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Kyoto protocol to push up Australian power prices.



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7 October 2004

KYOTO PROTOCOL TO PUSH UP AUSTRALIAN POWER PRICES

Australian electricity prices would most likely be 50 per cent higher by 2015 if Australia ratifies the Kyoto Protocol, according to a report released by the Australian Bureau of Agriculture and Resource Economics (ABARE).

Federal Industry Minister, Ian Macfarlane, warned against the Labor policy of ratifying the Protocol saying both electricity and petrol prices would be pushed up by the European-based scheme.

“Just as we’re about to deliver better access to electricity and gas through reform of the national energy market, here’s a Labor plan to make all Australians pay for what is a scheme designed by Europe, to benefit Europe.”

“By ratifying the Kyoto Protocol, a Labor government would introduce a carbon tax on all Australians. Labor’s own research shows this would cost Australia more than 15,000 jobs and immediately push up electricity prices by 27 per cent,” he said.

The ABARE Outlook 2002 report on Climate Change found that if Australia were to ratify the protocol, Australian electricity prices could be up to 50 per cent higher - or around AUS 6 cents a kilowatt hour higher - than they would be otherwise by 2015.

According to an International Energy Agency 2002 report, Australia has one of the world’s cheapest electricity prices at US 3.6 cents a kilowatt hour. That compares with Canada on 3.9 US cents, America on 4.7 cents and the UK on 5.4 cents.

“Our relatively cheap electricity prices make Australia one of the Asia-Pacific’s most cost-competitive places to do business. The Kyoto Protocol will trade away that international investment advantage, sacrificing local jobs and economic growth.”

The ABARE report also found that ratification of the protocol would lead to petrol prices in 2015 being around AUS 11.9 cents a litre higher than they would otherwise have been (in 2002 terms).

“On top of that, Labor will overhaul the Trade Practices Act to ban petrol shopper dockets. Again life gets more expensive under an experimental Labor government.”

“Economic detail is not the Labor Leader’s strong point but, in this instance, he is going to push up the cost of living for all of us. The Kyoto Protocol is not in Australia’s best interests,” said Mr Macfarlane.

The report can be found at www.abare.gov.au under research and ‘climate change’.