EXPERT REACTION: Federal Government climate policy

The good: The Government now, finally, has acknowledged the inadequacy of their current energy and climate policy framework to deliver meaningful, assured emissions reductions. And they have identified a number of worthwhile opportunities to assist households and businesses to reduce emissions while also reducing costs.
 
The bad: Whether Australia is to meet our 2030 Paris commitment ‘by a canter’ or not misses the point – effective global action to avoid the worst possible global warming impacts requires far greater emission reductions than the 26% promised to date, from what is after all one of the world’s wealthiest and highest per-capita greenhouse gas emitters.
 
The ugly: They have chosen to extend and expand one of Australia’s most questionable climate policies to date: the Emission Reduction Fund. The ERF delivers one of the worst possible carbon prices: a price not on measurable carbon emissions but instead ‘imputed’ carbon emission reductions from what would have happened otherwise (inherently unknowable of course). Furthermore, it does this through a largely non-transparent assessment process that has previously seen favoured participants receive several $ billion of Australian tax payers money to undertake activities that some may well have been planning to do, or not do, anyway. We have no assurance that the ERF has really delivered all the Government’s claimed emission reductions from the scheme and, unfortunately, that would seem to be a feature, rather than a bug, of the mechanism design.

Australia is not currently well placed to meet it’s Paris commitments given current government policy.

In fact we need policies strong enough across the economy to meet an emission reduction scenario consistent with the IPCC target of 2C, let alone the 1.5C target which is needed to minimise the risk of runaway global warming and climate change.

The coalitions proposed $2 billion fund is simply an extension of the previous two coalition governments policies which mostly rely on carbon sequestration in the farming sector. This is a minimal effort that can help the agricultural sector continue to play it’s very important role in reducing atmospheric CO2.

However this does nothing to ensure an orderly transition away from coal and natural gas in the power sector and towards renewables which are now the cheapest form of new generation. In fact large scale solar and wind will shortly be cheaper than grid power currently produced.

We need a suite of policies that incentivise progressive and rapid retirement of the ageing coal fleet which is already showing its unreliability anyway, as we saw in the recent heat wave in Victoria. We also need harmonised national and state policies for rapid build-out of our transmission system to enable large scale integration of renewables as drafted in the 2018 ground breaking AEMO Integrated System Plan.

The government’s new “Climate Solutions Fund” is simply a rebranding of the Abbott government’s “Emissions Reduction Fund”. This policy is a political success for the Coalition as it allows pork-barrelling – the fund distributes money to projects in rural areas. However, as a climate response the policy is a failure.

The ultimate goal of climate policy must be to reach net zero emissions – warming will keep getting worse until we reach that goal. Instead, official data shows that under the Abbott/Morrison government emissions have increased. They have risen from 514.1 Mt of carbon dioxide equivalent in the last year of the ALP government (to June 2013), to 533.7 Mt in the year to June 2018.

Strangely, the Prime Minister’s announcement seems to shift focus away from climate policies that have worked.

Electricity-sector emissions have been falling since 2016, despite the removal of carbon pricing, thanks to the expansion of renewable energy. However, the government’s internal divisions make it hard for Prime Minister Morrison to discuss renewable energy.

The announcement also makes no mention of the government’s work on low-carbon innovation.

The Turnbull government joined Barack Obama’s “Mission Innovation” pledge to double government spending on clean energy research and development. Australia’s target is to spend $216 Million on clean energy R&D per year by 2020. Hopefully the forthcoming budget will make good on this promise.
 

The minimal scale of this commitment ($200 million a year) pales into insignificance compared to the government’s proposal to subsidise new coal-fired power and indemnify the owners against any future carbon price, at a potential cost of many billions.

Australia’s target is insufficient to limit warming to 2C, let alone 1.5C. From a health perspective, it is imperative to limit warming to 1.5C. The Climate Solutions fund does nothing to limit burning of fossil fuels and therefore will have minimal if any impact on air pollution. Limiting the burning of fossil fuels to limit carbon dioxide emissions has important benefits for health in reducing air pollution, which is bad for our health. Australia’s emissions are rising under the Coalition’s previous emissions reduction fund. Therefore, without new policies on emissions reduction it is unlikely that this will be successful. 

This is a mere election stunt. The underlying drivers of climate change this nation needs to confront are not being addressed in any meaningful way. It's nothing more than window dressing to cover up a lack of action on core issues.