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Australia's carbon tax to be set at US$24.8/tonne

0 Comment(s)Print E-mail Xinhua, July 10, 2011
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Australia's carbon tax will be set at 24.7 U.S. dollars per tonne, starting from July 1, 2012, Australian Prime Minister Julia Gillard announced on Sunday.

Gillard is in Canberra of Australia to release details of the federal government's carbon tax plan.

She unveiled that the government's carbon price scheme will start from July 1, 2012. The tax is set to increase 2.5 percent each year for three years, and will switch to Emissions Trading Scheme in 2015.

"Carbon pricing is a reform we need to make to keep our economy competitive, to protect our environment and to do the right thing for our children and future generations," Gillard told a media conference in Canberra on Sunday.

The tax will result in emission cut of 159 million tonnes of carbon pollution by 2020, Gillard said, adding that Australia targets five percent emissions reduction from 2000 levels in 2020, and 80 percent emissions reduction from 2000 levels in 2050.

The government also set a target of 20 percent renewable energy by 2020.

Only about 500 biggest polluting companies in Australia will have to pay the full carbon price, with fuel for private motorists will be excluded from the tax.

Gillard announced that the revenue will be used to compensate households for price rises, help affected industries and support jobs and investment in clean energy and climate change program.

The assistant package includes 16.5 billion U.S. dollars assistant package to help households meet price rises over four years times, as well as a 9.85 billion U.S. dollars assistance over the next three years, which will be used to support manufacturers and industry that generate over 80 percent of emissions.

The worst impacted expected to be steel and aluminum manufacturers will get free permits representing 94.5 percent of industry average carbon costs and special jobs packages.

The steel industry will receive 323 million U.S. dollars in assistance to encourage investment and innovation to assist in the transformation to a low-carbon economy.

Lower polluters, such as plastics and chemical manufacturing, tissue paper manufacturing and ethanol production will be eligible for permits to cover 66 percent of carbon costs. Liquefied natural gas projects will receive 50 percent assistance.

While the 24.8 U.S. dollars carbon price will add around 1.9 U.S. dollars to the production of a tonne of coal, Climate Change Minister Greg Combet said the coal industry will receive a 1.4 billion U.S. dollars package to helped to reduce their pollution and maintain jobs.

Agriculture will not be included in the scheme, but farmers will benefit from around 1.3 billion U.S. dollars over three years for carbon farming.

Treasurer Wayne Swan said Australia's gross domestic product ( GDP) growth is expected to be reduced by 0.1 percent over 40 years under the carbon scheme.

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