JoNova

A science presenter, writer, speaker & former TV host; author of The Skeptic's Handbook (over 200,000 copies distributed & available in 15 languages).



The Skeptics Handbook

Think it has been debunked? See here.

The Skeptics Handbook II

Climate Money Paper


Advertising

micropace


GoldNerds

The nerds have the numbers on precious metals investments on the ASX



Carbon Price just jumped 30% — It’s not a free market, it’s a fixed charade

A small group of selected rulers just raised a hand, changed the rules, and sent billions of dollars from some people to some others.

This type of arbitrary control over the  carbon market shows why it is a misnomer to call it a “free” market, and why a “market” is the wrong tool to try to use to reduce emissions. CO2 is a universal molecule, found in every walk of life and many inanimate processes. We can’t include them all, and someone somewhere gets to decide which ones count and which ones don’t, and how many of them we are allowed to emit in the first place.

Supply and demand of CO2 emissions are not set by a free market (you know, voluntary and willing participants exchanging things for mutual benefit). The bureaucrats just mandated an illusion of market forces, within a range set by said ‘crats. The price of carbon credits had gotten too painfully low for the rulers and their patrons and fans, so something had to be “done”. They made the carbon caps more stringent. If the price was too high, they would have loosened them (and they admit as much below). This has nothing to do with the environment or science, and everything to do with a plutocracy charging “what it can get away with”.

Now, are they doing this more for your benefit, or theirs? Cui bono?

Any efficiency gains we get from the “free market” are destroyed by the losses due to corruption.

 

Bloomberg:

Carbon allowances rose as much as 32 percent on speculation that an amendment to an energy efficiency law voted today raised the likelihood of the EU curbing oversupply and supporting prices in its emissions trading system. Concern that the new energy- savings regulations will further cut demand for pollution rights at a time of economic slowdown helped knock carbon prices to a four-year low last week.

“The compromise amendment was adopted almost unanimously,” Peter Liese, a deputy from the European People’s Party in the parliament, told a news conference in Brussels today. “We approved a careful intervention in the ETS.”

“It’s an amendment of change in the current policy,” Liese said. “If you decide that a price is too low, you’ve also got to decide when a price is too high.”

Lubos Motl talks us through the potential for corruption:

“According to Bloomberg and others, the European Union Parliament’s environment committee backed a decision to make the “carbon caps” more stringent in the following years, i.e. to extract some carbon indulgences from the market.

The price of the permits for one ton of CO2 instantly jumped by 32 percent or so, from €7 to €10 or so. The committee which has 68 members may de facto change the worth of this trillion-euro industry by a third in a few minutes, just by raising their hand.

The financial transfers caused by raising the hand are equal to tens of billions of dollars per person. Now, try to convince me that these people are acting neutrally, without any external pressures and connections, …

It’s unthinkable that these people in the environment committee have never communicated with the holders of the carbon indulgences. They’re almost certainly among the people whom they communicate most frequently with. So imagine that you’re a holder of €10 billion in carbon indulgences who knows a guy who may organize such a vote that will increase the value of your holdings to €13 billion. You may make a profit of €3 billion so you surely want to convince your friend in the EU Parliament to organize the vote.

If the Yes outcome is not guaranteed, the details will change but the fact that there is a potential for giant corruption – almost inevitable corruption – doesn’t change. If the votes are uncertain, a sufficient number of them may be bought. Let’s say that 25 committee members are guaranteed Yes-voters. You need just 10 more “undecided” to vote Yes. Again, if you know that your wealth will jump €3 billion as a result of the vote, you have a pretty good amount of money to influence 10 people how they should vote. Of course that 1,000 times less would be enough.”

Visit Lubos to read his whole article.

VN:F [1.9.22_1171]
Rating: 9.4/10 (58 votes cast)
Carbon Price just jumped 30% -- It's not a free market, it's a fixed charade, 9.4 out of 10 based on 58 ratings

Tiny Url for this post: http://tinyurl.com/6w9yjkr

75 comments to Carbon Price just jumped 30% — It’s not a free market, it’s a fixed charade

  • #
    brc

    Does any of the regular posters who are ‘pro carbon markets’ want to have a go at defending this charade? Do they still think it was about co2 sensitivity and tropospheres and all of that?

    I posted last week about Enron how they managed to keep the financially-defunct company alive for another year or two just by scamming the Californian electricity market through manipulation of supply.

    Someone, somewhere, just made a mint on derivatives placed on top of the carbon price.

    This is not a free market. It is not a market of any kind. It is a rigged casino where the casino worker gets to put the balls on the roulette wheel after the bets have been placed, and the house always cleans up.


    Report this

    10

    • #
      JMD

      This is not a free market. It is not a market of any kind. It is a rigged casino

      Yeah, welcome to the real world. The house has been cleaning up for a long, long time.


      Report this

      00

  • #
    Bulldust

    As an economist the EU’s behaviour with respect to markets makes me cringe… I don’t think anything else needs to be said.


    Report this

    00

    • #
      brc

      Especially since the origins of the EU was just to have a common market in Europe for things like steel and coal.

      If it had just stayed at that, things probably would have worked out OK.

      But if you want to keep an economic union, you need a political union as well. So the common market was probably doomed.

      And if you want to keep a political union, there has to be winners and losers. The winners being the insiders who control the system and the losers being the outsiders who feed the system. A political union necessarily means more control in order to stop it from disintegrating.

      In the end, they would have all been better off just going for free trade without any further integration than that. Democratic free trading nations just don’t invade each other and it allows them to keep all that wonderful diversity of cultures.


      Report this

      00

  • #
    The Black Adder

    This is the end of the EU !

    They are Trillions in debt.

    France and Germany are going down the green road of doom.

    Pass the popcorn, cobbers!

    2012 is gonna be a hell of a ride !!!


    Report this

    00

    • #

      Wait until the IOC finds out how much extra it’ll cost in taxes to get athletes and entourage to the London Olympics in a few months.

      Well, they won’t be as outraged as those on the sharp end who have to raise the funds which end up as taxes or rip-offs by carbon traders.


      Report this

      00

  • #
    Andrew McRae

    “Supply and demand of CO2 emissions are not set by a free market”

    Welll… emission is proportional to production which is proportional to free market demand.
    Methinks our host meant “Supply and demand of CO2 emissions permits are not set”, since it’s the Legal Right to breathe that is regulated, not the actual breathing itself.
    Actually, when I think of Anna Burke and the Clean Energy Future my breathing becomes highly unregulated, and not in a good way.

    First they manipulate the science, then they manipulate the CO2 market, and now there’s UK-funded research on how to manipulate your household electricity supply.
    To quote Al Pacino’s character from Scarface: “The communists… they always try to tell you what to do.”


    Report this

    00

  • #
    rukidding

    Sub-Prime Carbon anyone.


    Report this

    00

    • #
      The Black Adder

      I believe Catamon is a sub prime merchant!

      Right up his alley….


      Report this

      00

    • #
      Andrew McRae

      That seems so… prescient.
      They won’t stop there. The financial carboniferous period will run the full suite of instruments. Carbon Default Swaps, Climate Debt Obligations, Exchange Traded Fundamentalists.

      Try not to think about how this gives the banksters a financial motive to light large fires.

      At least when people couldn’t afford to buy mortgages they weren’t forced to by law.


      Report this

      00

  • #
    Rob

    Trading air is the world’s biggest con, it is also the biggest money for nothing scandal in history.

    They are destroying the economy of NZ, Australian and the EU, robbing from the people to create super wealth for a few individuals. Julia Gillard makes Al Capone look like a decent bloke. Her low IQ was quickly spotted by predator banking criminals and that is the greatest threat to the wealth of ordinary decent hard working Australians. It is the largest transfer of wealth in history by criminal bankers and abetting governments.


    Report this

    00

  • #
    Alex

    Pop corn is becoming an expensive commodity I hear. Eeryone and his brother is buying loads of it, sitting on the sofa and watching the Euro/Carbon collapsing slowly, with Merkel/Sarkozy trying to prop it up here and there, but still crumbling on the other side of here and there, so they move the props to the other side, back and forth, back and forth, everytime the roof gets closer to the ground.

    On a serious level; What if, instead of carbon credits, it was some millions of shares being artifically pushed up just because some Big Thing says they too low? Would’nt someone go to jail or what?


    Report this

    00

    • #
      The Black Adder

      I dont know about you Alex, but in my youth I was given a record from Mum for Xmas called `Popcorn`. I Loved it!! Even Wig Wam Bam !!

      So, not only will I be eating Popcorn, I`ll be listening to it!


      Report this

      00

    • #
      brc

      Well… market manipulation of listed shares does go on, and there are many things you can do which are illegal. But there are plenty of other ways of manipulating the price which aren’t strictly illegal. This might include issuing lots of shares to give to your staff members, or doing a deal with another company in which the shares are sold at a lower (or higher) price. Trading on advance information like that is generally illegal but the thing itself is sometimes not.

      *but* if a company gets up to shenanigans it’s a case of ‘fool me once, shame on me, fool me twice, shame on you’. The forces of the free market generally mark a company up or down on the basis of fraudsters. Don’t forget Enron was worth basically nothing before it was taken off the market – interventions and fraud can only work for so long.

      But nowhere can we opt-out of trading in the carbon market. Which is why the manipulations are that much more sinister.

      If you really want, you can have no part in the share market. Just put your super into cash or property, don’t buy any shares yourself, and you can watch a market crash with disinterested curiosity.

      But it is very difficult to escape the carbon credit market, apart from living in a cave furnished with things you made yourself from local materials.

      So when the carbon credit market is openly manipulated for supply like this, everyone is affected. Why they insist on the whole ‘market’ charade is probably a combination of a sales job (nobody would accept 5 year carbon plans) and the profit-making opportunities for people who can profit from the manipulation.


      Report this

      00

  • #

    It’s all to late Alex we are in gaol, this is a nightmare. It won’t be long before we are wearing the same garb, driving the same car and fronting up for work at the Community work office. This is totally scandalous but it isn’t going to change while we have politically correct group thinkers and the greed bastards that want the easy money.

    I have lost all faith in humanity :(


    Report this

    00

  • #
    Joe's World

    Jo,

    This has very little to do with saving the planet and a great deal to do with greed and the redistribution of wealth.


    Report this

    00

  • #
    1DandyTroll

    It’s a tax market, has always been.

    The socialists are very creative in coming up with new ways to fund their way of life: to further the control of capital and the state authority.

    The socialists wet dream is the utopian presence of a well fed welfare state. Without the welfare state the socialists have no power over the people, since then people have the tenacity to actually be able to take care of themselves without the intrusion, and the control, of the “well meaning” government.

    Thing is though that the welfare systems of EU cost insane amount of money and has pretty much doubled over each period. And wouldn’t you believe that the need for more taxes follows that cost. So, in the coming years, there will be even more taxes for us EU folks on everything financial, since they’ve pretty much run out of carbon and energy taxes. EU also wants to tax the EU citizens directly, after all all that eurocracy utopia and noon day champagne during deliberations cost a lot of money.

    But don’t worry, you OZ folks might get it by ways of UN’s global financial tax as well.


    Report this

    00

    • #
      Lionell Griffith

      …people have the tenacity to actually be able to take care of themselves without the intrusion, and the control, of the “well meaning” government.

      Now you have done it. You have exposed the one fact “they” desperately don’t want to be exposed and are living in stark terror that it will be. We the People don’t need “them” for a damn thing. Without “them” we can get along just fine but “they” can’t do anything or even continue to exist without us.

      The only real question we need an answer for is why do we submit when all we need to do is say “Hell NO!” and make it stick.

      He who is free, never submits. He who submits, was never free. Stay free!


      Report this

      00

  • #
    Peter Miller

    Black tulip market of 1636 and the European black carbon market of 2011.

    Just one great big overpriced scam in both instances.


    Report this

    00

  • #

    Just prior to his election, (now President) Barack Obama said he would bankrupt coal fired power plants. He hoped to start Cap and Trade and set the price of CO2 emissions at $50 per ton, and (in his own words) he didn’t really care if it went to $500 per ton.

    Okay, so it was plainly obvious he was either clueless, or didn’t bother to get information from people who should have correctly advised him on this matter, and this is again a case of failing to understand the scale of those emissions from coal fired power plants.

    Okay then, let’s actually pretend that the market is, er, manipulated, again by money market people with no concept of what they are actually doing, similar to what has happened here mentioned in Joanne’s Post.

    Now at the mooted price of that $23 per ton, I still contend that electricity prices will rise by around 30%, as those emitting power plants pass on the cost in an increased price per unit of electricity to the providers who then pass it directly onto consumers.

    Let’s say the price does skyrocket, under manipulation like this.

    Now, imagine when that ETS comes in here in Australia, and the CO2 unit price is being, er, ‘regulated’ by the market.

    Keeping in mind how at the start of year three, the Government has increased the price of their issued Carbon Credits to the original $23 plus a bit for year 2, plus a bit for year three.

    The actual (now manipulated) cost has skyrocketed. Those emitting entities will hold onto what they have, knowing that at the end of the year, they must hand back what they were issued in the amount of one credit per ton of CO2 emitted. They will keep religiously to the exact amount of their emissions so that they can hand in the credits without having any over run, knowing they will have to make up those credits at the now larger going rate, as well as pay 1.5 times that make up in fines, and then have their over run subtracted from their following years emissions.

    Then, at the start of the ETS, and with the manipulated cost now off the map, their costs will rise considerably, as they now have to purchase credits from the Government at the vastly increased manipulated price.

    One of two things then MUST happen, not may happen, or might happen, but must happen.

    They can pass that cost directly down to the consumer, and at the earlier cost of $23, electricity bills rose a third, then imagine how much they will skyrocket with a vastly increased manipulated cost.

    Imagine if you will the monetary stress on not only the poor, the unemployed, the pensioners, but on the average people. Imagine the stress on businesses with a now vastly increased extra overhead for the electricity they consume.

    Either those power generators pass the cost on, or they just shut up shop and close the plant, and I feel sure that the ‘bean counters’ will advise them to just shut down rather than attempt to absorb the huge cost in the near term with no possibility of rectification in the long term, as bills don’t get paid.

    See now how this market manipulation has more of an effect than just greedy money grubbing market manipulators playing around with something so critical for the sake of making big bucks.

    This was bound to happen, or should I say IS bound to happen.

    These idiots have no concept whatsoever of what they are doing.

    If (more like when) these plants shut down, it is sudden and at the start of the ETS in three years, long long before anything alternative to actually supply that level of power will be coming on stream.

    This is absolute madness, and it surprises me that those in the Government introducing this madness cannot see this, or that they haven’t even bothered to take advice on it, blinded by the image of huge megabucks coming into Government coffers.

    This is a rolling train wreck disaster of possibly mammoth proportions.

    You may think I’m being alarmist in saying this, but it’s plainly obvious to see that this manipulation is guaranteed to occur.

    We all lose in this, and boy, do we lose!

    Tony.


    Report this

    00

    • #

      “…electricity rates would necessarily skyrocket.” We heard this directly from O’bummer and he meant it. I think he also “meant” the necessarily following recession/economic downturn/depression.


      Report this

      00

    • #
      Lawrie

      Tony,

      Instead of buying additional credits the generators could simply reduce supply. They would face no competition from the useless renewables so could just raise the price of their electricity on the old supply and demand basis. I feel that should this “rolling train wreck” go ahead, and I strongly believe it will die at the next election, the big users will shut down and move offshore. As you say the big losers will be the household and retail sectors and they have a lot of votes. The gillard government will not have the income to afford the bribes necessary to keep the plebs happy. Like you I am amazed by the stupidity of not just the government but the bureaucrats and the so called scientific advisors. We know that most politicians have little education in life and science but their advisors need to be put in jail.

      Our saving grace will be the complete collapse of the EU and the Euro. The sooner the better.


      Report this

      00

      • #

        Lawrie,
        you say here:

        ….. the big users will shut down and move offshore.

        The trouble with this is that of the Top 20 Emitters here in Australia, 15 of them are large scale electrical power providers.

        There’s no point in their moving offshore.

        If that CO2 cost skyrockets through manipulation, then reducing their generation capacity will, and let me repeat that, WILL, shut down Australia.

        In the current Draft Energy White Paper. they are talking of the (between the lines, insert the word desperate) need for new large scale (constant supply) generating capacity for three States, starting as early as 12/13 for Queensland, and then the rest out to 2017.

        If that CO2 price is manipulated so it artificially inflates, nobody in their right mind is even going to consider even the mooted Natural Gas Turbine power plants, let alone any form of coal fired power plants.

        Tony.


        Report this

        00

        • #
          brc

          But the unintended consequences are always the opposite of the intended consequences.

          The price floor is supposed to bring stability to the market, but has the effect of increasing volatility.
          The carbon tax is meant to bring certainty but manages to increase uncertainty.
          The ETS/Carbon Taxes are supposed to reduce emissions, but just encourage people to use dirtier power sources and to offshore manufacturing to countries with less emissions controls, thus increasing overall emissions.

          Funny how just leaving things be and relying on technical progress and the incentive to cut costs (ie, be more efficient) actually works better to lower emissions than any crazy centrally-planned scheme.


          Report this

          00

      • #
        brc

        The only problem with an EU collapse is that it gives people with a radical view a platform to stand on. Radical views usually tend towards the nationalist and socialist varieties – it’s unlikely to get someone saying ‘too much regulation got us into this mess, let’s loosen the regulations’.

        Instead the most likely outcome is that, while the EU may splinter into either individual counties or, more likely, trading blocs (think north vs south europe) each action is likely to come with even more regulation and control.

        Until everyday people can clearly see the link between trying to nationalise and regulate their entire society and economic stagnation, the charade will continue. The only result of the collapse of communism has really been for the communist sympathisers and socialists to try and adopt market-speak into their plans. So instead of a single state-owned supermarket, you’ll get two state-owned supermarkets and they will say ‘see, markets, you have a choice’.

        Talk to someone who grew up in East Germany sometime and get a clue of what it was like to live in a socialist state. It’s not really the secret police and the barbed wire that gets them down, it’s the complete lack of choice that grinds them away. Imagine having to wait years to get a crappy car for your family, and when it arrive you have no choice over it.

        Socialism in all forms is not something you want to have. Too many people live in a quasi-socialist states and say ‘but it’s OK’ while they enjoy the externalised benefits of free(er) markets like the USA where much of the innovation (was) developed, with no state involvement or hindrance. Socialist states have a terrible record of invention or innovation and have maintained living standards on the externalities created by places in which you’re allowed to keep the majority of benefit from inventions and hard work. But squash out those remaning places and you’ve got a real problem. Does anyone really think they’d have an iPhone if all mobile telephony was created by the likes of the old Telecom Australia? Take away Silicon Valley and see how many things in your house disappear, like the internet you’re using to view this comment. Sure, it wasn’t a valley invention, but the commercialisation of it certainly was.


        Report this

        00

    • #
      MikeO

      Hi Tony
      I have read your comments before and it does make as to what will happen. One thing I can not get a handle on though is how much of the eastern grid is publicly owned. I know SA and Vic are private but NSW, Qld and Tas?

      I was reading about Germany and their fool solar scheme. It made as much sense as us setting up a large solar plant on New Zealand’s Auckland Island (more appropriately Disappointment Island nearby) and laying a sea power cable to Australia. It is the same sort of distance from our pole, but perhaps the politicians there don’t understand than solar has something to do with the Sun. According to the article this madness caused large rises in electricity prices so Germans sold government bonds and the money raised was used to lower the price of electricity! The whole scheme is now in a lot of financial trouble.

      Here my reading is that we are in a lot of trouble already we are in a boat without oars or anything else just before the waterfall. I hope it is not too high. We needed new power stations started before now there is just not enough time to meet any shortages. The scheme to meet 20% of power with wind in now 9 years, it is stupid and unachievable. The coalition approves of it and I think brought it into being. Currently it is about 7% the rest has to be wind. Wind has increased by 2% in ten years so it does not look like another 13% in nine years will happen. The Fear Uncertainty and Doubt in these uncertain financial times certainly has produced a train wreck as you say.

      The carbon price will probably drop again today by a lot, things are really mad. Dow gained over 300 points one day down 50 the next day who knows about tomorrow. 2011 the financial year from hell.


      Report this

      00

      • #
        brc

        QLD Grid is owned by Powerlink – a 100% state govt owned corporation.
        Street-level wiring is operated by Energex – a 100% state govt owned corporation
        Stanwell corporation is a 100% govt owned corporation, and that owns Tarong and a couple of other big stations like Stanwell.
        CS Energy is 100% govt owned corporation, and owns the Callide generators as well as the thermal solar folly at Kogan creek and the Wivenhoe generation.

        On the Kogan Creek solar folly – the cost is (projected) $100 million and the output is (wait for it!) 44 Mw peak. The adjacent coal-fired station cost $1.2 billion and produces 750 Mw all day long. So it produces 17 times as much power (all day long) for 10 times the price. Or, putting it the other way, the Kogan Creek solar produces 1/17th as much peak power for 1/10th the price – but if you actually look at the output, it will be much, much worse because as we know the sun doesn’t shine the whole time. The calculated carbon price needed to make the solar plant cost-effective with the coal fired one is – wait for it – $3,000 per ton.

        Other generators are privately owned, like Gladstone.
        Energy retailers are all privately owned, like AGL etc.

        So the QLD government stands to do a lot of dough on the carbon tax, given that most of the network is government owned. It won’t be in the prices – they’ll just pass them onto the consumers – but it will be in the difficulty in continuing with financing and the asset value writedowns that result from the carbon tax.

        I await eagerly the outcome of the February QLD state election to see what impact this has on the national carbon tax discussion. The incoming state government might just try a stunt like asking for a bailout of its assets from the Fed government, or more compensation, or something like that. Or it could just stop one generator from working and see what happens.


        Report this

        00

        • #

          I want you all to see again how cleverly these renewable plants use figures that no one understands, and in doing this, it makes plants like this actually seem that something is being accomplished here.

          Watch the short video at the following link and it’s only 54 seconds long.

          Kogan Creek Solar Boost Press the ‘click to view’ button.

          See how they ‘boost’ the output of the plant up to the figure they quote. It ‘seems’ that they are boosting the plant’s total output, but this is just the nameplate capacity, the total ‘up front’ number.

          A little further on in the video, they show that the actual power delivered is an additional (in huge letters) 44,000 MegaWattHours, man, a stupendously huge amount of power, (to the non initiated) and then goes on to say that this powers a huge number of homes, saves a huge amount of CO2 emissions, or removes a huge number of cars from the road.

          So then, let’s do the Maths for actual power delivery using the industry equation

          Power delivered = NP X 24 X 365.25 (where NP is Nameplate Capacity, 24 hours in a day and 365.25 days in a year, leap year included as 0.25) This gives us the total theoretical power that can be supplied from a plant over a year at 100% operation, and is in MWH.

          From this, we can work out the Capacity Factor which is the actual delivered power divided by the theoretical 100% total, and then multiplying by 100 for a percentage capacity.

          So, for this Kogan Creek Solar Boost of 44MW, the theoretical maximum is 385704 MWH.

          The plant actually delivers 44,000 MWH, and again, this is a theoretical hoped for maximum, and no plant on Earth has ever reached this theoretical maximum, so even their figure is on the high side, and there’s no heat storage facility here.

          So the delivered power over the Maximum gives us a Capacity factor of around 12% or around 3 hours a day.

          For some further context, the extra power delivered from this ‘boost’ is supplied by the main 750MW plant every two and a half days.

          So, in all, we will be getting the equivalent of less than three days extra power.

          Er, I am impressed!

          All this for only $100 Million.

          Man, what a bargain!!!

          Tony.


          Report this

          00

          • #
            brc

            It’s shocking, isn’t it.

            It’s like spending a fortune on hamster-operated garbage trucks, then expecting to be congratulated when you only get rubbish collected every 3 weeks, and the cost goes up.

            Somehow there is a massive blindspot with the public about electricity generation which allows them to hand-wave away objections and assume that everything will be OK. Maybe that’s because those little white sockets on the wall just seem to work all the time magically and they don’t (or don’t want to) think about the massive electricity factory working away for them.

            But if a ridiculously small Garbage truck appeared and couldn’t take away someones garbage, and they had to pay extra for it, you’d hear about it on all the news channels.

            If you simultaneously reduce parking spaces and put the prices up, you generally get a riot on your hands.

            Yet install a stupidly small and expensive solar generator and politicians are so proud they get their photo taken in front of it. And everyone claps and nods and says ‘yes, yes, what a good thing’, despite electricity being more important to them than garbage trucks or parking spaces.

            The world has gone mad.


            Report this

            00

          • #

            Just wait until the electricity stops ‘flowing out of the little white wall sockets’, and see what happens then.

            It will not be pretty.

            Tony.


            Report this

            00

          • #
            The Black Adder

            Geez Tony,

            I just watched that vid and nearly threw up over my beer!

            What a disgraceful example of green idealogy crossed with marketing!

            11,000 cars! Well, F$%k Me ! Lets do a hoola hoop and all sing kumbaya !!


            Report this

            00

        • #
          Jazza

          It makes me positively spit chips that a constitutional lawyer has stated there is definitely a good chance under our Constitution whereby the state governments could successfully challenge the Carbon tax, on behalf of the electricity generators.

          When I heard this–from memory,on Alan Jones program on 2gb– I tried to get this advice looked at by the Vic Coalition government, with no reply.


          Report this

          00

  • #
  • #
    DougS

    It’s infuriating that the eco loons have set in train a tax on a harmless trace gas that has now run completely out of control.

    And, has the potential to distort markets and impoverish previously profitable enterprises.

    As well, of course, as making billions for those trading in the indulgences.

    Truly, a Robin Hood tax in reverse!


    Report this

    00

  • #
    crosspatch

    This will turn out exactly the same way as every other government intervention in every other market has turned out. Never in history has there been, that I am aware of, a government intervention in a market that turned out as intended (or even turned out well). Central manipulation of a market does NOT work, whether you are a government, a company attempting to corner a market, it doesn’t matter, it never succeeds. Never. Ever. Not once. Do these people honestly believe that they are smarter than everyone else ever in history?

    There is a book they should read with a somewhat ironic title called “This Time Is Different” available in the US here:

    http://www.amazon.com/This-Time-Different-Centuries-Financial/dp/0691142165

    The ironic part of the book is: No, this time really isn’t any different and economics works generally the same way now as it always has and when you attempt to manipulate things you end up with unintended consequences that result in disaster.


    Report this

    00

  • #
    MikeO

    Anything on the market will rise and fall but at 30% that is very volatile and risky and many will lose their shirt. Meanwhile the Mawson re-enactment should cool things down. It is behind a pay wall I think but with modern technology they are finding the going difficult. Too much sea ice I wonder where it came from?


    Report this

    00

  • #
    Roy Hogue

    They seem to fear no end to their ability to do as they damn well please. But that has tripped up many already. Who will be the next to fall?

    Dishonesty has a nasty way of turning on those who go too far. You can’t get too big to fail!


    Report this

    00

  • #
    Who Else

    And they wonder why the EU is FUBAR.


    Report this

    00

  • #
    pat

    N.B. *****”This is less a discussion about the environment and more about finance,” said Kumar.

    20 Dec: Deutsche Welle: EU responds to slump in carbon price
    Author: Zulfikar Abbany
    Editor: Nathan Witkop
    In a non-binding vote, the parliament’s environment committee agreed to broad support for lowering the number of carbon emission allowances from 2013.
    EU parliamentarians will need to vote again next year and member state governments are also required to debate the deal.
    Dutch Greens MEP and committee member Bas Eickhout told Deutsche Welle that Tuesday’s agreement was a strong signal to the EU’s executive and “the signal that markets had been waiting for, too.”
    European carbon prices jumped 30 percent almost immediately after the vote…

    “Government’s have only just started to realize how much money they are losing,” said Sanjeev Kumar, senior associate at the environmental think tank E3G, in an interview with Deutsche Welle.
    “Germany, the UK, and to a lesser extent Sweden, France and Italy have all been losing money,” he said.
    E3G was one of 15 companies and lobby groups, including Dong Energy, Alstom, and Shell, that issued a joint statement at the weekend calling for intervention in the ETS.
    If the plan passes the second vote next year, 15 percent of carbon allowances, around 1.4 billion, will be withheld starting in 2013.
    “I wouldn’t be surprised if the figure is raised to 2.5 billion relatively soon,” said Kumar, “it’s only a matter of time.”…

    Still struggling with the EU debt crisis, some governments have been accused of awarding too many carbon allowances to companies to help stimulate business.
    Europe’s ETS, which incorporates allowances, international offset credits, and direct trading, is seen as the bloc’s central mechanism for reducing carbon emissions and encouraging investment in green energy technology.
    For the system to work, experts say the price of carbon needs to rest between 20 and 50 euros (US$26-65) per ton. This year the price of carbon has been languishing, reaching a record low at one point last week of 6.30 euros…

    Cutting – or withholding – allowances is seen as one of the fastest ways to raise the price of carbon and provide the incentive for business to invest in a green future, rather than taking the cheaper option of relying on carbon-intensive activities when the price is low.
    Dietrich Borst from the German Emissions Trading Association (BEVK) said Tuesday’s agreement to withhold 15 percent of permits was “not enough.”
    “What we should be doing is cancelling allowances completely for a full year.”…

    Dutch MEP Bas Eickhout admits the agreement stops short of “fundamental change,” but insists it is an important political signal.

    “The ball is now in the Commission’s court,” said Eickhout. “But we have broad support for the agreement and narrow support for an amendment I put forward to have the 1.4 billion allowances dropped completely [at a later date]“.
    “Half a year ago it was impossible to address ETS reform, but politicians woke up when the price of carbon crashed – so I am confident of next year.”
    Next year is predicted to be even tougher economically for the eurozone.
    In this context, EU member states may be tempted to award more carbon permits in a bid to spur their economies.

    *****”This is less a discussion about the environment and more about finance,” said Kumar.

    “The crisis has had an important impact and the way to get out of the crisis is to invest in employment-heavy and energy-efficient industries, but we had to win this first argument to get the idea of intervention on the agenda at all.”
    http://www.dw-world.de/dw/article/0,,15615242,00.html

    anyone still believing CAGW is about helping poor countries? wake up.


    Report this

    00

  • #

    Canada has become the first country to pull out of the Kyoto Protocol on climate change, saying the accord will not help solve the global warming crisis.

    Environment Minister Peter Kent said on Monday that Ottawa is invoking its legal right to withdraw and added Kyoto doesn’t represent the way forward for Canada or the world, the Associated Press reported.

    On Sunday, countries from around the world meeting in Durban, South Africa, agreed on a program meant to force all the big polluters to limit greenhouse gas emissions for the first time.

    Canada, along with Japan and Russia, has said they will not join the proposed extension of the Kyoto. The United States has never ratified it, but no member country has formally renounced the only global pact enforcing carbon cuts. Monday’s announcement has lifted Canada’s status near to the US’s, which is considered a “rogue state” on climate issues.

    The protocol, initially adopted in Kyoto, Japan, in 1997, is aimed at fighting global warming. Canada signed the Kyoto Protocol in April, 1998, and ratified it in December, 2002, but did not implement it and current Prime Minister Stephen Harper’s government never embraced it.

    “The Kyoto Protocol does not cover the world’s largest two emitters, the US and China, and therefore cannot work,” Kent said.

    The first “commitment period” of the Kyoto Protocol runs out in 2012, but has now been extended until 2017 under the new deal — a key demand by developing countries struggling to preserve the only global pact enforcing carbon cuts.

    http://www.presstv.ir/detail/215369.html


    Report this

    00

  • #
    pat

    re my earlier comment: ‘anyone still believing CAGW is about helping poor countries? wake up’

    i should have added it is about helping “poor” EU countries ONLY.

    BBC leaves out India and all the other Countries opposing this unilateral, EU-only tax – an absurdity given all airlines fly in and out of everywhere, thereby cancelling out each other’s emissions in the long run:

    21 Dec: BBC: Business bites: Trade row fears over EU airline carbon emissions tax
    EU plans to levy a emissions tax on airlines are valid, the European Court of Justice (ECJ) has ruled…
    Opposed by Chinese and American carriers, it has already sparked tit-for-tat legislation in the US and is likely to provoke further sanctions…
    http://www.bbc.co.uk/news/business-16289618

    21 Dec: EU Observer: China joins legal battle against EU aviation tax
    The four carriers – Air China, China Eastern Airlines, China Southern Airlines and Hainan Airlines – have the backing of the country’s air transport association, which claims the new carbon emission rules will cost Chinese airlines some €95 million.
    The association asked all Chinese carriers not to take part in the EU carbon trading scheme, not to submit carbon emission monitoring plans or to negotiate with the EU on a bilateral basis…

    Some airlines, such as America’s cargo giant UPS, are already thinking about re-routing flights in order to side-step the scheme and cut costs, reports the Wall Street Journal. The move is likely to end up creating more carbon emissions.
    Mitch Nichols, president of UPS Airlines, told the newspaper that the company may look at redirecting flights between its hubs in Hong Kong and Cologne, Germany, by going through Mumbai. That will cut the cost of the tax by about a quarter because UPS would only be charged for the distance flown between Cologne and Mumbai. But the distance flown will increase by 1,100 miles, upping the emissions…

    In a statement on Tuesday (20 December), the Association of European Airlines expressed fears of an imminent trade war should the plan go ahead. “Even if the ECJ (EU court) decides that the EU (emissions trading scheme) conforms with EU law, this will not resolve non-European countries’ vehement hostility,” it said.
    EU climate change commissioner Connie Hedegaard has refused to back down, however.
    *****”It is not just an idea, it is EU law,” she told Financial Times Deutschland, stressing that the commission will not give in to pressure from the US or elsewhere.
    http://euobserver.com/884/114700

    EU needs to be dissolved…NOW.


    Report this

    00

    • #
      Lawrie

      The EU is under attack; from within. Termites in the form of EU commissioners have been nibbling away for years and now only the shell remains. One good push and down it will fall. The Hedegaards of Europe are staring unemployment in the face and are panicked. Couldn’t happen to nicer people.


      Report this

      00

    • #
      brc

      >It is not just an idea, it is EU law

      And has no jurisdiction outside the EU borders.

      Tough luck, that.

      Impoverishing your own people and handing a trade advantage to your international competitors. It has always been the way of the do-gooder, the hopeless meddler who can only concentrate on the seen and not the unseen. Whether it is giving business to other airports and airlines, luring economic migrants to their death or turning profitable industries into zombie organisations, the dead hand of the planning bureaucrat only looks at what it touches, and ignores that which it crumbles. It’s always about the ‘seeming’ and the ‘feeling’ rather than a hard-headed look at actual consequences.

      No doubt some refuellers, pilots or handlers somewhere will go on strike about this, and the blame will be sheeted home to those naughty Chinese and American airlines that don’t roll over and pay up like they should, being ‘derdy polluters’ and all.


      Report this

      00

  • #
    Madjak

    A free market requires all participants to actually be free.

    The fact this has toactually be explained to people in this day and age makes me want to hurl chunks.

    Nothing about trading trace gases can ever be described as being free.

    Why have people become so blatantly ignorant of basic capitalism that our masters can even think of referring to this as a free market?


    Report this

    00

  • #
    Alice Thermopolis

    Alex

    “On a serious level; What if, instead of carbon credits, it was some millions of shares being artificially pushed up just because some Big Thing says they too low? Would’nt someone go to jail or what?”

    Company share BUYBACKS (of issued capital) are legal under corporations law. They are popular with management (and quite a few shareholders) when share prices are low.

    Bought-back shares are cancelled, reducing the number of shares on issue and thus (theoretically, hopefully) raising the share price ceteris paribus – other things being equal, which they never are, etc.

    The “management” of EU INC seem to be operating on a similar principle, but instead of buying back credits and cancelling them my understanding at this point is that they are simply signalling they will issue less credits in the future, which also will reduce number of CC circulating in the market and, as we saw yesterday, raising the price.

    Big difference is integrity of a carbon credit – which is a creation of governments, as are all fiat currencies – as a financial “asset”.

    Very much in eye of beholder, or in this case, the holder and trader.

    Alice


    Report this

    00

    • #
      brc

      Buybacks are really just an accounting shuffle, though. I agree that the intended effect is not always what was meant. But it is completely legal as the people who sell their shares (usually) get full market price for their shares.

      A more apt analogy would be if a large parcel of shares was bought back by the company for $1 when the current price was $50.

      The effect would be that supply of shares would shrink but the people who had their shares forcibly acquired would be out, and the people who still owned them would be richer because the same amount of company is now spread across fewer owners.

      While this type of thing is illegal on publicly traded exchanges, in reality it happens all the time in privately owned companies where major shareholders are diluted out of the picture with new investment. Great for the new owners, sucks to be the old shareholders. It kinds of kills incentive to work for the company though, and it reduces the incentive to invest when these games are being played.

      Signalling there will be less carbon credit issues in the future is not the same as changing the amount on issue. If it was just a signalling thing with no actual follow through (which is still a real possibiltiy) then this will just cause a temporary spike, and the price will revert. To get a real spike in the price requires supply to actually be restricted.

      If a government acted in such a cavalier manner with their currency – blatant manipulation without even an apology – well, ask Zimbabwe how it worked out. At least the Federal Reserve is shamed enough into inventing technical sounding names to cover up the fact they are increasing the supply of US dollars.

      But the fact is these credits are denominated with a currency value, so in effect it’s just like printing money.

      To come up with a better analogy, imagine the Aust government decided that Gold production needs to be controlled. They decide that you can’t buy physical gold, but instead decide you can buy ‘gold credits’ which is a promise to get some gold one day. The government decides these are bankable as bits of paper and that they will hold onto the gold for safekeeping. The number of gold credits sold decides how much gold is produced. Then if the price started to fall outside the range they want for production, they just decide to create less gold credits. As such, the gold credit market goes up. Does the amount of gold change? No. Does the value of the actual gold change? No. Do they get to play games with ‘the market’ with the intention of both simultaneously making money for themselves, as well as allowing clued-in speculators to make stack of money on derivatives? You bet.

      Nobody would fall for such blatant fraud and market manipulation, yet here it is in the EU market. Australia will be no different, all the same ‘controls’ are written in.

      It’s a shame none of the usual pro-AGW types want to touch this thread. I suspect it’s because they know what is going on but can’t quite yet bring themselves to condemn what is happening. Kind of like when you realise your heroes aren’t the saints you thought them to be. Takes a while to go from hero worship to hero put-downs.


      Report this

      00

  • #
    Dave

    An interesting comment in The Australian – Food bowl vision worth every last drop – where it explains that Carbon credits can be earned during establishment of a farm as a commercial venture!

    The quote is:

    There is also the added attraction that nut trees planted on cleared sheep paddocks might also earn additional carbon credit payments in the years before the trees bear their first commercial nut crop.

    So any farmer that establishes CO2 fixing plants on cleared land can claim Carbon credits prior to harvesting? This is going to be the biggest PINK BATT repeat of all time! What are the conditions that the Climate Change Dept will apply – a list of species that come under Carbon Credit suitability? Pricky Pear could be viable – harvest for making alcohol!


    Report this

    00

  • #
    pat

    a bit of humour…am sure we could add some more to the list:

    20 Dec: Tom Nelson Blog: Settled science: Everyplace to be hit by climate change harder than everyplace else
    http://tomnelson.blogspot.com/2011/12/settled-science-everyplace-to-be-hit-by.html


    Report this

    00

  • #
    pat

    NZ getting in on the act:

    22 Dec: 3News NZ: Kim Choe: Govt steps in as carbon credits plummet
    The Government is going some way towards stopping that, announcing it will ban certain international units from the New Zealand Emissions Trading Scheme.
    “The problem with these industrial gas units is that they involve incredibly powerful greenhouse gases. These are things like CFC-22, 23, nitrous oxide,” says Environment Minister Nick Smith.
    The ban will protect the environmental integrity of New Zealand’s scheme, but Mr Smith won’t guarantee it will make carbon credits more valuable for investors.
    “One of the inevitable elements of an ETS is that the prices for carbon will be lower in periods of recession and will be higher in boomtimes. That’s actually quite appropriate.”
    Business New Zealand warn that any dramatic increase in the price of carbon could stifle development…
    The banned credits make up less than one percent of those currently held by New Zealand emitters, so our scheme will still be at the mercy of international markets.
    http://www.3news.co.nz/Govt-steps-in-as-carbon-credits-plummet/tabid/1160/articleID/237496/Default.aspx

    22 Dec: MSN NZ: AAP: Govt bans cheap emissions units
    The government has banned cheap, third world country emissions units from New Zealand’s emissions trading scheme and the business sector says the move is going to cost money.
    Climate Change Minister Nick Smith says the units some countries earn create “perverse incentives” that don’t benefit the environment…
    Dr Smith says the European Union and Australia are going to ban the units and he wants to maintain the integrity of New Zealand’s ETS…
    BusinessNZ says the ban means New Zealand companies are going to have to buy higher priced units and the cost will be passed on.
    “Just because the EU and Australia have made the decision doesn’t mean it is right for New Zealand to follow,” chief executive Phil O’Reilly said…
    http://news.msn.co.nz/nationalnews/8393733/govt-bans-cheap-emissions-units


    Report this

    00

    • #

      Hold on Pat we were told by our honest Government that Carbon credit fraud couldn’t happen. I think NZ are over reacting according to Ms Gilliard and the other patsies ..err I mean parliamentarians. Surely there couldn’t be less than verified Carbon Credits available on the the Free Carbon Market…nooo this would never happen /sarc


      Report this

      00

  • #
    pat

    21 Dec: Reuters: UPDATE 1-German court finds six guilty in CO2 fraud trial
    Guilty verdict in six cases, jail sentences for six men
    Men took part in VAT fraud in EU carbon market
    Deutsche Bank says uncovered no wrongdoing by its staff
    By Vera Eckert and Kathrin Jones
    Additional reporting by Nina Chestney, Editing by Anthony Barker
    A German court on Wednesday sentenced six men to jail terms of between three years and seven years and 10 months in a trial involving evasion of taxes on carbon permits.
    Judge Martin Bach said the men, aged between 27 and 66, were guilty of having participated in a conspiracy to evade around 300 million euros ($393 million) in value-added tax (VAT) between August 2009 and April 2010…
    The way Germany’s flagship lender, Deutsche Bank, conducted emissions trading with some of those that have been convicted had left the door open for tax evasion, he added.
    Deutsche Bank said on Wednesday that independent legal experts had so far found no wrongdoing on the part of the bank’s employees…
    European police agency Europol estimates widespread VAT fraud cost EU member states an estimated 5 billion euros in lost tax revenue…

    A separate trial in Britain is set to start next February, after seven suspects charged with carousel fraud pleaded not guilty in October.
    The EU scheme has suffered a series of scandals since its launch in 2005, including permit theft, the recycling of carbon credits and hacking of carbon accounts.
    To combat further fraud, the EU Commission proposed in October that spot carbon permits should be classified as financial instruments, but this still has to be approved by the EU Parliament and council of EU member states before it becomes law.
    “The carbon market remains weak. More fraud or similar episodes would be quite detrimental,” said Matteo Mazzoni, carbon analyst at Nomisma Energia.
    http://www.reuters.com/article/2011/12/21/germany-carbon-fraud-idUSL6E7NL44O20111221


    Report this

    00

  • #
    Mervyn Sullivan

    It has become quite clear that economists advising governments, such as in the EU, have have forgotten what represents free markets.

    To see such governments behaving as they have, over the years, handing out subsidy after subsidy to support costly inefficient and unreliable green technology to replace cheap efficient reliable unsubsidised technology explains why these countries are on the decline. To be doing the same with trying to rig a ‘carbon price’ for an ETS is no different.

    This EU disease is called ‘eurosclerosis’.


    Report this

    00

  • #

    “The Slave must be made fit for his freedom by education and discipline, and thus made unfit for slavery. And as soon as he becomes unfit for slavery, the master will no longer desire to hold him as a slave.”
    President Jefferson Davis, C.S.A.


    Report this

    00

    • #
      John Brookes

      Really? Sounds like someone trying to justify why they should own slaves.

      I think the reverse is definitely true – that is, if you wish to enslave people, you should make sure they are not educated. One of the worst aspect of apartheid in South Africa was the removal of education for blacks.


      Report this

      00

      • #
        brc

        Nice of you to turn up, John.

        Now enlighten us how you think the carbon ‘market’ is a good idea. I know you want to contribute.


        Report this

        00

      • #

        Southern whites fought against slavery being imposed on them from the north -

        “Every man should endeavor to understand the meaning of subjugation before it is too late… It means the history of this heroic struggle will be written by the enemy; that our youth will be trained by Northern schoolteachers; will learn from Northern school books their version of the war; will be impressed by the influences of history and education to regard our gallant dead as traitors, and our maimed veterans as fit objects for derision… It is said slavery is all we are fighting for, and if we give it up we give up all. Even if this were true, which we deny, slavery is not all our enemies are fighting for. It is merely the pretense to establish sectional superiority and a more centralized form of government, and to deprive us of our rights and liberties.”
        Maj. General Patrick R. Cleburne, CSA, January 1864


        Report this

        00

    • #

      Say John,

      would you like to make some observations on the Post of Joanne’s from, er, your side of the fence?

      Tony.


      Report this

      00

  • #
    Alice Thermopolis

    ALICE’S LAW

    “Any (market)scheme based on dodgy premises – no matter how big or well-intentioned – self-destructs at some stage; eg: sub-prime GFC, the euro, and eventually all legislated “carbon” (dioxide) currencies.”

    Yet governments and their eco-capitalist friends continue to promote the utopian fantasy they can use the Invisible Hand of the market (or greed) to conjure up a “stable” global climate, one just right for all the Earth’s population of 7,000 million anthropogenes.

    As for the developed world, if only it would give the UN an annual $100+ billion dollar in “climate reparations”, the planet’s elusive thermostat would be under control, they claim, before one could say “saving tomorrow today.”

    So it goes in this mad world…..

    Alice


    Report this

    00

    • #
      John Brookes

      Are you sure you’re an “Alice”, Alice? You see, Kinky Keith hung around masquerading as a lady for a while before unveiling his manhood (bad choice of words – erase that image from your head).

      And I’d hate to be disappointed again, if another apparent member of the fairer sex turned out to be just another bloke…


      Report this

      00

      • #
        The Black Adder

        `…And I’d hate to be disappointed again`

        Sorry to disapoint you just before xmas jb but,

        What about;

        - Climategate 1
        - Climategate 2
        - The Hockey Stick
        - Hide the decline
        - Al Bore
        - Durban Failure
        - JB worrying about girls and boys!! WTF ! This site is about Climate Change and the Science, corrupt and pure, and the scam that is AGW. Dont worry about Transvestites Johnny Boy, you should be worrying about that increase in CO2 emissions that you keep adding to by doing your useless posts.
        PS. Merry Xmas and a happy Carbon Filled Year 2012 !!


        Report this

        00

  • #
    Mervyn Sullivan

    Read the article at the following link titled “Europe fights to save cap-and-trade as crisis hits”

    http://hosted.ap.org/dynamic/stories/E/EU_CARBON_TRADING?SITE=UTSAC&SECTION=HOME&TEMPLATE=DEFAULT


    Report this

    00

    • #
      Llew Jones

      Interesting CO2 price in your link. A bit more than AUD23 but shows how far off the pace, when compared with coal, gas or nuclear these technologies are:

      “The lower price is really undermining the development of technologies that will be needed in the decades to come,” said David Hone, Shell’s climate change adviser.

      Shell, which is mostly known for selling oil and gas, has been one of the pioneers of carbon capture and storage, projects in which CO2 emissions are stored underground so they don’t get released into the atmosphere and contribute to global warming. But investing in new technologies like carbon capture and storage only becomes commercially viable at a carbon price of between euro25 and euro30, Hone said.

      “Over the last few months, we have seen some of these projects disappear,” he added.

      Happy days are ahead for our own crazy economically suicidal government.


      Report this

      00

  • #
    Llew Jones

    Just noticed that Abbott seems to be slowly frying Rudd/Gillard’s ineffective asylum seeker policy as there are hints Nauru might become a favoured Gillard destination for smuggled seekers. Noticed Abbott says yeah plus temporary visas plus turning boats back.

    If he gets his eye in with a bit of practice on this one lets hope he does the same with Gillard’s carbon tax and “clean energy” initiatives. Then we can forget about the real, imagined or rigged price of a tonne of CO2.


    Report this

    00

  • #
  • #
  • #