Australian climate-change adviser Ross Garnaut says a carbon price of A$26 ($28) a metric ton may raise about A$11.5 billion in the first year if planned laws aimed at curbing emissions are introduced.
Three independent bodies should be established to implement and administer carbon price arrangements, including advising on future targets, Garnaut said in a report released today. Revenue from the scheme should be directed to households, businesses and international aid to tackle climate change, he said.
Prime Minister Julia Gillard wants to set a carbon price starting July 2012 in preparation for a trading system that could begin as early as 2015. Garnaut recommends between A$20 and A$30 a ton, rising 4 percent a year, before moving to a flexible scheme that is internationally linked.
“One distinct advantage of reducing emissions through a market-based carbon price is that it raises considerable revenues,” Garnaut said. “These can be used to buffer the transition to a low-carbon economy.”
A multiparty committee, formed after a request from the Greens party, will recommend a strategy before the government introduces laws to parliament. Climate Change Minister Greg Combet said May 29 on Channel 10 he expects to bridge differences and complete details of a plan for a pollution tax after a weekend of talks with lawmakers.
Australia, the world’s biggest coal exporter, set a target of generating 20 percent of its power from renewable sources such as wind and solar by 2020. The Business Council of Australia last week proposed an introductory price of A$10 a ton.