Rising Energy Prices Signal Failure for Emissions Trading Schemes (Surprise!)
By Alisha Fowler, Breakthrough Generation Fellow
The Australian Workers Union and business groups are exerting pressure on the Government to more carefully consider the economic consequences of implementing an emissions trading scheme. Public support for an emissions trading scheme in Australia is also waning, and in response the Australian government announced it could delay the introduction of such a plan.
Evidence concerning the failure of market-based approaches to reducing carbon emissions continues to mount... perhaps it's time for a new approach?!
We have been writing about the failures of a market-based approach to reducing carbon emissions for some time now (here, here). We have continually articulated that market-based approaches such as Cap-and-Trade are inherently flawed as the price-centric approach is a political, technological, economic, and ecological loser. Voters, and thus politicians, will never accept raising energy prices high enough to make clean energy cost competitive.
What is happening in Australia is further evidence of this increasingly well-documented failure. Record-breaking gas prices, and waning public concern for greenhouse gas emissions (even in developed countries such as the U.S. and Australia) do not signal success for market-based approaches now, or in the future. How much more evidence do we require, to know that we need to seek alternative policy solutions that will make clean energy cheap, and fast, rather than make dirty energy expensive?
We must shift our approach in order to tackle the energy challenge and global warming head on!