BIOMASS HUB

In Australia, Prime Minister Julia Gillard unveiled her long awaited climate policy yesterday, which includes plans for a $23 per tonne tax on carbon. The plan will affect the country’s 500 largest polluters commencing July 1, 2012, including steel and aluminum manufacturers, and is slated to rise by 2.5 percent a year before moving to a market-based trading scheme in 2015.

“The nation’s future needs to be a clean energy future. We’ve opted for the cheapest way of cutting carbon pollution,” said Gillard, as she kicked off a nationwide campaign to sell the tax, opposed by most Australians. She added, “By 2020 our carbon price will take 160 million tonnes of pollution out of the atmosphere every year. That’s the equivalent of taking forty five million cars off the road.”

Gillard’s government’s proposal is a departure from earlier rhetoric.  Last August, Australia’s new Labor party leader Julia Gillard ran for office promising that she had no intention of pursuing a carbon tax. But that was before she became Prime Minister, and before a multi-party government commission endorsed a carbon tax as part of a long term plan to make markets account for the costs of climate pollution, explains Phil Mercer writing for PRI.

Richard Flanagan, writing for the Guardian, describes how Black Saturday reminded many Australians that of all the advanced economies, their country is perhaps the one most vulnerable to climate change.

Australia’s Black Saturday fires of February 2009 burned over a million acres of land and killed 173 people. It happened because of record high temperatures and a 20% drop in rainfall over the previous 12 years. It was what climate experts had been predicting for some years: the megafire. A megafire is hell come to earth.

The energy equivalent to 1,500 Hiroshima-sized atomic bombs was released in a fire storm that saw rivers of flame – sometimes rising 100 metres in the air – flowing through the countryside, generating winds of up to 120km an hour with new fires spotlighting 35km ahead of the main fire front.

Although the announcement triggered a sell-off of coal mining, steel firm, and airline assets on Monday, economists contend the tax on the top 500 carbon polluters would have little impact on economic growth. Clean energy firms are expected to be the winners from the carbon tax. The newly created Clean Energy Finance Corporation, a centerpiece of the proposal, will invest up to A$10 billion ($10.7 billion) in cleantech enterprises. A newly-minted Australian Renewable Energy Agency (ARENA) will manage $3.2 billion in existing renewables funding as well as a new $200 million Clean Technology Innovation Program. ARENA will consolidate funding from 10 agencies and departments in solar, geothermal and biofuel energy.

Australia’s Carbon Tax in the news:

• The Guardian elaborates on the political backdrop to the tax
• Biofuels Digest explains that road transportation fuels will be exempted from the tax initially
• Reuters on the market impact of the tax
• Phil Mercer on the tax fight

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