Wow, compare this to the disarray (or complete lack of) US policy that exists..
Australia Announces Carbon Tax Plan. The plan, released July 10, places a three-year tax of $23 on every metric ton of carbon emissions produced by Australia’s 500 largest polluters, starting in July of 2012. Among other things, the tax revenue will partially compensate industries for becoming more energy-efficient and will provide tax cuts for households as the industries being taxed pass the costs through to consumers. Revenue will also fund new clean energy, with the $10 billion Clean Energy Finance Corporation to invest in clean energy enterprises, and the Australian Renewable Energy Agency (ARENA), a newly created independent authority, managing $3.2 billion of renewable energy funding.
Just to summarize:
- Starts at $23/ton
- Increases 5% for three years
- After 3 years, market conditions will set the price
- Revenue goes to alternative energy research and investment
It will be really interesting I think for all the economists to compare this carbon tax approach with EU’s cap and trade market and maybe finally answer the question which is more effective. Maybe by that time the US will have realized that without a coherent policy for alternative energy R&D we are falling behind the rest of the world (regardless of your thoughts on climate change, fossil fuels are limited and the less we have to import the better)