Green homes may pay for big polluters

• Ben Cubby
• The Age, January 26, 2009
• http://www.theage.com.au/national/green-homes-may-pay-for-big-polluters-20090125-7pgt.html?page=-1

A QUIRK in the Federal Government's proposed carbon trading scheme means household efforts to cut carbon footprints could simply translate into more money in the pockets of heavy polluters, many economists and environment groups believe.

Using less coal-fired electricity at home means power companies will need to buy fewer carbon permits when the scheme starts in 2010, reducing the permit price and allowing other polluters to buy more permits to cover their emissions.

With one in 10 Australian households now paying extra on their electricity bills to support green power, and tens of thousands installing solar panels, there is a growing realisation that voluntary efforts to reduce greenhouse gases may not have the intended effect.

Paying $4000, after rebates, for a rooftop solar panel would still reduce Australia's total carbon dioxide emissions, but it also means householders voluntarily bear costs that industry would otherwise be compelled to take on.

"Unless the Government guarantees that voluntary reductions are additional to Australia's compliance targets, well-meaning consumers will merely be enabling dirty industries to pollute more for free," said Jeff Angel, director of the Total Environment Centre.

If voluntary household energy reductions were not treated separately from industry emissions, people would no longer have a way to participate in adaptation to climate change, Mr Angel said.

"While reducing individual emissions buys a clean conscience for individuals and businesses … understandably most people wouldn't bother," he said.

Voluntary carbon reductions could go a long way towards meeting the Government's current greenhouse target of a 5 per cent cut by 2020, said Chris Dunstan, a senior research consultant at the University of Technology's Institute for Sustainable Futures.

"Given we've got the 5 per cent target, it's entirely possible that voluntary action by households and businesses … could easily provide another 5 per cent cut, in addition to the current target," Mr Dunstan said.

The final shape of the emissions trading scheme is yet to be finalised — legislation will be put forward this year — but the plans contained in the Government's white paper suggest the loophole remains open.

A spokeswoman for Climate Change Minister Penny Wong said that winding back the number of permits so Australia could meet its carbon reduction targets would allow for voluntary household reductions.

"As we made clear in the white paper, the Government will be delivering energy efficiency measures for households prior to the commencement of the scheme in 2010," the spokeswoman said.

"Everyone will be doing their bit … no one gets a free ride. Households will benefit directly from reducing their own carbon pollution through reduced energy bills.

"It should be noted that the number of the permits in the system under the Carbon Pollution Reduction Scheme will reduce over time."