The good and the CPRS of emissions trading

Yesterday I went along to the Sustainable Living Festival to see Adjunct Professor Alan Pears of RMIT and the Australia Institute's Richard Denniss on the good and bad of emissions trading, which really does amount to the good and the CPRS of trading schemes as a way to reduce Australia's carbon emissions.

I can't capture everything that was said in this post (see the above website in a bit for the slides), but I was after a few simple gleanings to broaden out my knowledge of the scheme (or scam), which is certainly what I got.

The basics, of course, are that, once Australia sets a cap on carbon emissions, permits are issued to cover those emissions, and are surrendered by emitters to cover the level of emissions they make. Ideally the cap should be science-based, and the permits should be auctioned, not largely given away, as is currently proposed in many cases under the Rudd Government's Carbon Pollution Reduction Scheme.

Professor Pears observed that a carbon price was necessary because we're currently subsidising the pollution of our global atmospheric commons by not pricing emissions appropriately. He said that, while the impact on general prices of a carbon price was generally overplayed, the basic idea was that prices be sensitive to the level of greenhouse intensity - the more emissions in the production of a particular product, the greater the price should be as carbon permits are purchased and surrendered to cover them.

The effect of a carbon price should therefore be to make less carbon-intensive products more attractive through better pricing, with a reduction in emissions the desired result.

A good point Pears made was that the cost of an effective scheme could in fact be negative - if the value of the businesses encouraged (because they're less carbon-intensive) was greater than the value of the businesses discouraged (because they're too carbon intensive). However, the compensation to big polluters currently being offered under the scheme undermined abatement, according to the professor. I gathered this could take the form of insufficient incentives for green energy production, or energy efficient appliances, for example, due to the lack of revenue in this direction because of compensation to polluters.

Professor Pears also noted that fixed caps in the current scheme limited its ability to respond to emerging science. So, if, as Professor Will Steffen recently pointed out, climate impacts are shown by emerging research to be more likely at lower levels of warming, you may well want to reduce your emissions cap consistent with what is recognised by the science as a safer level of warming.

To an external musical accompaniment (!), Richard Denniss' fundamental points were that "targets have been set with no regard to the science of the underlying problem" and that the Rudd Government appears "to believe the science about the problem but ignores the science about the solution".

There was also an incentive to increase emissions, Denniss noted, because the number of free permits allowed to some emitters - to cover 95 per cent of their emissions in some cases - would rise with any rise in their absolute emissions.

The proposed cap on the carbon price ($40 per tonne) was also set at the level where it was likely to begin driving change. He also confirmed that personal abatement measures would also have the effect of freeing up more permits for the big polluters.

What I found very useful in Denniss' presentation was his explanation of the relationship between any domestic scheme we adopt and a potential international agreement to reduce carbon emissions.

Firstly, Denniss explained that the world doesn't care how we achieve domestically any international commitment we make, and therefore a CPRS wasn't a precondition of taking part in such an agreement. He then noted that if the world adopts a more ambitious target than we allow for domestically, we'd have to make up the balance by importing billions of dollars of permits, and this was indeed an assumption of the Government's scheme. According to Denniss, the proposed scheme would not reduce Australia's emissions before 2035 and not a single coal-fired power station would be shut down.

Finally, a very interesting point was made by Denniss in response to a question from the audience about the relationship between a carbon price and the drive to achieve zero net emissions being pursued by climate groups. Denniss said that this could not be achieved through a carbon price alone, but needed to be combined with other actions - for example, in pushing green energy.

He had earlier said that the debate between trading and "direct action" was a false one, and that the Rudd government had actually been pursuing a combined approach through renewable energy targets, home insulation etc. The point seemed to be that we could, in fact, have a lower carbon price if we were prepared to take much stronger complementary measures.

Well worth sitting in a somewhat steamy "Think Tent" at the Sustainable Living Festival.

Comments welcome.

Wong must back climate clarity with action

Update: There's a bit of a discussion going at Larvatus Prodeo about communicating the science of climate change. Where do you think the responsibility for communicating about climate change lies, and what should be the role of governments?

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In Friday's edition of The Age, Australian federal opposition leader Tony Abbott taunted the federal government for delaying action on the "moral issue of our time" in postponing the Senate vote on the emissions trading scheme.

Despite Abbott's claims of a government "backflip", any breathing space in the vote could prove useful in negotiating an interim carbon price with the Greens while serious flaws in the scheme are worked out. Claims of backing down by the government, at least in terms of its climate rhetoric, should also be dismissed following a speech by climate change minister, Senator Penny Wong, at a National Climate Change Forum held 18-19 February in Adelaide.

In the speech, Senator Wong spoke convincingly and with great authority to dismantle the arguments of climate sceptics of the kind Tony Abbott is only too happy to meet. In this sense, the Senator is poles apart from an opposition leader whose "direct action" is focused not on the climate, but on preserving the interests of the big polluters heedless of the catastrophic warming to which the world would be consigned.

The challenge for Senator Wong and the Rudd Government is to match the understanding so clearly demonstrated in the Adelaide speech with the action that science tells us is necessary to avoid dangerous warming.

The Senator claimed a positive outcome of the failed Copenhagen talks was a new commitment by developed and developing nations to keep warming within two degrees of pre-industrial levels. Yet, speaking at Melbourne's Transition Decade launch last Sunday, climate researcher Professor Will Steffen said that the risks at even two degrees of warming were increasing as our climate knowledge accumulates.

With the Senator conceding there is a greater than 90 percent chance that human activity is causing climate change, the news of worsening impacts at lower temperatures merits substantially tighter emissions targets and international leadership by Australia.

Further coverage of the Adelaide forum in today's edition of The Age reports comments by Professor Tim Flannery blaming the re-emergence of climate scepticism in part on the failure of scientists to communicate clearly on the issue:

He [Professor Flannery] said a lack of simple communication to the public about the science of climate change meant sceptics had been able to fill the void with misinformation.

Yes and no. Climate clarity from the scientists is most welcome, but is hardly lacking for those who take the very small amount of trouble to find it. Instead, there's a clear obligation of governments "to fill the void", when they at least acknowledge the obligation to do so on public interest issues such as the swine flu pandemic and, in Victoria, the imperative for better bushfire preparation and public warnings following Black Saturday, itself and early and tragic climate impact.

While Penny Wong's Adelaide speech is a contribution in this regard, there needs to be a large-scale public information campaign by government about what the latest science says on the Australian and global impacts of climate change caused by human activities. Surely this should find a place within the national science communication strategy recently launched by science and innovation minister, Senator Kim Carr?

Unfortunately, "public engagement with the sciences" around climate change is made politically difficult by the actions of state and federal governments that run counter to any effective climate solution - the expansion of coal-mining and exports among them. Clearer communication by government on climate science will only highlight the kind of compartmentalised thinking that threatens a further dangerous increase in our carbon emissions. Climate clarity from government must be matched by climate action.

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For further thoughts on communicating climate science, see a recent presentation by Professor Will Steffen at the 2010 Australian Science Communicators National Conference, available at the website of the Australian National University's Climate Change Institute, of which Professor Steffen is Executive Director.

Real offsets cut cost of zero emissions Australia

It was good to see Adam Morton reporting yesterday on the practical plan to achieve zero emissions presented at Sunday's Transition Decade launch by the Beyond Zero Emissions people. Unfortunately, the headline, "Zero emissions possible - at $40bn a year", played up the cost, when there are numerous savings to set against it.

Against the high-end estimate of $40 billion a year to switch Australia to solar and wind energy over ten years, we need to allow many genuine "offsets" that are far more valid than the dodgy evasions of responsibility that would be allowed under the proposed emissions trading scheme.

As Beyond Zero Emissions' Mark Ogge pointed out at Sunday's launch, the cost of the renewable switch should be discounted by what we would no longer be spending on the exploitation of emissions-intensive fossil fuels. Then there's the cost-savings from not paying the big polluters, and, most important of all, the saving of human lives and suffering from avoided climate impacts.

This is entirely consistent with the positions of Sir Nicholas Stern and Professor Ross Garnaut, who have long advocated that the cost of acting early on climate is far less than the cost of later action, or none at all.

As the ANU's Professor Will Steffen also pointed out at the Transition Decade event, climate risks are being linked to progressively lower levels of global warming as knowledge accumulates.

That means that more impacts are likely to fit under the European Union's "guardrail" of 2 degrees warming over pre-industrial levels. We need to be aiming for much lower levels of warming by cutting our emissions by as much as possible, as soon as we can. That makes even $40 billion a year a bargain, and Beyond Zero Emissions should be commended for its work to transition Australia to a renewable, green economy.

See also a couple of good letters on Morton's article in today's edition of The Age ("Zero obstacles" and "See the possibilities").

Transition Decade brings a shared plan for climate action

More than 1000 people at today's launch of the Transition Decade at the Melbourne Town Hall were called on to share a ten-year plan for emergency action to deliver a safe climate.

The packed three-hour program offered too many strong climate messages to easily summarise, beginning with Victorian Governor, Professor David De Kretser A.C., who called on the audience to value the contributions of sceptics, before noting that the climate evidence was now such that an actuary who failed to recommend climate action would be deemed irresponsible.

The ANU's Professor Will Steffen later elaborated with the idea of the 'honest sceptic' - not those who fail to acknowledge the evidence of climate change, but scientists within the process of scientific inquiry who already and routinely challenge their own findings.

In the face of recent controversies, Professor Steffen said that there was no problem with the science, that the IPCC's most recent report was a 'vastly reliable piece of work', and that the last decade revealed no slow-down or stoppage in the global warming trend. It remained 'very likely' (more than 90% probable) that anthropogenic greenhouse gases were the primary cause of warming since the mid-20th Century.

'As we accumulate knowledge, the risks are higher at lower temperatures,' Professor Steffen concluded, noting 'a lot of concern that the EU 2-degree "guardrail" is inadequate'.

Urging political support for an interim carbon price, Senator Christine Milne called on climate campaigners to 'build again the momentum that has stalled after Copenhagen', and not to tolerate political powers who stood in our way in moving from 'what is' to 'what can be'.

There was, of course, much much more, on which I will write later - the Beyond Zero Emissions Plan for Stationary Energy, the new Climate Emergency Network Strategy, Safe Climate Australia's Scientific Imperatives Project, and an inspirational and hopeful Cam Walker calling for more in the account of our 'progress' than the movement of money in the empty quest for endless growth and consumption.

After the climate nihilism of Copenhagen, and the denialist backlash via controversies over small errors falsely spun into climate doubt, and after the forlorn Australian tour of Christopher Monckton, this was a much-needed antidote.

The contrast with Monckton's recent anti-climate-change rant at the Hotel Sofitel couldn't have been clearer. Here was a broad-based message drawn together from no single political perspective or interest. The messages were clear, and hopeful. There were children in the hall. There was a sense of what is possible, not of grasping to keep what has been gained at the expense of so many others.

As Senator Milne said, we are global citizens before we are Australians, Victorians, or people of Melbourne. That's a transition we all must make, and now we have a plan.