Emissions Trading - Open Fire

[andrew.wilson]

Curious on others thoughts about this issue...

Do you support it?
Would a Carbon tax be a better idea?
Is the government doing it the right way?
What do you think of the Garnaut report so far?
Is the coalition being idiotic by opposing it largely for the sake of opposing it?
Should big emittors be getting free permits?
Does this defeat the hopefully added benefit of the scheme, making cleaner technologies more viable?
Are we deluding ourselves when we whinge at the thought of relatively small changes to try and tackle serious issues?
Should the govt be spending those millions on solar rebates instead of an ad campaign?
Is 'Carbon Pollution redcution scheme' the stupidest political speak you've ever heard?

I am going to keep my opinions out of it for the time being

Just a note, this is NOT a topic about whether anthropogenic climate change is or isnt occuring and whether it should be mitigated. In the spirit of keeping the thread on topic, those posts will be deleted. Start another thread if you wanna discuss that issue

[morn]

It's the best solution. It's a more flexible market based approach than a carbon tax.
Unfortunately, isn't agriculture to not be included though? Methane is a big part of the problem.
The opposition is not just being idiotic. They're sabotaging our countries, and planets future for political points. As extremely imperfect as labor is, I think I'm still happy I voted for them, the opposition is even worse

[andrew.wilson]

Originally Posted by morn

It's the best solution. It's a more flexible market based approach than a carbon tax.
Unfortunately, isn't agriculture to not be included though? Methane is a big part of the problem.
The opposition is not just being idiotic. They're sabotaging our countries, and planets future for political points. As extremely imperfect as labor is, I think I'm still happy I voted for them, the opposition is even worse

Don't quite believe what you hear re: agriculture. At the Garnaut public forum I went to, he said that there is no yet a mention of Agriculture in his report because it is a very complex issue that takes more time, but it will be in the final report. Presumably the government would not have made any decisions about this yet as a result. That being said, I have heard it rumoured they won't include it...haven't had a chance to read the Green Paper yet though...

NB: Have updated the original post with more questions

[Ozracingwrap]

Carbon Tax is better, the exemptions under this scheme when they get given out will, as happened in Europe, see the big polluters continue largly unaffected.

In addition because the big players have less need to buy 'credits' the price for them is depressed. This makes green energy in particular still economically uncompetative. However it must be acknowledged that Victoria will be long time before it can move from coal and if those plants shut down the national grid will crap itself also.

Hence why from a political viewpoint you go this way and not a tax.

Still think scrapping the solar rebate for those who actually might consider spending $20 to $30 thousand to fit it to their home, flys in the face of all this.

[andrew.wilson]

Originally Posted by Formulagpguys

Still think scrapping the solar rebate for those who actually might consider spending $20 to $30 thousand to fit it to their home, flys in the face of all this.

Could not agree more! I have done some number crunching that shows you could fit out a home with a solar system that can cut their power bill by around 30-40% (depending on other energy saving techniques used) for less than $2 a day over 5 years (plus around $300 of the install fee upfront)...what a great idea...imagine the masses flocking to solar power...but NO...the government framework doesn't allow an idea like this to come to fruition...

If there is one thing I will ever support the coalition for, it is their bill to get rid of the means test (currently in senate)

[morn]

In addition because the big players have less need to buy 'credits' the price for them is depressed. This makes green energy in particular still economically uncompetative.

Hmm, can you explain this in more detail?
As I understand it, the big players have a permit to produce a certain level of emissions. They can exceed that level if they buy more permits. If they use less, they can sell permits to others. In any event, there is a financial reward to a company for lowering emissions, and additional costs if they want to increase emissions.

[~Coxy]

Originally Posted by andrew.wilson

Just a note, this is NOT a topic about whether anthropogenic climate change is or isnt occuring and whether it should be mitigated.

Kinda hard to talk about the carbon scheme without being able to question whether mitigation tactics should be performed or not. Personally I feel that there's no point in attaching a price on carbon if it's not going to have any appreciable affect on matters.

[Ozracingwrap]

Well it is just simply the law of Supply and demand. the people who need to buy credits are the big polluters.

So the less they need to buy (because they are given credits to a certain level) the more depressed the price of each credit. Remeber also that as more Green solutions comes online they will also increase the credits in the system. So unless there is an increasing need to purchase credits these extra credits will again depress the price.

[micaros]

As I understand it, free 'credits' are not allocated to everyone included in the scheme...The designated 'big emitters' are required to purchase permits for their emissions, hence they will incur costs proportional to their emissions (it is big emitters only to avoid it becoming unwieldy as I understand it, not sure what % of emissions those companies represent). The complication in this proposal is that certain emitters have been flagged as getting some free permits to compensate for exposure to international markets (and there is lots of rent seeking going on with others seeking same) - Garnaut is against this IIRC (as am I).

As for home solar rebate, I find it hard to get too cross about this one... I would support the rebate because it would make it more affordable for me to become self sufficient. However, it doesn't hold up in terms of the best way to reduce emissions (for the cost). How many years of 100% GreenPower could you buy for the value of the rebate ($8000, also noting that many who use the rebate will not necessarily provide a system that has a net output of power to the grid over a year)? Of course, that argument would have more weight if the government actually proposed doing something in place of the open-slather rebate... And I certainly don't like the way in which it has screwed companies in the solar panel supply business. But in the end, the solar rebate cash could be deployed elsewhere to achieve greater reductions in emissions.

[oddturtle]

Originally Posted by andrew.wilson

Curious on others thoughts about this issue...

Do you support it?
Would a Carbon tax be a better idea?
Is the government doing it the right way?
What do you think of the Garnaut report so far?
Is the coalition being idiotic by opposing it largely for the sake of opposing it?
Should big emittors be getting free permits?
Does this defeat the hopefully added benefit of the scheme, making cleaner technologies more viable?
Are we deluding ourselves when we whinge at the thought of relatively small changes to try and tackle serious issues?
Should the govt be spending those millions on solar rebates instead of an ad campaign?
Is 'Carbon Pollution redcution scheme' the stupidest political speak you've ever heard?
)

A revenue neutral carbon tax is a better alternative to a trading scheme. The difference is like comparing trade quotas with border tariffs.

A trading permit system is going to be a whole new bureaucratic nightmare, and there will be huge rent seeking costs, as micaros mentioned, and lobbying efforts by industry with various justifications - as seen by the EU ETS. A carbon tax on the other hand could probably draw on the existing expertise and infrastructure of the ATO with less marginal admin cost additions.

Most importantly, the tax can be made revenue neutral and leave consumers and the government no more worse off than before (the cost is merely transferring tax costs from certain industries and economic sectors to others, namely, polluters).
So we could use the carbon tax revenue to reduce income taxes (the worst tax, IMO), land taxes, GST, company tax, etc.

The 'market' (and I use that term loosely) aspect of tradeable permits exists in a carbon tax as well. The objective and effect of both is to put a price on carbon, and thus create a price incentive to use less and innovate ways to use less.

[morn]

The complication in this proposal is that certain emitters have been flagged as getting some free permits to compensate for exposure to international markets (and there is lots of rent seeking going on with others seeking same) - Garnaut is against this IIRC (as am I).

The more free permits you hand out the greater the cost of the permit has to be, if you are to cause the same reduction in emissions. This is why as much of the economy should be including in the free trading scheme as possible, the more free lunches there are the more everyone has to pay.

Most importantly, the tax can be made revenue neutral and leave consumers and the government no more worse off than before (the cost is merely transferring tax costs from certain industries and economic sectors to others, namely, polluters).
So we could use the carbon tax revenue to reduce income taxes (the worst tax, IMO), land taxes, GST, company tax, etc.

An emission trading scheme can also be revenue neutral btw. You could have it set up so you buy the permits from the government. The government can redirect the revenue it gets from selling permits, to tax cuts.

[micaros]

Originally Posted by morn

The more free permits you hand out the greater the cost of the permit has to be, if you are to cause the same reduction in emissions. This is why as much of the economy should be including in the free trading scheme as possible, the more free lunches there are the more everyone has to pay.

Couldn't agree more! A very disappointing aspect of the Government's position vs that taken by Garnaut. I'm pretty sure I remember Garnaut re-iterating this at length at the forum in Melbourne.

[macaholic]

Originally Posted by andrew.wilson

Do you support it?
Would a Carbon tax be a better idea?
Is the government doing it the right way?
What do you think of the Garnaut report so far?
Is the coalition being idiotic by opposing it largely for the sake of opposing it?
Should big emittors be getting free permits?
Does this defeat the hopefully added benefit of the scheme, making cleaner technologies more viable?
Are we deluding ourselves when we whinge at the thought of relatively small changes to try and tackle serious issues?
Should the govt be spending those millions on solar rebates instead of an ad campaign?
Is 'Carbon Pollution redcution scheme' the stupidest political speak you've ever heard?

I am going to keep my opinions out of it for the time being

Your weighted questions give your thoughts away!

Anyway, I reckon they should be advertising - the solar rebate - set at 90% of the setup cost.

[Abaddon]

Originally Posted by ~Coxy

Kinda hard to talk about the carbon scheme without being able to question whether mitigation tactics should be performed or not. Personally I feel that there's no point in attaching a price on carbon if it's not going to have any appreciable affect on matters.

Have to agree with ~Coxy. The problem is that the majority of businesses agree with reducing the carbon footprint in principle but do not see it as a priority because most do not see Global Warming as an immediate threat. As such they see any emmissions trading scheme, carbon tax or any other variation on the theme as an added burden on doing business, affecting profits and therefore something to be avoided or circumvented in whatever way possible.

The only time that businesses will embrace such a scheme is if all businesses worldwide adopt the scheme at exactly the same time, in exactly the same way. As this is not likely to happen any time soon....I don't think a trading scheme will have any impact other than economic (some enterprising people will find a way to make a buck out of it). There are many things that a government could do to help individuals make a change - a solar rebate is just one. Again this would be a) initially costly and b) need to have a long term outlook something that governments are just not designed to have.

God I've become a cynic in my old age

[Silver]

I don't think that even that is enough.

I think the only way to get businesses to change is to force them.

The story of the banana is a good example of what happens with too much money and not enough government oversight.

[morn]

The only time that businesses will embrace such a scheme is if all businesses worldwide adopt the scheme at exactly the same time, in exactly the same way. As this is not likely to happen any time soon....I don't think a trading scheme will have any impact other than economic (some enterprising people will find a way to make a buck out of it).

You can't solve a problem by waiting for someone else to do something about it. You set the example and watch people follow.

[oddturtle]

Originally Posted by morn

An emission trading scheme can also be revenue neutral btw. You could have it set up so you buy the permits from the government. The government can redirect the revenue it gets from selling permits, to tax cuts.

yes, actually you are correct. Still, I think a carbon tax is the lesser of two evils (ducks).

[oddturtle]

Originally Posted by Abaddon

Have to agree with ~Coxy. The problem is that the majority of businesses agree with reducing the carbon footprint in principle but do not see it as a priority because most do not see Global Warming as an immediate threat. As such they see any emmissions trading scheme, carbon tax or any other variation on the theme as an added burden on doing business, affecting profits and therefore something to be avoided or circumvented in whatever way possible.

The only time that businesses will embrace such a scheme is if all businesses worldwide adopt the scheme at exactly the same time, in exactly the same way. As this is not likely to happen any time soon....I don't think a trading scheme will have any impact other than economic (some enterprising people will find a way to make a buck out of it). There are many things that a government could do to help individuals make a change - a solar rebate is just one. Again this would be a) initially costly and b) need to have a long term outlook something that governments are just not designed to have.

God I've become a cynic in my old age

Well I am watching SBS news and polls show 80% of australians want an ETS, while 60% want an ETS regardless of what everyone else in the world is doing.

I think this political pressure will mean we're going ahead regardless, which while possibly symbolically powerful and will give Australians a bit of feel good moral high ground, is stupid because we're just going to shift a lot of emissions offshore where there is no price on carbon and its more economic to pollute.

[EmJay]

From my understanding, doesn't the Carbon Trading program place a clear, numerical limit on the amount that is emitted by those included in the scheme, as opposed to the tax?

[Abaddon]

Originally Posted by morn

You can't solve a problem by waiting for someone else to do something about it. You set the example and watch people follow.

Totally agree with you Morn. Unfortunately businesses are not out to set examples. They are out to make a buck and circumvent any perceived barrier to making a buck. A trading scheme is perceived to be a barrier, at least you'd think so given all the bleatings about how much it will cost and how many exemptions are already being sought.

If the government really wants to set an example it should set emmissions targets to be followed by all industries, no exceptions. It should make it clear to everyone that this will mean higher costs and that's the reality and get over it because the alternative is the planet will be uninhabitable for humans within 100 years, and probably more like 50.

Unfortunately most of us don't give a flying @#@! what happens in the next 10 years, let alone the next 100, so it will never happen......I did say I was a cynic