Income tax is progressive in that higher levels of income attract a higher marginal rate of tax. As best I can understand the alternate emissions trading scheme analysed by Frontier Economics and now being touted as an alternative by the Liberal Party leader it seems to do something similar. So for each kWhr of electricity the rate of tax on emissions would be increase as the assocate emissions increase. Emissions below some baseline amount would essentially be tax free. Whilst those above the baseline amount would be subject to the cost of purchasing emissions permits. In essence it seems to be a sort of progressive carbon tax.
The idea seems innovative and is promoted as being cheaper and hence better in economic terms. It is also being promoted as greener with the capacity to deter more emissions than the governments proposal. And it is claimed it would reduce churn. I have little idea as to whether any of this is true or not.
For those that are interested you can find the full report here:-