Climate change - Cap and trade

The Case For An international Carbon Tax

With Mark O’Brien

Stories emanated from the 2010 Cancun talks the case for an international carbon tax was finally being talked about seriously. And then, went where?

One of the major flaws with Kyoto accord was that it pegged nations’ allowed greenhouse emissions to that of 1990, and that we should all aim for 10-20% less by 2020. Or something similar.

The Kyoto Agreement is based on very poor logic.

Europe, in particular Germany and France, receives a large amount of electricity from nuclear power stations that were built in the 80s, and so today their emissions are relatively low.

No, this is not an argument in favour of nuclear power as a greenhouse solution, because of the entire life cycle of nuclear power only the years in which power is produced is greenhouse friendly, in the country in which it is used.

Misleading carbon emission figures

For instance, the construction of a nuclear power plant produces emissions equivalent to what a coal fired plant produces over roughly 10 years.

European nuclear power stations were largely built in the 80s, so the emissions they produced then, that Kyoto was based on, were massively inflated.

The mining, processing and transport of uranium over the lifetime of the power plant (187 tonnes of uranium/year/plant) produce roughly half those emissions, yet these emissions are produced not by European countries, but by Africa, by Canada, by Australia and wherever else uranium comes from.

Decommissioning of a nuke plant is estimated to consume as much energy as a plant produces in 10 years (therefore producing equivalent emissions as construction), but that is a guess as because plants take 60-70 years to cool down, nobody has done it, and that is down to track quite some years, where the emissions accounting does not yet reach.

Storage of waste also has its own energy cost/emissions, estimated to be at least the same as construction, but again that is just a guess cause despite the $billions spent on this issue, no solution has been found.

So Europe is very proud of its low emissions society, and points fingers at China, India and miners like Australia, but is much of this not simply clever accounting?

Germany has just announced it is extending the life of 18 nuclear power stations for a further 10 years, because they do not have to pay for the emissions caused to get the uranium from ground to reactor.

Bogus carbon accounting

Europe has lots of solar panels, made in China, lots of windmills made elsewhere, so in effect they have exported their emissions.

For example, if I buy a solar panel, it saves emissions in the country I use it, yet to make it produced emissions equal to what will be saved here over 7 years of solar energy production.

A solar panel is a benefit in the country it gets used in, but the carbon price, currently gets paid by China.

Like most of the Western societies, Europe has shipped all of its manufacturing to China and India which source their raw materials from Australia and other countries, in effect exporting its emissions.

As a mining country 20% of Australia’s emissions are produced shipping raw materials to China, and the percentage of China’s emissions produced by export must be similar or higher.

So how to get around all of this so those who actually benefit from the production of emissions actually pay for it?

Make it work like a GST, in an agreed currency (maybe gold??), so that there is a carbon tax on minerals shipped to China, and additional carbon tax added on for the manufacturing process, then for getting goods to market.

Putting such a carbon tax on fruit grown in South America, especially on its shipping, via sea and then onto trucks, and then factor in highway construction costs (eg 1-2 cents/kg/km) etc, will make food grown locally, in fact most goods produced locally, more profitable and maybe viable.

Bad for traders and good for everyone else. Currently we can buy fruit shipped from China cheaper than it can be grown locally which has meant that most of our local vegies farmers have shut down.

With a carbon tax, then the destruction of land, habitat and waterways to export minerals to China to be returned to us as fridges and $7 camping chairs should cease, and while there would be an increase local land use, this can be more easily regulated than in China.

To me it is unfathomable that stuff like a chair can be made from materials mined here then shipped to China for manufacture, shipped to Australia, sold at the usual 100% mark-up, and we can buy it for the same price as a papaya we get from our farmers markets!

With a carbon tax, then uranium mining and processing goes directly on to the energy/emissions balance sheet making nuclear power simply unviable.

I have written elsewhere about the emissions cost of large resources projects in Australia, where a large natural gas project produces 1.8% of our annual emissions (that number is from the Australian Government’s Dept of Climate Change.).

If there was a GST-like carbon tax, then China would in effect pay a tax on the emissions produced to get the gas, and then pass that on to consumers.

See Business in a post carbon economy on this website, and The Case for a Carbon Tax

In favour of farm subsidies

In Australian cities and country towns, especially near the coast where most people live, land is simply to valuable to farm.

If you own rich food growing land, lets say 1 hectares, and make $50k/yer profit, how can you resist selling it for houses for $1million?

So some mechanism needs to be put in place that supports farmers, small scale farmers especially, to stay on the land.

Yes, there are lots of problems and they need international agreements, and with their financial and UN clout, China may end up being the prime mover here.

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