Australian Clean Energy Future Plan
Australia’s Clean Energy Future Plan is a comprehensive set of national policies aimed at reducing greenhouse gas emissions and driving investments in clean energy. At its core is a carbon pricing mechanism that commenced on 1 July 2012 and covers approximately 60 percent of Australia’s emissions. The mechanism begins with a fixed carbon price for the first three years, then transitions to a cap-and-trade emissions trading scheme. The Clean Energy Future Plan is notable for the complexity of its carbon pricing mechanism, for the breadth and depth of its accompanying complementary policies, and for the extent of the financial and other assistance provided to both industry and households. This short paper summarizes the main elements of the Plan and compares it to emissions trading schemes in other jurisdictions.