Australian business cautioned over low-emissions economy
Updated
Australia's climate change minister, Penny Wong, has warned the business community that a transition to a low emissions economy will not be easy.
Ms Wong has told a business lunch in Sydney that the introduction of a carbon emissions scheme is a test of economic credentials that the government intends to pass.
She says providing exemptions to high-emitting industries is economically responsible.
"We recognise that the emissions-trade-exposed sector does face carbon cost for the first time as a result of putting a price on carbon," she said.
"We do have to ensure there is proper transitional assistance in place."
The government announced last week that it plans on introducing a carbon trading scheme in two years.
Under the scheme, the government sets an overall limit on the amount of carbon the economy can produce and then provides permits to industry up to the nominated amount.
Companies can then trade their permits, meaning carbon-intensive industries must pay extra if they want to exceed their allocation, a system the government believes will provide a market-based incentive to reduce pollution.
