‘Don’t blow it – good planets are hard to find’TimeRecent reports on climate change have confirmed what has been intuitively and practically evident for many years, namely:
In response to community concerns over climate change, the Prime Minister set up a Task Group on Emissions Trading in December 2006, to report by end-May 2007. Its Terms of Reference state:
‘Australia enjoys major competitive advantages through the possession of large reserves of fossil fuels and uranium. In assessing Australia’s further contribution to reducing greenhouse gas emissions, these advantages must be preserved.Against this background the Task Group will be asked to advise on the nature and design of a workable global emissions trading system in which Australia would be able to participate. The Task Group will advise and report on additional steps that might be taken, in Australia, consistent with the goal of establishing such a system.’
In the circumstances we now face, these requirements are dangerously anachronistic:
The Task Group Issues Paper released in early 2007 ignored the substantial body of knowledge on climate change and emissions trading built up over the last two decades in Australia. This paper might have been appropriate as a primer in the early-1990s, but to put it forward today as a serious contribution on this critical issue, suggests that the Federal Government either does not understand, or does not want to understand the seriousness of the challenge we face, and is intent on delaying effective action yet again.
Having crossed the threshold from denying to accepting that climate change is a serious issue, which the government now claims to have done, sensible policy becomes mandatory. Time is of the essence, for the longer it takes to implement solutions, the harder they become, particularly given growing evidence of non-linear climatic responses to increasing CO2 concentrations and rapidly accelerating emissions both here and overseas.
Current piecemeal initiatives are totally inadequate. Emissions trading is now, reluctantly, under discussion but it is only one component of the comprehensive policy required.
While the Federal Government has no coherent policy, I do not believe that the ALP really understand the extent, and urgency, of the challenge we face. Only the Greens are coming anywhere near it, as demonstrated by the Re-Energising Australia policy paper released by Christine Milne in April.
So what constitutes sensible climate change policy? It would look something like this:
There must be rapid implementation of measures to stabilise atmospheric carbon concentrations by reducing emissions substantially. This requires clear, binding, deliverable targets to be agreed globally and nationally, best achieved by committing to a modified Kyoto Protocol in the immediate future:
Directional incentives are essential to speed the transition to a low-carbon economy and to capitalise on new business opportunities. For example we need to:
Fossil Fuel Exports are a substantial source of carbon leakage from the global carbon emission reduction effort unless the recipient country is part of the global reduction program.
There may well be justification for higher quality Australian coal, for example, to be used for power generation in preference to poorer quality coal in other countries. However, without carbon being fully priced, there will be substantial distortion of the future energy market if carbon-intensive projects become locked into the energy mix before global negotiations are completed.
The Australian coal industry has belatedly acknowledged that clean coal technology and carbon sequestration is essential if coal combustion is to continue. However, despite the industry having been on notice for more than 15 years, the R&D investment devoted to this task is miniscule compared with the challenge ahead. Further, whilst carbon sequestration may work in specific circumstances, it is by no means clear that it will be generally applicable or that timely solutions will be available.
Accordingly, no further fossil-fuel export projects should be approved until either all exported carbon can be securely sequestered on a long-term basis, or it is accounted for in the importing country by global carbon reduction agreements. This will ensure that investment decisions are not distorted, and spur technological and diplomatic innovation.
No further domestic carbon-intensive investment projects should be approved until the market structure outlined above is in place, with full carbon pricing. This would apply, for example, to any new coal-fired power generation, water desalination plants, industrial plant etc. Given Australia’s dependence on existing coal-fired power generation and its associated high emissions, all existing power plants should be phased out by 2020 unless retro-fitted with clean coal technology and carbon sequestration to acceptable standards.
At present airlines are not included in emissions trading systems. Airlines account for around 3% of global emissions, although this may be an underestimate as some types of emission may be particularly damaging, the total impact being perhaps 2-4 times as great. Airline emissions are growing rapidly, spurred by cheap air travel and increasing wealth, and will become a much more significant component of overall emissions. Accordingly aviation must be included in the global and national emission reduction programs. International sea-freight is also not included in current emission trading schemes and must be incorporated.
International emissions trading will be essential to achieve the optimal, least cost emission reduction strategies. This should be provided for by nation-to-nation emissions trading under the auspices of the modified Kyoto Protocol. It would allow nations with quotas in excess of their needs, as determined under contraction and convergence, to sell to those requiring additional quotas, in the process easing global inequity by transferring wealth from the developed to the developing world. Technology transfers from the developed to the developing world, to achieve low-carbon outcomes, must also be part of the process.
There remains the possibility that the science is wrong and that climate change currently being experienced is primarily due to natural causes rather than being human-induced. The mounting evidence suggests that the probability of this is low, and declining. Nonetheless, in committing to the policy proposed, this scenario should be kept in mind. Prudent risk assessment, weighing the risks and their probabilities in the light of today’s knowledge, suggests that it clearly makes sense to proceed with these proposals, as the potential impact of dangerous climate change may be catastrophic, while the costs of carbon emission reduction are manageable. To continue with business-as-usual implies an irreversible increase in global atmospheric carbon concentrations, which would be foolhardy in the light of the evidence available. But the risk assessment must be kept under review as the scientific evidence evolves.
Whilst policy should endeavour to minimise costs and smooth the transition to a low-carbon economy equitably, there will undoubtedly be pain, but the pain of not taking action will be considerably greater.In these circumstances, it is not possible to maintain industry competitiveness and economic growth as currently constituted. Conventional growth is a large part of the problem. We must move to a new paradigm of a sustainable economy, which requires major structural changes, as well as a shift in values.
But whilst some industries decline, greater opportunities open up. It is essential to take a proactive, forward looking view and seize these sustainable opportunities, rather than reactively defend an unsustainable status quo: the former represent the future of Australia, whereas the latter guarantees our decline and immeasurable community hardship. Rather than a problem, as currently presented, it is a unique opportunity to set humanity on a new course, built on sustainable principles.
The transition will only be achieved if there is strong leadership and a whole-hearted commitment to achieving these objectives. To build this commitment will require extensive community awareness programs.
Above all, visionary, principled, long-term leadership is needed from government, the community and business. Short-term political or corporate expediency is no longer acceptable. Bi-partisan cooperation is essential, for this will not be solved with conventional party politics. Many will argue that conventional politics is all we should expect. I suggest that after another natural disaster or two, the community will demand much, much more.
Current atmospheric carbon concentrations are 430ppm CO2e, increasing at 2ppm per annum. That leaves 10 years before we reach the danger point of 450ppm. As there is a considerable lag before any reduction in emissions has an impact, action is required in the next 6-12 months, not in the 3-5 years favoured in political debate.
Climate change is the most serious issue to confront humanity in centuries. It is of an entirely different dimension to the issues which typically dominate the political and corporate agenda. As such, it must be addressed with honesty and urgency, not with the denial and misrepresentation that continues to epitomise the debate.
Based on today’s criteria of economic success, defined by short-term myopia and profit performance, Australia is doing splendidly and may continue to do so a while. But on any sustainable basis, without rapid corrective action we are heading for a fall, the like of which we have never seen before. Particularly in an economy so dependent on unsustainable energy consumption and exports, on the driest continent on Earth.
We know what to do – it is hard, but we need to get on with it and not waste another 10 years. As Herman Daly said many years ago: ‘the economy is a wholly – owned subsidiary of the environment, not the reverse’. No environment, no economy.
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