An economical truth (from the Australia Institute)

The solar panel rebate announced by Peter Garrett this week sounded like just the news we need after the weak five per cent emission reduction targets were revealed in the White Paper. Finally, it seemed that the Government was doing something serious to reduce emissions. No such luck.

Minister Garrett chose his words very carefully when he explained the benefits of this new scheme. It would be a boost to the solar industry. True. It was great for families who wanted to put solar panels on their roofs. True. The removal of the means testing meant more families would be able to access the rebate. True.

But what is missing from the Minister’s statements is any mention about Australia’s total greenhouse gas emissions. The silence on this issue is no slip-up—it is part of an elaborate strategy to try and ensure that the public continues to ‘do their bit’ in their homes without revealing the awful truth behind the Rudd Government’s emissions trading scheme. After 2010, nothing households do to reduce their use of f ossil fuels will reduce Australia’s emissions by one kilogram.

The Rudd Government’s proposed emissions trading scheme, now known as the Carbon Pollution Reduction Scheme (CPRS), will work like this. The government will issue a fixed number of permits to pollute, with the number of the permits ensuring Australia’s emissions will fall by five per cent by 2020. Once these permits are given away (a small number will be sold) to polluters, the polluters can buy and sell them among themselves.

The problem for households keen to ‘do their bit’ to reduce climate change is that if they have shorter showers or put solar panels on their roofs, all they will do is reduce their personal demand for electricity. If less coal is burned to provide households with electricity, the coal-fired power stations won’t need as many permits and they can then sell their ‘spare’ permits to the aluminum or steel industries so that these polluters can INCREASE their emissions.

The real sting in the tail is that the less energy households use, the cheaper the permits bought by the big polluters will be.

Hopefully the Senate will modify the CPRS so that individuals who reduce their energy use can ensure that any ‘spare’ permits get ripped up, thereby reducing Australia’s total emissions. But in the meantime, if Peter Garrett’s announcement has made you think about installing some solar panels, it might be best to call his office first. The question you need to ask is a simple one: ‘Will installing solar panels on my roof reduce Australia’s emissions?’

Feel free to let us know if he answers.

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