Australia cannot complain about the effects of high global CO2 unless we get our own house in order. The US may be feeling the same this week with Washington DC recording 40C for the first time. Actions by Australia and others may cause a bandwagon effect with a bloc of countries able to control world carbon flows. Let's give it a chance.

The oil production plateau has been extended by fracking, tar sands, the revival of Iraq and other factors and may last another 1-5 years. Then it's downhill all the way unless we can adapt. It is a mystery why the oil price is half that of 2008 when the fundamentals are the same or perhaps a bit worse. That alone supports a case for artificially increasing the price such as via carbon tax.

Good article Tom.

You wrote:

<< The concept of an Emissions Trading Scheme (ETS) has two core aims: firstly, the reduction of carbon emissions with the intention of retarding global warming. and secondly, to shift our economy away from reliance on fossil fuels. This second aim, arguably far more compelling, has been neglected in the national discussion. >>

Yes, absolutely!

I’ve been saying this over and over on OLO for a long time now.

This second aim has indeed been badly neglected. I don’t understand why Gillard has basically avoided it. It is enormously important, much more so than climate change, given Australia’s tiny part in global emissions. Peak oil is of huge concern and is much more tangible to the ordinary person.

<< It is hard for politicians and the media to look beyond the Carbon Tax to the Emissions Trading Scheme that will replace it in a couple of years. It seems even harder to remember that its true focus is on an inevitable energy crisis still decades away, but that needs our attention now. >>

I don’t think we can assume that the energy crisis is decades away. It could be very close indeed. It won’t take actual shortages of supply to trigger it, it will be the rising price of oil that hits us first.

Important article thanks Tom though I agree with Taswegian and Ludwig that the crisis will likely hit much earlier than in a few decades. There are a lot of variables so it's hard to predict exactly when it will hit. These include: the EROEI (net energy) of producing unconventional oil; to what extent US shale oil and gas will extend the plateau; whether a high price will set off another GFC; whether a low price will stop production of declining wells in Saudi Arabia and elsewhere; whether an environmental disaster from unconventional wells will tighten up regulations so much as to make production unviable; etc etc.

Whatever, we do need to think as much about energy supply as we do about carbon pollution, and their interrelationship.

Excellent article - common sense and reality at last.

“The concept of an Emissions Trading Scheme (ETS) has two core aims: firstly, the reduction of carbon emissions with the intention of retarding global warming. and secondly, to shift our economy away from reliance on fossil fuels. This second aim, arguably far more compelling, has been neglected in the national discussion.”

That statement is nonsense. Hyperbole. The ETS and ‘Carbon’ taxes have never been about peak oil. Saying that is trying to change the goal posts now that the world has gone cool on AGW being a catastrophic or dangerous threat.

In 1992 the Australian Government committed to the ‘Toronto Targets’. We committed to cut CO2 emissions to 20% below 1988 levels by 2005. Global warming, not peak oil, was the justification two decades ago. ABARE Research Report 93.5 “Tradeable Emissions Permit Scheme” was entirely about the threat of global warming as were the many studies and reports by the various government departments: Department of Primary Industries and Energy, Industry Commission, Energy Research and Development Corporation, etc. And it has been ever since including in the Howard Government decade, e.g. the Peter Shergold “Report of the Task Group on Emissions Trading” and the Ziggy Switkowski “Uranium Mining, Processing and Nuclear Energy Report”.

The cost-benefit analyses by Stern, Tol, Nordhaus and others are all about the costs and benefits of avoiding AGW. They are not about reducing reliance on fossil fuels.

If we want to deal with transition away from fossil fuels, we would not dream of using a GHG emissions trading scheme, let alone one where twenty two of the twenty four GHG emissions – the Kyoto gasses – do not come from fossil fuels. If we believed it was wise to have government intervention get us off fossil fuels, we’d tackle that directly, not by putting a price on twenty-four greenhouse gasses.

Trying to raise peak oil and energy security now seems like a desperate last ditch attempt to find a new justification for the CO2 tax.

Peter Lang
A somewhat confused post of yours, perhaps. The issue of taxing carbon as a means of dealing with future oil and other fossil fuel shortages has indeed been ignored by the Government. Taxing carbon is an incentive for people to switch to alternative energy and to make a change in behaviour, that is, make the transition to a new economy.