winters of discontent

  1. 6,757 Posts.
    No change to C02 output just higher costs
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    West Australian
    July 13, 2011,
    WA households and businesses will be hit by a $1 billion electricity price bombshell over the next four years, according to Treasury modelling which reveals the full impact of the carbon tax on the State's power industry.

    Household bills next year will rise by $115 over and above the 5 per cent increase already slated by the State Government.

    When the tax per tonne of carbon increases from next year's $23, household power bills will keep rising.

    Treasury officials have forecast that the $24.15 per tonne tax in 2013-14 will push up annual bills by $121 and the $25.40 tax in 2014-15 will add another $127.

    The extra costs of generating power caused by the carbon tax, plus the State Government's planned rises, mean that within three years average WA households will be paying more than $2120 a year for electricity.

    It compares with $1515 this year.

    In advice to the Barnett Government, Treasury noted that the carbon tax would need to be between $60 and $70 a tonne to justify State-owned power companies switching from coal to natural gas.

    "On this basis a carbon tax of $23/tonne CO{-2} will not result in any material change to the operation of coal-fired power stations or abatement of CO{-2}," Treasury stated.

    "With a permit price starting at $23, the combined cost to Verve, Synergy and Horizon Power over the four years . . . will be approximately $1 billion.

    "In the first year of the scheme the cost will be approximately $250 million.

    "The increased electricity costs will need to be passed on to WA households in the form of higher tariffs, however there will be compensation."

    Treasury is yet to model the impact on business customers.

    WA Chamber of Commerce and Industry spokesman David Harrison said the business community believed the carbon tax was "the wrong policy at the wrong time".

    State Opposition Leader Eric Ripper said the extra $1 billion in electricity generating costs was about the same as the amount of money the State Government would rip out of the public power companies through dividends over the same period. The 8 per cent increase in WA electricity prices caused by the tax is below the 10 per cent national average because WA is less reliant on burning a type of dirty coal prevalent in other States.

    The Federal Government will shower $15 billion on pensioners and low and middle-income earners to compensate them for the expected $9.90 increase in weekly living expenses caused by the tax.

    It forecasts that average electricity bills will rise by $3.30 a week next year.

 
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