Carbon Emissions Exchange

The Kyoto Protocol and subsequent international dialogue related to climate change have arisen in response to mounting concerns regarding carbon and green house gas emissions around the globe, and the impact of these emissions on the worlds climate. There is general agreement in the scientific and political arenas that unless carbon and green house gas emissions are contained and reduced, the impact of climate change and global warming on the planet could be disastrous.

 

The Australian Federal Government has committed to the Kyoto Protocol, and had indicated its intention to implement some form of carbon emissions trading scheme based on a cap and trade rational to commence 2013. The legislative framework for the ETS (Emissions Trading Scheme) was to be based around the National Greenhouse and Energy Reporting Act, and the proposed Carbon Pollution Reduction Scheme Bill.

This legislation was defeated in the last parliament however with the re-election of the labour government a Carbon Tax is back on the agenda. The Government has recently announced that a carbon tax of $23/tonne will apply to  500 major emittors  from 1st July 2012, with the carbon tax to convert to a emissions trading scheme from 1st July 2014. We expect the result going forward will be trading of carbon offsets as part of a strategy whereby  organisations endevour to reduce their emissions and tax liability.

The governments stated policy  has been to set initial emission reduction targets to apply by 2020 of -5% with higher reduction targets subject to developments off shore.  Legislative framework is structured to  encourage reductions in CO2 emissions by providing incentives to cut emissions  through imposition of the Carbon Tax.

New policy is  formulated, around  the Carbon Tax Bills which were passed by the House of Representatives on the 12 October 2011.The stated objective of the new legislation is to help Australia meet it obligations under the United Nations Convention  on Climate Change and the Kyoto protocol, and to move the Australian economy to a more sustainable basis.The new legislation is expected to create significant challanges for industry generally and the major emitters in particular.  We expect the trading of carbon offsets to provide important breathing space as industry and commerce work towards reducing their carbon footprint.

 The majority of the state governments are already implementing emission reductions strategies and related legislation to deal with the emissions issue. In fact NSW established the first mandatory carbon trading scheme for its power industry in 1998, and was the first government in the world to establish and define carbon rights as a separately trade-able commodity in the same year with their  GGAS  scheme. The Greenhouse Gas Abatement Scheme aims to reduce greenhouse gas emissions associated with the production and use of electricity. GGAS has established annual statewide greenhouse reduction targets which requires electricity providers to meet mandatory benchmarks for reductions in CO2 emissions .  The national based Carbon Tax will cast a much broader net.

Carbon Emissions Exchange is positioned to assist those organisations looking to manage this issue in the most efficient way. We expect  the trading of carbon offsets to be an important part of a comprehensive strategy to be adopted by organisations as they deal with this issue.