Howard's Kyoto Sabotage

On the first Parliamentary sitting day of 2007, Prime Minister John Howard had to formally retract his climate change ‘denialism’. (Compare his performance as a full-blown ‘climate skeptic’ only a year ago on Four Corners.)  

This incident may prove to be a tipping point in more ways than one.

Howard’s retraction epitomised a Government in near panic on the politics of climate change, driven by events including the drought, the Stern Report and, most of all, the opinion polls. The last minute charade of tradable emissions schemes, isolated from Kyoto processes and constrained so as not to impact the export coal industry, has not helped the Government’s cause.

But despite this disarray, why does Labor still seem not yet fully effective on this issue?

The Malcolm Turnbull/Peter Garrett debate on ABC TV’s 7:30 Report on 8 February was a good indicator of Labor’s failure to target aggressively the core weaknesses in the Government’s position.

Environment Minister Turnbull focussed on two key messages: (i) promoting sharply improved efficiencies in the use of energy; (ii) a global problem requires a global perspective.

In support of the former message, Turnbull referred to an important International Energy Agency (IEA)/OECD Report that highlighted how technologies could be cost-effectively deployed to reduce global emissions by 60 per cent by 2050 (strange, given that he’d denigrated the goal of 60 per cent reduction in Parliament earlier that week).

Turnbull also claimed that the IEA/OECD Report pointed to a ‘need’ for nuclear power as part of the solution. The Report’s objective analysis does no such thing. Even in a particular scenario within the Report where expanded nuclear power is permitted, it accounts for only 6 per cent of the required emission reduction, compared with 44 per cent attributable to improved end-use efficiency. This debunks any notion of nuclear as a necessity, let alone a panacea.

And finally, Turnbull ignored a basic feature of the IEA/OECD Report its use of global emissions penalties allowing the market to discover the most cost-effective mix of technologies. The omission revealed as empty rhetoric Turnbull’s claim of addressing solutions through a global perspective.

How did Garrett handle these issues? There were the usual mantras about encouraging a renewable energy industry, albeit (appropriately) with side-references also to the potential role of natural gas. This was a standard response to Turnbull’s jibes about Labor’s alleged neglect of jobs and economic growth.

But until reminded by Turnbull’s reference to the IEA Report, Garrett neglected the less glamorous but all-important contribution of energy efficiency unequipped, as it is, with an industry lobby like that for renewables. And Garrett didn’t take the opportunity to point to years of Government inaction on this front by citing concrete examples such as the worsening of motor vehicle fuel-efficiencies.

Of greater concern, Garrett failed to engage fully with that other central issue raised by Turnbull: the need for a ‘global governance’ perspective. On that front, Labor constantly calls for ratifying the Kyoto Protocol but seems uncertain where to go from there. It’s as if Labor has not fully understood the truth about why Howard refuses to ratify.

The Government constantly claims it is ‘on track’ to meet its Kyoto target for domestic emissions. The implication is: ‘Why bother with formal ratification?’ But if ratification were no more than a formality, Howard would have ratified long ago. Refusal to ratify has little to do with domestic emissions targets and everything to do with sabotaging the Kyoto process and its evolution.

Thanks to Bill Leak

Kyoto’s evolution means at least two things: (i) the US, China and India (and Australia) join the rest of the world by accept binding emission targets; (ii) over time, a graduated adjustment of such targets and emission charges, as the magnitude of climate change consequences is better understood. Significant ‘hold-outs’ or free-riders will jeopardise Kyoto’s evolution both directly and by diminishing the resolve of those nations that would otherwise commit to limits on their emissions.

The great fear of Australia’s coal lobby is that an evolving Kyoto process will mean significant reductions in existing markets, loss of potential markets for Australian coal exports and downward pressure on prices and volumes of export coal.

Australia’s ‘sabotage’ of Kyoto by non-ratification provides cover for the US to do likewise. The result is a kind of ‘Coalition of the Unwilling,’ with Australia supposedly ‘punching above its weight’ as an ‘energy super-power’ two favourite phrases of the Government.

Full participation of the US is essential to effective action on climate change, for several reasons: (i) it has long been the largest emitter in absolute terms and one of the highest emitters per capita; (ii) high per capita income implies an ability to bear the cost of emission abatement; (iii) its prowess in technological innovation; (iv) China and India, with their booming economies and energy sectors but much lower per capita emissions and incomes will be more inclined to accept caps or targets under Kyoto-type agreements if the US does.

Since the Kyoto Protocol come into force in 2005, as many as 168 countries have ratified it   including energy producers such as Iran, Kuwait, UAE, Saudi Arabia and Norway even though such economies have a far greater dependence on energy exports than Australia does. These countries would face the same downward pressures on prices and export volumes of oil as would Australian coal.

China is the world’s largest coal producer and consumer around 2 billion tonnes a year. Australia’s current coal exports to China are a mere 0.1 per cent of this, and only 3 per cent of total coal exported by Australia. But the Australian coal industry wants to enlarge its share of this rapidly growing market.

The momentum in building coal-fired Chinese power stations is immense and cannot be stopped overnight. In business-as-usual forecasts published by the US Department of Energy (DOE), China’s coal-fired electricity capacity increases at 20 GW a year over the next two decades (it approached 100 GW in 2006 alone).  Twenty GW annually is about three times greater than equivalent US growth, and is equal to half of Australia’s total coal-fired capacity.

Longer term, such growth in China’s coal utilisation is not a fait accompli. Certainly it is incompatible with preventing dangerous climate change.

China, however, does have options for generating electricity alternative, cost-effective and non-nuclear options that are much less intensive in CO₂ emissions. These options include combined cycle gas turbines (CCGTs) using natural gas, complemented by diverse renewable sources. Such an option also implies substantial steps toward addressing China’s serious problem of air pollution and incidentally, market opportunities for Australian Liquefied Natural Gas (LNG) exporters.

However, as Stern and others have shown, such options, especially the more costly and problematic ones, like ‘carbon capture and storage’ (CCS), will not eventuate unless significant emissions penalties are in place.

That is why it is self-contradictory and dishonest for Howard to champion CCS, when his Government’s main policy thrust is to prevent meaningful and globally binding emissions penalties. This internal contradiction has not escaped the coal mining union ( CFMEU), as Garrett astutely noted on the 7:30 Report:

The CFMEU are totally in favour of ratifying Kyoto, are totally in favour of supporting renewable energy, are totally in favour of the Labor position . They recognise that’s the only way forward.

Clearly, as Developing Countries with emissions only around one tenth those of the US on a per capita basis, China and India will not commit to binding emission limits unless the US does. This is why Australia does have considerable leverage in these particular circumstances. As a responsible international citizen, Australia can help by ratifying Kyoto simultaneously emancipating us from pariah status and leaving the US as the last non-complying OECD member-State.

Instead, the Howard Government apes the Bush Administration in rhetorically calling for China to limit its emissions when it has, as yet, no formal obligation to do so under Kyoto, and while the US has made no such commitment itself.

Within a week of Howard’s gaffe on climate change that prompted his embarrassed retraction, he gratuitously attacked not only the leading US Democratic Party Presidential aspirant, Senator Barack Obama, but the Democratic Party as a whole. Howard surely must be aware also that apart from his position on Iraq, Obama is co-sponsor of a bipartisan Bill to significantly reduce US greenhouse gas emissions one of several being considered by US Congress. For instance, the Bill sponsored by US Senators Sanders and Boxer, and by Representative Waxman, involves greater cuts in emissions by 2050 than does Obama’s while also avoiding ‘sweet-heart deals’ requiring subsidies to the nuclear industry as part of the package.

After 10 years of inaction it is impossible for the US to meet its 2008-12 target. However, these Bills include commitments to serious long-term abatement. These signs of change in the US are obviously unsettling for Howard.

In the lead up to the Federal election, Labor needs to ruthlessly expose the Howard Government’s shameful objective of undermining the Kyoto process.

As even Howard has now had to admit, dangerous, human-caused climate change has real scientific foundation. The responsible policy for Australia is to ratify Kyoto immediately and thereby do its bit to shame or persuade the US to make serious commitments. This will encourage the full participation of China and India while fully recognising their legitimate development objectives.