Businesses can access some assistance programs to counteract the impact of the carbon tax.
Businesses can access some assistance programs to counteract the impact of the carbon tax. Warren Lynam

Carbon tax offsets available

BUSINESSES are being reminded about the schemes available to offset carbon tax impacts following this week's passing of legislation in the lower house.

Carbon specialist and BDO partner Dylan Byrne said the Emission-Intensive Trade-Exposed (EITE) assistance program could potentially save some companies hundreds of thousands of dollars each year.

"Australia's carbon tax will commence July 1, 2012, so businesses need to know how to deal with the changes that lie ahead," Mr Byrne said.

"Many smaller manufacturers don't know that they can actually benefit from the carbon plan by receiving free permits or partial-exemption certificates (or PECS) which can be redeemed with electricity generators as part of the Renewable Energy Target scheme.

FOR EXAMPLE: A company with 26,000 tonnes in emissions has the potential to offset their carbon liability by as much as $565,000 in 2012/13, courtesy of free carbon permits, as well as a reduced electricity cost via the redemption of PECS.

The EITE assistance program is aimed at businesses that undertake activities that are emissions-intensive and trade-exposed (EITE activities) and are therefore constrained in their ability to pass on carbon costs.

Mr Byrne said , in order to take advantage of the scheme, businesses needed to provide data to the Department of Climate Change on their emissions and revenue, and provide evidence of their trade exposed status and EITE activity.

"All required activities are covered by an audit process, which has to be signed off by a registered company auditor in conjunction with environmental scientists and engineers," Mr Byrne said.

"While this might seem like a lengthy - and costly - process, many companies have the potential to recoup these costs quickly through the savings generated."

Mr Byrne said industries should move quickly to establish their eligibility to qualify for Partial Exemption Certificates for the 2012 year.

"Now is the time for businesses to assess their eligibility to take advantage of the EITE assistance program in 2012," Mr Byrne said.

"This is a great way to counteract the impacts of the carbon tax."

The value of Partial-Exemption Certificates fluctuates depending on the value of Renewable Energy Certificates (REC), which are currently trading at $37 AUD each. Additionally, for EITE companies that have a carbon tax liability, there will be a free allocation of carbon permits per tonne in 2012/13, each worth $23 AUD.

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