The author is right that under the CPRS voluntary actions may not contribute to reductions in emissions, but this is not in itself sufficient reason to abandon CPRS.

Even if households do not reduce their electricity consumption by much if prices rise, this doesn’t mean that total emissions won’t decrease by much if prices rise. The whole point of CPRS is that the emissions reduction is fixed, but the market sorts out at what price and through what activities the cuts are made. If household energy use falls by less than the target, then emissions from some other activity are going to have to fall by more. So what?

Anyway, the Government is not relying solely on CPRS to achieve its emissions reductions. For better or worse, it also has mandatory renewables targets, building regulations, subsidies for research and a raft of other additional policies.

Changing household behaviour directly is not the most important way of achieving lower emissions. Higher prices will cascade through the production chain making emissions-intensive products less competitive. The shopper does not need to consciously choose the product with less emission-intensive packaging; the producer will have made that decision already.

The problem in relying on voluntarism and appeals to virtue is that people choose actions which give a warm inner glow and make a statement about their values but don’t actually cut emissions much, or do so at an unnecessarily high cost - like installing PV panels and driving a Prius. Under CPRS these actions will make even less sense, but to my mind that’s a good thing.

The issue of voluntarism has some political traction. The government may try to address it through measures such as ensuring that energy utilities offering voluntary “green energy” are required to buy emissions permits equivalent to what is needed to supply an equivalent amount of “brown energy”. Failing that, I suggest that people who want cut national emissions beyond the CPRS targets buy emissions permits directly, as this will mean that there are fewer entitlements left for the rest of us

A casual link of carbon reduction within communities can be included within CPRS accounting through the following mechanism:

Carbon pollution permits or carbon offsets are allowed to be voluntarily surrendered by individuals through the Australian Carbon Trust.
However for community and household carbon reductions to be accounted for I think stronger governance than the Australian Carbon Trust offers will be needed.

Subject to the hypothesis that CO2 is a pollutant.