Can we afford to reduce emissions?
Reducing emissions will not significantly impact the Australian economy
Recent Australian economic reports by the Allen Consulting Group, Deep Cuts in Greenhouse Gas Emissions - Economic, social and environmental impacts for Australia and the CSIRO's Beyond Double Dividend indicate that making deep cuts to our greenhouse gas emissions will have a very small impact on Australia's economic growth.
These reports indicate that Australia's emissions can be reduced by 60% by 2050 while Gross Domestic Product continues to grow at an annual rate of just above 2%.
The cost of reducing emissions is expected to reduce growth by only 0.1% per year.
But delaying action to reduce emissions will hurt the economy
The Allen Consulting Group's report, Deep Cuts in Greenhouse Gas Emissions - Economic, social and environmental impacts for Australia, indicates that delaying action on climate change would be significantly more expensive than acting now.
The report indicates that if we delay action Australia's economic growth would be reduced by 0.3% a year (as opposed to 0.1% a year if we act now).
Failure to reduce emissions at all will result in serious long-term economic costs
Modelling in the Stern Review on the Economics of Climate Change concluded that the cost of climate change impacts would be equivalent to a reduction in global per capita consumption of between 5% and 20%.
The CSIRO reported that the cost of climate change impacts would reduce global Gross Domestic Product by between 4% and 16% . It is essential to act on climate change to avoid serious long-term economic impacts.
The cost of your energy bill will drop as a proportion of household income
Economic research has shown that while energy prices will increase under efforts to reduce climate change, the total cost of energy will represent a smaller proportion of household income, dropping from 7% in 2005 to 6% in 2050 .
It has been estimated that the additional cost of electricity to residential customers would average from $1.20/week in Victoria to $3.60/week in Northern Territory if a price is put on carbon .
However, a recent study also showed that if Australians reduced the amount of energy they used in the home, the increased cost could be as little as $0.43 or less.
The CSIRO report The Heat is On shows that overall household energy will be more affordable in 2050 than they are today.
