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What is an Emissions Intensity Scheme?

An ‘emissions intensity scheme’ is just fancy name for an emissions trading scheme that doesn’t involve a government selling emission certificates, which, in any event, was just a shonky revenue raising scheme.

The methodology is that the government sets a base line for emissions from the electricity generation sector.

The baseline moves downward to match commitments for emission reductions in the Paris Agreement and its successors.

Those generators whose emissions exceed the baseline are required to buy credits from generators who have emissions below the baseline.

In theory the system should set a price for power that is technology neutral and free of subsidy.

George Walker

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