New legislation just passed on Nov 8, 2011 now adds Australia as another one of the big hitters who will charge the Carbon Tax. Their rate will start at A$23/Ton, and will be billed to the top 500 polluters. The carbon tax is set to start in July 2012 and will then move to a trading scheme in July of 2015.
Mexico is one of the first countries set to benefit from royalties generated from the Carbon Credits trading scheme. This would be a world-first deal that could pave a way for under established countries to receive funding for emission cuts, or even generate revenue.
The deal which is headed by an Australian company, Cool NRG International, is set to distribute 45 million energy efficient light bulbs supplied by Philips Electronics to an approx. 6.5 million low-income homes, in and around Mexico City. The project aims to reduce the carbon foot print in the city by about one third of the auto emissions that it produces. This equals out to roughly about 1.6 million tonnes of carbon dioxide each year. Each tonne saved will generate either Certified Emission Reduction (CERs) or Carbon Credits which Cool NRG will sell to many of the top players in the game, aka Polluters. The carbon market in just Australia is set to worth as much as 15 billion dollars by 2015, and set to expand to 25 billion within the first 4 years after that.
CERs will play a big part in the stock game in the upcoming 10 years as legislating in each country tightens the belts around the big polluters. I believe that at first, many of these companies will purchase CERs from overseas to diminish their own CO2 footprint. However as demand for the CERs increases, so will the price. The big players will be forced have to cover the increasing costs of CERs, or find a more environmental way to reduce their carbon footprint.
