Archive, Industry News

ETS ‘tax’ killed off in Senate

Senate says no to emissions trading, potentially saving trucking from higher fuel costs but paving way for early election

Brad Gardner | December 2, 2009

The Rudd Government’s proposed emissions trading scheme has been voted down in the Senate, potentially saving trucking operators from higher fuel costs but paving the way for an early election.

Despite Liberal senators Judith Troeth and Sue Boyce crossing the floor to vote with the Government on the Carbon Pollution Reduction Scheme (CPRS), the Greens and the two independents sided with the rest of the Coalition.

The Senate’s decision means the Government now has a double dissolution trigger because the same bill has been defeated twice.

However, Deputy Prime Minister Julia Gillard says the Government will re-introduce the CPRS Bill during the first parliamentary sitting week next year to try and get emissions trading passed.

If accepted, the CPRS would require fuel manufacturers from 2011 to buy permits to pollute and then pass on costs to consumers.

However, the Government committed to cutting the fuel excise by one cent for every cent increase in fuel prices from a CPRS for one year to give the industry time to adjust.

But Opposition spokesman on transport Warren Truss has vowed to continue to fight against its introduction.

He has accused the Government of being “high-taxing extremists” and the CPRS being part of Prime Minister Kevin Rudd’s addiction “to high taxing schemes”.

Truss also dared the Government to call an early election.

“If the Rudd Government wants to fight an early election on this issue and try to breathe life into this dead dog of a scheme, then the Nationals stand ready to fight,” he says.

The Government wanted the scheme passed before climate change negotiations later this month in Copenhagen which aim to reach an international agreement to reduce greenhouse gas emissions.

Under the CPRS, the Government would commit to cutting emissions by 5 percent below 2000 levels by 2020 if a global agreement was not reached.

The Australian Trucking Association (ATA) supported the scheme by saying while there would be an increase in fuel prices the CPRS was in the best interests of the industry.

“The scheme would eventually cost the trucking industry and its customers billions of dollars a year, but it would be much better than the alternative,” ATA Chairman Trevor Martyn has previously said.

“Without a national scheme, there would be a policy vacuum on climate change. The states, territories and local governments could be expected to fill the void with a patchwork of inconsistent regulations.”

Following the defeat of the CPRS, the Greens wrote to Rudd to ask his government to negotiate with them.

The Green’s do not want any assistance given to the transport sector to help it move to a low carbon economy.

“The scheme’s impact on transport fuel should not be shielded through equivalent reductions in fuel excise,” the Greens say.

The Government last week made amendments to the CPRS to gain the Opposition’s support.

Assistance for the coal industry would have been doubled from $750 million to $1.5 billion over five years, while the electricity sector would receive an increase in the number of permits from $3.3 billion to $7.3 billion.

The Government’s White Paper on the CPRS says transport must be included in an emissions trading scheme because it contributes 14 percent of the country’s emissions, with road transport responsible for 90 percent of that figure.

The paper argues that increases to fuel prices will encourage the development of new cleaner technologies and force fuel users to reduce their demand on the resource.

The United Nations Intergovernmental Panel on Climate Change (IPCC) says the 11 of the last 12 years from 1995 to 2006 were the warmest on record, with its Climate Change 2007: The Physical Science Basis report saying “warming of the climate system is unequivocal”.

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