'Overwhelming' Economics Favour Accelerating Shift From Coal, Reports Say

Fairfax - Peter Hannam

Making the transition to a low-carbon economy has the potential to unlock $US26 trillion ($36 trillion) in benefits by 2030, while failure to act on climate change will trigger huge costs including a surge in refugees, a report co-authored by Britain's Lord Nicholas Stern has found.
A separate report written partly by Canberra-based researchers argues global coal use has peaked and nations such as Australia must prepare for lower exports of the fuel. Local coal-fired power stations will also likely close earlier than forecast, it said.

Lord Nicholas Stern, a leading climate economist, says renewable energy sources "have their own momentum". Photo: AAP

The twin reports come as Angus Taylor, the new federal energy minister, this week said Australia had "too much intermittent" power in its grid. He warned energy companies "we'll force you to divest" assets such as AGL's ailing Liddell power station in order to keep old plants running, in comments made to 2GB.
In the New Climate Economy report, Lord Stern and other authors found ambitious climate action could generate 65 million new jobs through 2030 as nations moved to cut emissions from energy, land use and other industries.
Some 700,000 premature deaths would also be avoided from lower air pollution compared with business as usual.
The case for change was "overwhelming" especially as technologies such as renewable energy now "have their own momentum", Lord Stern told Fairfax Media.
Solar panel costs "are now less than 10 per cent what they were a decade ago, while the cost of storage and wind energy have come crashing down", he said.
His report, by the Global Commission on the Economy and Climate, also calls for carbon pricing of at least $US40-80 a tonne by 2020 in G20 nations – of which Australia is one. There should also be mandatory disclosure of climate-related financial risks so investors are better informed.

Wind and solar energy prices are tumbling, making those energy sources cheaper than new-build coal plants, analysts say. Photo: Jason South

Lord Stern said the decision by the Turnbull government in its final days to drop any emissions goal in its energy policy did not mean others won't act.
"Australia obviously has a big private sector, states and cities ... my guess is [they] will continue to move forward," he said.

'Three degrees of warming'
By contrast, if nations "move tentatively", and continue to build infrastructure as they have, the world is likely to lock in much more severe global warming, the report found.

Coal-fired plants are going to shut sooner than many of its boosters expect, a new report argues. Photo: Janie Barrett

"It's quite likely [keeping temperature increases to] 3 degrees will be out of reach," Lord Stern said, noting that heavy costs were already being triggered by the 1 degree of warming so far.
Business-as-usual growth could mean 140 million climate migrants by 2050, or more than double the number of refugees today, the report said.

Peak coal
The separate Coal Transitions report, by researchers including Frank Jotzo and Salim Mazouz from the Australian National University, look at the pathways for coal if nations met the Paris climate goal of keeping warming to "well below 2 degrees".
It found both climate action and market forces meant coal use could start to shrink by the early 2020s "if it has not done so already".
It noted 36 governments – and 28 major firms – had already committed to phasing out coal from the power sector by 2030.
Major markets for Australian coal such as China and India were already seeking to curb use. As local suppliers were likely to be given priority that meant "a negative long-term outlook for coal and a lot of uncertainty", Professor Jotzo said.
In Australia's power sector, the cost of new renewable energy is approaching even the operating cost of existing coal-fired power stations, he said.
While modelling done for state and federal governments assumed remaining coal plants would run for 50 years, the average age of those that closed over the past decade was 42 years.
Professor Jotzo said it was "highly unrealistic" to expect remaining plants to hit the half-century mark as they would be increasingly ramped up and down as more renewables enter the market.
Far-sighted governments would be preparing for plant closures that could "happen very suddenly", he said. "There's no policy for that at all at the moment."

Links

• Greener Growth Could Add $26 Trillion To World Economy By 2030: Study
• 2018 Report of the Global Commission on the Economy and Climate: The New Growth Agenda
• 2018 Report of the Global Commission on the Economy and Climate: Key Economic Systems
• 2018 Report of the Global Commission on the Economy and Climate: Energy
• 2018 Report of the Global Commission on the Economy and Climate: Cities
• 2018 Report of the Global Commission on the Economy and Climate: Food and Land Use
• 2018 Report of the Global Commission on the Economy and Climate: Water
• 2018 Report of the Global Commission on the Economy and Climate: Industry
• Coal Transitions