When will Australia catch on to China's clean energy drive? Opinion Article

Aug 18, 2010 - 7:00am

By Erwin Jackson, Deputy CEO, and Will McGoldrick, Policy Manager, The Climate Institute

Both Labor and the Coalition justify their weak policies on climate change and pollution by arguing that they do not want Australia to move too far ahead of other countries. The truth is that their policies are already falling behind China and other major emitters.

Clearly the world is not yet doing enough to curb pollution, but recent trends indicate the start of a global clean energy and technology race, with Australia’s most important trading partner, China, looking to secure poll position. This has been widely recognized by even traditionally conservative groups such as the International Energy Agency.

In 2009 global investments in renewable energy surpassed US$ 120 billion and in 2010 are forecast to rise to up to US$ 200 billion. This is more than a ten-fold increase since 2004 and renewable energy investments now routinely outstrip global investments on polluting power generation.

While Australian policy makers continue to dither around the edges, China has locked in ambitious targets and policies to shift to clean energy and drive energy efficiency and is now beginning to lead global investments in clean energy.

The ALP’s recent commitment to introduce pollution standards for new coal fired electricity plants is only really catching up to where China has been since 2008. Similarly, the vehicle pollution standard for cars the ALP have announced is weaker that is currently in place in China today. (They are also far weaker than those being implemented in Europe and Japan.)

The Chinese Government is also using iron hand efforts to clean up its economy with a recent ruling that over 2,000 high polluting industries must shutdown old and inefficient operations. Companies that fail to comply have been told they could see their bank loans frozen and their electricity cut.

In Copenhagen last year all of the world’s major economies announced targets for cutting pollution.  China committed to a 40-45 percent cut in emissions intensity of its economy by 2020. Australia committed to reduce its pollution by 5-25 percent below 2000 levels within the same timeframe. The international community expects these targets to be honored.

Since Copenhagen, China has shown every indication that it intends to live up to its Copenhagen pledge, and has promised to include new policies to curb pollution as part of its next Five Year Plan which comes into effect next year. Recent reports suggest that China is considering implementing a price-tag on pollution, through either an emissions trading scheme and/or taxes.

Australia, on the other hand is sending a very different signal to the rest of the world, with neither side of politics willing to support credible policies to deliver on our Copenhagen pledge. According to The Climate Institute’s Pollute-O-Meter, the policy suite advocated by the ALP and the Coalition would only reduce the pollution intensity of Australia’s economy by around 18 percent. This is well short of China’s target of 40 to 45 percent target, or indeed India’s weaker 20-25 percent target.

To make matters worse, the Coalition has said it would strip fast start funding away from helping the world’s poorest nations reduce pollution and adapt to a more hostile climate, a move that would undermine global action on climate change.

Collectively, the EU, Japan, the USA, Australia and other advanced economies have currently committed around US$ 30 billion over the next three years to new international climate financing. To date Australia has committed new funds of AU$355 million. These funds are critical to finance reducing poor nations’ dependence on polluting industries and helping nations cope with disasters like those currently being witnessed in Pakistan. They are also critical to build trust and political consensus between the rich and the poor so that a truly effective global agreement can be struck.

Without this financing we have no effective climate deal so the Coalition’s policy is effectively saying it will work against the global action required to avoid dangerous climate change and project Australia’s national interest.

Australia’s international credibility and influence in the climate talks relies on effective policies to meet our international commitments. Unfortunately during this election campaign our political leaders seem content to procrastinate, spin lies and half truths and run scare campaigns on the impact of policies on the cost of living.

Meanwhile China is busy entrenching its power as a clean energy super power. The longer we wait the better positioned China becomes and as my Chinese colleagues often point out this suits interest of many in the Chinese government and industry.

China and much of the world are not waiting for Australia to act to limit and price pollution. While we have had and will continue to have stumbles along the way the race to reduce the world’s dependence on pollution has begun.

Erwin Jackson

Erwin is Deputy CEO of The Climate Institute. With nearly 20 years practical experience in climate change policy and research, Erwin has developed and led many national and international programs aimed at reducing greenhouse pollution. This work has been undertaken in Australia, Europe, North and South America, the Pacific and Antarctica. He has represented non-governmental groups and advised government and business in national, regional and international fora, including being a non-governmental expert reviewer of the reports of the UN’s Intergovernmental Panel on Climate Change. Erwin has written, researched and produced many publications on climate change and energy policy including a number of review papers in scientific journals such as the Medical Journal of Australia.
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