Further to yesterday’s post on the ETS

I’m not a fan of criticising without offering alternatives (Liberal party, please take note) so here are some ideas I’d like to float as alternatives to the nasty ETS garbage we almost had as law..  I’m not going to back these up with statistics (at the moment), just take them as general ideas/concepts worth exploring.

1. A realistic look at where Australia sits

We produce roughly 1% (one percent) of the world’s carbon emissions.  The ETS would have set a reduction target of 5% of Year 2000 levels of emissions by 2020. 

Yes, you heard right, A 5% reduction of 1% of the world’s emissions.  That isn’t much, is it?  I think it’s better to see what the US and China do about carbon emissions, since they contribute almost half the world’s emissions before we go and spend away on the concept.

2. The Current Resources Market

The ETS would have provided financial incentives for high polluting companies to produce less carbon emissions due to emission caps.  It was a consideration that these companies would pass on costs to the consumer, so basically high polluting companies would have been given tax payer money, whilst putting up their prices to the consumer.  In other words, the consumer ultimately pays twice (taxes and increased costs).

A sceptic might think that this was to protect the profit margins of companies who are polluting our country.  They’d probably be right, too.  My counter-proposal is the opposite.  Give the polluters nothing.  They will raise their prices to cover the increased costs to reduce their emissions (and give them harsh fines if they don’t meet the target).  No problems, since they were going to raise prices anyway.

3. We have to do something!

Right you are!  Here’s what I suggest;

a) Take that tax money and other incentives that would have gone to the current resources (“high polluting”) market and instead subsidize alternative, eco-friendly options.  Help to make “green” resources and renewable resources cheaper – perhaps equalling the increased cost of “high pollution” resources.  Then, let the consumer decide (since, either way you look at it, consumers will pay increased costs no matter what).

b) Green/eco-friendly resources will never catch on unless they can match the price of less expensive, but high-pollution resource companies.  So why not spend those tax dollars on businesses who actually want to do the right thing, instead of subsidizing big business who won’t change their practices of their own free will?  Those companies, by the way, who are in the latter category includes companies who provide “green” alternatives, but charge extra for it!

c) Establish tax-funded retraining programs for employees of high polluting companies so they can get jobs with eco-friendly resource companies.  Give people the incentive to establish a lower emissions industry and take money away from the high polluting companies.  You need to provide incentives for change, and penalties for not changing. 

In short – Make eco-friendly and renewable options profitable!  Make polluting unprofitable!
Business always follows the profit making opportunities.

4. How do we measure the results?

A great question.  One might conclude that there’s not a whole lot of point to introducing ETS-style measures until we have some way of determining how to measure the success of the scheme.  We don’t currently know how to tell if a drop in carbon emissions will have any impact at all.  Perhaps this is something worth investigating.


Saving our environment is an interesting bandwagon.  We really don’t have enough information to act at the moment, and until we do, we risk a lot of economic turmoil, not too mention job losses and other side effects.  Australia is a tiny minority in overall carbon emissions, so it makes sense to wait and see what the big polluting countries are going to do about it first.

There’s really no prize (any way you look at it) for being the first to introduce a carbon trading scheme.  We need to figure out what we can do which will be effective, and then act.  We need to participate as part of the global community to find answers.

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