PW
117/08 16 July 2008 - The Rudd Government
today released proposals for a new plan
to tackle climate change by reducing carbon
pollution.
Releasing the Government’s
Green Paper on the Carbon Pollution Reduction
Scheme, Minister for Climate Change and
Water, Senator Penny Wong, said the time
for action on climate change was now.
“We confront a daunting
reality: we cannot continue to pour carbon
pollution into the atmosphere as if there
is no cost,” Senator Wong told the National
Press Club in Canberra.
“The 12 hottest years
in history have all been in the last 13
years.
“As one of the hottest
and driest continents on earth, Australia’s
economy and environment will be one of the
hardest and fastest hit by climate change
if we don’t act now.
“Climate change threatens
our food production, agriculture, and water
supplies, as well as icons like the Great
Barrier Reef, the Kakadu wetlands and the
multi billion dollar tourism industries
they support.
“The Carbon Pollution
Reduction Scheme is a response to climate
change that is economically responsible,
supports families and prepares Australia
for our future challenges.”
Senator Wong said the
Green Paper sets out options and identifies
the Government’s disposition and preferred
positions on emissions trading and the support
proposed to help households and businesses
adjust to this economic transformation.
“At the heart of the
Carbon Pollution Reduction Scheme is emissions
trading, in which the Government sets a
limit on how much carbon pollution industry
can produce, and then the Government sells
permits up to that limit, creating an incentive
to look for cleaner energy options.
“Companies can buy and
sell permits from each other depending on
how much they value them, thereby enabling
the market to find the most efficient ways
to reduce carbon pollution.”
Senator Wong said this
was the most efficient, lowest cost and
most economically responsible way to reduce
carbon pollution, but any move to tackle
climate change was not without costs.
“The Government will
ensure that every cent raised from the selling
of permits will be used to help households
and business as they make the move to a
clean energy future.”
Senator Wong said the
Carbon Pollution Reduction Scheme, that
the Government intends to implement in 2010,
is a whole of economy reform on par with
past economic reforms such as the reduction
in tariffs or deregulation of the financial
system.
“Placing a limit and
a price on pollution will change the things
we produce, the way we produce them, and
the things we buy. It will open new doors
to a cleaner energy future.”
“In this Green Paper,
the Government has sought to strike the
right balance, on the basis of economically
responsible policy in the national interest.”
Senator Wong said the
Carbon Pollution Reduction Scheme will cover
stationary energy, transport, fugitive emissions,
industrial processes, waste and forestry
sectors, and all six greenhouse gases counted
under the Kyoto Protocol from the time the
scheme begins.
“To offset the initial
price impact on fuel associated with the
introduction of the Carbon Pollution Reduction
Scheme, the Government will cut fuel taxes
on a cent for cent basis.
“We will periodically
assess the adequacy of this adjustment measure
for three years and adjust this offset accordingly.
At the end of the three year period the
measure will be reviewed.”
For heavy vehicle road
users, who transport goods across the country,
fuel taxes will be cut on a cent-for-cent
basis to offset the initial price impact
on fuel associated with the impact of the
Carbon Pollution Reduction Scheme. The Government
will review this measure after one year.
To assist rural and
regional areas, the Government will provide
a rebate equivalent to the excise cut for
businesses in the agricultural and fishing
industries for three years.
“The Government will
increase payments, above automatic indexation,
to people in receipt of pensioner, carer,
senior and allowance benefits and to provide
other assistance to meet the overall increase
in the cost of living flowing from the scheme,”
Senator Wong said.
“We will also increase
assistance to other low-income households
through the tax and payment system to meet
the overall increase in the cost of living
flowing from the scheme.
“Middle-income households
will also get assistance to help them meet
any overall increase in the cost of living
flowing from the scheme.”
The Government will
establish the Climate Change Action Fund
(CCAF) to help business transition to a
cleaner economy, by providing in partnership
funding for a range of activities, including:
• Capital investment
in innovative new low emissions processes
• Industrial energy efficiency projects
with long payback periods
• Dissemination of best and innovative practice
among small to medium sized enterprises.
The Government will
provide transitional assistance in the form
of a share of free permits to the most emissions
intensive trade exposed activities.
The Government also
proposes to provide a limited amount of
direct assistance to existing coalfired
electricity generators.
“After so many years
of inaction, it is impossible for Australia
to be in front of the rest of the world
in tackling climate change,” Senator Wong
said.
“A greater risk is being
left behind a world of emerging economic
opportunities.”
