It now seems to be clear that the tax is just a guess, probably done
by the treasurer;
I want 100 billion, so work out what the tax is.

At Peter's request, I am reposting my comment from Judith Curry's blog:

Hi Peter

In theory, a Regulatory Impact Statement should have been prepared for the legislation, and is publicly available. This is supposed to canvass the costs and benefits and possible alternatives to regulatory proposals in legislation. Having laboured over writing these things in a previous life, if properly done it should be a long and perhaps even informative document.

However, there is a history of RIS requirements not being properly met for controversial legislation, which (I think) the Auditor-General reported on a year or two ago.

I am not sure if RIS’s are online, but they are definitely publicly available. You could ask the Department where to find it, but if they are unhelpful, the relevant staff in Parliament House are usually very good – although Budget week might not be a good time to inquire!

Best wishes – J

Cohenite, thank you for the question. Here are some thoughts:

1. The emissions quantities are presented to eight significant figures. What is the justification for that? What is the error/uncertainty in the figures?
[It is correct to account money to any number of significant figures because they are the sum of transactions that are accurate to cents. However, we do not measure emissions and cannot estimate them accurately. So we need to know what is the accuracy for each of the figures that have been summed to make the totals presented.]

2. If there is say a 20% error in the emissions estimates, is that an indication of the amount contestable and/or open for fraud? If not, why not?

3. What will be the compliance cost for measuring and reporting emissions when the emissions monitoring has the level of precision and accuracy that we demand for trading a commodity?

4. This list is for the top 400-500 emitters. What will be the compliance cost when we extend the system to include all CO2 emitters (which will inevitable be where people will demand we end up)?

5. What will be the compliance cost for small business emitters, like farmers for example?

To Bazz:
How to estimate:

"Estimates of emissions from the combustion of individual fuel types are made by multiplying a (physical) quantity of fuel combusted by a fuel-specific energy content factor and a fuel-specific emission factor. This is performed for each relevant greenhouse gas (in this case, carbon dioxide, methane and nitrous oxide). Separate calculations should be carried out for each fuel type.
Total greenhouse emissions are calculated by summing the emissions of each fuel type and each greenhouse gas"

And to Cohenite, Peter etc:

There are only as you say 400-500 emitters who will be liable for emissions reporting. End of story: the rest of your garble is fable.

SillyFilly,

True, the starting points is 400-500 emitters. That is the start. It is like the ‘honey moon rate’. It is not where we are heading if we continue with CO2 pricing. The reason has been explained in previous comments posted in reply to your comments. You may have missed them or misunderstood them.

You quote: “"Estimates of emissions from the combustion of individual fuel types are made by multiplying a (physical) quantity of fuel combusted by a fuel-specific energy content factor and a fuel-specific emission factor.”

What you fail to acknowledge is that the power stations do not measure the (physical) quantity of fuel used or the fuel-specific energy content factor for the fuel actually used over a time period. Many of the power stations (such as Victoria’s brown coal power stations) do not even have a measurement of the mass (or weight) of fuel used.

If you think I am wrong, then please point me to a link where I can see the mass (or weight) of coal burnt in Hazelwood Unit 1 from 10:00 to 10:15 am on 31 March 2012, or any other generator unit, date and time interval you nominate. If you can’t do so, then please acknowledge we do not have measurement of emissions – we have crude estimates. These will not be good enough for trade, eventually, for the reasons previously explained in replies to your comments.

As an aside, the fuel quantity used varies according to the efficiency of each unit, how old it is, how long since last refurbished, what power output it is running at and, importantly, whether it is ramping up and down in response to changes in demand and to fill in for intermittent generators like wind and solar.

sillyfilly, good points on emissions reporting, but if the objective is to reduce *actual* emissions, rather than collect taxes from the big-polluters, how do you account for the diabolical problem of real-time measurement?

For example, what happens if a coal-fired baseload generator needs to reduce output for an hour during high wind conditions to balance wind farm output? In effect, all that has happened for the hour is that the coal generator sold less electricity but may have reduced emissions only marginally, yet the wind generation appears, at face value, to have contributed zero-emission electricity. Clearly, applying estimated emission factors is not going to give you the marginal abatement, and therefore not contribute to cost-effective abatement.