Isra-Mart srl : Carbon tax may cost households $608

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HOUSEHOLDS could be forced to find an extra $608 a year for electricity, gas and food if Labor's carbon tax starts in 2012 with a $30-a-tonne price, new Treasury modelling reveals.

Electricity bills will jump $4.10 a week, or 15 per cent, gas will rise $2.10 a week, or 12 per cent, and food will cost $1.20 a week more, a less than one per cent increase.

The overall impact totals $11.70 a week, or $608 a year.

The government has repeatedly insisted households will be compensated for cost-of-living increases.

The "preliminary" figures, contained in a Treasury minute released today under freedom of information laws, assume a mid-2012 start date.

They also assume a fuel-tax concession.

Without the fuel-tex concession the total would be $16.60, or $863 a year.

The federal government's climate change adviser Ross Garnaut wants petrol included in the carbon tax but any price rise offset by a one-off cut to the fuel excise.

Treasurer Wayne Swan and Climate Change Minister Greg Hunt said the figures were created to promote discussion within the government.

"No final decisions on the starting price or assistance have been taken and therefore it is far too early to speculate on any potential price impacts," the pair said in a statement.

"Until the final design and modelling have been settled, anyone who uses these figures to scare families about prices is engaging in a dishonest, misleading scare campaign."

Professor Garnaut came under fire from a government frontbencher today for another of his findings.

This week the economist suggested "exceptional" power bill rises over recent months were largely due to an overinvestment in poles and wires.

In response, Energy Minister Martin Ferguson has told an industry forum that Prof Garnaut "does not speak for the government" and energy ministers preferred to work "away from the spotlight of the daily media cycle".

Prof Garnaut caused a storm by arguing that distribution companies were effectively price-gouging consumers by gold-plating infrastructure.

He said the impact of a carbon tax would be small by comparison and called for an independent review of the regulatory regime.

Industry was quick to hit back and now Mr Ferguson has joined them.

"The regulatory framework for Australia's energy sector is leading-edge," the energy minister said in Melbourne, adding it was often reviewed to ensure it delivered optimal outcomes for the community.

"It is not in the public interest to trivialise these matters in a high-level public debate over the network regulatory regime."

Mr Ferguson said prices had jumped by about 40 per cent in the past three years and were forecast to increase by a further 30 per cent by mid-2013.

But there was no "quick-fix", he said.

"Trying to suppress prices ultimately leads to pain in the future," Mr Ferguson said.

"Prices reflect the cost of investment to maintain and replace ageing assets to ensure the community gets the reliability it has come to expect."

Mr Ferguson's intervention came as the general council of the Australian Chamber of Commerce and Industry (ACCI) voted to continue fighting the Gillard government's proposed carbon tax.

The council passed a resolution that ACCI "remains opposed to a unilateral carbon tax in the absence of similar policy action by major emitting nations and Australia's export competitors".

Other individuals opposed to a carbon price are expected to gather in Sydney on Saturday.

The organisers of the "no carbon tax" rally in Hyde Park say "thousands" of residents will deliver a clear message to Canberra that they can't afford "this great new tax".

They'll be joined by the movement's spearhead, Sydney broadcaster Chris Smith, and federal coalition MPs and senators.

Climate Change Minister Greg Combet today used new analysis to lampoon the opposition's "direct action" approach to reducing emissions.

Scientists from the CSIRO and the Wentworth Group told ABC TV on Thursday night that opposition climate action spokesman Greg Hunt was wrong to suggest 150 million tonnes of carbon dioxide could be abated each year in just 100 square kilometres of land.

"Mr Hunt originally claimed that only 10,000 hectares of land would be needed to deliver 150 million tonnes of abatement per year, however CSIRO research indicates 500 million hectares could be needed," Mr Combet said.