A Case Study In Reducing Emissions

There is a story in on News.Com.Au about a how a meat processing plant in Queensland, Australia has been dealing with the Carbon Tax in Australia. For those who are unaware of this tax, CO2 emissions in Australia are taxed at a rate of about A$23/tonne. The company in the article had a monthly energy bill of about $100,000 per month before the tax, and they were obviously somewhat concerned since their emissions amounted to about 80,000 tonnes per year.

The story details how an investment of $6M from the company and $6M from the company is allowing them to reduce their emissions from 80,000 to 25,000 tonnes per year. This is about a 69% reduction in emissions. The tax on these emissions was going to be about $1.84M, reducing to $575K under the changes. This is a reduction in liability for tax of about $1.265M. This is a lot of money.

I am guessing that the changes that are being implemented are also reducing the cost of energy for the plant, but unfortunately the story does not detail this. Grid electricity has a carbon tax of about 10%, whereas the tax liability for this company is about 50% of their energy costs, suggesting that the company somehow sourced a cheap source of energy, or was causing emissions elsewhere. My guess is that they have been using waste produce energy to assist with their processes. Also, my guess is that this generation of energy was particularly bad from a CO2 point of view

It is uncertain from the article if the upgrade would have been cost effective without the carbon tax, but it is certain that with the carbon tax that the cost of project is worthwhile. One would hope that overall energy usage will also have dropped leading to a decrease in energy expenditure as well.