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The other two Bills, the True-up Shortfall Levy (General) (Carbon Tax Repeal) Bill 2013 and the True-up Shortfall Levy (Excise) (Carbon Tax Repeal) Bill 2013, deal with taxation and levy issues in relation to ending assistance to emissions intensive companies that are liable for a carbon price.
The carbon price mechanism (CPM) is a cap-and-trade emissions trading scheme that began with a three-year fixed price. The Government has said that the 2013 election gave it a mandate to repeal the CPM, which it says has increased costs to business and households, has not reduced greenhouse gas emissions, and is not commensurate with international action. Removing the CPM before a replacement has been finalised creates uncertainty for business and investors, and potentially jeopardises Australia’s ability to meet nationally agreed emissions reduction targets.
Although there was some element of electricity and other price increases with the establishment of the CPM, it is unclear to what extent prices will drop after the repeal.
Should the Bills not be passed before 1 July 2014, the repeal would apply retrospectively to that date. The Opposition proposes moving forward to 1 July 2014 the start date of the full emissions trading scheme. The Government has outlined, but not detailed, a policy with capped annual budgets for purchasing emissions reduction by reverse auction.
In both the True-up Shortfall Levy (General) (Carbon Tax Repeal) Bill 2013 and the True-up Shortfall Levy (Excise) (Carbon Tax Repeal) Bill 2013 the operative provisions (sections 3 to 9) commence at the same time as Schedule 1, Part 4 of the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013. Together, the Clean Energy Legislation (Carbon Tax Repeal) Bill 2013 (the main repeal Bill), the True-up Shortfall Levy (General) (Carbon Tax Repeal) Bill 2013 (the second Bill) and the True-up Shortfall Levy (Excise) (Carbon Tax Repeal) Bill 2013 (the third Bill) dismantle the carbon price mechanism (CPM), with some provisions to recover over-allocations of free emissions permits to emissions-intensive, trade-exposed entities. Schedule 1 repeals the six Acts that legislate a price on carbon and amends 13 related Acts. Schedule 5 amends the funding allocated to the Australian Renewable Energy Agency (ARENA) through the Australian Renewable Energy Agency Act 2011. The CPM is a framework that internalises into the cost of production of certain goods and services, the cost on the economy of greenhouse gas emissions resulting from that production.
Among the 11 Bills, five amend existing legislation to remove the equivalent carbon price imposed on aviation fuels and synthetic greenhouse gases. Apply consequential amendments required by the main repeal Bill to recover the value of over?allocated free emissions permits that provide assistance to energy intensive trade-exposed activities under the CPM. Repeal provisions that apply an equivalent carbon price to aviation fuel and synthetic greenhouse gases.
Apply transitional arrangements for the import of bulk synthetic greenhouse gases between 1 April and 30 June 2014. Repeals personal income tax cuts set to commence on 1 July 2015, and repeals the associated amendments to the low-income tax offset. Abolishes the Climate Change Authority and the Land Sector Carbon & Biodiversity Board.
Before the 2013 election, then Opposition leader Tony Abbott pledged that a Coalition Government would, as its first item of business, repeal the CPM. The 11 Bills, including the three that are the subject of this Digest, have been referred to the Senate Standing Committee on Environment and Communications for inquiry and report by 2 December 2013. At the time of writing, the Senate Standing Committee for the Scrutiny of Bills has not reported on these Bills. At the time of writing, the Parliamentary Joint Committee on Human Rights has not reported on these Bills.
The CPM was a policy implemented by the Labor Government, developed in collaboration with the Australian Greens. The CPM was designed with an initial three-year transition phase, during which the price of carbon is set by legislation rather than the market.
Costings released alongside the proposal claim that it would reduce the cost of living by $7.20 per week on average per household (totalling $380 in the first year), more than half of which would come from lower electricity and gas bills.
Having been a significant and instrumental part of designing and bringing to fruition the CPM, the Australian Greens strongly oppose its repeal.
Senator Madigan of the Democratic Labor Party could have a deciding vote before 1 July 2014. To avoid the perception of a conflict of interest, Clive Palmer abstained from voting on the Bills.[26] Palmer is owner of a resources company that is covered by the CPM. Should the passage of the Bills through the Senate be delayed until after 1 July 2014, the Palmer United Party (PUP) will also have at least two Senators in Parliament. From 1 July 2014, the Senate will also include one member of the Australian Motoring Enthusiast Party, Ricky Muir.
The Government released exposure draft Bills of the repeal legislation on 15 October 2013 and called for submissions by 4 November 2013.
During implementation of the CPM, business and industry were divided on whether they supported a market?based mechanism as the cornerstone of climate policy. Some industry groups seemed resigned to the fact that such an approach, while potentially demanding on business, may be the cheapest way to reduce greenhouse gas emissions. After considering the exposure drafts of the repeal legislation, these groups now seem more unified in their views.

It is not in this nation's broader interest to legislate and repeal and legislate and repeal energy policy.
Retrospective repeal provisions should the legislation not pass before 1 July 2014: The BCA, AiG, BHP Billiton and ESAA are among those that have raised concern that existing legislation would not be repealed before 1 July 2014. Price pass-through and monitoring powers of the ACCC: Almost all industry groups called for clarification on the proposed price monitoring powers of the ACCC.
Flow-on effect to renewable energy certificate (REC) prices: According to some business and industry groups, electricity prices will be affected not just by the repeal of the carbon price but by the increase in costs under the Renewable Energy Target (RET) scheme. Abolition of the price and limit on carbon emissions removes the principal mechanism by which Australia can achieve its target range. Independent research and advisory firm RepuTex, which specialises in carbon risk analytics for global companies and investment professionals, also provided input into the Government’s consultation process.
To minimise this cost, Reputex suggests that the government explore the possibility of transferring allocated permits into any new replacement scheme.
The Australian Council of Trade Unions (ACTU), the Construction, Forestry, Mining and Energy Union (CFMEU) and the Australian Workers’ Union (AWU) accepted the CPM when it was first announced. It is important to note that the estimates relating to the cost of removing the tax incorporate certain assumptions about the level of the carbon price that would have applied in each respective financial year. As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The CPM requires that any facility with greenhouse gases emissions above an annual threshold must surrender emission permits to the government, where one permit represents one tonne of carbon dioxide equivalent (CO2e) [83] emitted. Domestic aviation, shipping and rail transport, and non-transport use of fuels are included through an equivalent carbon price enacted through separate legislation. In Australia, the national cap has been determined from a bipartisan agreement to reduce greenhouse gas emissions by at least 5% on 2000 levels by 2020.
The CPM has a provision for additional assistance to be provided to coal-fired generators under the Energy Security Fund (ESF). From 2015 until 2018, up to 50% of a facility’s liability can be met by importing emissions units from overseas. Under the CFI, farmers and landowners can voluntarily undertake projects to reduce or store greenhouse gas emissions. Laws imposing taxation shall deal only with the imposition of taxation, and any provision therein dealing with any other matter shall be of no effect. Laws imposing taxation, except laws imposing duties of customs or of excise, shall deal with one subject of taxation only; but laws imposing duties of customs shall deal with duties of customs only, and laws imposing duties of excise shall deal with duties of excise only. It is not possible to base an assessment of whether the CE Act is a law with respect to taxation by focusing solely on section 100. In regards to the price for the 2012-2015 fixed price carbon units regime, an argument may be made that it amounts to an imposition of a tax within the meaning of section 55 of the Constitution, rather than representing a type of licence to emit atmospheric carbon. However, Latham’s baseline definition of a tax has been the subject of extensive reflection and clarification by the High Court. Thus, the fact that the object of the CE Act is to, among other things, reduce Australia’s greenhouse gas emissions, give effect to our international obligations in this regard and put a price on greenhouse gas emissions does not mean that the creation of a fixed price on carbon is not a tax. The post-2015 carbon units are tradable instruments purchased at government auction or on the open market at prices determined by the market. Finally, section 307 of the CE Act sets out the alternative Constitutional basis for the legislation. Mary Wilkerson from Indian Rocks Beach explains that she wants to lower her power bills for her beach rentals by generating power from the sun, but Duke is standing in the way.
Tags: Crystal River, Duke, Duke Energy Florida, Florida, money in politics, Pitchfork Protest, Plant Levy, St. Amounts received from the rate rider are used to recover additional and unpredictable energy costs.
Today, a 2.5 per cent rate rider on current rates contributes about $100 million per year to reduce the balance of energy deferral accounts. A separate A“rate riderA” increase of 2% was approved: Rate rider is effective February 1, 2007, to March 31, 2008. The decision also orders an interim increase to BC HydroA’s current rate rider of 2.5 per cent to 5 per cent.
Industry and business tend to support the repeal in principle but are concerned over the detail which leaves high levels of uncertainty. However, Part 1 includes provisions to preserve certain parts of the repealed Acts as a transitional measure, specifically in relation to CPM liabilities in 2013–14. The purpose of these Bills is to repeal the arrangements implemented by the former Government to establish the CPM. One Bill abolishes the Climate Change Authority (CCA) and transfers some of its functions to the Department of the Environment. For example, the registry established under the CPM to record and manage carbon credits is maintained but amended to reduce its function. Whether it is indeed a breach depends on whether the CPM can accurately be described as a carbon tax.

At some point the major parties will need to sit down and agree on a sensible, workable direction for Australia's energy future.
This will introduce additional costs for companies reviewing contracting arrangements, and will create uncertainty for industry. According to the BCA and the AiG, the majority of businesses in the manufacturing, services and construction sectors have been unable to pass through most of their carbon price-related energy cost increases.[48] The implication is that buyers will see minimal price impacts from the repeal. As such, the RET should also be reviewed.[54] In its submission on the exposure drafts, AiG commented that the carbon price repeal will have an upward effect on certificate prices under the RET scheme. To repeal the carbon pricing legislation before developing robust replacement policies and efficient transitional arrangements jeopardises Australia’s 2020 targets, international influence and thereby its national climate interest. The need to utilise this special appropriation is dependent on the timing of the passage of the main repeal Bill. Agriculture, forestry and fishing sectors have no liability under the CPM but may participate through a scheme known as the Carbon Farming Initiative (CFI). It starts on 1 July 2015 when the fixed price for permits moves to a floating price under a cap-and-trade system.
Permits allocated under the program for each year are a specific vintage for that year only. In August 2012 the Australian Government and European Commission announced the intention to link emissions trading schemes (ETSs) from 2015.
This debate may have been sparked by the two-phase roll-out that included a fixed price period. The practical effect of this is that legislation imposing a tax cannot contain provisions which, for instance, also impose penalties.[96] Section 55 of the Constitution requires that laws that impose taxation deal only with taxation.
Indeed, the fact that section 100 deals with the issue of fixed charge units does not detract from whether the CE Act might be construed as a law with respect to taxation or taxes. In Air Caledonie International v Commonwealth,[100] the High Court unanimously decided that the definition provided by then Chief Justice Latham, should not be understood as being an exhaustive definition of a tax. The CE Act operates to create a strong incentive for certain emitters to acquire eligible emissions units even though it does not explicitly prescribe or prohibit conduct. However, they remain instruments that emitters captured by the scheme effectively have no choice but to purchase. Petersburg and Tampa Bay Area residents raised their pitchforks in protest outside Duke Energy Florida’s headquarters in St. We reserve the right to moderate all comments and may exclude any that are spam, abusive, indecent, or off-topic. This phase ends in 2015 when the CPM transitions to a full emissions trading scheme, with links to other carbon markets. This comprised a period during which carbon prices would be fixed (2012 to 2015), and a period during which the carbon price would fluctuate with market forces (from 1 July 2015). One Bill repeals legislated income tax cuts that were part of compensation arrangements upon the implementation of the flexible price period from 1 July 2015. The ACCI added to this, suggesting that the carbon footprint of companies varied significantly as it depended on direct and indirect emissions. A cap-and-trade system is an ETS where there is a national cap on emissions that translates into facility-level caps. Banking and borrowing provisions that apply to other permits do not apply to free permits under the ESF or the JCP. The speeches echoed similar sentiments that Duke is failing its customers time and again by prioritizing shareholder profits at customers’ expense, manipulating the political process via campaign contributions and lobbying, and stifling customer choice, the free market, and positive economic development by blocking opportunities for clean energy deployment.
The opinions expressed by those providing comments do not reflect the official position of SACE. Moneys from the rate rider, to be effective February 1, 2007, will be allocated to paying down BC Hydro deferral accounts. However, to ease the transition for facilities with emissions-intensive and trade-exposed (EITE) activities, a certain number of permits will be distributed for free under the Jobs and Competitiveness Program (JCP) (the JCP also applies in the fixed price period). The CFI has a limited scope of included activities and within those activities only those projects covered by approved methodologies can generate ACCUs.
Also, the unit shortfall charge cannot properly be characterised as a penalty because the liability to pay it does not arise because of a failure to fulfil some pre-existing legal obligation. If, however, its substantive operation gives rise to an obligation to pay a charge that is used for a scheme that has a public purpose, this would arguably make it a law with respect to taxation. Conversely, facilities that emit more than allowed by the cap must buy extra permits from the market. Facilities considered highly emission-intensive, receive enough free permits to cover up to 94.5% of the industry average baseline.
Moderately emission-intensive facilities receive free permits covering up to 66% of the industry average baseline.

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