Illawarra stakeholders are cautious but optimistic over the Federal Government's green paper on carbon reduction, though the public has been warned that any resulting cost increases are likely to be passed on to them.
Industry groups have also warned that a too-forceful approach could push big business offshore to countries with cheaper labour and less strict environmental rules.
However, there is broad acceptance of the paper, and support of the shift towards environmentally friendly policy is strong.
BlueScope Steel, one of the region's largest employers, yesterday again emphasised the impact heavy restrictions would have on its carbon intensive operations, given new technology for making iron and steel is decades away. Managing director and chief executive, Paul O'Malley, said any program that put at an advantage imported steel from countries that do not impose a carbon cost would not only hinder Australian businesses but also increase total global emissions.
"Both the green paper and the recent draft report from the Garnaut review make clear that in the absence of a carbon price among major trade competitors, there are sound environmental and economic reasons for assistance for emissions-intensive trade-exposed activities," he said.
"We support the Government's intention in the green paper to provide assistance."
The Australian Industry Group also welcomed release of the green paper, but questioned whether the Government has considered future growth as it moves forward with setting emissions caps. AiGroup regional manager Leanne Grogan said the public needed to realise the heavy impact a scheme would have on them.
"You're going to have most, if not all of these extra costs passed on to the consumer, either directly or through the cost of petrol and energy," Ms Grogan said.
"We need to make sure this doesn't drive our companies offshore."
South Coast Labour Council secretary Arthur Rorris said the "hole in the strategy" was a lack of focus on "the development of non-nuclear renewable energy".
However, he felt the scheme would have a positive environmental effect without the negative impact on jobs and the economy some had feared.
"Clearly, the Illawarra is one of the most carbon exposed regions in Australia and there are local sensitivities about jobs and the future of our key industries," he said.
"I think ... there's sufficient leniency and compensation both by way of credits and time for companies to make ... adjustments."
Mr Rorris said plans to compensate the electricity industry was "another nail in the coffin of the State Government's privatisation plans" and they could now not justify "shifting the problem to the private sector".
NRMA president Alan Evans stressed the importance of adjusting the fuel excise by the same amount petrol prices would increase as a result of the Carbon Pollution Reduction Scheme.
"Next week, the NRMA will release its Jamison Report and in it call for the Australian Government to use a substantial portion of the revenue raised by the scheme to invest in greener alternative fuels and technologies," he said.