Carbon price FAQs

What is the carbon price announced by the Federal Government?

A carbon price is a price that businesses with high emissions pay for producing carbon emissions.

For the first three years, the carbon price will be a fixed charge per tonne of emissions produced – in the first year companies will pay $23 per tonne of emissions they produce.

On 1 July 2013, the charge will increase to $24.15 per tonne. On 1 July 2014 it will be $25.40 per tonne.

From 1 July 2015, the scheme will enter a flexible price period, which means the price of carbon will be set by the market within certain constraints.

Visit the Federal Government’s Clean Energy Future website to find out more about carbon pricing.

What is the Federal Government’s carbon policy?

The Federal Government’s carbon policy includes a carbon price. A carbon price is a price that businesses with high emissions pay for producing carbon emissions. The aim is to encourage carbon intensive businesses to reduce their emissions.

Businesses can reduce their emissions by changing to more carbon-friendly options. These changes may require businesses to invest in upgrading their current facilities.

Tax cuts and increases to pensions, benefits and allowances will also be introduced on 1 July 2012 to help households with the expected price increase. The extent to which these will help households will vary according to individual circumstances.

Visit the Federal Government’s Clean Energy Future website to find out more about the carbon policy framework and objectives.

When did the carbon price take effect?

The carbon price took effect on 1 July 2012.

Why does the carbon price affect the energy industry?

In Australia, 80 percent of electricity used by customers is generated from coal.

Coal-fired generation produces more carbon emissions than other types of electricity generation. As a result, the carbon price will increase the overall cost of generating energy, particularly from coal sources.

Why do so many electricity generators use coal?

Coal-fired generation is a relatively cheap, readily available and reliable way to generate energy, but it also produces higher carbon emissions than other generation options.

Coal will still play an important role in electricity generation but, as an industry and a company, we’ve also been moving to lower emission technology and offer solar power options to customers.

It’s not possible to change the main way we generate electricity straight away. It’s going to require time and money to upgrade and, where necessary, replace existing generation facilities.

What type of energy generation does EnergyAustralia have?

As well as our coal-fired generation facilities, we developed and now operate a gas-fired power station that emits 50-70 percent less greenhouse gases than coal-fired power stations. We’re also involved in wind generation and solar projects.

We’re exploring ways we can generate energy using low-emission technology. We’re also looking to reduce emissions and have already achieved a 370,000-tonne reduction in greenhouse gas emissions at one of our power stations over the past four years.

How will the carbon price affect me?

The introduction of a carbon price will increase production costs. In order to remain profitable, some businesses may increase their prices to accommodate higher production costs.

In Australia, 80 percent of electricity used by customers is generated from coal-fired generators. Coal-fired generation produces more carbon emissions than other types of electricity generation. As a result, the carbon price increases the overall cost of generating energy, particularly from coal sources.

The increased cost of producing energy from coal and other fuels is expected to increase the retail prices customers pay for gas and electricity.

The Australian Government expects the carbon price will increase the average household energy bill between eight to 10 percent in the first year. This is their forecast for carbon only – it doesn’t take into account that future price increases will also include other costs, such as higher network charges.

Tax cuts and increases to pensions, benefits and allowances have also been introduced by the Federal Government to help Australians with the price impacts.

The extent to which this will assist households depends on individual circumstances.

For more, visit the Federal Government’s Clean Energy Future website.

When will my energy rates increase?

We’ll notify you about any increases to your energy prices. See our price information page for details about our new prices as of 1 July 2012.

How much is the carbon price?

For the first three years, the carbon price will be a fixed charge per tonne of emissions produced. In 2012 companies will pay $23 per tonne of emissions they produce.

For the next two years, on 1 July, the charge will increase to $24.15 per tonne and then to $25.40 per tonne. From 1 July 2015, the scheme will enter a flexible price period which means the price of carbon will be set by the market, within certain constraints.

Businesses will independently review how this price affects their production costs. Depending on their assessment, these businesses may increase their prices to make up for higher production costs.

If a business increases their prices, consumers will pay more for that business’ goods or services.

How can I reduce my energy usage?

Explore our range of tips and tools to reduce the amount of energy you use and save money when it comes to using gas and electricity.

Contact us to find out more.