If I've got it right they're saying handing back carbon revenue on petrol while fares go up will discourage public transport. Yes, no, maybe since there are a lot of complex effects going on that are hard to predict.

For starters if they cut petrol excise by 5c to bring the bowser price down to say $2 a litre the bus may still be attactive. BTW the daily return bus fare on a commute I used to do in NSW is now $28.80. If they left the 5c on petrol (corresponding to $20 per tonne of CO2) and gave it to bus subsidies there would be some balancing point whereby x% drivers were subsidising (100-x)% of new bus passengers. The value of x is anybody's guess, say 50% will give up cars.

Sticking with 5c a litre on petrol which might raise say $2.5bn they could abolish the means test on solar gadgets. That might lower electricity bills so people had more cash to spend on petrol. But petrol is effectively capped unless they want to cut coal or gas or some other form of carbon. That would drive up the price of petrol (more demand, fixed supply) in a rebound or Jevons effect, so again taking the bus looks like a good option.

These I think are the kinds of economic modelling scenarios that will take Treasury until October to work out, assuming their models can cope with these intricacies.

That's a good point about the public transport ending up being more expensive, while private transport stays the same.

The other day on the GreensBlog I was noting that at present GreenPower is available with a surcharge on conventional power. That is, if I want conventionally-generated power I may pay 16c/kWh, if I want it from wind or solar I may pay another 5c, bringing it to 21c/kWh.

So I was saying that if the emissions trading scheme means that coal power becomes more expensive, would there continue to be a surcharge? That is, if an ETS made coal 10c/kWh more expensive, would I still pay 21c/kWh for wind while coal became 26c/kWh, or would both coal and wind go up? I suspect the latter.

Some drongo was saying that renewables had to be more expensive than coal, because otherwise everyone would want them, and there wasn't enough to cover demand. I explained that the justification for the higher cost of renewables is that the coal-fired plants are already built and paid for, while the renewables are all new - so we pay extra for them to be built.

But anyway, just as it would be ridiculous than in an emissions trading scheme public transport became more expensive while private transport stayed the same, so too would it be ridiculous that an ETS made renewables more expensive as well as coal.

It's an abominably stupid idea, the whole ETS.

The ETS is not proposing to have less tax on petrol(and diesel?)but to replace 5 cents of the excise with 5 cents/L based on a price for CO2e of $20/tonne. How is public transport being treated unfairly? If the claims that public transport users produce much less CO2e than private motor vehicle users then any carbon costs will be much less than the 5 cents a liter a motorist pays.
The ETS is going to mainly hit electricity generation from coal, because that's why Australia has the highest CO2e. Oil prices and the remaining 33 cents/L tax on petrol are going to do much more to discourage petrol use than a 5 cents CO2e charges. This will drive motorists to PHEV and eventually EV even though they will pay some CO2e charges for the electricity they use. Electric trains will still use less and therefore be more competitive. If you have an emotional objection to cars then promote an anti-car tax, if an objection to petrol or diesel use by private or public transport then promote a transport fuel tax, but if you want lower emissions you should tax all CO2e at same rate(produced by public and private transport), ie only 5cents tax on petrol and the rest used for road construction, this of course will hit public airline transport very hard, but it is a big CO2e and deserves to pay.

The ETS is not proposing to have less tax on petrol(and diesel?)but to replace 5 cents of the excise with 5 cents/L based on a price for CO2e of $20/tonne. How is public transport being treated unfairly? If the claims that public transport users produce much less CO2e than private motor vehicle users then any carbon costs will be much less than the 5 cents a liter a motorist pays.
The ETS is going to mainly hit electricity generation from coal, because that's why Australia has the highest CO2e. Oil prices and the remaining 33 cents/L tax on petrol are going to do much more to discourage petrol use than a 5 cents CO2e charges. This will drive motorists to PHEV and eventually EV even though they will pay some CO2e charges for the electricity they use. Electric trains will still use less and therefore be more competitive. If you have an emotional objection to cars then promote an anti-car tax, if an objection to petrol or diesel use by private or public transport then promote a transport fuel tax, but if you want lower emissions you should tax all CO2e at same rate(produced by public and private transport), ie only 5cents tax on petrol and the rest used for road construction, this of course will hit public airline transport very hard, but it is a big CO2e and deserves to pay.