Earlier today, Malcolm Turnbull and Andrew Robb launched a report by Frontier Economics into alternative emissions trading schemes. This work was developed using the same economic model used for Labor’s Garnaut Report and the Treasury’s model of the CPRS.
This report outlines a greener, cheaper and smarter model for an Australian ETS that reduces the impact on household power bills and limits potential damage to our economy.
Greener, because the proposed baseline and credit approach for electricity generation means that we can afford an unconditional 10% reduction in Australia’s greenhouse gas emissions by 2020, compared to the Labor’s 5% target.
Cheaper, because the cost to Australia’s GDP will be 40% lower than Labor’s CPRS. Electricity bills will be cheaper for households and the entire economy. Under the Frontier Economics proposal power bills will increase by $44 after 5 years, as opposed to $280 under Labor.
Smarter, because there will be a net gain of 42,000 jobs in regional Australia as opposed to the loss of 26,000 under Labor.
Kevin Rudd often quotes international developments, but he doesn’t tell the full story.
The US House of Representatives recently passed the Waxman Markey Bill, the outline of a US ETS. Importantly, it has not yet passed the US Senate, where it is expected to face significant opposition.
The Coalition has said time and again that we should wait for an international agreement. Why? Because we need to ensure we are competitive in the global economy.
For example, Labor’s CPRS will raise tax revenues of $A404 per capita in its first year. In comparison the US proposal will only raise $A57 and the EU scheme will do so by only $A0.80. This is a recipe for disaster for Australia and represents a massive tax grab by Labor.
With a few modest changes to the proposed CPRS we can have a ETS that is twice as green and 40% cheaper. Does Labor have the courage to work with the Coalition in our national interest?
We will find out this week as the Senate debates Labor’s flawed CPRS.