The Rudd Government will establish the Australian Carbon Trust to help all Australians to do their bit to reduce Australia's carbon pollution and to drive energy efficiency in commercial buildings and businesses.
The Government will also take into account the contribution of individual households that purchase accredited GreenPower in setting Carbon Pollution Reduction Scheme caps.
The $75.8 million Australian Carbon Trust will incorporate:
* a $50 million Energy Efficiency Trust, and
* a $25.8 million Energy Efficiency Savings Pledge Fund.
Australian Carbon Trust - Energy Efficiency Savings Pledge Fund
A new website will provide a one-stop shop for individuals and households to simply calculate their energy use and buy and retire carbon pollution permits under the Carbon Pollution Reduction Scheme.
Because the Pledge Fund will pool pledges, even small amounts can combine to make a big difference.
Households and individuals will be able to pledge as little or as much as they can afford to reduce carbon pollution.
The Pledge Fund will be entirely voluntary and contributions to the Pledge Fund will be tax deductible.
Australian Carbon Trust - Energy Efficiency Trust
The Government will provide $50 million in seed funding for an Energy Efficiency Trust to promote energy efficiency in the business sector.
The Trust will work by putting proposals to businesses to undertake energy efficiency measures that will save money over time.
The Trust would cover upfront capital costs of undertaking energy efficiency investments and put in place arrangements for business to repay the capital costs at a commercial rate as energy cost savings flow through.
For example, the Trust could identify lighting improvements in a business that would cost $2 million to undertake. The Trust would cover this $2 million cost, with the business contributing nothing upfront. The business would then pass the energy cost savings from the lighting improvements back to the Trust at a commercial rate until the full $2 million with interest is paid back to the Trust. Once the upfront capital is paid back, the business keeps the ongoing cost savings.
The Trust ensures participating businesses save money without having to tie up any capital.
The Trust also earns a solid rate of return on its investments and demonstrates to other businesses that energy efficiency pays dividends.
The Australian Carbon Trust will be developed in collaboration with the Carbon Trust in the United Kingdom, which is a leader in working with business to cut carbon and develop commercial low carbon technologies.
Supporting individual action through GreenPower
Many households, businesses and community organisations purchase accredited GreenPower to increase the supply of renewable energy and help Australia make the transition to a low pollution future.
As part of the new measures announced today, additional GreenPower purchases above 2009 levels will be directly recognised when the Government sets caps under the Carbon Pollution Reduction Scheme.
Additional GreenPower purchases will be measured annually and future caps will be tightened on a rolling basis.
The Rudd Government has listened to Australian households who have raised concerns that their individual efforts to reduce emissions will not be adequately taken into account under the CPRS.