Electricity prices could rise by as much as 40pc and petrol prices rise by up to 10 cents a litre as a result of a carbon price and emissions trading targets proposed by economist, Professor Ross Garnaut, in his second report to the Government which was unveiled today.
He says Australia should cut its emissions by 10pc by 2020, which would trigger major structural reform and adjustment in Australia.
The targets will be disappointing news to The Greens and other environmental lobby groups, which have been pushing for cuts of about 40pc to greenhouse gas emissions.
Professor forecasts a carbon price around a mid $20 range at the start of the scheme, which he expects to rise by about 4pc a year to be about $34 in 2012, when he recommends a scheme should be fully operational.
But while Professor Garnaut reiterated the enormity of such proposals on the Australian economy, he said today that the costs of mitigations still won't derail Australian growth, but in fact non mitigation "probably would".
He said the biggest impact on everyday Australians would be felt in big expense rises for electricity, transport and petrol, which he hopes is included from the start in the scheme adopted by the Government.
He said a $20 carbon price would equate to a 5c/l rise in petrol, and under a $40 price would double to 10c/l.
He said in the higher levels of price increases for electricity to 2020, his report forecasts prices could increase by as much as 40pc, depending on issues in the market.
He said he doesn't underplay the impact that would have on Australian households, adding it would be a "big hit".
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