From: Rod McGuirk, Associated Press
Published February 5, 2007 12:00 AM

PM Says Australia Must Put Price on Carbon Emissions

CANBERRA, Australia -- Australia must place a price on carbon emissions to fight climate change, Prime Minister John Howard said Monday in an apparent softening on his refusal to join in global carbon trading.


"Market mechanisms, including carbon pricing will be integral to any long term response to climate change," Howard said in his weekly radio address to the nation.


Howard said a government-appointed task force will this week release a discussion paper on the role Australia can play in a global emissions trading scheme.


Australia, the world's largest exporter of coal, joined the United States is refusing to sign the Kyoto Protocol on reducing greenhouse gas emissions.


Australia is also one of the world's worst greenhouse gas polluters per capita because of its dependence on that fossil fuel to generate electricity.


Australian National University climate change expert Prof. Warwick McKibbin said he preferred a carbon pricing system in Australia to a carbon tax as a means of creating financial incentives to reduce industrial pollution.


A tax would financially penalize polluters for the amount of carbon they emit.


But carbon pricing is usually based on a permit trading system in which polluters can buy and sell credits to emit carbon on an open market and reap financial rewards for using cleaner technology.


"The beauty of that is that it puts all the incentives in the market, it gives all the different energy sources a level playing field ... and the price of carbon which is driving decisions therefore causes a lot of adjustments in the economy to reduce emissions at the lowest possible cost," McKibbin told Australian Broadcasting Corp. radio.


The opposition Labor Party has long called for the government to sign Kyoto and to introduce a carbon trading scheme.


Source: Associated Press


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