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Australian Carbon Tax Remains Intact

April 1, 2014

Sources in the fire suppression market have recently reported that the Australian Carbon Tax has been abolished. That report, however, is a misrepresentation of the actual events taking place in Australia.

The Australian Senate has rejected Prime Minister Tony Abbott’s first government bill to scrap the carbon tax. Environment Minister Greg Hunt’s bill to abolish the Authority was defeated by Labor and The Greens in the Senate, a move which prevents the reintroduction of the same bill for three months.

Its defeat means the bill may not be reintroduced until June, or likely July, when the new Senate starts.

In July 2012‚ Australia began driving down use of HFCs by implementing a carbon price (tax) that has dramatically impacted HFCs sold into fire suppression. Carbon is priced at $23 AUD per ton and will gradually increase until 2015‚ at which time the price will be determined by the market. HFCs‚ including those sold into fire suppression‚ face an equivalent carbon price magnified by their global warming potential. The result is an unsustainable addition to HFC agent costs by more than $30/lb. The good news for the Australian fire suppression market is that substitutes‚ including 3M™ Novec™ 1230 Fire Protection Fluid‚ are readily available for any application in Australia that would have used HFCs in the past.

The Australian tax and the recent update to the EU F-gas regulation and other regional initiatives are unfolding under the backdrop of the United Nations continuing to find common ground for implementation of a global phase-down in the production of HFCs. Again‚ these regulatory bodies have recognized that these policies are possible in sectors such as fire suppression where alternatives are readily available to replace HFCs and minimize the future impact of these potent greenhouse gases.

The bottom line is that HFCs sold into fire suppression fall squarely in the middle of the crosshairs on HFC legislation‚ because no other sector is as well prepared to move to the next generation of sustainable alternatives.

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