There exists a political conundrum in Australia that exceeds any other in living memory. While there is a high level of concern among average Australians that climate change is an existential threat, there is a commensurate political reluctance to do anything about it. Surveys show that at least 85% of Australians believe that climate change presents a threat to our future quality of life. However this sentiment has been stubbornly translated into a political resistance to act that has not gone unnoticed by the rest of the developed world which views Australia as one of the weakest climate actors in the world.
And this is not a recent phenomenon. In the late 1990’s, the Howard Government set a target for Australia to generate 10% of its electricity from renewables (aside from hydro) by 2010. Within a short time, this was reduced to 2% much to the chagrin of investors in the nascent wind energy industry. Howard later refused to sign the Kyoto Protocol leaving Australia exposed on the international stage. At the same time, a future prime minister in Tony Abbott supported the concept of putting a price on carbon as a market-led shift to clean energy. In a few short years Abbott won a federal election at least partly on the basis of promising to remove that price. It is arguable that every prime minster in Australia this century has lost their job because of the position that they have taken on climate. Our latest prime minster, Scott Morrison, may well become the latest victim.
So what is it about climate and energy policy in Australia that makes it such a toxic subject? A subject so rent with potential downsides that politicians are prepared to take the risk of adopting such a contrary stance to the general population. Why is it that an issue that has way more support than the gay marriage plebiscite, is one that also languishes in a half-hearted set of policies that are both confusing and quite frankly, anti-business?
Part of that answer is that climate action by definition, is a political process. Unlike the industrial and technology revolutions of the past 200 years that were driven by market forces directing capital into those areas of consumer demand, the clean energy revolution is Government driven as a response to the threat of the Earth becoming uninhabitable in 100 years. While high levels of Government planning and investment may be tolerated in times of war and other crises, climate change to date has struggled to meet the trust test that first must be passed. Instead, the power of the vested interests in fossil fuels have mobilised to make Government action seem like an anti-business, employment reducing threat with questionable scientific analysis to back it up. One is reminded of the tobacco companies of the 60’s and 70’s to see the tactics being employed.
The standard anti-action rhetoric usually goes like this. Australia produces 1.3% of the world’s carbon emissions and regardless of how much we do, it is going to have a negligible impact. So, why should Australia destroy its economy to just make itself feel good on the international stage? Moreover, unless China is the prime mover and does the heavy lifting, nothing significant can be achieved anyway.
It is certainly true that nothing effective can be done without China being fully on board. However, Australia is not the minnow that the conservative forces would have you believe. While Australia is the 14th largest carbon emitter in the world, if we add our coal, LNG and agricultural exports into the equation, we are the 3rd largest emitter and producer of carbon-based products. Whether Australia likes it or not, we are a major player that many countries still look to for both moral and economic leadership in matters that affect the world. To pretend otherwise is to both ignore the physical reality of our emissions as well as the damage that is already being done to Australia’s reputation as a fair player.
And China, being the largest emitter in the world that will also continue to increase its emissions until 2030, has begun to step up. They have already committed to reach net zero emissions by 2060 and world pressure is likely to be brought to bear to bring them into line with the rest of the world’s 2050 ambition. If Australia remains on the sidelines as we now are, the build-up of world pressure to bring China into a leadership role will be made all the harder.
Like many conundrums, truth is often found by following the money. Currently, Australia is the largest coal and liquefied natural gas (LNG) exporter in the world. Indeed, these two commodities alone make up 25% of Australia’s almost $A 500 billion of annual exports. Australia also exports 70% of its food production and the bulk of its semi refined minerals such as alumina. Overall, Australia’s exports are carbon heavy and are therefore vulnerable to trade restraints such as carbon border taxes that the EU is already talking about introducing. On the other hand, the economic might of Australia’s exporters cannot be underestimated and their influence on the current Coalition Government’s climate stance is clearly evident.
And this stance is highlighted by the influence of the National Party which has shifted its weight squarely behind the fossil fuel industry and some argue, at the cost of their traditional backers in the agricultural sector. One only has to look at the 2019 federal election where the “miracle win” was delivered by the Nationals, principally in Queensland’s coal centres. With the return of Barnaby Joyce as the National’s leader and Deputy Prime Minister, the National’s anti-climate action rhetoric has ramped up with the northern Queensland senator Matt Canavan, outwardly defying the Liberals attempts to look more moderate. He instead continually plays to his constituency in the coal regions of Queensland, falsely claiming that coal fired power generation will bring cheap electricity and with it, more jobs for Queensland. Never an opportunity passes when he reminds people that he is willing to get his face dirty with coal dust to protect their long term economic interests.
While the Nationals continue to differentiate themselves from the latte sipping intellectuals in Sydney and Melbourne, the Coalition Government is desperately trying to play two sides of the street. While they have indicated their willingness to help the development of new industries such as hydrogen, they continue to pour most of their investment into fossil fuel based measures such as carbon capture and storage ($4 billion) and propping up two domestic oil refineries ($2.4 billion). In the meantime, the committee set up to recommend a post COVID economic recovery was stacked with oil executives who produced an unsurprising plan based on increasing the supply of natural gas. They even gave $3.6 million to an inexperienced company to conduct a feasibility study for a coal fired power station at Collinsville in northern Queensland. A ten-minute back of the envelope analysis would have shown the folly of such a project. Meanwhile, insufficient government support is being given to universities in Melbourne and Brisbane which are developing world leading new battery technologies that could solve the energy storage problem that a clean energy revolution will demand.
The Coalition’s strategy is to formulate policies around trying to keep the exports receipts from carbon exports flowing while making noises about addressing climate change in an economically responsible way. Barnaby Joyce is more forthright in telling the nation that he will not support net zero by 2050 until the planned actions are properly costed and the economic impact properly assessed. He neglects to mention however, that he is the Government and he as Deputy Prime Minister is in a powerful position to demand such an analysis. Of course, he will not call for this because the absence of such analysis will enable him and his Queensland colleagues to continue to make outrageous claims about the cost to Australia of pursuing significant emission control policies.
And the focus on the cost side of the equation further enhances the National’s position. By highlighting the costs of restructuring the economy away from fossil fuels both in terms of capital investment and the loss of jobs, keeps the conversation in the negative. The cost of doing nothing however is something they do not, or cannot acknowledge. Indeed, many of the adverse climate outcomes will be rejected by the Nationals anyway as unscientifically proven regardless of the evidence that is mounting around the world. But what is hard to understand about the National’s posturing, is the looming cost to our farmers and ultimately the fossil industry itself of carbon border taxes that will be targeted against freeloaders such as Australia. It is no wonder then that the Australian Farmers federation and many of the energy company and miners have embraced the “net zero by 2050” target in recognition of these threats.
So where are we likely to go from here? With November’s world climate council meeting in Glasgow a short time away, Scott Morrison is under building pressure to take some meaningful forward commitments to that meeting so that Australia is no longer seen as sitting on the side lines of climate action.
He is therefore positioning himself to do a deal with Joyce that presents a compromise between the two parties’ positions while not scaring away the punters in the lead up to the next election. That compromise is likely to include certain exemptions for the agricultural sector and a commitment that fossil fuel exports remain untouched. Some form of statement on the development of new coal mines that fudges their future environmental approval will also be hashed out. However it may come out, the PM’s army of PR consultants will have worked the compromised position as a breakthrough that only strong leadership can produce.
And this political messaging will be facilitated by the Newscorp who have recently come out as supporting climate action after years of promoting anti-climate positions by giving voice to many conservative commentators such as Andrew Bolt and others. While editors in the Murdoch stable will continue to claim that they are free to continue to air both sides of the issue, they know that Rupert has made a fundamental shift in his position and will not do anything to upset him. Such is the unspoken direction of the Murdoch press.
Meanwhile, the other side of politics has retreated to maintain a small target strategy for as long as possible in the lead up to the federal election. Burnt by what were considered aggressive climate positions in the past when the electorate was probably not ready for change, the Labor Party is probably now being too careful so they cannot be painted as the enemy of major Australian industries. It is quite possible however, that they have again misread the electorate and may well be seen as not aggressive enough. Such is the mood swing of an Australia where the ravages of the recent fires and drought still haunt people who once thought that we had more time to act.
The politics of climate in Australia over the past 20 years have produced mostly negative outcomes for both Australia’s standing in the world and the economic advantages that could have been captured by leveraging Australia’s natural advantages in a clean energy revolution. While China ramps up their new energy industries to lead the world in such areas as solar energy and electric cars, Australia is still caught arguing over whether it should move on from our unsustainable old world industries. Again, Donald Horne’s Lucky Country probably best describes the malaise. Australia, with all of its boundless natural resources, will probably muddle through and succeed to some degree despite our breathtakingly mediocre political leaders.
One thing is for certain however. Australia will miss many of the opportunities to excel in the clean energy revolution just as we have missed opportunities in the past. But don’t fret. We will continue make money as the world’s mine and ship our resources to other countries so that they can add value to them (and then sell them back to us). Such is the Lucky Country.
Clean Energy Oz 