A former chief economist at BHP has called for the introduction of a carbon price to drive down emissions, arguing that current government policies are not enough to meet Australia's climate targets.
Carbon Price Proposal
Dr. David Williams, who served as BHP's chief economist for over a decade, said a carbon price of $75 per tonne by 2030 would be necessary to encourage businesses to invest in low-emissions technologies. He made the remarks at a climate policy forum in Sydney on Thursday.
According to Williams, Australia's current mix of subsidies and regulations has failed to deliver the necessary emissions reductions. He pointed to the success of carbon pricing in other jurisdictions, such as the European Union, where emissions have fallen significantly since the introduction of the Emissions Trading System.
Emissions Reduction Targets
Australia has committed to reducing greenhouse gas emissions by 43% below 2005 levels by 2030, but current projections suggest the country is not on track to meet this target. The Climate Change Authority recently warned that additional policies are needed to bridge the gap.
Williams emphasized that a carbon price would provide a clear economic signal for companies to decarbonize. "Without a price on carbon, we are relying on voluntary action and piecemeal regulation, which history shows is not enough," he said.
Industry and Political Reactions
The proposal has drawn mixed reactions. Some industry groups argue that a carbon price would increase costs for businesses and households, while environmental groups have welcomed the call. The federal government has ruled out a carbon tax, but is considering other mechanisms such as an emissions trading scheme.
BHP itself has set a target to achieve net-zero emissions by 2050 and has invested in carbon capture and storage projects. However, the company has not endorsed a specific carbon price.
Economic Impact
Williams acknowledged that a carbon price would have economic implications, but argued that the cost of inaction would be far greater. He cited research showing that climate change could reduce Australia's GDP by up to 6% by 2100 if left unchecked.
"The transition to a low-carbon economy will create new industries and jobs, but we need the right policy framework to make it happen," he said.
