Hon Tim Clifford questions the Minister for Environment regarding the economic efficiency of national versus state approaches to climate change mitigation, specifically in relation to emissions trading schemes. The Minister responds by highlighting the economic efficiency of market-based mechanisms and references Productivity Commission reports.

AnsweredQoN 946Legislative Council
Asked
11 October 2018
Portfolio
Environment

QuestionView source ↗

CLIMATE CHANGE — POLICY
946. Hon TIM CLIFFORD to the Minister for Environment:
I refer to the minister's
response to question without notice 921, outlining the efforts taken by the
McGowan government towards addressing climate change, which I wish to clarify.
(1) In what ways
does the McGowan government consider the national approaches to mitigation are
generally more economically efficient?
(2) Could the
minister please outline or table economic modelling that shows the efficiency
of the national scheme over the proposed state ones?

AnswerView source ↗

I thank the
honourable member for some notice of the question.
(1)–(2) Market-based
mechanisms that directly price greenhouse gas emissions, such as a carbon price
or emissions trading scheme, are acknowledged to be the most economically
efficient way of dealing with the market failure associated with global climate
change. Economy-wide, market-based mechanisms, such as emissions trading
schemes, are able to achieve least cost emissions abatement across the Australian
economy. This is by allowing companies with cheaper costs of abatement to
pursue those actions rather than those with higher abatement costs.
These principles are recognised by
the Productivity Commission and were incorporated into the complementarity
principles by the Council of Australian Governments. These were developed as
part of the complementary measures review undertaken by the Gillard government
in 2012 and are available at
www.pc.gov.au/research/supporting/garnaut-emissiontrading/garnaut.pdf. A copy
of the Productivity Commission's submission is provided for tabling. I table
the attached document.
[See paper 2048.]

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