Emissions trading:Explaining the costs

Sometimes the best explanations come from the most unexpected sources.

That happened in Federal parliament, when Malcolm Turnbull explained the proposed Emissions Trading scheme.

The proposed scheme is complex – and even the Federal government, which is sponsoring it admits it is having trouble explaining it.

The Former Opposition Leader, though, displayed his forensic skills brilliantly,
when he compared the proposed ETS – with the rival plan, that his successor, Tony Abbott, is offering.

Mr Turnbull’s speech is displayed in full on the ABC’s website www.abc.net.au, in The Drum section.

It’s a good read,  especially for those who  are still confused over what should be done about climate change.

Mr Turnbull says, for example, the government’s scheme, as amended, is now very similar to the one John Howard proposed, shortly before his government was defeated.

Surprisingly, perhaps, Turnbull also concludes that the ETS will be cheaper, in the years ahead, than Tony Abbott’s alternative.

He says the best policy, to cut carbon emissions, must have a price signal.

Mr Turnbull declared his belief “as a Liberal” that market forces would deliver “the lowest cost” and “most effective” outcomes.

He warned, too,  that alternatives, which rely on direct regulation and subsidies “would be more costly to the economy.”

Mr Turnbull quoted from a letter, that he had received from a senior public servant, to emphasise that point.

It said:”While I worked in government for a significant part of my life, I am horrified by the prospect of a ‘fund’ from which public servants give handouts to grow trees.

“It just does not work.”

Summing up, Mr Turnbull said:”This legislation is the only policy which can credibly enable us to meet our commitment to a 5 per cent cut in emissions by 2020.”

He said the proposed ETS would also have the flexibility to enable Australia to move to bigger cuts, when they are warranted.