Photo Courtesy of: Blind Wiehle (flickr.com)
It’s been several years
since the Carbon Tax was implemented, and the long-term benefits
of the restriction are definitely being felt down the road. It’s still a
long-way from the goal of reduced emissions in twenty-five years’ time, though.
How’s
the rollout going so far? Here’s a lookback and forecast of what to expect.
Curbing
Consumption: Taxation
In
essence, a carbon tax levies manufacturing and mining firms for every tonne of
hazardous gases their factories and equipment release into the air. In Australia,
the government charges $23 Australian bucks or around fifteen pounds per tonne,
and this rises by 2.5% in yearly payments. Because of this additional expense,
the legislators expect that the top firms will eventually curb their use of
fossil fuel to run their power generators and vehicles. Thus, the amount of
carbon emission will hopefully drop to 5% all over the country in eight to ten
years under this policy.
Demand,
Upgrades Dictate Cost
Naturally,
the power rates would increase because of changes in the way the firms run
their business. Old equipment must be replaced with newer and more
energy-efficient ones. Suppliers of electricity must stop using coal or oil to
fire up the turbines and shift to a cleaner energy source, such as water, wind
or sunlight. And so, energy companies that invest in cutting-edge technology,
like hydroelectric power generators, modern wind turbines, and large solar
panels, will survive through the transition.
Forward-Facing
and Optimistic
On the
whole, the carbon tax aimed (and still aims) to clear up Australia's air
quality at the expense of the energy and mining companies that lack economic
resources to improve their facilities. This concern is evident in the 2012
Australia and New Zealand report from the Carbon Disclosure Project, which
revealed that seventy-five percent of the energy firms affected by the
legislation viewed the required changes to their business operations as risky
investments. In particular, three big corporations in the energy and mining industry
have shared strong warnings that the carbon levy presented high risks for all
sectors. This means increased consumer prices for gas and electricity and more
expensive wholesale rates for energy bundles.
On the
flip side, the rise in power costs eventually drives investment into
"green" energy generation. businesses will seek cost-efficient means
to get the resources they need by developing newer technologies. This led
legislators to believe that electricity
retailer and producers, as well as major players in the energy, mining and
manufacturing industries will thrive despite the initial drawbacks of this tax
policy. In fact, the 2012 Australian Energy Technology Assessment from the
Bureau of Resources and Energy Economics predicted that electricity generated
through wind turbines may turn out to be cheaper than coal within ten years or
so under the carbon policy.
Related
Resources:
The
End of the Electric Utilities? The Industry Thinks So Too
(huffingtonpost.com)
Power
and Water Utilities: An Unlikely Alliance (huffingtonpost.com)
