Australia’s carbon tax legislation, expected to pass tomorrow, will benefit Mexico and other developing countries.
The tax would affect the country’s 500 biggest polluters starting in July 2012 ($25 per ton), and it would be followed by a carbon trading program in 2015, when polluters could buy carbon offsets from projects overseas.
Australian company, Cool nrg International, is preparing to distribute 45 million energy efficient lightbulbs supplied by Philips Electronics to 6.5 million low-income households in Mexico City, reports Reuters.
Cool nrg plans to roll the bulbs into credits to sell to Australian polluters and Mexico will earn a royalty to help the country reduce emissions.
The project is expected to save 33,000 gigawatt hours of energy, about a third of Mexico City’s auto emissions.
"Governments in the emerging markets who are putting in place their own low-carbon technology strategies can do so while receiving some financial benefit," Abyd Karmali, Merrill Lynch’s global head of carbon markets, told Reuters.
Under Australia’s carbon pricing legislation, companies could meet 50% of their carbon reduction targets by paying for offsets.
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The noble leadership of our friends in Australia is genuinely inspiring. They’ve done a historic thing in bringing this legislation through their legislature and getting it signed.
One thing that remains disturbing however is the loose and unconnected way that many carbon offsets work. How many of these 45million lightbulbs will roll off a kitchen counter? How many will get smashed by a toddler’s soccer ball? This kind of indirect connection creates a real loophole in most consumption/sequestration-side offset schemes. It further disconnects the economic drivers that can fuel public support for a politically risky program. Hard working, low income people SHOULD be given this kind of support, but they should be given it because it helps take them out of poverty. Money spent on offsets should be funneled toward projects connected to the actual usage they are offsetting. By way of example, here at Global Power Solutions we’re building a program called GreenSource that will connect the carbon footprint of individual consumer purchases to the real world arboreal sequestration of the embodied carbon of an item and offset the future lifecycle of an energy consuming device by installing renewable power to match the demand required.
This is a good example of how to the process should work, with clear well defined front and back end accounting, consumer choices driving action instead of industry seeking out a means to cheat a tax penalty, and with transparency that links all parties to all outcomes.
It’s very difficult to imagine all the possible permutations of this lightbulb scheme being properly accounted for in the calculations… but thank God Australia is trying. That’s a lot more than can be said for anybody else.