How much has the carbon tax increased manufacturing energy costs? > Check the facts
Who: “I was speaking to a major manufacturer in NSW the other day… [the energy bill for his NSW plant was] 52 million dollars a year. Of that 52 million, 12 million is the carbon tax….the biggest input cost at the moment which is detracting from manufacturing is the carbon tax” Shadow Treasurer Joe Hockey.
The claim: The carbon tax has greatly increased the cost of energy and is currently the biggest input cost for manufacturing.
The facts: The price impact of the carbon tax claimed by Joe Hockey, $12 million of a $52 million energy bill, is 30 per cent. In a survey of manufacturing businesses undertaken by the Australian Industry Group (AIG) it was reported that manufacturing energy costs had increased on average by 14.5 per cent as a direct result of the introduction of the carbon tax. This is half the amount claimed.
The finding: Since July 2012, when the carbon tax was introduced, energy costs for manufacturing have reportedly increased by an average of 14.5 per cent, half the 30 per cent figure claimed.
Discussion of evidence: It may be true that the manufacturer Joe Hockey spoke with has seen a large increase in energy costs since the carbon tax was introduced. However, it is unlikely that all these costs are a direct consequence of the carbon tax. Electricity prices have been increasing rapidly for the past two decades with an increase of 170 per cent from 1995 to 2012. There have been other factors putting pressure on energy prices since the introduction of the carbon tax. For example, costs associated with poles and wires have had a large impact on prices. When stating the price rises associated with the carbon tax, only costs attributable to the carbon tax should be considered.
Between the Lines Newsletter
The biggest stories and the best analysis from the team at the Australia Institute, delivered to your inbox every fortnight.
You might also like
Here are 23 Times Carbon Offsets Were Found to be Dodgy
Carbon offsetting has received a lot of attention recently. As businesses and governments look to meet their climate targets, many are turning to carbon offsets. That is, they are paying someone else to reduce or avoid putting greenhouse gases into the atmosphere, so they don’t have to.
The carbon con killing koalas
The NSW Labor Government took office promising to create a vast koala sanctuary on the state’s mid-north coast – the Great Koala National Park. Despite the threat of koala extinction in the state, more than a year later the Great Koala National Park is yet to be established.
Carbon Myth Industry | Mark Wootton
Australian agriculture doesn’t have enough capacity to offset its own emissions, according to Mark Wootton from Jigsaw Farms.