Qantas chief slams $23 carbon tax as too high

POSTED May 30, 2012

QANTAS chief executive Alan Joyce says the carbon tax is too high and should be reduced to reflect international market prices.

Mr Joyce told a lunch in Perth the $23-a-tonne fixed price of the carbon tax was much more than in the rest of the world under the current economic situations.

"I think in Europe it's going to be below $9 when the scheme comes in," he told a lunch in Perth. "And I think that is a real disadvantage in terms of the price imposition that's going to be here."

Asked whether the tax should be introduced at a lower level, Mr Joyce said $23 had looked like a good price when the carbon tax legislation was introduced.

"I think $23 everybody will say is too high today," he said.

The Qantas boss said he did not believe most people would notice the $3.50 per sector average charge from the tax. But he also pointed out that he did not believe the tax had changed the airline's behaviour or prompted it to reduce carbon emissions.

He said it was the fact the airline was spending $4.4 billion on fuel and needed to do everything in its power to reduce that cost through areas such as new aircraft technology and sustainable fuels.

He also hoped that some of the money raised would be used to help develop sustainable fuels and reinvested in areas that were good for the economy and would reduce carbon dioxide emissions. Qantas has been working with two biofuel producers to assess the feasibility of setting up plants and has been talking to federal and state governments.

One firm, Solazyme, uses an algal process that converts waste from plants such as sugarcane to fuel while the other, Solena, converts urban waste to fuel.

Biofuels have proved to work well in existing aircraft engines, but the problem for airlines is commercialising the processes on offer to produce the vast quantities of fuel needed.

Steve Creedy (The Australian, May 26 2012)