Finally! Climate Policies Explained

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When the Government released its climate change package on 10 July, it was under the moniker of a "Clean Energy Future". This is, ostensibly, a fairly clear vision for where Labor sees Australia in 2050 and beyond.

But where are we really going with all this? If the world follows the suggestions of science and reduces CO2-e emissions to constrain dangerous climate change, what sort of future are Australian political parties setting us up for?

There are five basic possibilities, relating to our emissions levels relative to our global entitlement and how we approach any excess/shortfall:

1) Australia emits less than its global entitlement of CO2-e, and exports its remainder. (This needn’t be an allowance as under a global emissions trading scheme with binding national targets and permit allocations, but could simply be a level of domestic CO2-e offsetting in excess of the local demand that’s then traded abroad.)

2) As above, but we don’t export the remainder.

3) Australia emits at or about its share of CO2-e — a balanced carbon budget, if you like.

4) Australia emits more than its global share of CO2-e, and offsets the difference by importing allowances/offsets from other countries.

5) As above, but we don’t import (enough) to cover our excess emissions.

Both the approach to calculating Australia’s right to CO2-e emissions and the position vis-à-vis offsetting domestic emissions internationally are predominantly moral decisions, even if they are underpinned by science, economics, law and so on.

Following the argument that each person should have an equal right to the use of the global environment, which seems a sensible and equitable approach, Australia’s entitlement to emit CO2-e should be based our share of the global population. (Perhaps a little less, if you take our disproportionate historical use of the atmosphere into consideration.)

The 2011 Garnaut Review estimated that global per capita emissions would need to fall to less than two tonnes of CO2-e per year to stop CO2-e concentrations rising altogether, with even lower levels required to reduce concentrations. One to two tonnes of CO2-e per person per year seems a ballpark figure for our entitlement, then.

Offsetting domestic emissions internationally should, scientifically, be a non-issue: if the processes are of equal quality, arguing about whether Australian emissions should be offset by projects in Australia or Borneo is equivalent to arguing over offsetting in Queensland versus Tasmania; the climate responds equally well to both. And while the processes to offset emissions in Australia and Borneo are not of the same quality, we can restrict the import of foreign offsets to those that meet the relevant standards of additionality, verifiability, and so on. This would be little different, in principle, to Australia’s importing foodstuffs or consumer goods only from foreign companies certified to have a certain quality standard of production.

Where quality is equal, it would seem most efficient to choose the lowest cost abatement, which will probably not be in Australia. Investing in higher-cost domestic options, however, could establish new industries that prove more efficient in the long run, similar to the way Germany is fostering its solar and wind power industries. While Australia will end up importing some of our future offset and abatement technology — we simply aren’t large enough to develop everything ourselves — a strong local market might have kept talents such as Zhongreng Shi or David Mills in Australia rather than watch them found their solar PV companies in China and the USA, respectively.

There are also the arguments that Australia should not achieve its entire net emissions reduction by shifting the work overseas. One argument involves equity: if foreign offsets are sold through intermediaries, is the money going to the end producers or the intermediaries? If it’s the intermediaries, would we prefer the money went to Australians, instead? Another argument (pdf) is that countries have an ethical responsibility to abate their own emissions. Such arguments for domestic abatement are broadly accepted (see Article 6(d) of the Kyoto Protocol, for example), though to varying degrees.

So: how do the climate policies of Australia’s political parties fit into the above framework?

Vision 1 — Low Emissions, Exporting Surplus
This is the vision of the Greens, and the clearest of the major parties. A goal of The Greens’ climate change policy is "to achieve net zero greenhouse gas emissions as soon as is feasible and by no later than 2050". Emitting zero is obviously less than our entitlement, which leaves the question of trading our surplus allowances/abatement. Since the Greens are comfortable with the MPCCC proposal of importing up to 50 per cent of permits required under the ETS — though only, they stress, permits of the highest quality that do not replace serious domestic action — they would presumably also be comfortable exporting any surplus we might have. (Assuming, of course, that our own abatement is of the highest quality!)

Part of the Greens’ vision is a low-impact lifestyle: less energy use, less driving, less flying, more public transport use, less logging, and so on. Such lifestyle change might not be absolutely necessary to reach a low-emissions scenario, but it would certainly be more difficult without it.

Vision 2 — Low Emissions, Not Exporting Surplus
While a part of the environmental movement (and the Greens) might be against Australia enabling the emissions of other countries — similar to current calls to stop fossil fuel exports — this scenario is unrealistic. It would require explicitly rejecting a potentially quite large revenue stream, to which Australian businesses are famously and vociferously opposed, and a significant change in public attitudes toward actions that might be primarily symbolic.

In particular, if Australia achieves low net emissions via plentiful offset generation rather than low gross emissions, it would be radical to ban the generating companies from selling their offsets overseas. To a certain extent, this vision seeks to impose a lifestyle choice upon other countries by limiting their options — such a vision is not always wrong (most people would be happy limiting certain countries’ access to nuclear weapons, for example), but it is controversial.

Vision 3 — Medium Emissions, Balanced Over Cycle
The use of the term "balanced" here is deliberate: this future sees Australia emitting at or about its share of global CO2-e emissions, trading allowances as and when economic or natural fluctuations require us to, but striving to maintain a roughly equal quantity of CO2-e imports and exports over time. Unlike other budgets, however, there is no pressing need that this one sum to zero over time; that would purely be a matter of preference.

Vision 4 — High Emissions, With Imported Offsets/Allowances
This is the ALP’s position — probably. It’s difficult to tell. Labor’s rhetoric has been about cutting pollution, supporting jobs, remaining competitive, increasing efficiency, and moving toward clean energy. These are all laudable goals, but jobs and competition have little to do with the climate and it’s unclear how clean the ALP’s energy future is, exactly. The Government’s long-term target of 80 per cent reduction of CO2-e emissions versus 2000 levels by 2050 is one of the more concrete figures, but will still almost certainly lead to a future Australia that emits more than its global share.

Climate protection is not part of Labor’s core ideals. Though it’s not said so explicitly, implicit in the ALP’s rhetoric about maintaining our standard of living and its stance toward imported emissions (80 per cent of required permits allowed under the CPRS; 50 per cent under the current proposal) is a vision of an Australia that uses its wealth to pay other (poorer) nations to offset higher domestic consumption of CO2-e. Labor might be interested fuelling our current consumption model differently, but it’s not particularly interested in changing the style in which we live as the Greens are; the choice is for "cheaper, rather than deeper" action, to borrow a phrase.

Vision 5 — High Emissions, Without Imports
It seems harsh ascribe this vision to the entirety of the Liberal and National parties as it is certainly not shared by all their members. Under the current leadership, however, this is the Coalition’s vision. Its direct action plan is nonsense and won’t achieve 5 per cent emissions reductions by 2020 under the proposed spending cap, while Liberal policy documents don’t even include a target for 2050 or beyond. Though a theoretical commitment to 100 per cent domestic action sounds very responsible, Tony Abbott’s tendency to frame his public statements on climate change around the views of his audience at the time brings into question his underlying commitment to significant action.

Between the intellectual flexibility of Tony Abbott and his Shadow Minister for Climate Action, Greg Hunt, so long as no Australian is monetarily worse off — never mind the environmental costs, or the rest of the world — the Coalition vision is to plant some fig trees for their metaphorical leaves and let someone else sort out the problem.

The examples here are not definitive. Malcolm Turnbull’s vision, for example, sees lower emissions than Tony Abbott’s and could share a category with the Greens or the ALP — but it differs from theirs in a greater emphasis on carbon capture and storage technologies, as well as a more explicit recognition of the need to manage risk and uncertainty. Similarly, Paul Frijters’ "Give up, or hope for a technological miracle" stance falls into the same category as the Coalition vision, though he expressly rejects their direct action policy. (And the ALP’s policy, too, to be fair.)

Which type of future you prefer is entirely your choice. But don’t kid yourself: the Coalition under Abbott aren’t really interested in a low-carbon economy; the ALP would like a low-carbon economy, but only where it’s not too difficult; and the Greens sincerely want a zero-carbon economy, but will want to change your lifestyle to achieve that. It’d be nice if they said it — but most voters only want so much honesty from their politicians.

 

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