a Business Spectator publication

Oz climate strategy: OK, can do better

"You've got to ask yourself, what is the point of all this if millions of Australians are going to be worse off and we are not actually going to cut our emissions?" So sayeth, and repeateth often, the federal leader of the opposition, Tony Abbott, in his denouncements of the Gillard government's now legislated Clean Energy Future Plan and, more pointedly, the carbon price it will introduce.

It's an argument – along with that alleging that even if we do cut emissions, it won't do anything to halt global warming – that has been seized upon by a vocal few in the Australian media; especially after getting an unintended boost from the government's very own Climate Commissioner, Tim Flannery, who said in March this year that "if the world as a whole cut all emissions tomorrow ...the average temperature of the planet's not going to drop for several hundred years, perhaps as much as a thousand years, right? Because the system is overburdened with CO2 and that has to be absorbed and that only happens slowly."

(Never mind that Flannery then went on to explain that climate action is "a long process, no one country or action can solve it," and that Australia's measures are were a "first step in a long trajectory of change." Flannery also told the ABC's 7.30 Report that "what needs to happen is the developed countries need to get their emissions trajectories going down this decade, the larger developing countries need to follow the next decade and then the very poorest countries the decade after that." By then the damage was done.)

But now, as signatories to the UN Framework Convention on Climate Change meet this week in Durban to, among other things, nut out a legally binding international agreement on emissions reduction targets, a new report has been released that aims to answer the question of whether the Australian governments' climate action – current and pledged – can meet national targets, approach targets required for a global 2°C (or lower) by 2020, and pave the way to a low-carbon future?

The report, a joint effort by Ecofys, Climate Analytics and the Potsdam Institute for Climate Impact Research – the highly respected devisers of the global “carbon budget” – is the first in a series of country analyses that compares and assesses national and global action against a range of different climate targets, and which aims to "help clarify the gap between current domestic action and the pledges, thus stimulating discussion on how best to close the gap, taking into consideration the international regime."

So, how are we doing? Well, the results are mixed. The report finds that, due to special provisions in the Kyoto Protocol allowing us to account for a reduction in deforestation emissions back in the early 1990s, Australia is well within reach of meeting its Kyoto target for the period 2008 to 2012, without significantly slowing the growth of greenhouse gas emissions from the energy and other industrial sectors, and taking into account energy and industrial greenhouse gas emissions, afforestation, reforestation and deforestation emissions and removals.

The report also points to the passage of the Clean Energy Future legislative package as "a ground breaking development" that is likely to change the trend of emissions in a positive direction. "This legislation establishes a framework for significant and long-lasting emission reductions," says the report, and "has the potential to become the cornerstone instrument for low carbon development in australia"

But, and it's a decent-sized but, it "requires substantial enhancement." The report points out that CEF policies "differ significantly in stringency and do not completely cover some areas that could potentially have a large impact on emissions." And it warns that "with very high per capita emissions and a rising population, Australia’s starting point is difficult – and shows that the longer a country delays strong policies, the more difficult it will be." (It also points out that, while the researchers "recognise" the threat posed by Abbott's now-infamous "blood oath" to repeal the package of policies, the impact of policies has been evaluated under the assumption that the measures would continue independent to possible changes to administration. This point is unnervingly followed by a disclaimer of sorts, advising that "Given the dynamic nature of policy development and implementation, the analysis in this report must be seen only as a snapshot.")

So, while Australia gets big ticks for its general climate strategy (rated B on the report card) and its support for renewables in electricity generation (this gets an A), the rest of the report card is littered with Es ("some policies with medium ambition level"), Fs ("few policies, ambition level low"), and Gs ("no, or very limited policies"). The transport and industry sectors rated particularly badly, listed among the policy areas that the report says have been covered inadequately by governments – energy efficiency in transport or non-energy emissions in industry, both showed significant emission reduction potential but both rated F. "Australia has not yet implemented emissions standards for light vehicles," says the report, "and the levels it is proposing are too low and would be introduced too late." ...There are very limited incentives for efficiency improvements for heavy vehicles apart from some information programs."

Reductions in energy intensity is another area in which the research finds Australia's efforts lacking. According to the report, the nation's energy intensity has been steadily decreasing over the past 20 years, but business-as-usual projections indicate a slowing down of this trend. Policies implemented, specifically the renewables target, are projected to improve intensity beyond the long-term trend, approaching a 39 per cent reduction from 2005 levels by 2035. "While positive, this falls short of the (non-binding) target of APEX countries of achieving a 45 per cent reduction in energy intensity compared to 2005 levels by 2035.

And how about emissions? According to the report, Australia’s GHG emissions excluding lUlUCF (land Use, land Use Change and Forestry) have increased by 75 per cent since 1990 (2008 levels) and, under business-as-usual, are projected to grow further to around 731mt CO2e until 2030. This would represent an increase of 187 per cent compared to 1990 levels. With the new Clean energy Future Plan, the report says this growth could be dramatically reduced. And they will need to be.

"The comprehensive Clean energy Future Plan defines a legislated strategy, which if fully implemented would almost reach australia’s 5% ‘unconditional’ reduction by 2020 from 1990 target domestically with deep and far-reaching policy changes," says the report. "However, the plan gives no indication as to how Australia would reach its ‘conditional’ 15 or 25 per cent reduction by 2020 from 1990 targets – or the long-term target of an 80 per cent reduction by 2050 from 2000 levels"

As for Australia's international obligations – which the report describes as "one of the key issues" in evaluating how the Clean Energy Future package places Australia – the researchers found that only in one best-case scenario would the CEF measures be sufficient to meet the Kyoto "allowed" energy and industrial GHG emissions under the -5 per cent by 2020 pledge. Of more concern, however, was the report's finding that "in all cases" – including those with the most ambitious government-projected energy and emissions cuts – the reductions were "less ambitious than what Australia needs to do to be on a path towards keeping global warming below 2°C, the temperature limit that it signed up to in both Copenhagen and Cancun."

"In this context," says the report, "it is worth noting that a 2050 emission reduction globally of 80 to 85 per cent from 1990 levels, which would be required to give a high probability of limiting warming to 2°C, ultimately ...would require 95 per cent or more reductions from the developed countries by 2050 in order for global per capita emissions to be approximately equal
in that year.

"With the new 2050 goal," the report continues, "Australia has joined the EU (80-95 per cent) as the only Annex I countries to come close what is needed on this time frame. The low carbon policy package described in this report and that is consistent with meeting internationally agreed long-term goal of holding global warming below 2°C above pre-industrial levels would require, for developed countries, at least a 95 per cent reduction from 1990 levels and would likely need to be anchored in a legally binding manner.

"While the legislation puts the appropriate instruments in place to achieve the necessary change, its long-term effectiveness will depend on the ability of successive governments to increase stringency and coverage of the instruments over time.With very high per capita emissions and a rising population, Australia’s starting point is difficult – and shows that the longer a country delays strong policies, the more difficult it will be."