Australia’s carbon tax plan takes major step ahead

By James Grubel, Reuters

CANBERRA — Australia’s plan for a national carbon price passed its biggest political hurdle on Wednesday when the lower house of Parliament voted in favor of the scheme — a major victory for beleaguered Prime Minister Julia Gillard.

Gillard, who is staring at electoral defeat according to opinion polls, has staked her minority government’s future on the sweeping economic reform that will impose a carbon tax on around 500 of the country’s biggest polluters from July 2012, before moving to a carbon trade scheme in 2015. “Today is a significant day for Australians and the Australians of the future who want to see a better environment,” Gillard said before the bills passed by 74 votes to 72 in the House of Representatives. Australia, the world’s biggest coal exporting nation, accounts for only around 1.5 percent of global emissions, but is the developed world’s highest per capita polluter due to a reliance on coal for 80 percent of its electricity generation.

The carbon legislation, and a bill for AU$300 million (US$298.7 million) in assistance for the steel industry, must still pass the upper house Senate in a vote due in mid-November, but the government and Green senators have the numbers to ensure the bills will become law. The carbon plan, if passed by the Senate, would see Australia join the European Union and New Zealand with national emissions trading schemes, while the United States and Japan have smaller regional schemes. The government and the Greens hope the carbon tax will reignite momentum for a global emissions reduction agreement at climate talks in Durban, South Africa, in December. Government Celebrates Carbon Vote Government lawmakers applauded when the lower house vote was taken, while Gillard and her ministers hugged each other and waved to supporters. However anti carbon-tax protesters later disrupted Parliament by shouting at the prime minister from the public galleries. Two previous attempts to pass laws for a carbon price failed in 2009, and were partly responsible for the ruling Labor Party’s decision to dump then Prime Minister Kevin Rudd in favor of Gillard in June 2010. The carbon price is the central plank in the government’s plan to cut carbon emissions, blamed for global warming, by 5 percent of 2000 levels by 2020. The conservative opposition, which opinion polls put on track to win an election in two years, said it would dismantle the tax if victorious and replace it with an alternative that did not explicitly price carbon. “We can repeal the tax, we will repeal the tax, we must repeal the tax. This is a pledge in blood. This tax will go,” opposition leader Tony Abbott said.