Qantas sticking to charging passengers for carbon tax

[froggerADL]

If this taxing thing is so ineffective can we please reduce the taxes on cigarettes and alcohol?

I promise not to smoke or drink more if they do!

 

[Moody]

So the $2 optional carbon offset is turning into a $4 compulsory carbon tax. I believe the correct AFF response to this should be "Meh", but instead we get the usual shock-jocks prattling on about "Juliar". How pathetic.

 

[Mal]

So the $2 optional carbon offset is turning into a $4 compulsory carbon tax. I believe the correct AFF response to this should be "Meh", but instead we get the usual shock-jocks prattling on about "Juliar". How pathetic.

The optional carbon offset will still be around - yes, Qantas is not retiring it. They want people to donate to that cause too. (There's hefty tax benefits to them ..... )
There's no Meh about it. Julia lied, introduced a tax that is based on false science and we all pay more as a result (well anyone who doesn't breed as an occupation, and is actually gainfully employed).

 

[one9]

when airline A is using gas guzzling old planes a ticket on them costs more, when airline B is using newer fuel efficient planes or a mix of biofuels etc it is paying much less in carbon tax than airline A and can either pass that on to the consumer (= cheaper prices and higher market share) or pocket it and make a bigger profit. Either way there is a big incentive to cut carbon use both on the individual and on the company.

But you forget the big picture. What happens is other airlines (eg. Singapore airlines, Thai airlines, Malaysia airlines, China airlines etc etc.) don't have to pay any carbon tax so they become more competitive and can offer lower prices than Australian airlines so Australians will chose overseas airlines instead of Australian airlines. These airlines can keep using gas guzzling old planes.

So there is no benefit to the environment. Instead Australia just becomes more uncompetitive.

Just like with many Australian retailers setting up companies in Hong Kong so they can ship from HK to Australia with no gst, I can see the same thing happening with airlines. It will further increase airlines to set up and expand overseas registered operations (eg. Jetstar Asia) so they can remain competitive. This not only doesn't help the environment, but it also hurts the Austrailan economy as taxes are paid to overseas governments instead of the Australian government.

 

[oz_mark]

But you forget the big picture. What happens is other airlines (eg. Singapore airlines, Thai airlines, Malaysia airlines, China airlines etc etc.) don't have to pay any carbon tax so they become more competitive and can offer lower prices than Australian airlines so Australians will chose overseas airlines instead of Australian airlines. These airlines can keep using gas guzzling old planes.

I didn't think there was a carbon tax being levied on international aviation.

 

[777]

But you forget the big picture. What happens is other airlines (eg. Singapore airlines, Thai airlines, Malaysia airlines, China airlines etc etc.) don't have to pay any carbon tax so they become more competitive and can offer lower prices than Australian airlines so Australians will chose overseas airlines instead of Australian airlines. These airlines can keep using gas guzzling old planes.

That's probably why it doesn't apply to international aviation.

 

[Simo]

It might be already covered in the thread but is carbon tax paid on flights once it leaves Aust territory and also if a flight from SIN to LHR it should attract no Carbon Tax.

Just another nail in the coffin for Aust manufacturing

 

[serfty]

Yes, lets get back to Qantas and the Carbon Tax surcharge:

Qantas sticking to charging passengers for carbon tax

"... Qantas CEO Alan Joyce says the airline was always going to pass on the price of the carbon tax to consumers and won't change its mind now that it's in place. ..."

Further political discussion in relation to politics and the Carbon tax has this very posted to thread : http://www.australianfrequentflyer.com.au/community/open-discussion/carbon-tax-29438.html

Personally, I think that article is just column filler; of course the airlines are going to pass on the charge - to both revenue and Award customers.

 

[rechoboam]

See if the Govt somehow subsidized telephone bills and/or internet connections for Skype etc the same day the carbon tax came in for airline prices, it might have been spun as a positive move to reducing pollution (not just the carbon type). But of course the prospect of job losses at Qantas etc means it couldn't be politically done any more than aluminium plants or car factories can be allowed to shut.

 

[RAM]

Not immediately that i'm aware (not an expert on biofuel economics right now) but the pricing of carbon around the world is driving a lot of the investment in biofuels which in turn is bringing the cost of them down. It also changes the tipping point at which biofuels (or solar or wind or whatever) become competitive which drives adoption of them much earlier.

Unfortunately Govt incentives or demands for biofuels/ethanol in petrol etc have seen a large proportion of previously food crops diverted into energy inefficient uses to produce ethanol etc. In Australia imported ethanol was discouraged so the large domestic producer's even less efficient process could operate - a true lose-lose-lose situation.

All of this saw the global price for soft commodities sky-rocket and resulted in the poor in developing countries being hit immediately by doubling or trebling cost for daily food as against a possible future benefit from lower carbon emissions.

Trouble is tens of thousands died last year from malnutrition and more have died so far this year.

"Trendy" vote-grabbing by any political party does have real costs.

Bringing it back to flying though:

Qantas should have to charge according to the exact plane flown (eg B737-800 with GE Version XX engine vs 22 yr old B747-400 with GE engine KK) as the age of plane and engine determine the fuel usage.

Equally if it is to be done totally correctly - the price can only be worked out once the final number of passengers is known. Otherwise it is bound to be the wrong amount charged. If Qantas' past is any guide to the future then should we be assuming they will err on the side of over-charging?

## Qn ## When will the fuel surcharges drop to match what Q has been paying for the last couple of months.

 

[serfty]

Some 115 posts not specifically related to this discussion have been moved:

http://www.australianfrequentflyer.com.au/community/open-discussion/carbon-tax-29438.html

 

[mannej]

QF have one 19 year old 747 with GE engines, the rest of the GE fleet are much younger.

IMHO it would be much harder to charge a full surcharge based exactly on what type of aircraft you will be on. Too many variables to come up with an accurate charge.

 

[RAM]

QF have one 19 year old 747 with GE engines, the rest of the GE fleet are much younger.

IMHO it would be much harder to charge a full surcharge based exactly on what type of aircraft you will be on. Too many variables to come up with an accurate charge.

It is absolutely correct that it would be harder but small companies are required to be able to absolutely prove any increase in price they attribute to the carbon price.

If ma & pa companies have to do the hard yards surely Q should?

Generally Q has scheduled a specific aircraft before the seats are uploaded onto the booking engine for that flight. The specific can change (and does) but it is possible.

%$#@@%

I admit it - I didn't check what engines the oldest Q B747-400 had - fair cop.

 

[rechoboam]

European Union politics website EurActive has gotten its hands on official EU data reporting that many biofuel crops release more carbon dioxide than crude oil, and approximate the emissions of the much-maligned oil mined from tar sands
....
However, also in the biofuel directive is that “biofuel production should be sustainable,” and the new numbers suggest that it is not.

Leaked EU documents rank biofuel emissions higher than crude oil | SmartPlanet
The alternative to flying with fossil fuels is surely not biofuel. It would be to cease, for example, large international conferences and rely on the pretty impressive teleconference facilities we have now. The $3(?) current charge is clearly pointless in these terms. It acts as a dead weight on the economy. Now if domestic travel had punitive sanctions applied (hundreds of dollars) and this money to building alternative energy sources (not carbon credits in Indonesia) it would make a difference. Solutions can work, or be politically palatable, but not both.

 

[777]

Unfortunately Govt incentives or demands for biofuels/ethanol in petrol etc have seen a large proportion of previously food crops diverted into energy inefficient uses to produce ethanol etc. In Australia imported ethanol was discouraged so the large domestic producer's even less efficient process could operate - a true lose-lose-lose situation.

All of this saw the global price for soft commodities sky-rocket and resulted in the poor in developing countries being hit immediately by doubling or trebling cost for daily food as against a possible future benefit from lower carbon emissions.

Trouble is tens of thousands died last year from malnutrition and more have died so far this year.

"Trendy" vote-grabbing by any political party does have real costs.

Indeed. Again: this is not an argument against carbon taxes - it is an argument against government mandating inefficient solutions. A carbon tax leaves it entirely up to consumers and producers like Qantas to find the most cost and resource efficient ways to reduce emissions. By contrast, the direct action plan is ENTIRELY about government mandated solutions. If you don't think a multi billion dollar slush fund + coalition with the National party = squillions being slashed up against a wall in ethanol and dubious subsidies for farmers then you are a far more trusting man than I.

FWIW a lot of the biofuel investment is actually not going into crop based production or food based ethanol. Virgin Australia is investing in harvesting biofuel from scrub grown in marginal/non-farming land, Qantas trial flights have been using recycled cooking all based product, and most of the investment internationally is going in to algae based solutions that are, essentially, grown in vats not on farms. Nonetheless your core point is correct and a key reason why governments should design mechanisms (like a carbon tax) that encourage innovation across the spectrum and not simply picking winners from lobbyists and lobby groups.

 

[SeatBackForward]

Nonetheless your core point is correct and a key reason why governments should design mechanisms (like a carbon tax) that encourage innovation across the spectrum and not simply picking winners from lobbyists and lobby groups.

And the ETS will be an ideal mechanism, it lets the market sort it out.

 

[777]

And the ETS will be an ideal mechanism, it lets the market sort it out.

In practice there is very little difference between the carbon tax and an ETS in terms of how they drive investment. One sets the price by direct pricing (the tax), the other sets the price indirectly by controlling the number of permits/ the cap/ the quota. An ETS is better for capping emissions as it is blunter in that regard but is a lot more prone (potentially) to gaming and profiteering due the way credits are traded. In any case we now have a tax that will evolve into an ETS in a few years time. Personally i prefer the tax for the simplicity but they both do the job.

 

[777]

It might be already covered in the thread but is carbon tax paid on flights once it leaves Aust territory and also if a flight from SIN to LHR it should attract no Carbon Tax.

Just another nail in the coffin for Aust manufacturing

Carbon Tax does apply SIN-LHR...

... it's the EU carbon tax though.

Definitely the death knell of Australian manufacturing. Bloody devious. I can't believe they've managed to organise that all the way from Europe.

 

[clifford]

Both qantas and virgin are investing in biofuel development.


Sent from the Throne

Ah yes, biofuel. That's when you use food to power your transportation and deny starving people sustenance.

Great approach. Is that really Green (or just one-eyed)?

 

[medhead]

Ah yes, biofuel. That's when you use food to power your transportation and deny starving people sustenance.

Great approach. Is that really Green (or just one-eyed)?

Actually not with later generation biofuel sources. Certainly that was the first approach but things have changed. The BA/QF research involves an algae that produces the "fuel" as part of its photosynthesis IIRC. It sounded pretty good, don't even need to convert biomass. I'm sure I provided a link to a new scientist story about this around here somewhere.

Edit: My memory might not be that good :shock horror: The Solazyme bit on this page sounds like what I read about. Fermentation not photosynthesis. But digging into my memory again, it was a process that used sunlight and CO2 to feed the fermentation. So they were talking about putting it next to a coal power station.

http://www.qantas.com.au/travel/airlines/sustainable-aviation-fuel/global/en