Isra-Mart srl : Carbon price 'fair'

www.isra-mart.com

Isra-Mart srl news:

PUTTING a price on carbon will remove an unfair subsidy that industry has enjoyed for too long, according to Deutsche Bank's head of carbon emissions research, who says it is basic economic theory that companies should meet all costs of doing business.

Deutsche Bank's Mark Lewis, who has spent the past week in Australia meeting political and business leaders, says high emitters in Australia have, so far, dodged the environmental cost of operating.

''What has been established is that emitting carbon dioxide has an external cost on the environment. Until that cost is captured in the goods and services that emit CO2 in their manufacturing processes, then those industries are receiving a subsidy,'' he said.
Advertisement: Story continues below

''There is a cost to their activities that is not being priced into their selling price, when economic theory says that it should be.'' He said the debate was being conducted from a false premise. ''It isn't a great, big, new tax on industry, it is the elimination of a subsidy for big-emitting industries.

''I have heard a lot this week that Australians have a right to cheap energy. But even those in the energy industry are flagging that prices will rise to become more closely aligned with international prices,'' he said. ''The same can be said for coal prices.''

The comments came as the world's largest coal exporter, Xstrata, agreed to sell Australian energy coal to Japan at $US129.80 a tonne, up from spot prices for Australian coal of $US123.20 a tonne and 13 per cent higher than the previous settlement of $US115.