Senate Approves Carbon Tax; Labor Sticks to $23 per Tonne Carbon Price
As the Australian Senate votes on the carbon price on Tuesday, the Labor government said it will stick to its proposed $23 per tonne price.
At that rate, Australia's carbon tax is almost 23 times that of India and almost double that of Europe's which ranges from $8.70 7o $12.60 per tonne.
Climate Change Minister Greg Combet said there is no need to amend the price because of the long-term outlook of the Labor government in setting the price of the carbon tax. He pointed out that a few months ago Europe's carbon tax hovered in the vicinity of $23 per tonne.
"I certainly hope and anticipate that in the course of the next three and a half years, the crisis in Europe is overcome, markets will stabilise and recover and our carbon price will mesh well," Mr Combet said in a statement.
Under the proposed carbon tax, Australia would shift to a floating price by mid-2015 as its market-based emission trading scheme runs along international standards. By that year, the carbon tax will rise to $29 a tonne.
The Senate is expected to pass the carbon tax at noon of Tuesday, following the House of Representatives approval of the measure on Oct 12.
The Opposition has vowed to repeal the carbon tax if it will win the election, while some manufacturers continue to criticise the tax for adding to their cost.
Coogee Chemicals said imposition of the carbon tax will lead to the shuttering of its methanol plant in Laverton, Victoria and postponement of a $1-billion plant that would have created 150 jobs in other parts of Australia. The firm said the carbon tax would render Coogee Chemicals uncompetitive and unviable in the global arena.
Coogee Chemicals said Australia would lose $14 billion in exports from methanol with the carbon tax because methanol producers would transfer to China due to its less stringent emission benchmarks and no carbon tax.
Mr Combet, however, belied Coogee Chemical's claims. He said the government will provide an assistance package that would ensure major polluters in Australia would not be at a disadvantage with foreign competitors which enjoy laxer emission rules.
Mr Combet said Coogee Chemicals would be entitled to over 100 per cent of its carbon price liability through free carbon permits since the company's new facility would operate at lower emission intensity than current plants.
"A carbon tax is unquestionably in the long-term national interest of our environment, but also it is very important for the future of our economy," Mr Combet added.