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Australia Australia's Prime Minister Tony Abbott speaks during a session at the annual meeting of the World Economic Forum (WEF) in Davos Jan. 23, 2014. (REUTERS/Ruben Sprich)  

Australia’s carbon tax costs $7 billion, only yields 0.3 percent CO2 reduction

U.S. policymakers often tout a carbon tax, but a quick look at the land down under shows that it can be burdensome and do little to fight global warming.

Australia’s carbon tax cost $7 billion (in Aussie dollars) over 15 months, but only reduced carbon dioxide emissions by 0.3 percent. The cost of the country’s carbon tax comes out to about $300 per person.

The Australian newspaper obtained government figures that show the carbon tax has done little to fight global warming, while burdening the Aussie economy. The country’s conservative government derided the figures.

“What’s driving this very slight reduction is a fall in demand for electricity due to a decline in manufacturing, the Renewable Energy Target and reduced economy activity,” said Federal Environment Minister Greg Hunt.

Hunt reiterated that the government is still committed to reducing carbon emissions by five percent by 2020, but taxing carbon was not the way to do it.

“The Carbon Tax won’t achieve this,” he said. “The Carbon tax does not work — plain and simple.”

Australia’s carbon tax was put into place by the left-leaning Labor government in the summer of 2012. It has been widely unpopular, especially among industry, because of how it raised energy costs for households and businesses.

The conservative Liberal-National coalition was able to beat the Labor Party in last year’s election, partly because of their promise to repeal the carbon tax.

“The carbon tax is bad for the economy and it doesn’t do any good for the environment,” Prime Minister Tony Abbott told The Washington Post. “Despite a carbon tax of $37 a ton by 2020, Australia’s domestic emissions were going up, not down. The carbon tax was basically socialism masquerading as environmentalism, and that’s why it’s going to get abolished.”

Labor and Green Party officials, however, still defend the tax, arguing its necessary to fight global warming — which some scientists say is exacerbated by burning fossil fuels.

“Significant decreases in the electricity sector emissions have been neutralised by increasing fugitive emissions because of the Abbott government’s open slather rush to support the dangerous coal seam gas industry and coal mines,” said Greens leader, Sen. Christine Milne.

“Reducing free permits and ending fossil fuel subsidies to coal and gas would help to drive down emissions but the Abbott government is keen to maintain the culture of entitlement in those industries,” Milne added.

Indeed, emissions in the power sector fell 5.5 percent in the first 15 months since the tax was implemented. But the carbon tax had little to do with these reductions, according the government figures.

“The Environment Department said the lower electricity emissions were driven by lower demand and changes in the generation mix,” reports the Australian.

“The figures show that overall emissions of greenhouse gas are largely unchanged since 2010,” the newspaper continued. “While emissions from electricity generation fell, emissions from stationary energy such as on-site power generation from industrial plants rose 1.7 per cent, emissions from transport rose 2 per cent and so-called fugitive emissions from mining activities rose 8.3 per cent.”

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