Making our way: Adaptive capacity and climate transition in Australia’s regional economies

Overview

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Making our way header image - A green signposts at a crossroads pointing to Tom Price in one direction and Karratha in the other

The report looks at how  government and communities can build locally-led responses to climate transition “from the ground up”.

Making our way examines the regional economies most affected by climate transition, and develops a multi dimensional, analytical framework that assesses their ability to adapt to change.

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Making our way proposes and applies a framework to assess the adaptive capacity of ten local government areas affected by economic changes during the climate transition.

It provides guidance to policymakers on how to create responses to climate transition “from the ground up” with local communities.

Why does this matter?

A just transition puts the people most affected at the front of the pack for jobs, opportunities and projects.

Simply replacing anchor industries is not enough. Transition measures must increase economic diversity so local economies are more resilient, support projects that build on community strengths, and be shaped by leaders on the ground.

Taking this approach at a local level will help diversify our national economy, making Australia more resilient to global shifts that result from addressing climate change.

Having common data, approaches and understandings between levels of government will equip them to work better, faster and more cooperatively with affected communities.

What is adaptive capacity?

Adaptive capacity describes a local economy’s ability to adjust to change.

Making our way measures this capacity in 11 local government areas (LGAs) affected by climate transition.

It develops and applies a framework for measuring adaptive capacity using ten indicators across seven dimensions, including economic diversity, innovation and access to services.

Communities with high levels of adaptive capacity will be better equipped to navigate change 

Three circle venn diagram from Making our Way illustrating the seven dimension of adaptive capacity
MAKING OUR WAY - THE SEVEN DIMENSIONS OF ADAPTIVE CAPACITY

What does the analysis show?

Making our way finds that most communities affected by transition are below the regional average in economic diversity, access to services, and social capital.

However, the report also finds that the LGAs differ in many important aspects, underscoring the necessity of discrete transition plans instead of a one-size-fits-all approach.

Making our way analysis picture - a screenshot of a table with heatmap colours showing the performance of 11 LGAs against adaptive capacity indicators
Comparison of adaptive capacity indicators for Australian regions most exposed to declining fossil fuel demand. Colours indicate the number of standard deviations away from the Australian average for non-capital-city LGAs.

While LGAs in NSW and Collie in WA benefit from dynamic local economies and strong domestic market connections that provide a good base to build upon with general business support, LGAs in the Pilbara and Central Queensland likely require more extensive planning and infrastructure investment due to their more highly-concentrated economies and fewer connections to nearby markets.

What does Making our Way recommend?

By leveraging the adaptive capacity framework, governments can better understand the specific strengths, needs and capabilities of local communities, and work with them to develop more effective and appropriate responses.

The Making our way report recommends:

  • Local transition plans that aim for resilience and adaptability rather than just new anchor industries;

  • Transition responses built “from the ground up” with local communities

  • Governments collaborating on realistic, ambitious plans for affected regions

  • Local governments identifying strengths and weaknesses in adaptive capacity

  • State and Federal governments providing funds, coordination and policy frameworks

Making our Way in the media

Local transition plans for Australian regions affected by climate transition should be built “from the ground up” to strengthen resilience and adaptability, rather than adopting a one size fits all approach that focuses just on replacing fossil fuel industries
Coal and natural gas production hubs in Australia, one of the top exporters of the fossil fuels, should diversify their economies and can’t rely on potential new industries such as green hydrogen to preserve jobs, according to a study.
Australian coal mining regions need a steady supply of teachers, healthcare workers, volunteers and entrepreneurs to adapt and prosper as the world moves away from fossil fuels.
Coal-producing parts of the country are looking ahead to their future beyond the industry, and what sort of economies they need to build. A new report from the Centre for Policy Development...

About the authors

Mara Hammerle

Dr Mara Hammerle is policy adviser for the Sustainable Economy Program at the Centre for Policy Development
A man smiling wearing a blue shirt in front of foliage - Toby Philips

Toby Phillips

Toby Phillips is the program director for the Sustainable Economy Program at the Centre for Policy Development

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