Carbon tax or genuine climate action?

[This article by Perth Socialist Alliance member Alex Bainbridge was printed in the Saturday 11 June 2011 issue of the Perth Voice Speaker's Corner.]

Thousands of people attended World Environment Day rallies in Perth and other cities last weekend to “say yes” to climate action.

Unfortunately, the rallies were also saying yes to a “price on pollution” which isn't quite the same thing and is even likely to be a step backwards.

While the Gillard government is determined to give us the carbon price, the action needed to actually reduce carbon emissions is clearly not part of its agenda.

The debate so far has largely been polarised between climate deniers who oppose any action on climate and those who advocate a carbon price as an “essential” step towards reducing emissions.

However, nobody has ever proven that market mechanisms are actually effective in reducing emissions, let alone that they are essential.

In fact, existing carbon markets around the world are in bad shape having suffered a decline last year according to a report released by the World Bank this month. The Guardian newspaper described the decline as an “almost total collapse”.

This was in the same year – 2010 – in which global energy-related emissions were the “highest in history” according to a May 2011 release from the International Energy Agency.

The most “successful” carbon market is the European Union which accounts for 97% of the world trade in pollution. Emissions in the European Union have continued to rise while polluting corporations have made billions of euros from the schemes.

The failure of existing market mechanisms underline the critical importance of developing a third pole in the climate debate: one that rejects an ineffective carbon price in favour of immediate public investment in renewable energy and other measures to reduce emissions.

Why should serious climate activists reject the carbon tax? After all, isn't something better than nothing?

Firstly, for clarity, it should be noted that the carbon “tax” is not really a tax – it is an emissions trading scheme that will operate with a fixed price for the first three to five years. That is, it is a similar mechanism to the “worse than useless” CPRS that the Rudd government tried to introduce in 2009 and similar to the failed schemes in Europe and other places referred to above.

Secondly, the carbon price will increase, not reduce, greenhouse emissions. This is because the biggest beneficiary of the scheme will be the polluting gas industry.

Wayne Swan has revealed that Treasury modelling demonstrates that the carbon price will result in a 150% to 300% increase in gas-fired electricity generation by 2050.

Between gas and renewables, Gillard's carbon price supports gas.

The preference for gas is not accidental, it is government policy. Greg Combet confirmed on Lateline in March that gas (and not renewables) is the government's preferred technology for new baseload electricity production.

At the burning phase, gas produces less emissions than coal. However, when the whole greenhouse “footprint” of gas is considered (including the extraction, processing and transportation stages), gas turns out to be as dirty if not dirtier than coal over a 20 year time frame – which is the relevant time frame for preventing runaway global warming.

Thus, there is no reason to assume that Gillard's carbon price is even a small step forward. More likely it will be a step backwards.

Even worse, is that the whole process of debating the mechanism of a carbon price represents an unforgivable delay in the adoption of measures that genuinely can reduce emissions.

The real alternative to coal and gas is renewable energy. The Victorian-based Beyond Zero Emissions have demonstrated convincingly that Australia could move to 100% renewable energy by 2020 given the appropriate political will. That is, existing commercially available renewable technologies can provide reliable baseload power.

Despite their rhetoric about tackling climate change, the Labor government is still surely in bed with the fossil fuel industries. This is revealed most clearly in the $10 billion per year that is handed out for free to polluting industries in government subsidies of various kinds while renewable energy initiatives receive a paltry drop in the bucket by comparison.

The first and simplest measure that any government would take to tackle the climate crisis is to reverse that situation. Yet there are no indications in the recent budget or anywhere else that Labor is even considering measures like that.

The conclusion from this is that the current government still needs to feel the full weight of public pressure if we are to see measures that will genuinely reduce emissions.

Demanding a better policy than the carbon price, instead of implying that a carbon price will achieve more than it can, is the best way to exert that pressure.