Monday, November 27, 2006

Climate change: changing their minds

For the past few years, business leaders and major energy consumers waged a campaign against the government's efforts to put a price on carbon via the carbon tax. In December last year, they got what they asked for, and the carbon tax was dumped. Now, it seems, they've changed their minds: at the Energy Future Forum in Wellington last week, business leaders and the energy sector demanded that the government put a price on carbon, including on agricultural emissions. I guess they figured out that the uncertainty of not having a price on carbon was worse than the pain of internalising that externality. But while its great to see the sudden shift in consensus, it would have been nice if it had happened earlier; that way we might have an effective policy, rather than the weak one we seem to be heading towards.