Renew Economy - Giles Parkinson
Australia will find itself again on the outer in global climate change efforts, excluded from key decision-making processes because it is one of a minority of major polluters that has yet to ratify the Paris climate accord.
The European Union on Tuesday voted overwhelmingly to
ratify the Paris treaty, a day after India announced it would also do
the same thing. The ratification is expected to be formally voted by
ministers later this week, taking the total well past the trigger point
of 55 countries and 55 per cent of total global emissions.
The speed of the ratification – less than a year after the Paris
treaty was voted to general acclimation last year – compares with the
eight years it took to get its predecessor, the Kyoto Protocol, into
force after it was adopted in 1997.
The move will impact Australia in two ways. Firstly, only those
countries who have ratified the treaty can vote in negotiations for the
next step in the treaty's implementation. That means Australia will be
excluded from these processes, although it may have observer status.
It also means that Australia will reinforce its status as a climate
outlier, a reputation it earned when former prime minister Tony Abbott
and former Canadian prime minister Steven Harper were branded "climate
villains" because of their opposition to action on climate change.
Malcolm Turnbull was expected to change this. but has instead
entrenched the policies of his predecessor. New Canadian prime minister
Justin Trudeau, however, has signalled a major change in direction.
This week he mandated a national carbon trading scheme, that will set a carbon price of $C50/tonne by 2022.
"After decades of inaction, after years of missed opportunities, we
will finally take real and concrete measures to build a clean economy,
create more opportunities for Canadians, and make out world better for
our children and grandchildren," Trudeau told parliament.
"Mr Speaker, we will not walk away from science, and we will not deny
the unavoidable." Canada is expected to formally ratify the Paris deal
this week.
The second impact of the Paris treaty ratification is that Australia
will face inevitable pressure to increase its emission reduction
targets. Already criticised by most analysts as inadequate and below
Australia's "fair share", the unexpectedly quick ratification of the
Paris treaty indicates the world is serious about upping its efforts to
combat climate change.
"In our view, climate diplomacy will shift its focus to raising the
ambition levels of country pledges as record temperatures and climate
impacts highlight the magnitude of the work to be done to limit
temperature rises to within 2°C, or even 1.5°C," HSBC researchers said
in a research note this week.
The combined efforts of the pledges that countries brought to Paris
are only expected to cap global warming at around 3°C at best, so there
is massive work to be done to lower that likely growth in warming to
well below 2°C and possibly below 1.5°C.
"Average temperatures for the first half of 2016 were already 1.3°C
higher than pre-industrial levels, which is close to the aspirational
1.5°C target," the HSBC analysts said. "We think ambition levels would
need to be raised considerably higher in order for the 1.5°C target not
to be missed."
Australian officials admitted last week that no modelling has been
done on whether its current policy suite – based around Direct Action
and the Emissions Reduction Fund – will meet even its 26-28 per cent
reduction in emissions by 2030.
Independent analyst suggests it won't. Australia says it has already
beaten its first Kyoto target, but that allowed it to increase emissions
by 8 per cent, and its 2020 target required virtually no emission
reductions at all.
Current estimates suggest that Australia's emissions are rising again and could be 9 per cent ahead of current levels by 2030.
Leading economist Professor Lord Stern said the treaty progress would
provide an enormous boost in confidence for investors, particularly at a
time when the world needed to ramp up its efforts to meet the targets.
"A key reason why countries have moved so fast after Paris is that
they now recognise the great attractiveness of the growth and
development paths for both rich and poor countries that will result from
the transition to a low-carbon economy," he said.
Australia, however, is showing no such ambition. The Coalition is
rejecting any talk of increasing its targets in next year's policy
review, and is looking at trying to force states that have higher
renewable energy targets to bring them back to the less ambitious
national target.
On green finance, Australia is also moving in the opposite direction,
voting to cut $500 million from the Australian Renewable Energy Agency
and slashing $800 million from the Clean Energy Innovation Fund, the
only new initiative announced by the Turnbull government, although it
involved only recycled money.
On the international stage, the story is different.
"The race has begun: September has been an extraordinary month for
green finance globally," the HSBC researchers noted, citing new
initiatives in China, which is establishing a "green financial system",
and in France and other countries.
"We believe governments are increasingly thinking about how the
transition to a low-carbon economy will be funded, and are laying the
financial infrastructure to encourage more green capital (especially
private) and to develop and scale up new products.
"In the run-up to COP 22 (Marrakech, Morocco from 7-18 November
2016), we expect these initiatives to gain momentum as investors and
businesses seek to be a part of, and contribute to, the low-carbon
transition."
But, not in Australia.
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