone. That’s all they want the public to hear. The rest will stay.

  12. Paridell

    “erradicate”?

    Rolling your r’s?

  13. Lawrie Ayres

    This beast is sure taking some killing. The wheels should have fallen off with Climategate and the flop at Copenhagen but the rent seekers have kept it going and few politicians have the courage to call “bullshit”. The real problem lies with the media. Had they reported rather than advocated the plebs would have called stop long before the ball got rolling. Has the ABC invested their employees super in renewables? The way it keeps reporting the most ludicrous alarmist claims one would think they have some skin in the game.

    Get rid of the RET and forget spending another cent on CO2 abatement. To every reader; write an email to you representative, tell them you want the RET gone. They will take notice if they get enough mail. Remember the blitz of calls and mail got rid of Turnbull and installed Abbott.

  14. Demosthenes

    The cost of the RET, according to Deloittes, is an impost on consumers of at least $29 billion.

    ACIL Allen says consumers will be better off.

    The latest analysis, commissioned by peak business groups and carried out by Deloitte Access Economics, was released last week.

    This work adds to the growing list of attempts to model the effect of the Renewable Energy Target (RET) on electricity prices. We have now seen reports commissioned by the Climate Change Authority, the Clean Energy Council and the Australian Energy Market Commission, as well as analyses by Bloomberg New Energy Finance and IES Advisory Services. The Climate Change Authority is also set to deliver another review later this year — assuming it still exists by then.

    Another recent modelling effort is the ACIL Allen report, carried out on behalf of the RET review panel itself.

    Perhaps inevitably, these reviews have reached different conclusions — mostly because they started with different assumptions. The differences are particularly stark between the two most recent reports, so let’s focus on those.

    The ACIL Allen modelling concludes that electricity prices will be lower if the RET is left unchanged, while the Deloitte work concludes that they will be higher.

    Deloitte says that scrapping the RET completely would save between A$47 and A$65 dollars per year per household. But ACIL Allen says the target will cut power bills from 2021 onwards, by up to A$91 per year by 2030.
    ………………………………………………..
    But at the end of the day, “who is right” actually misses the point of the RET: reducing emissions and encouraging Australia’s renewable energy industry. As the Deloitte study makes clear:

    It is important to note that we have not included an assessment of the environmental costs and benefits of adjusting or abolishing the RET. We also have not modelled potential benefits of developing local expertise within renewable energy. Including an assessment of these elements would be likely to influence the broader costs and benefits of the RET.

    The difference is likely to be pretty small in the scheme of things. As other commentators have pointed out, Deloitte’s pessimistic forecast still only adds up to an extra 50 cents a week for the average household.

    Removing the RET would have an insignificant impact on household electricity bills, according to Greg Hunt.

    There is, in addition, the subsidies to carbon-lite energy through the $2 billion a year “Clean Energy Finance Corporation”

    Abolishing the CEFC would cost Australian taxpayers $200 million a year.

  15. cohenite

    Bullshit Demosthenes.

  16. manalive

    Like ‘carbon tax’, ‘Clean Energy Finance Corporation” another ALP senseless ‘thought-terminating cliché’ (aka lie).

  17. Andrew

    To every reader; write an email to you representative, tell them you want the RET gone.

    What is the process for emailing “my representative” if in a safe Labor/Green seat? Do you email the nearest LNP MP? Or are such people disenfranchised? There’s no point writing to my Labor MP about it – he knows my views anyhow.

  18. Normal Norman

    Thanks Alan. This is brilliant.We have really touched only the surface. Clearly, the coddled guys in energy need a very big dose of reality. Starting with the Santos and BG types who have so stuffed up the LNG projects supply side that the local market is driving gas prices up by threefold. This is especially bad for smaller businesses. And it is driving power prices up even further.
    Let’s have a good look at the oil and gas majors, who appear to have developed a bit of an anti-competitive racket in local energy.
    Personally, I think it’s a game the bureaucrats are in on.

  19. entropy

    What? Santos and the other gas producers just found someone prepared to pay more for their product. And those people happen to live OS. They haven’t stuffed up anything except expecting their opponents to behave rationally.

  20. Blogstrop

    How many of our august company have turned away solar energy reps who doorknock and offer you a piece of kit whose only real worth is the rebate it attracts, to the detriment of all other energy consumers? I try to explain this to them each time, and sometimes they comprehend.

  21. nerblnob

    Starting with the Santos and BG types who have so stuffed up the LNG projects supply side that the local market is driving gas prices up by threefold. This is especially bad for smaller businesses. And it is driving power prices up even further.
    Let’s have a good look at the oil and gas majors, who appear to have developed a bit of an anti-competitive racket in local energy.
    Personally, I think it’s a game the bureaucrats are in on

    Well, you’re right about the last bit, but I’m not sure where you’re coming from on the rest.

    The myriad compliances , penalties, and taxes in Australia serve as a barrier to smaller companies and pretty much guarantee that only majors with their own bureaucratic compliance departments can succeed.

    This is rather ironic when you consider the way the proponents of such taxes and regulations portray themselves as fighting Big Business.

    Small projects that could be run by smaller companies like CSG and shale in Victoria, again ironically, face the fiercest opposition from Greenies and Nimbies who imagine (or pretend) that they’re fighting Big Oil/Fossil Fuel/Whatever.

    I’m not sure how the LNG market affects local energy prices. As far as I know it’s all for export. There’s still plenty gas and coal that can be used for local energy production.

  22. johanna

    Lawrie Ayres
    #1401238, posted on August 1, 2014 at 2:44 pm

    This beast is sure taking some killing. The wheels should have fallen off with Climategate and the flop at Copenhagen but the rent seekers have kept it going and few politicians have the courage to call “bullshit”.

    Lawrie, the politicians went out on a limb, and are now cautiously edging back. In the UK, the so-called “Conservatives” who proclaimed their commitment to all things Green are edging back. But not before the UK is facing brownouts and blackouts next winter. And the lead-times for fixing that problem are long – they have been closing down ideologically incorrect power stations (coal) and making the rest unviable (gas) because of priority given to intermittent sources like wind and solar.

    I suspect that it will take brownouts and blackouts to put this right in the UK, and other places as well. “The Planet” becomes a lot less important when you are freezing your a*** off and you can’t cook a meal for your family.

    Oh, and thanks Alan Moran for keeping on keeping on. It’s a thankless task, but some of us appreciate it.

  23. WhaleHunt Fun

    Criminalising the manufacture, sale, distribution and use of solar panels and wind turbines with seizure of all family assets to the state as well as hefty mandatory minimum sentences would give state governments significant funds for investments in dams, uranium and coal mines, aluminium smelters and deeply dredged export terminals. The economic benefit of shifting capital from the hands of lowlife scum to the public purse, would be great, but greater would be the benefit of the next generation knowing that scum and their relatives will be punished and degraded unmercifully. This then is the path to a happy and prosperous nation. The smart nation is within reach.

  24. ProEng

    If Parkinson was involved with telling lies they should have sacked him immediately instead of giving him notice.
    The easiest and best act the government could do is get rid of the environment department (firstly by stopping all funding, then by abolishing any committees associated with environment in all other departments). Then the government should steadily abolish all commonwealth laws and regulations to do with environment. Environment is a state responsibility. Duplication and over sight by the federal government is a waste of money and just gives room for minority lobby groups to hamper economic progress both for the individual states and Australia as whole. Let the states compete and if the people in a one state (eg Tasmania) vote to live in poverty they should not be subsidised for their bad choices.

  25. Bruce

    Can we please stop referring to it as “CARBON” and give it its correct name of “CARBON DIOXIDE”.

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