As American academic Bob Massey put it, “Australia now holds the fate of the world’s climate in its hands”.
In its pursuit of a solution to the ‘budget emergency’ Australia is using up the ‘carbon budget’ at a rate incompatible with the global goal of limiting temperature rises to below two degrees, a Climate Council report out today has demonstrated.
While Australia is under increasing pressure to announce an ambitious target to limit emissions at home, the report makes clear that it is our reliance on fossil fuel exports that is doing the real damage.
By actively seeking to prolong the dying revenue stream, which has buoyed the economy through the past decade, the Australian government is doing massive damage to the remaining ‘carbon budget’.
At a recent talk in Sydney, Massey was blunt.
“If your government and mining companies decide to develop all of the coal and gas currently planned, already on the books, our children will be forced to endure a world very different from what we know,” he said.
To avoid such a world, scientists have developed the ‘carbon budget’ which, put simply, is the amount of carbon dioxide humans can emit into the atmosphere before temperature rises reach two degrees above pre-industrial levels.
On that basis, if all of Australia’s coal were burnt, it would use up two thirds of the ‘carbon budget’. Effectively, 90 per cent of the continent’s coal must stay in the ground.
Not all of that coal is technologically and economically viable now, but even if we burnt only the nation’s ‘reserves’, a 19 per cent bite would be taken out of the carbon budget.
If we burnt the total ‘resources’ – coal known to exist but not necessarily recoverable at this point – it would constitute a whopping 67.7 per cent of the carbon budget.
Yet despite the increasingly gloomy outlook for the commodity – the price of which has collapsed by around 60 per cent in the last five years – mining companies continue to explore for it and develop new mines. Australian governments are not only approving them, they’re promoting them.
Last month, it was revealed that Tony Abbott is standing in the way of attempts from the US, UK, and France to shut down OECD subsidies for new coal-fired power stations in developing Asian economies which are seen as a promising market.
In recent policy papers, like the Energy White Paper and Domestic Gas Strategy, there is a lot of talk about the federal government’s efforts to “cement our position as an energy superpower”.
“Unnecessary and burdensome regulation, high labour costs and business uncertainty through unpredictable policy or inappropriate taxes create risk and contribute to Australia losing investment to other resource-rich countries,” the Energy White Paper states.
The central purpose of the document, which maps out the foreseeable future for energy policy, is to ‘keep us competitive’, and keep us exporting.
The government has indicated it will take a ‘technology neutral’ approach, which explains why Australia is the only nation in the world to axe the (carbon) tax, and efforts to slash the Renewable Energy Target by more than half.
Last year, the federal government approved the world’s largest coal fields in Queensland’s Galilee Basin – resources which the Climate Council reports “can not be developed” because they are “inconsistent with tackling climate change”.
Collectively, the proposed mines would create more emissions than nations like Australia, the UK, Italy and South Africa.
According to the former President of BP Australasia and Councillor at the Climate Commission, Gerry Heuston, the fact that “there’s not a very strong link between energy policy and climate policy” is a key problem.
“My view is that it’s nothing to do with the environmental concerns or moral concerns, it just defies economic logic.
“When you see the economic analysis being done, [it’s] investing money in a future that’s not going to exist.
“Basically what the report shows is the demand is not going to exist if the world is going to keep within the two degree guard rails.”
Huston argues that big business is not against climate action, and recognises there’s a risk, but is waiting on secure, bi-partisan policy settings.
“In fact for years companies like Shell and BP, and other extractives player, were advocating ‘lets have the right policy settings and business will do the heavy lifting’,” he said.
“There are obviously some people out there that take a very short term business approach but you scratch most of the big companies out there and they recognise something is needed on the response to climate change and they’ll respond to it when the policy settings are right.
“That means you’ve got to have a bi-partisan approach, otherwise they’re just going to look after their short term interests.”
Globally, the Climate Council report said, to have a 50:50 chance of meeting the two degree target: 88 per cent of coal reserves, 52 per cent of gas reserves and 35 per cent of oil reserves are unburnable, and must be left in the ground.
At current usage rates, report author Professor Will Stephen said, the world would spend the ‘carbon budget’ within two decades.
The global community, recent events suggest, realises this and are getting serious in the lead up to the Paris climate talks later this year.
The US will reduce emissions by 26-28 per cent on 2005 levels by 2025, China will see peak emissions by 2030, and EU nations are gunning for at least a 40 per cent reduction on 1990 levels by 2030.
In the Australian context, the associated diminishing demand, coupled with drastic reductions in the price of renewables, likely has us headed for an economic cliff.
“If it happens suddenly then it’s going to be more catastrophic than if you see it in advance,” Heuston said.
“You know it’s going to happen some time in advance, then you [should]move towards it with your eyes open.”
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