The price elasticity of household electricity demand is quite low, around -0.1, meaning that a 20% increase in price leads to a 2% reduction in demand. The addition of a carbon price into the cost of electricity is unlikely to have much impact on consumption unless carbon prices were to be very high. You might
A few commentators to my Picking Losers blog earlier in the week quite rightly pointed out the potential for gas-fired CCGT plant to be a sensible baseload replacement for brown coal-fired power. I have looked at the numbers, and agree. Taking the cost of new gas CCGT at around $1million per MW, replacing 6GW of
There’s a notion going around that an Australian carbon tax will raise more tax in its first three months than the EU ETS has generated in six years. Mr Seamus French’s column in The Australian on Monday included this idea. No numbers have been put forward to justify this assertion, and it can’t go unchallenged.
For some time now, there has been bipartisan support for a 5% reduction in emissions from 2000 levels, and Australia has committed this abatement effort under the Cancun agreement. Although it may sound small, a 5% reduction actually represents a very substantial abatement effort. In absence of mitigation policy, emissions under a “business as usual”
When Tony Windsor, MP, said that he would like to see the carbon debate in this country move beyond the words “tax” and the word “lie”, it really struck a chord with me. We seem to be stuck in this Groundhog Day style conversation where each issue is immediately translated into a one line pro