The Coalitions climate policy may have passed but the argument it has deferred will eventually have to be revisited
Australia has been fighting about climate policy for almost 10 years. Most people wish the argument would go away. Investors just wish they knew the outcome.
After repealing the carbon tax and winning parliamentary backing for its Direct Action scheme this week, the Coalition says we have an answer to last 20 years. But thats not true. The Abbott government has deferred the most controversial element of its own policy the bit likely to determine whether it can succeed, and the bit that the government would prefer not to talk about.Continue reading...
With the passage of the Emissions Reduction Fund through the Senate last night, the federal government has taken a step towards achieving Australia’s minimum target to reduce greenhouse gas emissions to 5% below 2000 levels by 2020.
But questions remain over how Australia will achieve the post-2020 transition to a decarbonised economy by mid-century. Avoiding dangerous levels of climate change is the reason for emissions reductions policy.Glimpses of an ETS
We now know that we have a limited “carbon budget” that means emissions must be close to zero by 2050. The carbon budget is well described by the Climate Change Authority which fortunately was retained in a deal between the coalition and the Palmer United Party to see the fund through the upper house .
The deal also provides a review into emissions trading schemes (ETS) and Australia’s future target or cap.
It has frustrated many to see a working emissions trading scheme abolished only to commence a new review into an ETS. Still, this shows that the ETS is a topic that won’t die.
Glimpses of an ETS exist in the deal. The promise of a safeguard which acts as a cap on large emitters as part of the Emissions Reduction Fund deal could over time be strengthened to match the decarbonising trajectory needed. Shortfalls could possibly be met by buying abatement units achieved by others.Meeting a 2020 target
Both of Australia’s major parties have agreed to a minimum national target of reducing greenhouse gas emissions to 5% below 2000 levels by 2020. The Emissions Reduction Fund is the Federal Government’s signature policy to achieve this minimum target.
The fund involves direct payments made by the government to businesses who agree to take actions to emit fewer greenhouse gases than expected. It will achieve this through an auctioning process whereby business can “bid” with their emissions reduction projects, and the projects that can reduce emissions at the lowest cost are paid to do so.
ClimateWorks’ previous research suggests that, if well designed, the fund could effectively fund some emissions reduction opportunities in Australia.
In particular, it could be suitable to fund projects that deliver large reductions in emissions at reasonable cost through technologically proven methods, including projects to:
- Capture waste methane from coal mines, preventing the gas from escaping into the atmosphere
- Undertake deep retrofits of commercial buildings and industrial facilities to make them more energy efficient
- Take carbon out of the atmosphere through “carbon farming” – agriculture, afforestation (planting trees) and reduced deforestation.
According to the government’s Emissions Reduction Fund White Paper, the fund will have a budget of A$2.55 billion, with further funding to be considered in future budgets. The adequacy of the budget for the task remains a question.Beyond 2020
The Emissions Reduction Fund is currently only designed to incentivise emissions reductions between now and 2020, with a view to meeting the 5% target.
However, even if this target is met, the far bigger question is how Australia will achieve the fundamental transition to a low carbon economy, which we now know will be required globally and in Australia by the middle of this century.
In particular, a major transition is needed in energy systems, and these investments need longer timeframes than the next five years. The Pathways to Deep Decarbonisation project report, which was presented to world leaders at the recent UN Climate Summit in New York, shows that near-zero carbon energy systems are feasible for all major emitting countries, while sustaining economic growth.
Australia’s pathways are detailed in an additional national report which shows that Australia has abundant renewable energy options and can achieve near-zero carbon electricity through renewables alone.
Alternatively, a mix of renewables, carbon capture and storage and/or nuclear could be used. This low carbon electricity could then replace petrol and diesel in cars and passenger transport and replace gas used for cooking, heating and cooling buildings. Gas would be used in trucks replacing diesel, and gas would be the main fossil fuel used in industry. Some of this can be shifted to bioenergy or sequestered with carbon capture and storage, and the rest sequestered with carbon forestry.
Australia’s report sees a 71% reduction in CO2 emissions from energy, while the economy grows by almost 150% by 2050 and retains mining and manufacturing, in a world that is also decarbonising.
To reduce the remaining emissions to stay within Australia’s share of keeping warming below the “safe” threshold of 2C, a large increase in land-based carbon sequestration is needed to complement the energy use transition.How to decarbonise by 2050
The Deep Decarbonisation Pathways reports show that it is possible to transition to a decarbonised economy by 2050, but that this would require a rapid acceleration in activity in all sectors of the economy to reduce emissions and set the economy on an achievable trajectory for deep decarbonisation.
Further, the project highlighted the need to start making decisions today across the economy based on the required long-term emissions reductions.
In particular, it will be necessary to:
Accelerate action to reduce emissions now, particularly through energy efficiency opportunities which are already proven and profitable
Avoid lock-in of emissions-intensive technologies, particularly for long-lived assets such as buildings, industrial facilities and power plants which if built today could still be in operation in 2050
Prepare for the future by investing in research and development to bring down the cost of low carbon technologies, building the necessary supply chains and developing local skills and capabilities in these new technologies and processes.
In theory, the Emissions Reduction Fund could continue to operate beyond 2020, with the proposed “safeguard mechanism” operating like a cap on total national emissions. The could be reduced each year in line with the necessary trajectory to achieve complete decarbonisation by 2050.
However, this would require budget allocations to be made every year for a task that will only get larger, or an evolution toward trading between emitters rather than purchasing by government.
In its current design, the Emissions Reduction Fund is most suited to incentivising a certain set of emissions reduction activities.
The Deep Decarbonisation report shows that the transition will be required across all sectors of the economy, and some areas will be better incentivised through other mechanisms.
These mechanisms include minimum efficiency standards for long-lived assets such as vehicles, buildings and industrial developments to avoid “locking in” inefficient technologies, and long-term incentives for the transition to zero carbon electricity, such as an increased Renewable Energy Target or similar measure and ongoing support for new technology development.
Whether or not the Emissions Reduction Fund has a role to play post-2020, a suite of additional measures will be required to drive this transition. We don’t have long to switch to the technologies that can power our economy without creating emissions.
Anna Skarbek works for ClimateWorks which is funded by philanthropy and Monash University. Additional funding was received for the Deep Decarbonisation Pathways Project from ARENA, Accenture, the Global Carbon Capture and Storage Institute, TransGrid and the Mullum Trust.
Australia passes new climate policy that fails to address the key problem of massive over use of fossil fuels
Direct Action is the brand name of the freshly minted Australian Government policy to try and reduce the countrys emissions of greenhouse gases.
But with a name that sounds more like a dodgy box of laundry powder, Australias Direct Action is unlikely to leave the country looking any cleaner or smelling any fresher in the climate change stakes.Continue reading...
Despite Abbott government instruction, the green bank says it is legally obliged to continue operating until legislated not to
The Abbott government has instructed the Clean Energy Finance Corporation to prepare its accounts for the upcoming mid-year economic statement on the basis that it will stop making investments on 31 December and cease to exist on 30 June next year.
But the $10bn so-called green bank says it is legally obliged to continue operating as normal, and will do so, at the same time as it prepares its accounts in line with the treasury instruction.Continue reading...
Palmer United party support guarantees Coalitions plan to cut carbon emissions will become law
More than three months after repealing the carbon tax, the Abbott government has finally succeeded in replacing Labors climate policy with one of its own.
After a marathon debate that stretched into Friday morning, the governments direct action plan passed the Senate with the support of crossbench senators from the Palmer United party.
By Fossil Free Staff Jay Carmona, Community Divestment Campaign Manager & Cat Jaffee, Digital Divestment Campaigner
As oil prices drop, spectators are ready to jump on the tails of fossil fuel divestment advocates and say, “see…?”
The recent drop that we are seeing on the price of oil shows that stranded assets are a real financial risk.
Billions of dollars have been poured into energy projects that require long-term oil prices over $80 a barrel to be profitable–this is especially true for expensive Tar Sands and offshore arctic projects. It is increasingly likely these projects will lose a good deal of money, even without a carbon tax. That scares off investors from funding future oil exploration. So, we can say that the volatility of fossil fuel investment shows the financial benefits of divesting.
There is, perhaps, a drawback of low oil prices for divestment, and that is that it can make consumers complacent about transitioning away from fossil fuels. The payback on electric cars, energy-efficient appliances, or installing rooftop solar may not be immediately as enticing for consumers when oil prices are low. This is precisely where leadership and organizing come in: it’s extremely important now to push for investment in solutions, especially community-based solutions, to the climate crisis. Because we can’t wait for the market to transition from fossil fuels by itself, this is where big institutional investors, say, Harvard or the State of California or the State of Vermont can be leaders right now in this transition from fossil fuels and into climate solutions.
Ultimately, low oil prices are just as much about low demand as they are about low supply. This may come as a shock, but the conventional wisdom that assumes that the world has an unquenchable thirst for oil is actually incorrect (sorry Exxon!). The market is oversupplied with oil because demand is less than oil companies expected (hey, good news!). Believe it or not, the industrial world is becoming cleaner and more efficient; China is slowing down the pace of heavy infrastructure projects that gobbled up heaps of oil and the economy is responding.
This theme may repeat itself many times in the coming years, and when it does, remember two things: the world economy isn’t as thirsty for oil as oil companies had hoped, and large institutional divestment and reinvestment is needed to spur an ongoing transition away from fossil fuels at the scale and pace required to hit global environmental benchmarks.
Here are a list of articles for additional references:
- Ending the Oil Age, New Internationalist
- World Oil Demand: And Then There Was None, by the Brookings Institute
This is what happened when frontline communities tried to make their voices heard at the UN Climate Summit
When frontline communities tried make their voices heard to leaders assembled at the UN climate meeting, it didn’t quite go how they wanted. They’d gathered for the People’s Climate Justice Summit, right across the street from where global corporate and government leaders met to discuss the future of our planet. Watch the video below to see what happened next.
Thanks to our friends at Our Power!
Winner of the Sustainia Award 2014, Wecyclers enables low-income communities to make money from waste and while its a low-tech innovation, its impact is high
When it comes to climate change, we have the bad habit of focusing on the first part of the story, the part about the problem, and forgetting the second part about the many available solutions. These solutions are speeding up recycling, slowing down emissions and providing sustainable alternatives to plastic, air conditioning, smartphones and fast fashion.
The Intergovernmental Panel on Climate Change is gathered in Copenhagen to present its latest report on the impacts and pace of climate change. Due for release on 2 November, we know the highlights of the reports message already. Climate change is now measured on all continents and our efforts to lower emissions must be intensified to avoid it escalating out of control. Along with outlining the risks and challenges, Copenhagen must also embrace and focus on the solutions.Continue reading...
The Australian Financial Review recently trumpeted America’s “re-emergence as a world oil power”. It is an accomplishment four decades in the making and its success is still under debate.
Energy security, or “energy independence”, appeared suddenly on America’s national security agenda in the 1970s, in the wake of the oil embargo that drastically interrupted daily life for Western consumers.
Although the images of (now vintage) cars snaking around city blocks in the queue for rationed imported fuel seem a distant memory, the legacy of the oil crisis is still with us.The “oil weapon”
When fuel pump prices increased by 400% overnight in October 1973, it wasn’t the result of market forces but of a powerful oil cartel. The Organisation of the Petroleum Exporting Countries (OPEC) – which included Iraq, Iran, Kuwait, Libya, Qatar, Saudi Arabia, the United Arab Emirates, Venezuela, Nigeria, Ecuador, and (before it became a net importer) Indonesia – was formed as a bargaining bloc to counter the influence of Western oil companies.
When oil-exporting states used this new economic leverage for political aims, it ensured that oil would never again be viewed as a simple commodity, but as a potentially dangerous weapon.
The oil crisis began when the Arab members of OPEC, plus Egypt, Syria and Tunisia (known as OAPEC – the Organisation of Arab Petroleum Exporting Countries) announced an embargo to protest the West’s support of Israel in the Yom Kippur war. Ministers agreed to raise the price of crude oil by 70%, cut production, and embargo oil exports to the United States, the United Kingdom, the Netherlands and Japan.
It had a crippling effect on the West. In the United States, gasoline was rationed, daylight saving was put into effect year-round, and the national speed limit was cut (permanently, it seems) from 70 miles per hour (112 km per hour) to 55 mph (89 km/h) to increase fuel economy.
Oregon turned off all hot water in state buildings, and snowy Alaska only ploughed half of parking lots, to force carpooling. Some towns even banned Christmas lights as part of a “Don’t be Fuelish” campaign.
An oil crisis makes you think pretty hard about priorities.
President Richard Nixon encouraged Americans to make do with less – a theme that was still relevant almost four years later, when President Jimmy Carter went on national television in a cardigan to encourage Americans to turn their heating down.
The oil embargo brought the consequences of US foreign policy to bear on the daily lives of ordinary citizens. Kuwait and Saudi Arabia attempted to reach out to this audience through an “Open Letter to the American People” published in the Washington Post and The Los Angeles Times but the message received was quite different: imported oil was a liability.
In Europe the pain was even worse, as the embargo and price increase exacerbated already high costs. Sweden rationed heating oil over the winter. The Netherlands introduced prison sentences for excessive electricity use. In parts of Europe and the United Kingdom, driving, flying and boating were prohibited on Sundays (leading to photos of people picnicking, rollerskating, cycling and riding horses on deserted freeways).Long-term legacy
Though these measures are gone, some of the impacts of the crisis are still with us today.
The embargo prompted a rapid change in attitudes towards energy conservation and spurred alternative energy investment. Energy-conservation efforts built on the growing environmental movement were championed as a pragmatic national security move, by both the left and the right. Meanwhile, massive investments were made in solar, nuclear and wind energy programs (at least until the mid-1980s, when oil prices plummeted).
It also changed how we design our houses and appliances. As late as the 1970s American homes were constructed with little thought to energy efficiency. Houses typically had leaky, single-glazed windows, no wall insulation, and inefficient shower heads, taps and appliances. By the 1980s, double-glazing was standard, walls and roof spaces were insulated, and programmable thermostats were becoming commonplace.
Interestingly, Australia, which was not part of the oil embargo, fared differently (and because of the Bass Strait oil discovery in the 1960s was almost self-sufficient). Between 1971 and 2009, energy efficiency (or “energy productivity”) for OECD nations nearly doubled, while Australia’s increased by only 23%, and is now roughly on a par with China.
The crisis may have even shifted national trajectories. Brazil pioneered the introduction of ethanol in gasoline, while the Japanese government directed a shift from oil-intensive industries into the nascent electronics industry.Energy independence at last?
The articulation of energy security as a US national security goal was the most ambitious and long-term result of the oil crisis. President Nixon aimed to achieve domestic self-sufficiency within a decade, weaning his nation off the “addiction” of foreign oil. This mantra still continues today, despite the fact that most US imports now come from Canada.
The resulting safeguards aimed at smoothing disruptions and keeping domestic supplies in the home market are still in place. In the aftermath of 1973, the United States coordinated the establishment of the Paris-based International Energy Agency, whose members must keep 90-day stockpiles of fuel in reserve (Australia is the only member not currently meeting this commitment).
US bans on crude oil exports still remain, and the recent oil exports from Texas to South Korea (the first non-Alaskan US crude oil export since the embargo) were only made possible by reclassifying ultralight oil as processed “fuel".
Meanwhile, energy independence has become a contested goal. The United States is set to become the world’s largest oil producer this year (by some calculations it already has), but at the expense of opening up federal land for exploration and deploying new, invasive extraction techniques.
Even the phrase “energy independence” has taken on a politically confrontational aspect. Saudi Prince Turki Al-Faisal argued in 2009 that the term is “little more than code for arguing that the United States has a dangerous reliance on … Saudi Arabia, which gets blamed for everything from global terrorism to high gasoline prices”.
Forty years after America was brought to its knees over foreign oil, it remains to be seen whether the goal of energy independence has been achieved – and if so, at what price.
Jennifer Hunt does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.
Sale of coal mines and power plants would enable the state-owned energy company to meet its emissions targets without reducing pollution
Swedish state energy company Vattenfall plans to sell off its German lignite operations because it says they are incompatible with the companys climate change goals.
But Greenpeace said the sale of the coal mines and power plants, which includes the fourth largest CO2 emitting power station in Europe, would be an abdication of responsibility and would simply allow Vattenfall to meet its emissions targets without actually reducing pollution.
As the Intergovernmental Panel on Climate Change meets in Copenhagen to approve its latest report, which will provide the strongest assessment to date of the dangers to life and the planet of burning fossil fuels, Denmark has pledged to examine how it can stop using coal as an energy supply by 2025.
This is five years ahead of previous targets and, as Danish Climate and Energy minister Rasmus Helveg Petersen, said,
“It would benefit the climate and it would be a very, very good signal to send“.
Denmark has already set itself the target of meeting 100 per cent of its energy needs with renewables by 2050. Today 30 per cent of the country’s energy supply comes from wind energy and 20 per cent from coal.
Denmark wants wind energy to make up 50 per cent of its overall power supply by 2020. This summer the government’s energy agency declared that onshore wind is now the cheapest form of new electricity generation in Denmark, significantly undercutting coal power.
The coal industry’s future is, and must be, one of decline. The global market price for coal has already collapsed under oversupply. Dark clouds also loom over any significant expansion of the industry as renewables become cheaper and stronger and international action is taken to reduce carbon pollution.
In a report released yesterday, BankTrack showed that major world banks have lent $500bn in support to the coal industry since 2005. These vast sums of finance illogically being handed to it are keeping it on life support and holding the world back from moving on to cleaner, sustainable technologies.
While coal played a significant role in global development, the era of coal is over. According to the European Commission, wind is already cheaper than coal when external factors such as health impacts are accounted for, and it will only get cheaper, while coal is expected to increase in cost.
Denmark is leading the way with its renewable commitments and pledge to quit coal completely by 2025. Let us hope others see the writing on the wall and follow suit at next year’s COP21 meeting in Paris.
Sea level rise is half due to melting ice and half due to ocean warming, including 13% from the deepest oceans, a new paper has found
There have been a number of studies recently on ocean warming and sea-level rise. Collectively, they are helping scientists unite around an emerging understanding of climate change and its impact on the Earth.
Most recently, a study by scientists Sarah Purkey, Gregory Johnson, and Don Chambers was published. This team was responsible for a 2010 paper that was groundbreaking in that it quantified very deep (abyssal) sea warming. This latest paper is, in some respects, a continuation of that work.
We find a small but measurable contribution from deep-sea warming to the global sea level budget (and hence global energy budget) from 19962006. The ocean warming is estimated directly from highly accurate, full-depth, oceanographic temperature data. The magnitude of the deep warming contribution to sea level below 2,000 m is about 13% of the total contribution of the mass trend below 2,000 m for that same time period.Continue reading...
Recycling aluminum cans is cheap, efficient and doesnt damage the integrity of the container. So why wont Coke, Pepsi or Budweiser use them?
Imagine an infinitely recyclable product that performs as well as the alternative, costs less to make, and is unquestionably better for the environment. You would bet on its success, wouldnt you?
Novelis, the worlds largest recycler of aluminum, has made that bet. Since 2012 the Atlanta, Georgia-based company has invested half a billion dollars in recycling by building, among other things, the worlds biggest aluminum recycling plant. This $260m high-tech marvel officially opened earlier this month in Nachterstedt, Germany.Continue reading...