Impact of Direct Action Plan and Carbon Tax Policy on Australia’s Transport Sector

IMPACT OF DIRECT ACTION PLAN AND CARBON TAX POLICY ON AUSTRALIA’S TRANSPORT SECTOR
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Impact of Direct Action Plan and Carbon Tax Policy on Australia’s Transport Sector
Rationale and Theoretical Underpinnings of the Policies
Australia’s local and federal governments launched a Carbon Tax Policy via the Clean Energy Act 2011. The focus was on minimizing and controlling carbon emissions to provide relevant support to the country’s economy by the newly implemented Clean Energy Regulator and Climate Change Authority (Australian Academy of Science, 2015). With the implementation of the Carbon Tax Policy, the Australian Government observed a decrease in carbon emissions. The Australian Government abides by the Kyoto Protocol and UNFCC guidelines in developing climate change policies. The economic theory indicates that greenhouse gas emission pollution is an externality because the exchange between transport companies and customers impacts the climate that is not part of the exchange.
Direct Action Plan is a climate change policy adopted by the Australian Government for minimizing greenhouse gas emissions. This scheme provides incentives to Australian firms for minimizing carbon emissions (Hoque et al., 2019). The Emission Reduction Fund of the Government provides direct support to the industries and businesses that are adopting CO2 emission reduction policies at the workplace. The transport sector is working collaboratively with the Government of Australia to promote best practices so that carbon emissions do not negatively impact the overall industry. The Government is also providing subsidies to carbon emission reduction projects.
The Direct Action Plan and Carbon Tax Policy play a vital role in promoting environmentally friendly practices and minimizing carbon emissions. The carbon emission has been minimized in the transport sector by 17 percent from fuel consumption, domestic shipping, pipeline transport, aviation, rail, and off-road recreational vehicles. Also, the greenhouse carbon gas emissions have decreased by 1.4 percent after introducing climate change policies like the Carbon Tax Policy and Direct Action Plan (Hoque et al., 2020). It can be concluded that the Australian Government's climate change policies have been successful in achieving the desired targets.
Australia’s Transport Sector and Climate Change Policies
The Government's climate change policies aim to minimize carbon emissions by 80% by the year 2050 and limiting global warming response below 2 degrees. In Australia, cars are a source of generating greenhouse pollution across different states. The Transport sector is the main contributor to emitting greenhouse gas, which is 17 percent of its overall carbon emissions (Wolfram and Wiedmann, 2017). From the year 1990, the transport sector's carbon emissions have increased by 60 percent, which is more than any other industry. However, the implementation of the Carbon Tax Policy has contributed to de-carbonizing Australia. The Government is providing subsidies to the transport sector so that the fuel costs remain at an affordable rate (Wolfram and Wiedmann, 2017). A long term approach adopted by the Australian Government, which incorporates carbon pricing in-vehicle standards and technology, has contributed to minimizing carbon emissions. This government policy positively influences consumer choices related to vehicle purchase, miles driven, and transportation mode.
The Direct Action Plan policy of the Australian Government has played a role in minimizing greenhouse emissions. However, it is not sufficient because the transport sector contributes to adding 100 million tons of greenhouse gas pollution. The Australian Government heavily relies on the Emission Reduction Fund for minimizing greenhouse gas emissions (Alam et al., 2020). With these policies, the Government has been able to boost energy production, which has benefited the transport sector. The Government is taking continuous steps to promote environmentally friendly practices among the population related to vehicle usage.
Impact of Predicted Climate Change
The carbon tax policy has a positive impact on Australia's climate change as an increase in transport taxes is changing citizens' travel behavior. The tax imposed on the initial cost of products influences the vehicles purchased by the public. The people are adopting alternative transport options which are environment friendly. It has promoted fuel-efficient cars, cleaner fuels, congestion reduction, and alternative fuel cars (Ireland and Clausen, 2019). The carbon tax policy influences vehicle fuel economy, type of fuel consumed, and vehicle technology. The carbon tax policy is the best possible solution for minimizing greenhouse emissions across the transport sector because it provides incentives to the public and companies to utilize cleaner fuels and minimize energy consumption.
The Direct Action Plan has played a vital role in minimizing emissions generated by waste material, recycling, and alternative transport fuels. The Government has allocated a 750 million dollar budget for funding projects that minimize emissions and increase prices. The Government is taking the rights steps towards climate change and minimizing carbon emissions. Transport businesses are also promoting low carbon vehicles for making the environment user-friendly (Butterfield and Low, 2017). The organizations are reviewing the overall negative impact created by fleets and continuously searching for providing new solutions to the customers. With the current government policies, cars will most likely dominate the transport industry, contributing to congestion, greenhouse gas emissions, and air pollution.
Risks and Opportunities
The Carbon Tax Policy and Direct Action Plan play a positive role in minimizing greenhouse gas and carbon emissions. The tax charges are applied to fossil fuels depending on the amount of carbon emitted by vehicles. The transportation sector companies focus on consuming less energy obtained from fossil fuels to apply minimum taxation fees. The citizens of Australia have opted to use public transportation instead of their cars to emit less carbon (Qiu et al., 2020). It has contributed to making the environment clean and ensuring that car drivers adopt the best practices.
The risks associated with the Direct action Plan and Carbon Tax Policy are that there is a lack of alternative options for ensuring that cars less carbon dioxide is emitted. The number of electric cars operating in the country is approximately 1 percent, and this number will be below 10 percent in the next eight years. Moreover, battery-operated cars have not been deployed in Australia. Natural gas is a cleaner fuel option for vehicles, but fossil fuel is considered unsustainable (Li et al., 2017). The fossil fuel contributes to generating carbon dioxide, enhancing global warming, and adding the greenhouse effect.
There are various risks associated with the Carbon Tax Policy as a sudden rise in carbon taxes results in increased fuel prices and a burden on the low salary group. The public and transporters that cannot switch to alternative fuel solutions suffer the losses. These taxes are...