Australia Passes Historic Carbon Price Laws

Posted November 8th, 2011 at 3:05 am (UTC-5)
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The Australian Senate passed a controversial plan Tuesday that imposes a carbon emissions tax on the nation's biggest polluters.

Cheers erupted in the upper house of parliament as the package of 18 laws was approved by a vote of 36-32, nearly a month after the lower house passed the legislation.

Effective July 1, Australia's 500 biggest polluters will begin paying about $24 for each ton of carbon emissions they produce. The carbon tax will remain in effect until 2015, when a market-based carbon trading scheme will take effect.

Australia is one of world's largest per-capita producers of greenhouse gases, due to its heavy reliance on coal to generate electricity. The new laws are aimed at reducing the country's carbon emissions to 95 percent of year 2000 levels by 2020.

Prime Minister Julia Gillard hailed Tuesday's passage of the Clean Energy Act. Ms. Gillard's push for the legislation has sent her approval ratings to historic lows and could lead to the Labor Party's ouster in elections due by 2013.

Australia's conservative opposition parties strongly opposed the plan, arguing it will cost jobs and increase the cost of living.

Australian business leaders say the $24 per ton tax on carbon emissions is harsh compared to current prices in Europe, which have plunged to between $9 and $13 per ton – the lowest prices in four years.

The new Clean Energy Act will also create an independent government corporation that will generate billions of dollars for investment in clean energy sources.

Tuesday's vote is also expected to have an impact on December's U.N.-backed talks in Durban, South Africa, that will seek to craft a new global climate change treaty.