Climate Change Policy in Australia - Carbon Tax and Direct Action Plan - Case Study Example

Climate change policy Name Subject Professor Date Climate change policy Introduction Climate change is an aspect that has greatly been experienced in different parts of the world. The effects are however felt differently depending on the extent. Climate change can simply be defined as the phenomena of a changing climate that is as a result of human actions or activities. Some of the common observations of climate change include changes in precipitation and temperature as well as a rise in sea level, ocean acidification and extreme weather events. There are various causes of climate change. Some of them include human influences, plate tectonics, volcanism, solar output, orbit variations, life and ocean-atmosphere variability among others. Climate change is associated with a number of negative effects on the environment and the society at large. Greenhouse effect is one of the major effects, which happens naturally as a result of some gases in the air that in one way or the other absorb infrared radiation. Some of the gases involved are methane, water vapour and carbon dioxide (Adger, Barnett, Brown, Marshall and O'brien, 2013, p. 113). For this reason, there have been various intervention and mitigation strategies put in place as a way of dealing with the effects of climate change. This includes policies dedicated for the same. This piece of paper will give an in depth discussion of the concept of climate change in Australia and different aspects associated with it. Nonetheless, much emphasis will be placed on the climate change policies that have been implemented with and aim of curbing the effects of climate change such as greenhouse emissions. In particular, Carbon Tax and Direct Action Plan will be evaluated and the best policy alternative identified. In addition, an alternative policy to Carbon Tax and Direct Action Plan will be identified and discussed. Climate change policy in Australia Impacts of climate change on Australia are real. They include a decline in agricultural production, loss of marine biodiversity, heightened acidity and ocean temperature, extinction of species and decline in international trade. There is also food insecurity, geopolitical instability, infectious illnesses as a result of severe weather, allergens and air pollution among others (Tranter, 2010, p. 414). As a result of adverse effects of climate change in Australia, various interventions have been sought from time to time. For instance, in 2003, the greenhouse gas reduction scheme was introduced by the New South Wales government (Gupta, 2010, p. 648). The Rudd government also tried to implement the carbon pollution reduction scheme in 2008. The idea of carbon tax was brought forth in 2011 by the labour government after which the Emission Reduction Fund replaced it in 2014 (Andre, Kaidonis and Andrew, 2010, p.614). Other efforts to deal with the problems have also been considered with an aim of coming up with an effective solution to effects of climate change. For the sake of this assignment, Tax and Direct Action Plan will be discussed in detail. An alternative policy will also be highlighted. Carbon Tax and Direct Action Plan According to Bulkeley and Betsill (2013, p.137), climate change is an aspect that has been greatly felt in Australia. This is an aspect that has made various stakeholders to feel the need of taking necessary actions towards the same with an aim of safeguarding the environment and making the situation better to not only the current but also the future generations. Some of the plans that have been implemented with an aim of mitigating greenhouse gas emissions and managing the staid environmental challenge of climate change in Australia include Carbon Tax and Direct Action Plan. The fact that both the carbon tax and direct action plan are aimed at achieving similar goals (minimizing emissions), means that the rationale and motivations of the two are also similar. Some of the aspects that are related to rationale for government intervention with regard to climate change include the fact that there is clear evidence that human activities are a lead cause of climate change, which in turn affect the environment and the society at large. According to economic theory, GHG pollution is considered an externality and hence the need for intervention. Potential climate change is also linked to high socio economic costs and as such, there is need to invest in various mitigation and adaptation plans and strategies (Garnaut, 2011, p.56). This brings about the carbon tax policy and eventually the direct action plan after the former failed. The central motivation of implementing the Carbon Tax was to enhance energy efficiency, make use of alternative sources of energy other than coal as well as shift economic activity towards an economy that is low carbon intensive. On the other hand, the principal motivation behind the implementation of Direct Action Plan is to reduce emissions in an effective manner compared to the Carbon tax. This is achieved by offering funding to organizations as a way of incentivising activities for emission reduction. Carbon Tax Carbon tax entails a carbon pricing scheme, which was introduced in 2011 by the labour government. It started as the Clean Energy Act of 2011 and was effected in 2012. The Australian government felt the need to introduce a Carbon Tax in 2012 as a step towards safeguarding the environment. It is a measure that was sought as one of the ways through which the challenges associated with climate change in Australia would be minimized or solved. The main motivation of implementing the Carbon Tax was to enhance energy efficiency, make use of alternative sources of energy other than coal as well as shift economic activity towards an economy that is low carbon intensive (Jotzo, 2012, p.478). It aimed at minimizing the amount of carbon dioxide entry into the atmosphere. The Carbon Tax did not last for long since it was replaced by the Emission Reduction Fund. The short time of existence made it impossible for the regulated institutions to respond positively and formally and there was no much in terms of investment in strategies directed at emissions reductions. The fact that the scheme did not achieve so much with respect to the initial goal is one of the reasons as to why it did not last long (Garnaut, 2011, p.68). Some people also thought that it was exploiting the population through the tax. According to Crowley (2013, p.606), carbon tax is capable of reducing and finally doing away with the use of fossil fuels whose combustion translate to the destruction and destabilizing of the climate. It makes the users of carbon fuels to be responsible by paying for the climate damage that is as a result of emitting carbon dioxide into the atmosphere. In the event that it is set high enough, it acts as a strong monetary disincentive that encourages people to opt for clean energy sources (Robson, 2014, p.36). Direct Action Plan In a bid to effectively deal with the environmental challenge of climate change in Australia, the coalition government came up with a Direct Action Plan. This was meant to replace the Carbon Tax as it was seen as a better alternative when it comes to mitigating greenhouse gas emissions. The main motivation behind the implementation of Direct Action Plan is to reduce emissions in an effective manner compared to the Carbon tax. The direct action plan basically works by offering funding to organizations as a way of incentivising activities for emission reduction. According to AMMA (2014), direct action policy on climate change is an effective approach to minimizing carbon emissions as well as promoting innovation. Also, direct action plan is founded on competitive market mechanism that does not penalise carbon emission but rather incentivises carbon abatement. To a large extent, the scheme helps in driving productivity enhancements as well as initiatives meant for sustainable development. Best policy Based on the above discussion, it is apparent that the two policies had the same goal; mitigating the emissions of greenhouse gas and dealing with the adverse environmental challenge of climate change. The fact that they were implemented differently means that they achieved the goal differently and attained varying success levels. It is not easy to pinpoint one policy over the other since all have some positives as well as negatives. Nonetheless, based on the achievements associated with the two policies, I believe that carbon tax is the best policy. This is more so because it is more effective especially when it comes to driving organizations to act urgently as well as managing emissions. The carbon tax tends to be more effective since it offered companies incentives to act because it heightened the prices of utilities. In turn, this acted as a force that added financial burden for some organizations. The companies were also held liable under the tax (Meng, Siriwardana and McNeill, 2013, p.12). On the other hand, the direct action approach does not offer the same incentives since it is just a compliance measure that has no direct financial burden (Kumarasiri, Jubb and Houghton, 2016). The effectiveness of the carbon tax can be attached to the fact that it not only created financial pressure but also a reputation threat especially for high emitting organizations (Hodgkinson and Johnston, 2015). However, this is not to say that direct action plan is has nothing to offer in terms of managing effects of climate change. Alternative policy Scott and Becken (2010, p. 291) assert that no action plan could be all inclusive. For this reason, there is always a better option that could be sought with an aim of achieving better results. For this case, excise on coal will be discussed as an alternative policy that could be effectively implemented in Australia in place carbon tax and direct action plan. This is an emissions mitigation approach that have been successfully used in China and hence the need to consider it for Australia. Excise on coal policy is based on the fact that coal is one of the dirtiest forms of fuel with regard to carbon emissions as well as general air pollution. From an environmental perspective, coal should therefore be taxed. Coal excise tax is capable of effectively cutting carbon dioxide emissions in Australia since coal accounts for a relatively high percent of emissions in the country (Parry, Shang, Wingender, Vernon and Narasimhan, 2016, p.20). The unique aspect of this policy is that it specializes on coal and not other fossil fuels, an aspect that makes it more effective. Conclusion From the above discussion, it is clear that climate change is a real problem whose effects are negative towards the environment, an aspect that affects both the current as well as the future generations. This has led to various parties such as the government of Australia to come up with various action plans aimed at minimizing the adverse effects of climate change. Some of them include Tax and Direct Action Plan. Both have their benefits as well as limitations with regard to attaining the goal of reducing greenhouse gas emissions. A comparison of these policies could lead to the conclusion that carbon tax is a better policy than direct action policy as its benefits tend to outweigh those of the latter. Another alternative policy that could be used in place of Carbon Tax or Direct Action Plan is excise on coal. Despite the fact that it could have some limitations, the benefits associated with it will go a long way in reducing the greenhouse gas emission and environmental climate change effects in general. Taking advantage of the benefits involved, while at the same time managing the challenges in an effective manner, will yield better results. 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