|
February 23, 2011
The most serious carbon issue today is coal. To avert a disastrous climate change tipping point coal-fired plants must be rapidly phased out to protect the earth. Hence the need for a price on carbon to enable the market to drive energy change and bring down carbon pollution. Increasing the carbon price acts as an incentive for the low carbon investments.
James Fallows in Dirty Coal, Clean Future in The Atlantic (December 2010) argues that the only way to meet the world’s energy needs, and to arrest climate change before it produces irreversible cataclysm, is to use coal—dirty, sooty, toxic coal—in more-sustainable ways. The assumption here is that coal will be used in the future as a substitute for oil and gas when the latter's production has peaked and that new technologies (processing coal into liquid fuel; carbon capture and storage will secure the future of the coal industry's investments.
The immediate response is that the longer we pursue energy from coal instead of committing to renewable energy and reduced energy consumption, he emphasizes, the worse will be the economic and ecological costs and the less likely such a transition will be successful. Secondly, CCS technologies are unlikely to be developed enough to deploy before 2035 at the earliest; these are very expensive; and the peak of higher-quality coal reserves means the shift to lower-quality coal with the social and ecological costs this entails.
Climate policy can create opportunities for massive investment: to expand the supply of renewables; build the power grids of the future; develop the robotics and nanotechnology required for energy-efficient construction materials; facilitate the shift from coal to gas to renewables.
The naysayers--denialists--- say no to price increases on carbon whilst continuing to rely on energy from coal for economic growth. Their old de-industrialise and anti-growth argument seems to been forgotten. They now claim that a socio-political pathology surrounds Australian public policy on climate change.
Europe is on track to comfortably exceed its existing climate change targets of cutting emissions by 20% by 2020, and on current policies will reduce greenhouse gas emissions by 25% by that date.This means that without any extra effort, by 2020 Europe will be well within reach of the higher target of an emissions reduction of 30% which some member states, including the UK, are pushing for.
Australia, in contrast, does not have a low-carbon roadmap with respect to buildings, transport, agriculture etc. It has given up trying to position itself so that it can compete in the €3.5tn global market for low-carbon goods and services. The Gillard Government has foreshadowed a system that would start with a fixed price on carbon, followed by a move to a market-based system in several years.
With the Opposition set to vote against any market-based scheme, the Government will need the support of the Greens and the independents to get the legislation through Parliament. Reduction targets and compensation to industry are again expected to be the main stumbling blocks in negotiations.
Update
The Gillard Government says that a carbon price scheme will be rolled out from July 2012 to begin the move to a clean energy future, The price on carbon would be fixed for a period of three to five years before moving to a cap-and-trade system. This outline of "the framework" is just the start of the process.
However, the starting price has not yet even been discussed, the household compensation package has not yet been discussed, support for emissions-intensive trade-exposed industry has not yet been discussed, the treatment of the energy sector has not yet been discussed.
So the fear campaign begins--the early talking points are that increased electricity prices that cannot be afforded.
|
It is possible to increase economic output while cutting emissions. Produce more does not mean you have to emit more. That was the 20th century business model.