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Carbon Tax Impact: Coal Sector Questions Grattan Institute’s Findings

The Australian Coal Association (ACA) today questioned the results of the Grattan Institute research on the impact of the proposed carbon tax on the coal, LNG and steel industries.

The Executive Director of the ACA, Ralph Hillman said the report released today by the Grattan Institute was not based on the detailed data that ACIL Tasman had access to when compiling their assessment of the impact of the tax on the black coal industry.

"The Grattan Institute based its estimate of the cost impact of a carbon tax on just one year of estimated coal emissions data. The study also falls into to the trap of examining average cost impacts rather than the impacts on mine margins and on investment at the margin.

As ACIL Tasman has pointed out: "It is inappropriate to consider impacts of emissions pricing in terms of average cost per tonne of production across all mines. Each mine produces different emissions and each has a different cost structure. Therefore individual mines can be affected very differently by emissions pricing. Adverse effects result from effects at the margins of extraction and investment. Analysis based on averages will produce spurious results."

Mr Hillman said the Australian government is the only government in the world to tax fugitive emissions from coal mining, threatening our international competiveness and costing Australian jobs - but with no impact on global greenhouse emissions.

"ACIL Tasman conducted a thorough mine-by-mine review of sensitive commercial information to draw its conclusions.

"The Grattan Institute only assessed publically available information and its' conclusions failed to take this crucial information into account.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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