List reveals businesses and others to pay carbon tax in eight weeks, with impact expected to be wider

The regulator overseeing the Federal Government’s pollution price regime expects around 330 government and private sector entities will be liable to pay the carbon tax when it starts in eight weeks, but the impact on SMEs will vary by sector.

The Clean Energy Regulator (CER) published a list of 248 companies and city councils which it is “fairly sure” will be liable to pay $23 for each tonne of carbon dioxide they emit from July.

They account for around 70% of emissions covered by the regime.

CER chair Chloe Munro said the list known as the Liable Entities Public Information Database would be updated as the regulator received information about changes in entities particular circumstances.

“This phase of the LEPID is our first step in providing timely information to participants in the new carbon pricing mechanism,” said Munro.

“Our primary focus is on providing education and training to help them understand and meet their statutory obligations.”

Iain Smale, managing director of consultancy Pangolin Associates, told SmartCompany although the list of businesses directly affected was limited, the impact would be more widely felt to varying degrees.

Smale says electricity pricing is likely to be the most noticeable impact for SMEs, however, he warned businesses to watch out for “price gouging” by suppliers that tried to overestimate the cost of the carbon tax and to pass the cost on to SMEs.

“It is important for businesses to understand what the impacts are to makes sure unnecessary and inflated costs aren’t being passed on by their suppliers as purely price gouging under the guise of an increase due to the carbon price,” says Smale.

“For SMEs, especially service based ones, electricity is generally only a small part of their overall expenses, but that’s not to say it’s not an area to tackle.

“If they are in manufacturing then it is a much larger component, but manufacturers have a huge opportunity to reduce those electricity costs.

“We are doing a lot of audits of manufacturers at the moment and we generally identify around 30% power savings and there is government funding around to help that process as well.”

Pangolin Associates models potential supply chain increases due to carbon prices for business.

“Even though these increases should be relatively small, say in the order 0.1% to 0.8% depending on the nature of the service or product, it is important to understand and make sure that there isn’t price gouging as recently indicated by the ACCC,” says Smale.

“We are finding electricity is a fairly small component of costs for SMES; wages and rent are much higher.

“The impact is going to be far less than people think.”

Smale says while some companies were being very proactive in dealing with the potential impact of the carbon tax, others were putting off action for as long as possible.

“There are those who think that a change of government in a year’s time will fix the problems, but the reality is that electricity prices are going to go up regardless,” says Smales.

Here’s the list of the 248 companies identified by the CER which are likely to be paying carbon tax: