Over half the money raised from the carbon price is being used to assist households.
Why we need to act
Our climate is changing. The evidence is unequivocal. Climate change won't just damage the natural environment, it also poses risks to our economic prosperity.
Q. Why do we need a carbon price?
Q. Why do we need to reduce carbon pollution?
Australia’s carbon pollution
Australia generates more pollution per person than any developed country, including the United States. We produce significantly more pollution per person than India and China.
Australia’s carbon pollution is high because our electricity is mainly generated by burning coal. Transport, mining, industry, farming and deforestation also contribute.
Our carbon pollution is continuing to grow at a rapid rate. Without action, it is expected to continue to grow by almost 2 per cent a year to 2020.
Reducing our carbon pollution means we have to produce and use energy in a cleaner, smarter way.
Our climate is changing
The CSIRO, the Bureau of Meteorology, and Academies of Science from around the world have all advised that the world is warming and high levels of carbon pollution risk environmental and economic damage.
In Australia and across the globe, 2001 to 2010 was the warmest decade on record. Each decade in Australia since the 1940s has been warmer than the last.
Climate change risks damaging our environment and way of life
Australia faces significant environmental and economic costs in a warmer, more unstable climate. Climate scientists advise that extreme weather events, such as droughts, heatwaves and bushfires, are likely to become more frequent and severe. This threatens our homes, businesses and communities, and vital industries such as agriculture.
Scientists agree that the worst effects of climate change can largely be avoided if we reduce carbon pollution to an acceptable level.
The world is moving to a clean energy future
Countries around the world are already taking action on climate change. 89 countries – representing 80 per cent of global emissions and 90 per cent of the world’s economy – have already pledged to take action on climate change.
Globally, more money is now invested in new renewable power than in conventional high-pollution energy generation. China is now the world’s largest manufacturer of both solar panels and wind turbines.
Acting now is cheaper than acting later
Australia has an opportunity to move to a clean energy future and cut pollution before the task becomes more difficult and costly.
For further information about climate change and what others are doing, see:
Australia’s carbon pricing mechanism will be linked to carbon markets around the world from the start of the flexible price period on 1 July 2015 allowing Australian businesses to access international emissions reduction opportunities.
Flexible-price phase – fiscal implications
Putting a price on carbon is the cheapest and fairest way to cut pollution and build a clean energy future. The carbon pricing mechanism is an emissions trading scheme that commenced with a fixed price for a three-year period before transitioning to a fully flexible cap and trade scheme from 1 July 2015.
Additional action beyond our national targets
Many people are concerned about climate change and want to make their own contribution to protecting our environment. There are a number of ways to make a contribution that complements Australia’s national pollution targets.