Generally, plants and trees need carbon to survive in contrast to animals and humans who need oxygen to live. However, the increasing amount of carbon in the atmosphere has led to changes to the environment, such as a shift in weather pattern and the rise of atmospheric temperature all over the world. So, to bring back balance to Earth’s atmosphere, governments began to implement green initiatives, including carbon tax, designed to reduce carbon emissions caused by burning gas, coal or crude oil from manufacturing plants and other industrial sites.
A Significant Drop in Carbon Emissions Index
The Australian government introduced its carbon tax in July 2012 after years of debate. According to BBC News, around 300 firms were levied at $23 Australian dollars per tonne of greenhouse gases they create. When the country’s top industries include mining, steel manufacturing, and energy generation, this legislation can be an alarming threat. The opposition branded it as “toxic tax” that will cost people their jobs and increase the cost of living in the country.
However, after nearly four months since its implementation, reports from ABC News and other local media revealed positive results. Victoria alone has had a 8.7 percent reduction in its carbon emissions since July. All over the country, the fall in record emissions reached down to 7.6 percent, according to a report from the Australian Energy Market Operator (AEMO). Hopefully, this trend continues until the year 2020 and meets the government’s goal of reducing carbon levels by five percent or less in all regions.
But, what does this mean to consumers and businesses? Will the Australia carbon tax lower power rates, supply enough energy for a growing population, and still attract investors to the mining and energy sector? Nobody knows for sure how far and wide the benefits of the levy would go ten years or twenty years from now. One thing’s certain though: consumers and small business owners end up reaping the benefits of getting energy from abundant sources.
Carbon Tax Led to a Surge in Power Costs?
Of course, it’s too early to predict the downfall of the energy and mining industries of Australia as result of the levy. Naturally, an increase in power rates began almost immediately after implementation. Energy firms had to cover the cost of paying taxes for every tonne of pollutants they release into the atmosphere. On one hand, these discouraging power rates shifted public attention to more efficient technologies, such as hydroelectric turbines and solar panels. Although the demand for renewable energy hasn’t begun to surge yet nationwide, the huge investments of companies and their high production expenses has nudged clean energy prices a bit closer to traditional rates.
The AEMO report also admits that other possible factors may have contributed to the decrease in the Carbon Emissions Intensity Index (CEII) during the months of June through August. Before the carbon tax, floodwaters in Gippsland, Victoria stopped operations for the Yallourn power plants, which supply most of the energy to that region. They had to go offline for emergency cleanup and repairs. These power generators run on coal fuel and their temporary absence may have led to a significant decrease in carbon levels. In short, the policy has definitely been successful in curbing the atmospheric levels of carbon over large regions in Australia, but there were negative effects from paying too much taxes too soon and to the energy sector’s mad scramble to provide more clean energy options to consumers.
This article was provided by Gene Armstrong. Gene has worked as a consultant for industrial firms on and off for eight years specializing in energy-efficient technologies and green energy policies. He also contributes to online media regularly with articles and blog posts that share effective money-saving advice for households and businesses. Most data and news reports shared in this article came from http://www.switchwise.com.au where you’ll learn more about carbon tax and how it works.