Statement from BCA President Greig Gailey on the Release of the Frontier Economics Report on the CPRS
A 10 per cent unconditional reduction of carbon emissions by 2020, as modelled by Frontier Economics, would impose high costs on the Australian economy. This translates into a 30 per cent reduction per capita over the next eleven years.
Such a target can only be achieved in two ways – by placing extremely difficult demands on industry and households to reduce emissions, or substantially increasing the number of permits that must be bought overseas by government and business.
The first approach will require a substantial economic restructure. This will put at risk Australia’s trade advantages by pursuing measures more aggressive than those proposed by other developed nations.
The second approach will bring with it a substantial cost that will impact on business operations and particularly government revenues.
The research and analysis undertaken by Frontier Economics does highlight the complexity of addressing the outstanding concerns of business in the design of the Carbon Pollution Reduction Scheme (CPRS).
It underlines the problems facing the electricity sector, coal and emissions-intensive, trade-exposed industries.
As we reach the critical stage of considering the CPRS legislation, it is essential that the details of the scheme are right.
Unresolved issues in the current legislation include treatment of electricity generation, the coal industry and a number of matters involving emissions-intensive, trade-exposed industries.
Business again urges the government and Opposition to work together in the national interest to ensure that Australia has a scheme to that is workable, achieves a smooth transition to a low-emissions electricity sector and does not reduce Australia’s competiveness and unfairly put jobs at risk.
With bipartisan support for the right scheme, business will have the confidence to make the necessary investments that are essential for Australia to transition to a low-carbon future.