Australia Sabotaging Itself On Climate Action


As it emerged over the weekend that the Abbott government is bloodletting the Clean Energy Finance Corporation, the Climate Council unveiled a new report demonstrating just how far behind the rest of the world Australia is in its efforts to curb carbon emissions.

In the report, released this morning, the Climate Council endorses a recommendation from the government’s advisory Climate Change Authority that Australia cut its emissions by a minimum of 40 per cent by 2030.

Starting from the current target of a five per cent reduction on 2000 level emissions by 2020, the higher targets recommended by the Climate Change Authority would require a steep trajectory, and each time the government takes a retrograde step it gets much steeper.

In 2011, the International Energy Agency (IEA) was already warning that “delaying action is a false economy”.

“For every $1 of investment in cleaner technology that is avoided in the power sector before 2020,” the IEA said, “an additional $4.30 would need to be spent after 2020 to compensate for increased emissions”.

The ‘crucial decade’ for tackling climate change is already halfway through, and the government is expected to announce its targets for the post-2020 period later this month.

As well as canvassing future requirements the Climate Council report serves to remind us of past failures.

When Labor set Australia’s target of a 5 per cent cut by 2020, it also committed to a higher 15 and 25 per cent cut if the rest of the world stepped up efforts to tackle climate change.

Those lofty aspirations are scarcely mentioned now, but the Climate Change Authority has said that considering the science, economics and international action, a minimum cut of 19 per cent in emissions by 2020 is warranted.

The independent Climate Institute has recommended even deeper cuts, of around 60 per cent by 2030, but as the Climate Council notes, the reality is that “there remains uncertainty as to whether the [Abbott government’s] new Emissions Reduction Fund will meet the 5 per cent target”.

In fact, while the rest of the world has been moving quickly to capitalise on the global renewable energy boom, which attracted $270 billion in global investment last year, and implementing increasingly ambitious carbon pollution reduction targets, Australia has taken out a string of inglorious tittles.

Kofi Annan, a former United Nations General Secretary, recently described Australia as a climate “free-rider”.

Last month a report from the influential Grantham Institute singled Australia out as the only nation to take a legislative step backwards from tackling climate change, with the repeal of the carbon tax, while the Climate Council reports that 39 countries and 20 sub-national jurisdictions have now priced carbon.

A further 26 countries are currently considering introducing a price on carbon, the Climate Council report said, and recent data from the International Renewable Energy Agency indicates that 145 countries have introduced renewable energy policies.

Which brings us, of course, back to the government’s most recent battle in its war on renewables.

After successfully cutting the national Renewable Energy Target by around 20 per cent, the government has issued a directive to the Clean Energy Finance Corporation, a body which it has tried unsuccessfully to abolish twice, not to invest in wind or small-scale solar.

The Clean Energy Finance Corporation was established to pump money into the renewable energy sector to encourage growth in the industry, and it’s a job the profit-making entity was doing quite well.

How exactly the government’s directive will play out is unclear. The CEFC now has to respond to the directive, which must be tabled in parliament before coming into effect.

The corporation is governed by an Act, and unless the government succeeds in abolishing it altogether, that legislation will enforce some limits to how deeply the government can interfere with its functions.

Regardless, a spokesperson for the CEFC said 21 per cent of the organisation’s funding has gone to wind, and more than 30 per cent to solar. Much of the money invested in solar by the CEFC went to small-scale developments which now look as though they’ll be banned, so the directive will clearly result in a big shake-up of how the taxpayers’ funds are invested.

The CEFC had in large part been investing in the most profitable, economically viable, and functional projects in terms of their ability to establish an industry that will help reduce carbon emissions. So while the government can issue directives, the CEFC will retain its funds and the upshot is likely to be that public money will be invested much less sensibly.

As the International Renewable Energy Agency and Intergovernmental Panel on Climate Change have noted, emissions reductions will become more expensive with each year of delay, and squandering money won’t change that.

The global community is moving quickly now, but as the Climate Council report points out, Australia’s emissions in and of themselves aren’t insignificant. Quite the opposite, in fact.

Despite our tiny population, Australia is the world’s 13th highest emitter of greenhouse gasses, with per capita emissions of more than three times those of the European Union, Japan and China.

Our economy’s emissions intensity, effectively the amount of carbon emitted per unit of GDP created, is roughly twice as high as that of the United States, and 2.5 times that of the European Union.

This means tackling climate change is less challenging for other nations, and those responsible for more than half of the world’s carbon emissions have now announced the targets they’ll pursue for the period after 2020.

While they’re not yet enough to avoid the two degree increase in global temperature identified by the international community as ‘dangerous’, they’re a substantial leap forward on past efforts.

In terms of comparable economies, the United States will cut emissions by 26-28 per cent on 2005 levels by 2025, the European Union is on track for a massive 80-95 per cent cut to emissions by 2050, and even Canada has agreed to a 30 per cent reduction by 2030 relative to 2005 levels.

China, the world’s highest emitter overall, will peak emissions by 2030 and lower its economy’s carbon intensity by 60-65 per cent on 2005 levels by the same year, while also embarking on an ambitious reforestation program and increasing its uptake of renewable energy.

Actions like these are creating the diplomatic and market conditions which mean Australia’s task in tackling climate change will become increasingly difficult once it eventually begins and, as the IEA points out, necessarily more expensive.

The reality is that with its high emissions intensity, reliance on coal usage and exports, and a seriously weakened renewable energy sector, Australia is starting from behind, and ongoing moves to diminish mechanisms like the CEFC are only making it more difficult to catch up.

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