Carbon tax in the context of economic history

Whether or not you believe in climate change, we all have to admit that reducing carbon dioxide emissions has got to be better for optimum health of ourselves and our planet. Agriculture, industry  and vehicles all add to CO2 emissions and air pollutants and so the government's proposed 'carbon tax' may encourage big polluters to think about utilizing Low Emissions Technologies including wave power, solar power and wind power.
The address by the Minister for Climate Change and Energy Efficiency, The Hon Greg Combet, delivered to Westpac on 8 March this year makes some interesting points, namely:

Climate change needs to be understood in the context of economic history...carbon emissions need to have a price...A carbon price will create the incentive for large emitters to reduce pollution, and stimulate investment in low emissions technologies and processes. It will provide greater certainty for business investment...A market mechanism encourages ingenuity and innovation because it does not prescribe or regulate any particular form of response. Hence a market mechanism encourages innovation through the everyday decisions of investors and businesses. These changes across the whole economy are what will drive the move to a low carbon pollution future.

Combet further outlines every dollar raised by the carbon price will be dedicated to supporting households with any price impacts, supporting businesses through the transition to a clean energy economy and tackling climate change.

He concludes: Pricing carbon is a vital and significant economic reform. It will change the way we invest, produce and consume. It will cut pollution and herald the beginning of a clean energy future. It requires sound long term policy based on rationale principles and an understanding of how economics works.

The government has recently called for submissions for the Low Emissions Technology Demonstration Fund and is at present funding five projects under the program. The (LETDF) assists Australian firms commercialize world-leading low emissions technologies. The objective of the LETDF was to demonstrate the commercial potential of new energy technologies or processes or the application of overseas technologies or processes to Australian circumstances to deliver long-term large-scale greenhouse gas emission reductions, through: the demonstration of the commercial potential of new energy technologies or processes and application of overseas technologies or processes to Australian circumstances. 
Jill Duggan, a European Union climate export is surprised that Australian's are against a carbon tax and states in an article in Business Spectator on 8 March 2011 that since the beginning of 2005 there are 30 countries in Europe that have had a carbon price. Of course, this shouldn't be the reason why Australia should impose a carbon tax, but all of this information is worth considering.