There has been a 9 per cent drop in emissions from electricity generators during the first six months of carbon pricing, a Senate committee has been told.
Last July the Federal Government introduced a carbon price of $23 per tonne for businesses that are big polluters.
Jenny Wilkinson from the Department of Climate Change and Renewable Energy says that since then, there has been a reduction in demand for energy.
She says the early results are due to several factors.
"Increased uptake of renewables on account of the Renewable Energy Target, changes in manufacturing; there's a range of different things which are contributing to this," she said.
"The latest data from the Australian Energy Market operator suggests that emissions from electricity generation have fallen by about 8.6 per cent in the first six months of the year." The cost businesses now have to pay are set to increase between now and 2015 when there will be a shift towards a trading scheme that will allow the market to set the charges.