One working week down, sky still above

A closer look into the key points of interest in week one of the carbon tax: What is happening with NZ’s ETS? Will Australia’s floor price remain? Is Gerry Harvey jumping on board? And can the ACCC curb deceptive carbon claims?

One working week after doomsday and as usual the media is still running tripe about the carbon pricing package. Gerry Harvey has realised that the carbon tax will actually be good for retailers like him. And finally some people are being brought to justice for scaremongering by the ACCC (ACT Renewable Energy and Polaris Solar), if only their powers extended to industry associations.

The Herald Sun

The prize this week has to go to the Herald Sun, who on Tuesday ran the following:

Pressure on as NZ turns back on carbon pricing

-         New Zealand has deferred its scheme

-         NZ PM didn’t want to “sacrifice jobs in a weak environment”

-         Opposition push Gillard to drop “job threatening” tax

The indefinite postponement of New Zealand’s Emissions Trading Scheme has added pressure on the Australian Government to dump its two-day-old carbon pricing regime.

Conservative New Zealand Prime Minister John Key announced yesterday his scheme would be deferred because he was "not prepared to sacrifice jobs in a weak international environment" when other countries were moving slowly on climate change measures.

This was all a bit of surprise to me, because as far as I knew New Zealand’s emissions trading scheme far from being deferred, had already been operating for forestry since January 2008, and July 2010 for energy, industry and transport. So I decided to look at the New Zealand government’s own website to learn more about this deferral. On the website it states:

The Government has announced a number of changes to the NZ Emissions Trading Scheme (NZ ETS), to be implemented through legislation to be passed this year. The purpose of the changes is to maintain the costs that the ETS places on the economy at current levels.”

Note that these so-called changes largely aim to “maintain” the cost of the ETS. In fact rather than being changes, they largely involve continuing the scheme as it stands at present. They certainly don’t represent a deferral of emissions trading.

The real story is that the New Zealand government had originally planned on expanding the scheme to cover agriculture and decided against it, which notably neither Australia nor Europe’s emissions trading schemes plan on doing either.

Also, just like Australia has done, New Zealand has decided that those importing goods which contain synthetics refrigerant gases such as refrigerators will not be covered by the ETS but instead pay a carbon levy. And it will expand coverage of the scheme to include those that import or produce the synthetic gases HFC-245fa and HFC-365mfc.

A review of the scheme had suggested that New Zealand consider restricting the use of international carbon credits or CERs, which currently overwhelm NZ relatively small carbon market and dictate the carbon price. The government decided against implementing this recommendation because it would lead to carbon prices rising above current levels.

While it is disappointing that New Zealand has failed to strengthen its scheme to provide a stronger incentive to reduce emissions in their economy; the Herald Sun is either not doing its research, or is absolutely desperate to print anything to undermine the public’s perception of Australia’s carbon pricing scheme.

The saga over the carbon floor price

As usual The Australian had another go at trying to undermine the floor price on carbon. Yesterday, The Australian carried a front page story claiming the government was negotiating to have the carbon floor price dropped as well as the fixed price period. This is in spite of Combet telling The Australian that: “we have a legislated a three-year fixed price period,” and “we are committed to the whole package”.

Also while the government was consulting about the details of the carbon price, “certainly we intend to proceed with what we agreed.”  Also, “Greens sources” told The Australian that suggestions of changes to the floor price were “mixed up, confused and wrong”. So I’m left rather confused – we have direct quotes from the two protagonists involved denying that there was any discussion of dropping the floor price on carbon, yet The Australian decided to lead with the claim that the government had proposed to the Greens that the floor price be dropped.

Now today we have a report from David Wroe at Fairfax stating:

“The Age believes there are no discussions to scrap the floor price but the government is in talks with the Greens on how to tackle the fraught issue of stabilising the price of permits once the carbon tax becomes an emissions trading scheme in 2015.”

Climate Spectator has tried to sort out this confusion through a series of phone calls, and while we think that you can never lock anything in until it’s operational, it appears that you are best to trust the direct quotes from Combet and the Greens rather than The Australian’s interesting spin on the whole story.

Harvey Norman’s Gerry Harvey realises the carbon tax is not so bad after all

Back in April, Climate Spectator pointed out that Australian retailers such as Harvey Norman should have little to fear from the introduction of the carbon price except the misleading fear that Tony Abbott had managed to scare into Australian consumers. At the time we said the only thing to overcome people’s fears was to actually implement the carbon price rather than defer it because only then would they realise the scare campaign was a complete load of rubbish

Well it appears Gerry Harvey may now realise we were right. According to reports in The Australian, in May, as the carbon tax compensation payments started hitting householder’s bank accounts consumers splashed out on household electrical goods, shoes, restaurant meals and books with retail sales rising by 0.9 per cent for the month, leading to the biggest annualised gain for nearly two years.

According to The Australian, Gerry Harvey said his June sales were even better than May’s, stating:

“Most of the government’s compensation payments started in June and have crucially helped lift our sales, especially in furniture, bedding and whitegoods.”

ACCC shines a light on solar companies’ carbon tax scare tactics, but what about the Minerals Council, ACCI and the Housing Industry Association?

One of the things that has constantly annoyed me over the last twelve months has been those incessant ads by solar companies (joined by the since disgraced Energy Watch) trying to scare people into buying solar panels and changing energy suppliers because the “carbon tax man is coming”.

Finally the ACCC has acted, getting both ACT Renewable Energy and Polaris Solar in Western Australia to desist from making misleading claims about the carbon price. These companies claimed that electricity prices would rise by 20 per cent due to the introduction of the carbon price alone, and that if this continued, by 2019 electricity prices would increase by over 400 per cent. According to The Age, they had sourced these claims from advertisements run by anti-carbon tax front group – the Australian Trade and Industry Alliance.

Yet the great tragedy of this is the groups behind this ludicrous scare campaign – the Minerals Council of Australia, the Australian Chamber of Commerce and Industry, the Australian Coal Association, and the Housing Industry Association – will never be brought to justice for the misleading conduct they’ve engaged in over the last two years. As an example, please read a recent article in Climate Spectator that explains that the impact on house construction is a fraction of what the Housing Industry Association had originally been claiming.

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