Carbon price modelling update

On 21 September 2011, the Deputy Prime Minister and Treasurer, the Hon Wayne Swan MP, and the Minister for Climate Change and Energy Efficiency, the Hon Greg Combet MP, issued a joint media statement announcing the release of the updated modelling of the impact of a carbon price which confirms the Australian economy will continue to grow strongly while emissions are reduced.

The modelling shows the impact of a carbon price starting at $23, and also includes elements of the Steel Transformation Plan and Jobs and Competitiveness Program that were not included in the initial report released on 10 July 2011 by the government.

The updated modelling shows almost no difference with the previous modelling exercise. The economy continues to grow strongly under a carbon price, with real gross national income per person growing at an average rate of 1.1% to 2050. Jobs grow strongly under a carbon price, with national employment expected to increase by 1.6 million jobs to 2020.

Incomes grow strongly under a carbon price, rising by around $9,000 in today's terms by 2020. Australia's domestic emissions under carbon pricing will fall to nearly half of what they would be without carbon pricing by 2050.

The updated modelling covers the main impacts of the Clean Energy Future package on the Australian economy. However, it was not feasible to include all elements of the plan.

Article last updated 29 September 2011