Australia joined New Zealand and 30 countries in Europe applying a national price on carbon emissions on Tuesday with the passing into law of the government's carbon pricing and clean energy legislation. A range of measure became law after the Senate voted to approve the package that has at its heart a $23 a tonne fixed carbon price on 500 large emitters from July 2012.

The so called carbon tax will rise to around $25 over three years before a transition to flexible-price emissions trading scheme up to 2020.

While carbon tax obligations don't formally begin for another eight months, it was clear at a major conference of clean energy and carbon markets players in Melbourne the same day that business was already in preparation for a carbon price regulation.

A carbon offsets scheme, the Carbon Farming Initiative, has already been approved under separate legislation and is attracting growing investment interest in forestry and farm-based activities to cut emissions and sequester carbon.

Addressing Carbon Expo the next day, Prime Minister Julia Gillard said the Senate vote finalised the work of a generation and governments back to the early 1990s to begin a transformational change in the economy. Along with the carbon tax comes a range of clean energy and low carbon incentives including a $10 billion Clean Energy Finance Corporation (CEFC), still to pass parliament, to provide loans and loan guarantees for promising clean technologies. A key plank of the carbon pricing package sees billions in revenue raised distributed to taxpayers to compensate them for price rises that will be passed on by taxed emitters, and to the CEFC and other clean investment incentives. Tax cuts will begin to flow from July when the carbon tax comes into force.

Carbon tax obligations will apply widely across the Australian economy, including directly on the emissions of large energy and industrial enterprises and indirectly on the transport sector with a 'bunker levy'-style charge on the fuel usage of airlines, shipping companies and rail operators. Answering criticism that Australia was going out on a limb in implementing a carbon tax while there was little chance in the near term of a global climate change agreement, Gillard said that carbon markets and emissions controls are emerging at the national level in a number of countries.

"Don't think that in the meantime that action is not happening," she said. "Action is happening in California, in the European Union and elsewhere." Gillard said that the Australian government was already in discussions with the New Zealand government and the European Commission over linking their emissions trading schemes with the local trading regime that will begin in 2015. But there remains criticism of the setting of the fixed carbon price at $23 at time when the price in Europe and across the Tasman Sea is hovering around the $13 (€10) mark due to the ongoing financial woes in Europe.

The conservative opposition has vowed to repeal Australia's carbon price legislation if it gains government at the next election, due in late 2013. The prime minister tried to reassure Carbon Expo delegates that this would not happen. Gillard said that responsible policy would prevail and going back on carbon pricing would be irresponsible and short-sighted.

"When people look back at yesterday in 10, 20, 30 years' time, they will look back on this legislation as they did on reducing tariffs and floating the dollar. Without it, we would be living in a very different Australia, with more carbon pollution, and less wealth," she said. The government has taken what measures it can to ensure that its legislation is as legally and politically as irreversible as possible.