International Law

Ken Henry on tax reform

Posted on October 19, 2009
If the tax structure from early last century prevailed today, we would have to raise $40 billion from excise and $230 billion from tariffs to meet today's revenue demand. At that rate the excise on a schooner of beer would be around 7 times what it is today...

Climate Change Blog Action Day

Posted on October 15, 2009
Apparently today is Blog Action Day for Climate Change and I thought I'd throw it open to my wonderful blog readers.I find myself alternatively optimistic and despairing on climate change. How bad is it going to be? Are we going to do what it takes to avoid the worst? And what do you think is going to be the most help? People and communities and businesses taking action themselves? National governments agreeing on strong action at Copenhagen and setting up strong domestic laws, like emissions trading? Peak oil or economic crisis reducing emissions automatically? Or technological breakthroughs making it easier than we thought? Or will it take some real environmental crisis to get the impetus?What do you think? Put in your two cents for Blog Action Day - bloggers, regulars, visitors and lurkers!CheersDave

What's the Opposition's climate policy?

Posted on October 07, 2009
I saw Maclolm Turnbull interviewed the other night saying that he supported emissions trading and reminding people that emissions trading was indeed government policy under the previous Howard Liberal government when Turnbull was Environment Minister (it was pretty token and very very late if I remember rightly)...

Emissions trading: Auctioning permits vs giving them away

Posted on October 06, 2009
As I've talked about before (The great permit give-away), one of the big debates in emissions trading is whether to auction most of the permits or give them away free to industry. Under the Australian CPRS it looks like more and more will be given away, to industries that are particularly affected and/or have to compete with overseas industries that do not face carbon costs...

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Red sky in the morning...

Posted on September 22, 2009
Strange weather in Australia recently: record high winter temperatures, bushfires in spring, hail the size of cricket balls overnight and we woke this morning to an apocalyptic orange glow in Sydney.Meanwhile our Prime Minister is at the UN for climate change talks and the domestic question is whether we should have our emissions trading scheme ready to go for Copenhagen or wait for the outcome of the Copenhagen talks and a post-Kyoto international agreement...

Stimulus payments can kill you

Posted on September 09, 2009
Yes, those $900 cheques from Uncle Kevin can kill. That?s the finding of a new study in the Bulletin on Aging and Health:Many studies find that households increase their consumption after the receipt of expected income payments, a result inconsistent with the life-cycle/permanent income hypothesis...

Economics and supermarket checkout lines

Posted on September 09, 2009
I remember reading a nice exposition of the efficient markets hypothesis on Andrew Leigh's blog a while back:So if we believe shoppers are as rational as traders (why not?), then there should be a parallel efficient supermarkets hypothesis. The efficient supermarkets hypothesis tells us that: (a) the length of the line reflects all available information about its speed (cashier skill, size of preceding trolleys etc), (b) the best way of getting through the supermarket checkout is to pick the closest line and stay in it, and (c) the worst thing you can do at the supermarket is switch lines...

Dealing with uncertainties in carbon price

Posted on September 09, 2009
The main difference between a carbon tax (emissions tax) and an emissions trading scheme is this. With a carbon tax, the price of emitting a unit of greenhouse gases is fixed but the total level of emissions is unknown. With an emissions trading scheme, the level of emissions is fixed (capped) but the price is unknown...

Clean Coal on Four Corners

Posted on September 06, 2009
Four Corners tonight is on progress with "clean coal" (also known as carbon capture and storage, CCS): coal-fired power stations that capture the greenhouse gases emitted from burning the coal and store them underground.The bottom line: coal is a large and growing contributor to greenhouse gas emissions and clean coal technology is a long way from being a commercial reality...

Nitpick of the day

Posted on September 04, 2009
OK, I'm being a bit trivial but indulge me. Sweeping generalisations and grand rhetorical statements bug me at the best of times, but particularly when they're quite obviously wrong.Ziggy Switkowski who, as former CEO of Australia's first and biggest telecommunications company, should know better, opens an otherwise interesting Online Opinion piece about the march of technology with this:Our forebears 100 years ago could not have dreamt of the emergence of television, computers, satellites...

The great give-away: Allocating permits under an emissions trading scheme

Posted on September 02, 2009
One of the bigger areas of debate in emissions trading is how to allocate permits. The purists (eg, Garnaut) suggest they should all be auctioned while political realities suggest a large chunk will be given away to compensate the industries that will suffer most under the scheme (Garnaut suggested that you should give cash compensation so it's transparent)...

Tax cigarettes, aclohol and junk food til no-one buys them?

Posted on September 01, 2009
The National Preventative Health Taskforce has just publicly released its strategy "Australia: The Healthiest Country by 2020".For probably the first time ever, life expectancy in Australia is getting shorter. Three of the biggest and most preventable killers are tobacco, alcohol and obesity...

Carbon offsets: Oils ain't oils

Posted on September 01, 2009
If you wanted to offset the carbon emissions of a flight, you can buy carbon offsets from any number of providers. But the price for offsets done in different ways or certified under different standards can vary greatly. Why? A new paper investigates...

Renewable energy target expected to pass today

Posted on August 19, 2009
Some good news following last week's defeat in the Senate of the Australian emissions trading scheme. The Senate is voting today on the big increase in the mandatory renewable energy target (MRET), and it's expected to pass after the government and opposition reportedly reached a compromise yesterday...

Sustainable House Day - 13 September

Posted on August 17, 2009
13 September is Sustainable House Day. Greenies around Australia open their homes and share their stories and tips for making your home greener. Learn and be inspired.HT: Greenfoot

Game theory and Kyoto negotiations

Posted on August 13, 2009
I'm not a huge fan of simple game theory analyses of international climate change negotiations (even though I've been guilty of using them myself) because they tend to model each country as being an individual acting in its own interests, when the political reality is rather more complicated...

Wind power: plus ca change

Posted on August 12, 2009
Some common sense observations about wind power's potential in the UK from The Times: it deserves attention as fossil fuels diminish, it has low capital costs, it's plentiful, it's intermittent and there are challenges with power storage, but this is only a problem if it's intended as baseload supply...

Making cycling safer: The Idaho Stop Law

Posted on August 11, 2009
One area where I think public policy could really help sustainability in Australian cities is by making cycling an easier transport choice. Sydney strikes me as crying out for measures to encourage cycling. Cycling could really be a big part of the trasport mix here - yes some of the city is hilly but you've got probably 3 million people living within very easy cycling distance of the CBD...

The oppostion's rival carbon plan: greener, cheaper, smarter?

Posted on August 10, 2009
Malcolm Turnbull yesterday released an alternative carbon plan: "greener, cheaper, smarter". Sounds great. And finally some opposition policy on climate change. Well, not quite. The plan is a report by economic consultants 'Frontier Economics' commissioned by the oppostion and independent Senator Nic Xenophon...

Idle thoughts

Posted on August 07, 2009
An article in the August issue of Energy Policy suggests that people idling their cars (leaving the motor running when stopped) accounts for a surprising and mostly unnecessary 1.6% of US greenhouse gas emissions.Drivers who were surveyed on average thought that a car could be idle for almost 4 minutes before it was better to turn the engine off (in fact, it's more like 10 seconds)...

What I've been up to...

Posted on August 05, 2009
Hi all,Well Oikos is back. Welcome readers old and new!Oikos is a blog I started in November 2005, while enrolled in a Masters in environmental economics and not long after moving from an environment NGO to a government environmental agency.The blog's focus is at the intersection of the environment and economics...

Oikos returning soon...

Posted on July 22, 2009
Stay tuned!

Congestion tolls in Sydney

Posted on November 11, 2008
One interesting announcement in yesterday's NSW state mini-budget was the introduction of "congestion tolls" on the Sydney Harbour Bridge and Tunnel: the toll will vary depending on the time of day. Tolls will increase from $3 to $4 during peak travel times, stay the same during a shoulder period and drop to $2...

Conflicts of interest in environmental planning

Posted on October 22, 2008
Andrew Norton has an interesting article on some unintended consequences of proposed reforms to Victoria's local government legislation. Reforms desgined to reduce the potential for conflicts of interest could undermine, rather than strengthen, the rights of residents to partcipate in the planning process:In the future, local councillors may be prevented from voting on the very motions before council they may have been elected to support or oppose...

Defensive investments

Posted on October 20, 2008
I'm back from a very enjoyable trip to Ireland and Scotland - and two fantstic weddings. Being on holidays, I was only generally aware that there was a financial meltdown going on and that everything was costing more each day as the Aussie dollar sunk about 30% against the Euro and pound over the course of the trip!I developed a bit of a taste for whisky in Ireland and (especially) Scotland, which is timely as it appears that fine whisky is one asset that has been appreciating in these tough times:Roughly 11 months after the launch of a Dutch online trade platform for exclusive single malt whiskies, mostly from Scotland, the World Whisky Index has seen an average return of 26...

Blogging break

Posted on September 04, 2008
There's been a lot going on in my life lately (in a good way) and unfortunately Oikos has been the victim of that. Ironically I've been spending more time on climate change issues than ever before but my energy in that sphere has been channeled into my environmental economics thesis which has kept me busy indeed...

Why do we pay people to waste our most precious resource?

Posted on July 17, 2008
It's one year today since the contract to build Sydney's desalination plant was signed and ANU environmental economists Quentin Grafton and Michael Ward have run the numbers on whether it was a good deal.  Their conclusion: the net benefit to Sydney households of the plant is negative one billion dollars...

Thoughts on the green paper - Part 1: petrol

Posted on July 16, 2008
The government?s green paper on emissions trading is now available. The government?s new phrase for its emissions trading scheme is ?carbon pollution reduction scheme?.The first thing that?s captured everyone?s attention ? not surprisingly ? is petrol...

Government's green paper on emissions trading out today

Posted on July 15, 2008
It's being launched by Climate Change Minister Penny Wong at the Press Club at 12.30.I'll put up a link when I have one and hopefully some analysis tonight.

Garnaut Review out today

Posted on July 03, 2008
The draft report of Professor Ross Garnaut's Climate Change Review will be released at 12.30 today here.For overseas readers, this review has been described as the Australian version of the Stern Review. The report will look at the economic impact on Australia of climate change and the design of a domestic emissions trading scheme (ETS), as well as suggestions for Australia's role in international negotiations...

Responses to higher fuel prices

Posted on June 17, 2008
Observing how people are responding now to higher fuel prices gives us some idea about how people will respond to a price on carbon under an emissions trading scheme.In the short term, we can expect pain on households and businesses as their usual ways of doing things become more expensive...

Drivers with bumper stickers are road ragers

Posted on June 16, 2008
My favourite subject at uni was social psychology. The experiments we studied were brilliant and most seemed to have a sense of humour. I love this one reported in Monday's Washington Post:[Social psychologist William] Szlemko said that, in an as-yet-unpublished experiment, he conducted tests of road rage in actual traffic...

Socially defective economists

Posted on May 28, 2008
From time to time economists like to analyse human relationships through whatever economic model is occupying them at the time, thinking they're offering some insights. Like this from the EconLog ("insights in economics") blog:One of the examples [of the idea that a lot of human behaviour can be explained as an attempt to signal something about onesself to others] concerns dating...

Liveblogging the budget

Posted on May 12, 2008
Can't wait until tonight's budget? No worries, Zoe at CrazyBrave has already blogged the best bits, in advance:7.37... We?re going to investigate the tax system - root and branch. We?re going to get the head of Treasury to tell us what bits are rooted and then we?ll get the maths whizzes who organised our branch stacking in NSW and Victoria to fix it all up...

Lessons from Europe's emissions trading scheme

Posted on May 08, 2008
The Pew Center on Climate Change has released a new report examining what went wrong and what has been going right with the EU emissions trading scheme.The report finds that the scheme has achieved much of what was intended: establishing a European-wide carbon price; causing businesses to incorporate the price into their decision-making; and creating the infrastructure for a multi-national trading program...

Taxing 'Alcopops'

Posted on April 27, 2008
News over the weekend that the federal government has raised the excise on pre-mixed drinks ('alcopops') from $39 to $67 per litre of pure alcohol caught my eye, given my interest in using economic instruments for public policy.These drinks are sweet and taste less alcoholic than they are and have therefore been a drink of choice for young people, women in particular, and the move is designed to help arrest the increase in dangerous drinking among teens and young adults...

We need some clear thinking on plastic bags - Part 2

Posted on April 17, 2008
What planet are our politicians inhabiting?Here's Queensland Premier Anna Bligh on plastic bags, as reported by the Brisbane Times:Queensland will oppose a levy on plastic bags at tomorrow's meeting of federal and state environment ministers. Premier Anna Bligh today told state parliament the levy would be another impost on families already struggling to meet rising household costs...

We need some clear thinking on plastic bags - Part 1

Posted on April 15, 2008
I've been observing the debate about plastic bags for years but haven't posted anything on it.I'm agnostic about whether something really needs to be done about plastic bags in particular.Good environmental policy, it seems to me, looks at the best ways of fixing identified problems - rather than targeting certain products...

Earth Hour this Saturday night - is it all just a waste of time?

Posted on March 27, 2008
It's the second annual Earth Hour this Saturday night and the wise cynics are once again gleefully reminding us how stupid we are to turn out our lights for one hour in the deluded belief that we're doing something about climate change.Their triumphant, but I think misguided, crowing about how naive we all are kind of reminds me of a scene from the Simpsons:Homer takes Lisa to the Springfield Museum and sees the sign, `Suggested donation: $4...

Why don't TV networks advertise their competitors' shows?

Posted on March 26, 2008
Here's my random thought for today: why don't TV networks ever promote their competitor's shows?Now I'm sure you're thinking that's one of the most stupid ideas you've heard lately. And it probably is, but it's not quite as stupid as it sounds.The potential audience for any particular show is people who would otherwise watch another free or pay TV channel and people who otherwise wouldn't watch TV at that time at all...

Garnaut review - emissions trading scheme discussion paper

Posted on March 25, 2008
Professor Ross Garnaut's blueprint for an Australian emissions trading scheme was released last Thursday (pdf). I haven't got past the exec summary yet, but Robert Merkel has an excellent discussion at Larvatus Prodeo today, and econobloggers Harry Clarke, Peter Martin and Joshua Gans had some thoughtful comments over the weekend...

EPA: US can halve greenhouse emissions for the cost of a cup of coffee a day

Posted on March 17, 2008
Alright, that's a bit of an exaggeration, but a report very quietly released by the US EPA (there's remarkably little mainstream coverage of it) has found that if emissions were cut by 56% by 2050, US GDP would grow by 80% between now and then, compared to 81% if emissions were allowed to increase on a business-as-usual basis...

Rudd's tax cuts - inflationary or illusory?

Posted on March 16, 2008
Mark Davis has a nice piece in the Herald today questioning the angst expressed by so many people about Rudd's election promise to cut taxes in an inflationary environment.Davis points out that these announced tax 'cuts' (and the Howard government's cuts of the past few years) are not necessarily cuts at all: the stated amount of the cut is the predicted reduction in the amount of tax collected because of the change to tax rates, compared to what would have been collected if the change hadn't been made (not compared to what was collected last year)...

Can biofuels help reduce greenhouse emissions?

Posted on March 07, 2008
The answer, from a recent CSIRO study (pdf), appears to be yes - unless it's from a plantation that was established by clearing forest.The study compared total life-cycle emissions from biofuels from various sources with diesel. Fuel from canola has 49% lower emissions over its life cycle than diesel and, for a waste product such as used cooking oil, emissions can be 87% lower than diesel...

Economic analyses of intergalactic trade

Posted on March 06, 2008
A new paper on the potential pitfalls of interstellar trade prompts economist bloggers Tyler Cowen and Joshua Gans to look at some of the recent and not so recent economic treatises on the subject.I love this quote from a Paul Krugman paper on the topic:It should be noted that, while the subject of this paper is silly, the analysis actually does make sense...

An important day for climate change action?

Posted on March 04, 2008
With Mike Huckabee withdrawing from the Republican party nomination race, all three remaining US presidential contenders favour strong action on climate change (albeit to varying degrees).That means - whatever happens in November - we will see a significant shift in US climate change policy in January 2009...

Garnaut Review - interim report now out

Posted on February 21, 2008
The interim report of the Garnaut Climate Change Review is now out and is required reading if you're interested in what an Australian emissions trading scheme will look like. The review was commissioned last year by Australia's State and Territory Governments (and the then federal opposition - now federal Government) to examine the impacts and opportunities of climate change...

Does car sharing have a place in Australia?s transport mix?

Posted on February 12, 2008
The Wall St Journal had an article last week on the emerging car sharing industry in the US.Car sharing is designed for people who want access to a car for short trips occasionally without the expense of owning a car. You pay a membership fee and then hourly or daily usage rates that include petrol, insurance, etc...

Economic communicators contest

Posted on January 31, 2008
Are you an effective communicator of economic ideas?The US Association of Private Enterprise Education is running a contest with a first prize of US$10,000. You need to submit a video and a written piece explaining an economic idea. (Oh, and it's not open to tenured academics)...

Moral hazard in emissions trading

Posted on January 30, 2008
Moral hazard is an interesting concept in economics. It?s the problem that someone protected from risk may behave differently from how they?d behave if they were fully exposed to the risk.It?s a big issue in finance and insurance. Moral hazard has been blamed in part for the sub-prime mortgage debacle gripping the US and elsewhere...

How much should we spend to reward pollution?

Posted on January 29, 2008
New Treasury figures estimate that by next year we'll be spending over $2 billion per year subsidising the use of company cars ? nearly twice as much as was previously predicted.I've talked before about this environmentally destructive tax rort that encourages drivers to drive and drive and drive - the more you drive, the less tax you pay...

Will fuel efficiency laws save motorists money?

Posted on January 03, 2008
With petrol prices in Australia nudging $1.50 a litre, the clamour to 'do something' is growing and even the Australian Conservation Foundation is jumping on the bandwagon. Its solution: mandatory fuel efficiency standards for new cars sold in Australia:ACF?s Sustainable Australia program manager Alison Cleary...

Who should you vote for in the US Presidential elections?

Posted on January 02, 2008
A site that should be of interest to all US readers (and many others) is glassbooth.org. A non-partisan site, it aims to give you an insight into how the views of the Presidential contenders align with your own views.First it asks you to assign points to issues that you're most concerned about, then it asks you a series of questions about those issues...

Happy new year!

Posted on January 02, 2008
I hope you've all had (or, better still, are having) a refreshing break and I wish everyone a healthy and happy 2008.It's a good time to reflect and to look forward to a great year and, in that vein, the Sydney Morning Herald has a great article on eco-friendly New Year's resolutions - most of which are pretty cheap and easy to implement.

Blogroll update

Posted on December 18, 2007
I need to update my list of links: some blogs I link to have ceased to be updated or even to exist and there are new blogs on the scene I haven't yet included.If you think there are any glaring omissions, please leave a comment. Given Oikos' theme, I try to link to really good blogs about environmental economics, Australian economics or Australian environment - or truly outstanding blogs about the environment or economics more generally.

Bali wrap up

Posted on December 16, 2007
I think this cartoon by Alan Moir pretty much sums it up!I'll post some more thoughts soon...

Will the US be rewarded for failing to ratify Kyoto?

Posted on December 09, 2007
The Sydney Morning Herald reports today:Three options in the draft Bali deal will be put to international environment ministers who will meet on Wednesday... and the hope is that a deal will be signed by Friday.The most favoured option is a two-track process...

New-ish environmental economics blog

Posted on December 05, 2007
While I've been galavanting around Europe with its surprising lack of wireless internet, I've missed the appearance of a new addition to the healthy and growing stable of blogs around the world with an environmental economics focus.Common Tragedies is a play on the 'tragedy of the commons' concept, the tendency for overexploitation of common resources...

An Inconvenient Truth: US doing better on climate change than Europe?

Posted on December 04, 2007
Yesterday's Wall Street Journal reports some suprising figures on US greenhouse emissions:The Bush Administration announced last week that U.S. emissions of carbon dioxide fell by 1.8% from 2005 to 2006. Output of all greenhouse gases was down 1.5% last year...

Bali high - or ballyhoo?

Posted on December 04, 2007
Now that Australia has ratified the Kyoto Protocol, I'd expect that Kyoto-related debate and discussion in Australia would focus on:Can we meet our emissions targets in the first commitment period (2008 - 2012)?What happens after 2012? What will the new Kyoto Protocol or alternative post-Kyoto agreement look like?For the first issue, the die is really cast: there's not much we can change now in terms of domestic policy that will pay big dividends within the next 5 years...

Australia's political climate change

Posted on December 03, 2007
Australia has today ratified the Kyoto Protocol. Cat and I are back home after a great trip, to a new federal government and some important developments on climate change. Climate change was a prominent issue in the election campaign. My impression is that, while policy differences between the parties on this issue had narrowed since the former Liberal government announced earlier this year that it would establish a carbon trading scheme, the Liberals' regular climate skeptic rhetoric over the past decade (which only really changed this year) resulted in the distinct feeling that they were not genuine about climate change action...

What happened to Oikos?

Posted on September 12, 2007
Apologies to my loyal and very attractive readers for a lack of posts here lately. I'm acting in a new position at work which I'm loving but it's been a learning curve and a lot of work! Free time has largely been devoted to my thesis (first chapter now 4 weeks overdue - woops!) and - more importantly - planning a big overseas trip!Cat and I set off for a very exciting 9 weeks in Europe via San Francisco and the Phillipines in only a few days...

Can markets predict global warming?

Posted on August 22, 2007
It's been a little quiet at Oikos lately, as work has been particularly busy. I've also started researching for my thesis on whether prediction markets could effectively predict climate change and its impacts - something I've previously talked about. Could a well-functioning market in future temperatures or sea level rises be set up, and how might its predictions compare with the consensus forecasts from the Intergovernmental Panel on Climate Change (IPCC)?According to an article today on MSN, companies are starting to look at precisely such markets:Farmers have for generations used futures contracts on commodities such as corn and grain to provide insurance against poor weather and crops...

Australian Conservation Foundation looking for Economic Adviser

Posted on August 10, 2007
An illustration of how economics is becoming increasingly important in environmental debates, ACF is advertising for an economist to fill the apparently newly-created position of Economic Adviser.According to ACF:ACF?s advocacy to protect the environment increasingly involves economic analysis, and ACF has set a long-term strategic priority to transform Australia?s economy into one that is ecologically sustainable...

Kenneth Arrow and Thomas Schelling on Climate Change

Posted on July 18, 2007
The latest issue of The Economists' Voice is out, with two articles on the economics of climate change by Nobel Prize-winning economists.The first is an excellent primer on climate change by Kenneth Arrow: Global Climate Change: A Challenge to Policy...

Exposing the hidden costs of pollution

Posted on July 16, 2007
An article in today?s Sydney Morning Herald, which questions whether the Australian states could undermine national action on climate change, illustrates just why a broad-based national emissions trading scheme would be effective.Environment groups said the Opposition Leader, Kevin Rudd, needed to explain how he would curb rising greenhouse gas emissions at a time when Queensland and NSW were dramatically boosting coal exports and several states were approving big road and power projects that would increase climate change pollution?The NSW Treasurer [Michael Costa] favours building a new coal-fired power plant to meet the state's energy needs, in contrast to other proposals for more gas-fired generation or energy efficiency and demand management...

Live Earth concert this Saturday

Posted on July 03, 2007
Only 4 sleeps to go until the Live Earth concerts around the world - in New York, London, Johannesburg, Rio de Janeiro, Shanghai, Tokyo, Sydney and Hamburg on 7/7/07 - this Saturday!By the way, I have a couple of spare tickets to the Sydney concert, so email me at ozelaw [at] yahoo [dot] com [dot] au if you missed out...

Cheap ways to reduce greenhouse emissions

Posted on June 27, 2007
An interesting article in The Economist last month took a look at the cost of various options for reducing greenhouse emissions (summarised in the graph above).Two things are particularly notable:There are a number of options that have a negative cost...

Coming soon to an Australian high school near you?

Posted on June 24, 2007
Click picture to enlarge. More nuclear fun at Ethan Persoff's site.

Should carbon taxes be linked to global temperatures?

Posted on June 17, 2007
I?ve mentioned before the possibility of creating markets in long-term weather ? that is, betting on future climate change ? as a method of predicting and insuring against climate change. Betting markets are good at predicting future outcomes ? you can look at the odds on horses in a race if you want to get an idea of who?s likely to win...

Review of Environmental Economics and Policy

Posted on June 14, 2007
The first issue of the Review of Environmental Economics and Policy is out and articles can be downloaded for free.The Review...seeks to fill the gap between traditional academic journals and the general interest press by providing a widely accessible yet scholarly source for the latest thinking on environmental economics and related policy...

Happy World Environment Day!

Posted on June 05, 2007

Who do you trust with the challenge of climate change?

Posted on June 04, 2007
That?s what Australia?s Prime Minister John Howard asked yesterday, when announcing his Government?s policy on climate change for the next election:We must get this right. If we get this wrong, it will do enormous damage to our economy; to jobs and to the economic wellbeing of ordinary Australians, especially low-income households...

Emissions trading - the report is out

Posted on May 31, 2007
The Prime Minister's Task Group on Emissions Trading has handed down its final report and it is now available.It recommends an emissions trading scheme based on the following principles:a long-term aspirational emissions abatement goal and associated pathways to provide an explicit guide for business investment and community engagement an overall emissions reduction trajectory that commences moderately, progressively stabilises, and then results in deeper emissions reductions over time and:· is sufficiently flexible that it can be periodically recalibrated by government to changing international and domestic circumstances through regular and transparent reviews· provides markets with the ability to develop a forward carbon price path to guide business investment decisions and help drive longer-term technology development ? markets would be expected to establish a low initial carbon price and a forward price curve that rises over timemaximum practical coverage of all sources and sinks, and of all greenhouse gases with permit liability placed on direct emissions from large facilities and on upstream fuel suppliers for other energy emissions with those sectors initially excluded from the emissions trading scheme subject to other policies designed to deliver abatement initial exclusion of agriculture and land use from the scheme though agricultural emissions should be brought into the scheme as practical issues are resolveda mixture of free allocation and auctioning of single-year dated emissions permits that:· provides an up-front, once-and-for-all, free allocation of permits as compensation to existing businesses identified as likely to suffer a disproportionate loss of value due to the introduction of a carbon price· ameliorates, through free allocation, the carbon-related exposures of existing and new investments in trade-exposed, emissions-intensive industries while key international competitors do not face similar carbon constraints, but which also provides ongoing incentives for abatement and adoption of industry best practice allows for the periodic auctioning of remaining permitsa ?safety valve? emissions fee designed to limit unanticipated costs to the economy and to business, particularly in the early years of the scheme, while ensuring an ongoing incentive to abaterecognition of a wide range of credible carbon offset regimes, domestically and internationallycapacity, over time, to link to other comparable national and regional schemes in order to provide the building blocks of a truly global emissions trading schemeincentives for firms to undertake abatement in the lead-up to the commencement of the scheme, including through the purchase of offset credits from carbon plantations, and potentially from other accredited activitiesrevenue from permits and fees to be used, in the first instance, to support emergence of low-emissions technologies and energy efficiency initiatives (the focus might shift more toward households and business as the scheme matures)...

PM's Emission Trading Task Group - report out midday today

Posted on May 31, 2007
I've just been informed that the report will be posted on the Task Group's website at midday today.Today's Sydney Morning Herald has a brief summary and the recommendations are a little disappointing (if not surprising). The good point is that it recommends a domestic cap-and-trade system (with fees for exceeding permit requirements - which makes it more like a hybrid cap-and-trade / carbon tax)...

The Prime Minister's Task Group on Emissions Trading

Posted on May 30, 2007
The Prime Minister?s Task Group on Emissions Trading gives its report to the PM today and is expected to recommend the introduction of a national emissions trading scheme in Australia.I have been pretty sceptical about the taskgroup, given its membership: of the twelve members, five are from within the government, three are from mining / resources companies, one is from a power company, two are from heavy energy users (aluminium and airline companies)...