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Australia's emissions fall slightly under carbon price

Source: Reuters - Fri, 13 Dec 2013 03:08 AM
Author: Reuters
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Dec 13 (Reuters) - Australia's greenhouse gas emissions edged down 0.1 percent in the first 12 months after introducing a price on carbon, as a big drop in emissions from electricity generation was offset by growth in almost every other sector, government data showed.

Emissions fell by 300,000 tonnes of carbon dioxide equivalent (CO2e) to 545.9 million tonnes in the 12 months to June 30, according to data released by the Department of the Environment on Friday.

The biggest source of emissions, electricity generation, posted a 6.4 percent drop in CO2e to 181.3 million tonnes, mostly due to falling demand. But apart from waste, emissions rose in all other sectors including mining activities and transport.

The country's newly elected conservative coalition government has vowed to repeal the carbon pricing scheme, which was introduced by the former Labor government.

Coalition Environment Minister Greg Hunt said the small drop in emissions showed the scheme had little effect.

"What we see is that Australia's electricity prices go up, our gas prices go up, our refrigerant costs go up but our emissions barely change under the carbon tax," Hunt told ABC radio this week.

The reporting period covered the first year that some 280 of Australia's biggest emitters were made to pay for the CO2 they released into the atmosphere.

Hugh Saddler, an energy expert with consultancy Pitt & Sherry, said achieving emission cuts required significant technical and investment changes, and would take time.

"These processes are unavoidably gradual, which of course makes it all the more important not to have frequent changes in policy, but to have long-term predictability about relative cost and prices," he told Reuters.

"No one who really understands how the economy responds to changes in relative input costs ... would expect a large instantaneous response from putting a price on emissions."

The conservative government wants to replace the carbon price with a 'Direct Action Plan', which would include a A$2.55 billion ($2.28 bln) fund to buy emission cuts from polluters and a 15,000-strong 'Green Army' to plant trees.

Labor and the Greens currently hold the majority in Australia's Senate and have pledged to block the government's attempts at changing the current policies, but the carbon price is expected to be repealed when a new Senate sits from July next year. (Reporting by Stian Reklev; Editing by Richard Pullin)

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