(AU) The Case For Sustainable Communities: Three Big Ideas To Future-Proof Australia

UNSW - Peter Sheldon

Business leaders can mitigate the adverse impacts of climate change by generating thousands of jobs in renewable energy, which can, in turn, help build more sustainable communities across the country

Professor Peter Sheldon is Director of the Industrial Relations Research Centre, University of New South Wales

With Australia's coal-fired power stations set to close in the next two to three decades, Australia has the potential and opportunity to become a renewable energy superpower. But this depends in no small degree on the financial support and backing of business.

So how can business contribute to sustainable communities? This question was posed to a panel of experts as part of the Future-Proofing Business Series recently hosted by UNSW Business School's Responsible Business Program. Panelists discussed how businesses could take the lead in managing climate risk in the short and long term, what a sustainable community looks like, and the role of business in achieving this.

The speakers included Ursula Hogben, Co-Founder and Company Secretary at Zero Emissions Sydney North, Dr Jennifer Kent, from City of Sydney Council, Dr Paul Twomey, Centre for Energy and Environmental Markets UNSW Sydney, and Peter Sheldon, Professor in the School of Management and Director of the Industrial Relations Research Centre at UNSW Business School.

All speakers agreed climate leadership is shifting from government to business in Australia. New opportunities exist for both companies and communities in localised collaboration to create employment opportunities, modernise infrastructure and reduce greenhouse gas emissions. The panel discussed three ways businesses might help support local communities to create a better future for all:

1. Support community-led initiatives

Kicking off the panel discussion, Dr Kent said businesses need to be looking at how we can flatten the 'unsustainability curve' – the acceleration of unsustainable practices around the world, and the existential challenges that we're facing as a result.

She also said COVID-19 offered some examples of what is possible. "People went to some interesting partices such as bread making and [planting] vegetable gardens," Dr Kent explained. "These localised practices are characteristic of sustainability movements around the world.”

Planting vegetable gardens are examples of localised practices that are characteristic of sustainability movements around the world. Image: Shutterstock

So what is a sustainable community? Dr Kent explained that this involves: ecological integrity, ecological security, social wellbeing, civic engagement and the democratisation of decision-making. But it would also require "moving away from business as usual" and thinking about sustainability as much more than a simple tick-box experience, and "actually embedding sustainability within the corporate culture," Dr Kent said.

Businesses collaborating with communities would be essential because communities across Australia are in the best position to know precisely what those communities need, Ursula Hogben explained. "So, with community-led initiatives, we've got, ideally, local skills and local jobs meeting local needs now and in the future," she said.

Examples of successful localised cooperation in Australia were seen earlier in the year when devastating fires destroyed lives, communities, wildlife and infrastructure. With flooding and storms then adding to the damage, hundreds of properties were running diesel generators and faced lengthy delays before regular services resumed.

During this time, the Resilient Energy Collective – a collaborative effort funded by the family office of Mike and Annie Cannon-Brookes – installed solar systems provided by 5B and batteries solutions provided by Tesla in communities unable to access energy via the grid, Ms Hogben recounted.

"Very swiftly, there was a significant issue with rural and remote communities having access to power. So in Tobago, they [the Resilient Energy Collective] helped with 24-hour electricity to man the emergency power of the emergency community towers – and that was for the police, fire services and emergency crews communication," Ms Hogben explained.

"There is a huge ecosystem business desperate to get a level of support and consistent messaging because they are completely committed to becoming a part of the new wave"
Professor Peter Sheldon, Director of the Industrial Relations Research Centre, UNSW Business School

Another example was the transformation of the Newcastle and Hunter Valley region from a coal energy hub to a renewable energy hub, Ms Hogben explained. Molycop – the world's largest mining and rail consumables manufacturer – signed a long-term Power Purchase Agreement (PPA) with energy retailer Flow Power, and under the agreement, Molycop's expected offtake of renewable energy is 100,000 MWh per year.

This covers more than half of its electricity consumption in NSW and makes Molycop one of the largest purchasers of renewable energy in Australia.

"That's a considerable supplier of jobs in the area which is now looking at being part of the green steel revolution, which is important from a business perspective, low emissions perspective, and a community perspective in terms of the environment and also the economy," said Ms Hogben.

Finally, she cited South Australia's Port Augusta hybrid wind and solar project, which established a significant increase in the share of wind and solar in the state's grid. The repowering of Port Augusta aims to replace the Northern and Playford brown coal power plants with renewable energy: six solar thermal power towers and 90 wind turbines to provide secure, affordable electricity to South Australia and the Eastern Australian grid.

This will lead to the creation of hundreds of jobs, a major reduction in pollution and a significant move forward in terms of what's possible for powering manufacturing, added Ms Hogben.

2. Create employment by modernising infrastructure

So, job creation plays a vital role in sustainable communities, but to what extent should businesses take part? There is an opportunity for businesses to advance the discussion, creating sustainable communities and sustainable job creation, according to Prof. Peter Sheldon.

Creating renewable energy infrastructure will lead to the creation of jobs, a reduction in pollution and a move forward in powering manufacturing. Image: Shutterstock

While job quality – which encompasses wages, excellent conditions and job security – is incredibly important in setting up sustainable communities, so is access to decent work. "Decent work is work that provides meaning and complexity to make it interesting and engaging, access to training and development for workers, as well as access to trade union rights and collective bargaining rights," he explained.

So how can businesses support future decent work and good jobs to make communities more sustainable? For Sheldon, it's a matter of acting quickly and supporting job growth in areas where they are desperately needed – for example, in the process of closing down the 23 coal-fired power plants in Australia that are nearing the end of their lives.

The shutting down of these power plants could be utilised as an opportunity for job creation and reskilling the current workforce. "Every time you decommission a coal-fired power station or a coal mine there is work for 10-15 years just in the remediation and potential rehabilitation of the site," explained Prof. Sheldon.

"These are similar jobs in terms of skills in the coal mines, or in the petrol stations that are operating heavy machinery. There's no reason why they shouldn't pay the same amount or any reason why they shouldn't provide the same job security or access to training and development," he said.

"I think it's more important to start with what we can easily do and where we can get consensus relatively quickly," he added.

Building 90 gigawatts of solar and wind energy over the next five years would create thousands of jobs each year. Source: Beyond Zero Emissions

3. Business must back a reduction in carbon emissions

In Australia, the major obstacles to building more sustainable communities are the policies of the Federal Government, Sheldon explained. However, to some extent, business is also responsible.

"There are some business associations like the Business Council who have been lukewarm in pushing the government for a consistent approach to bring in climate-friendly energy policies," he said.

But at the same time, he said there is also "a huge ecosystem of businesses looking for government support" that want to contribute to sustainable communities, and that is working to overcome "federal government paralysis" on climate change.

"There is a huge ecosystem of businesses desperate to get a level of support and consistent messaging because they are completely committed to becoming a part of the new wave," he said.

And at this extraordinary time, with massive stimulus spending, there's a real opportunity to create resilience and sustainability within communities, by supporting renewable energy businesses in manufacturing, regenerative farming, regenerating mining land, planting trees and land restoration, added Ms Hogben.

"Businesses can help by offering finance… by making an ideological shift to more financing of renewable and sustainable projects," she said.

Ending the session, Dr Paul Twomey reminded the audience that while there are several encouraging stories of industries moving towards sustainability, an important question to ask is: are we achieving success at the speed and scale we need to?

"It's not clear to me that it is," said Dr Twomey, who said the change would require more in-depth thinking about capitalism, democracy and sustainability. "It's not entirely clear to me that it can happen in the scale that it needs to be," he added.

Links

• (AU) Renewable Energy Stimulus Can Create Three Times As Many Australian Jobs As Fossil Fuels
• Renewable Energy Could Offer Up To 60,000 Australian Jobs
• Study: Climate Change Crisis Requires Less Growth-Oriented Global Economy
• Can We Have Prosperity Without Growth?
• Australia Urgently Needs Real Sustainable Agriculture Policy
• (UK) Make Covid-19 Recovery Green, Say Business Leaders
• (AU) Getting Down To The Business Of Evolving Australia's Climate Policy
• Companies Expect Climate Change To Cost Them $1 Trillion In 5 Years

(AU) A Path To Climate Consensus

National Security College - Richard Yetsenga

This article is part of the Futures Forecasting series. We’ve asked experts to identify crucial trends – from a shortlist of categories – that will influence national security out to 2035 and how those trends might intersect in a future scenario.

In this article, which explores the future of globalisation, Richard Yetsenga concludes that facing the existential challenges of climate change, national governments will reorient to address the challenge in a cooperative and concerted manner.



Key trends

The National Security College is a joint initiative of the Commonwealth Government and the Australian National University. Richard Yetsenga is Chief Economist and Head of Research at ANZ. In this role, he leads the Bank’s economic and markets research efforts, with a focus on Australia, New Zealand and Asia.

1. Economics and Identity: Increasing inequality within national populations will make the social contract between governments and citizens increasingly fragile

Global inequality between countries has improved dramatically over the last few decades as poverty has declined, and the middle class has grown. Within countries, however, inequality has generally worsened.

Combined with trends such as the automation of manufacturing jobs and the rise of social media, inequality has already caused shifts in voter behaviour in many countries, leading to the election of populists and nationalists. However, these leaders have by-and-large failed to address inequality problems.

The COVID-19 pandemic will exacerbate the trend of inequality. Across most countries, the poor have suffered disproportionately from the virus – and lock-down measures to contain it. Loss of employment due to the pandemic has disproportionately impacted the young, and will be most acutely felt by the poorest.

The challenge of balancing families and working from home is disproportionately affecting women, as are job losses in services industries which are typically dominated by women. Rates of infection and death have disproportionately impacted ethnic minorities and those living in areas with higher levels of air pollution.

Conversely, many economic recovery policy responses, particularly in advanced economies, have disproportionately benefitted holders of financial assets, who are often older and wealthier.

2. Black Elephant: Impacts of climate change will become more severe and observable, leading to stronger calls for climate action from diverse interest groups

Manifestations of climate change have become more obvious in recent times. Antarctica’s record highest monthly temperature was set in January 2020, 2019 was Australia’s hottest and driest year on record, and 25 July 2019 was the hottest recorded day in the UK. For Australia, the catastrophic Black Summer bushfire season increased the salience and urgency of addressing climate change in public discourse and national security debates.

But concern about climate change will arguably explode as a result of COVID-19. Scientists have been warning of the link between climate change and pandemics for some time. The COVID-19 crisis can, therefore, be framed as a climate crisis.

As of 2020, there is limited concerted, collective action by national governments from both the developed and developing world to reduce the amount of carbon in the atmosphere. Given this, citizens and businesses are likely to suffer the consequences of more strategic shocks that relate to climate. COVID-19 is a stark instance of how damaging it can be when the natural environment behaves in a way we are not accustomed to.

Climate protest movements, already rising in frequency and participation, could become even more mainstream and influential as 2035 approaches.

3. Sovereignty: Lack of leadership by national governments in the face of existential global challenges will prove unsustainable

National governments are struggling to find ways to address ‘problems without borders’, with significant costs to the environment, global stability and their own citizens’ economic wellbeing and health.

Different nations have adopted very strongly-held, competing visions of the world and their place in it. As of 2020, we are seeing a trend towards a ‘G-Zero world’ – that is, a world with a global leadership vacuum, and where coordinating bodies like the G20 and G7 are losing relevance.

China and the US and their respective allies see themselves as strategic competitors and find it increasingly difficult to cooperate on shared challenges. Responsibility for the source of COVID-19 has widened pre-existing cracks into crevasses.

In 1985, Ronald Reagan asked Mikhail Gorbachev whether Soviet Russia would come to the United States’ aid if it was attacked by aliens. Gorbachev’s response was “no doubt about it”. Reagan responded “we too”. An alien lifeform has attacked, and the great powers have decided to battle the aliens as well as each other.

While this response could be a cause for pessimism, it is also a stark demonstration of the need for renewed cooperation. It will drive increased demand for leadership and collective action from across and within societies.

2035 future forecast

Staring down the risk of mutually assured climate-destruction, and increasingly dissatisfied populations, by 2035 the world will experience a reorientation. National governments will set aside goals and beliefs previously held to be non-negotiable to respond to the global crisis in a more cooperative manner.

• In the near-term, humankind is likely to continue down a path which risks mutually assured climate-destruction. Solutions to the trends identified in this post – from climate change to pandemic preparedness – require global cooperation and alignment of objectives.
  Additionally, near-term reactions to economic inequality, such as experiments with nationalism and populism, are tending to exacerbate the global leadership vacuum, making meaningful action to address climate change even more difficult

• As this near-term path is ultimately unsustainable, a reorientation in the next 15 years is likely.
  The timing and manner are open questions. It might be driven by citizen protest or business efforts, or a realisation by national governments that they cannot maintain power and legitimacy without delivering public goods to citizens.
  Increasingly, middle and smaller powers are forming coalitions of the willing in an attempt to find agreement. As the costs to these countries of climate inaction rise, they are likely to play a higher-profile role in driving change.

• However, cooperation may not be entirely fair, and there will be winners and losers.
  There will be a ‘prisoners’ dilemma’ in play. Players will need to set aside some national priorities and interests and instead choose to pursue a higher common purpose to ensure the wellbeing of their citizens and economies. But the costs and gains of climate action will not necessarily be shared.
  The past decade has been challenging for many smaller economies as they navigate the tension between their legacy diplomatic and security relationships, and their deepening economic relationship with China.
  These countries in particular will need to deftly manage relationships with big players to ensure their populations do not disproportionately bear the costs of climate action.

• There is no guarantee that cooperation will extend beyond averting climate crisis, the most pressing challenge.
  In the interim, international engagement, approaches to foreign investment, foreign aid, and the sources of future prosperity are now seemingly inextricably interlinked. Decisions in one area increasingly have implications for the others.
  Recognising the requirement to co-operate on climate, however, could spark a recognition of the gains from cooperation more generally.

Links

• Every Nation for Itself: Winners and Losers in a G-Zero World
• Coronavirus Bailouts Stoke Climate Change
• Climate Change Is Already Killing Us
• Change on Climate Change - Breaking the Policy Deadlock
• Climate Change Is a Chronic Condition - And Policymakers Need to Respond to It Accordingly
• How to Understand the Geopolitics of Climate Change

Insights Into Climate Change During Origin Of Dinosaurs

Phys.org - University of Utah

A dinosaur-like reptile leaves muddy footprints along the shoreline of a lake during a rainstorm some 234 million years ago in northwestern Argentina. Credit: Jorge Gonzalez/NHMU
 

The Triassic Period, about 252 to 201 million years ago, was a time of volatile change, particularly during an interval known as the Carnian (about 237 to 227 million years ago).

Three dramatic events occurred on Earth: the first dinosaurs appeared, gigantic volcanic eruptions called the Wrangellia large igneous province spewed out greenhouse gasses and the climate suddenly shifted to warmer, more humid conditions that scientists call the Carnian Pluvial Episode (CPE).

Recent work suggests that the Wrangellia eruptions caused the CPE, and that the resulting climate change may have spurred the early diversification of dinosaurs. But the lack of precise absolute dates for many Carnian sediments makes comparisons difficult.

Additionally, few detailed paleoclimatic data exist for many regions outside of Europe, making it unclear whether the CPE was truly a global climate event or conclusively linking it to dinosaur diversification.

In a new study in the journal Gondwana Research, an international group led by Adriana Mancuso, a National Scientific and Technical Research Council (CONICET) researcher at the Instituto Argentino de Nivología, Glaciología y Ciencias Ambientales in Mendoza, Argentina, demonstrated that the CPE affected the southern hemisphere, specifically South America, which strengthens the case that it was a global climate event. The study was published online on June 15, 2020.

"There are ample Triassic, and specifically Carnian, rocks and fossils in South America, and Argentina in particular, but until now there were no paleoclimatic studies that could conclusively show that the Carnian Pluvial Episode occurred in the southern hemisphere," Mancuso said.

Photos (left) and 3D models (right) of dinosaur-like footprints from the Los Rastros Formation in the study area in northwestern Argentina. Credit: Randall Irmis/NHMU

The team, which included researchers at the University of Utah and the Berkeley Geochronology Center, studied Carnian rocks of the Los Rastros Formation, which are preserved in the Ischigualasto-Villa Unión Basin in northwest Argentina. For the first time, the team precisely dated volcanic ash preserved in lake sediments and pieced together the paleoclimate at this time.

"Our study focused on these rocks because they had the perfect combination of a good fossil record, dateable ash layers, and rich climate data preserved in lake sediments," said Randall Irmis of the Natural History Museum of Utah and Department of Geology & Geophysics at the University of Utah.

In order to date the ash layer, the scientists isolated small needle-like crystals of zircon, minerals that act like time-capsules. When zircon crystallizes during an eruption, it traps the element uranium in its crystal structure, but never incorporates lead. Any lead preserved in the crystals today is a result of the radioactive decay of uranium.

Because scientists know this decay rate, they can measure the ratio of uranium and lead in each zircon crystal and calculate how far back in time the crystals formed. In the present study, this measurement was done on a precise mass spectrometer at the Berkeley Geochronology Center.

Co-authors Adriana Mancuso (left) and Cecilia Benavente (right), along with colleagues, examine dinosaur-like footprints in the Los Rastros Formation at the study area in northwestern Argentina. Credit: Randall Irmis

The scientists then obtained paleoclimatic data by looking at detailed features in the sediments— the types of clay preserved, and carbon and oxygen isotopes in freshwater limestone layers. With these measurements, the researchers estimated temperature, humidity and aridity and observed a distinct interval of particularly warm and humid conditions.

Based on the absolute date from the same strata, they concluded that it matched in time with the CPE in the northern hemisphere. By using a variety of different analyses, the resulting paleoclimate inferences were more robust than previous assertions made from a single line of evidence.

This warm/humid interval also fortuitously includes layers that preserve fossil footprints of early dinosaurs or their closest relatives.

"Our study suggests that the appearance of dinosaurs in South America could be linked to the CPE, but the data available worldwide remains inconclusive. To make a more robust global link between the CPE and dinosaur diversification will require many more detailed studies of paleoclimate with precise ages like we were able to do for the Los Rastros Formation in Argentina," concluded Mancuso.

Links

• Mass extinction crisis triggered expansion of dinosaurs
• A Climate Catastrophe Paved the Way for the Dinosaurs’ Reign
• Dinosaurs Roar Again, Now Including a Focus on Climate Change
• What Can Dinosaurs Tell Us About Global Warming? 
• Dinosaurs and Climate Change
• Earth was stressed before dinosaur extinction
• Dinosaurs may have faced volcanic climate change before the asteroid 
• By 2025, carbon dioxide levels in Earth's atmosphere will be higher than at any time in the last 3.3 million years

Five Must-Read Novels On The Environment And Climate Crisis

The Conversation - Ti-han Chang

Pexels

Ti-han Chang is Lecturer in Asia-Pacific Studies, University of Central Lancashire

Since the start of lockdown, more of us have taken to our bicycles, grown our own vegetables and baked our own bread. So it’s not surprising it has been suggested we should use this experience to rethink our approach to the climate crisis.

Reading some environmental literature – sometimes called “eco-literature” – can also give us the opportunity to think about the world around us in different ways.

Eco-literature, has a long literary tradition that dates back to the writings of 19th-century English romantic poets and US authors. And the growing awareness of climate change has accelerated the development of environmental writings.

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Animal’s People
by Indra Sinha

Indra Sinha’s Animal’s People, looks at the Bhopal gas explosion in India – one of the most horrific environmental disasters of the 20th-century.

A poisonous gas leak from a US-owned pesticide plant killed several thousand people and injured more than half a million.

The main character in the novel, Animal, is a 19-year-old orphaned boy who survives the explosion with a deformed body.

This means he must “crawl like a dog on all fours”. Animal does not hate his body, but embraces his animistic identity – offering an unconventional non-human perspective.

With this wounded “human-animal” figure, Sinha puts forward his critique of India’s postcolonial conditions and demonstrates how Western capitalist domination continues to damage people and the environment in contemporary postcolonial society.

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My Year of Meats
by Ruth Ozeki

Ruth Ozeki’s novel intermingles themes such as motherhood, environmental justice and ecological practice to explore the appalling use of growth hormones in the US meat industry from a feminist ecocritical perspective.

The novel employs a “documentary” narrative mode and begins with a TV cooking show – sponsored by a meat company.

While filming the show, Jane Takagi-Little, the director, encounters a vegetarian lesbian couple who reveal the ugly truth about the use of growth hormones within the livestock industry.

The encounter motivates Jane to undertake a documentary project to uncover how growth hormones poison women’s bodies.

Through a deliberate choice to make all her main characters female, Ozeki draws her readers’ attention to nonconforming, atypical female figures who rebel against social or cultural norms inherent in patriarchal capitalist society.

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Disgrace
by J.M. Coetzee

In Disgrace, J.M. Coetzee, a celebrated Noble Prize laureate, who is also known for his outspoken defence of animal rights, interweaves a brutal dog-killing scene with the gang-rape of a white South African woman by three black men.

Praised as one of the South African postcolonial canons, the novel explores complex issues of white supremacy and anticolonial resistance as well as racial and gender violence.

It ties these issues with humans’ domination and exploitation of the animals and further challenges our ethical position.

The combination of these two acts – the killing of dogs and the rape of a woman – can be read as Coetzee’s ecocritique of the colonial violence against nonhuman beings and the natural environment.

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The Man with the Compound Eyes
by Wu Ming-yi

Climate fiction or the so-called “cli-fi” takes on genuine scientific discovery or phenomenon and combines this with a dystopian or over the top twist.
This approach underlines the agency of non-human beings, environments or even phenomena – such as trees, the ocean, or a tsunami.

Wu Ming-yi’s novel is composed of four different narratives: a Taiwanese university professor, a boy from the mythical Wayo Wayo island and two other city-dwelling indigenous characters.

Their stories are viewed in fragments from the multiple perspectives of the “compound eyes”.

At the backdrop is a tsunami which causes the Great Pacific garbage patch to crash on to the eastern coast of Taiwan and the fictionalised Pacific island of Wayo Wayo that brings together all their stories.

Wu blends this unrealistic event with the real-life trash vortex to draw our attention to the severe environmental problems of waste dumping and our unsustainable lifestyles.

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The Overstory
by Richard Powers

The Overstory is praised by critics for its ambition to bring awareness to the life of trees and its advocacy to an ecocentric way of life. Powers’ novel sets out with nine distinctive characters - which represent the “roots” of trees.

Gradually their stories and lives intertwine to form the “trunk”, the “crown” and the “seeds”.

One of the characters, Dr Patricia Westerford, publishes a paper showing trees are social beings because they can communicate and warn each other when a foreign intrusion occurs.

Her idea, though presented as controversial in the novel, is actually well supported by today’s scientific studies.

Despite her groundbreaking work, Dr Westerford ends up taking her own life by drinking poisonous tree extracts at a conference - to make it clear humans can only save trees and the planet by ceasing to exist.

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These are just a few books with a specific focus on environmental issues – perfect for your current reading list.

To everyone’s surprise, this global lockdown has given us some eco-benefits, such as a sudden dip in carbon emissions and the huge decline in our reliance on traditional fossil fuel energy. Maybe then if we can learn from this experience we can move towards a greener future.

Links - Books

• 7 Climate Change Novels That Imagine Our Possible Futures
• Facing The Climate Change Crisis, Three Books Offer Some Ambitious Proposals
• Everyone, Everywhere: The Global Challenge Of Climate Change
• Gift Guide: 12 Books On Climate Change And The Environment
• A Better Planet: Big Ideas for a Sustainable Future
• More From Less: The Surprising Story of How We Learned to Prosper Using Fewer Resources – and What Happens Next
• On Fire: The (Burning) Case for a Green New Deal
• The Frigid Golden Age: Climate Change, the Little Ice Age, and the Dutch Republic, 1560-1720
• Anointed With Oil: How Christianity and Crude Made Modern America
• Waters of the World: The Story of the Scientists Who Unraveled the Mysteries of Our Oceans, Atmosphere, and Ice Sheets and Made the Planet Whole
• McSweeney’s Issue 58: 2040 AD
• Bad Environmentalism: Irony and Irreverence in the Ecological Age
• Greta and the Giants: Inspired by Greta Thunberg’s Stand to Save the World
• Imagining both utopian and dystopian climate futures is crucial – which is why cli-fi is so important

(AU) Environmental investigations - From Covid-19 To Climate: What's Next After The Global Oil And Gas Industry Crash?

The Guardian - Adam Morton

While oil and gas are not alone in struggling in the economic slump, the reality of the climate crisis is starting to bite, analysts say

An estimated US$1.6tn has been wiped from the global oil and gas industry this year, but the danger for Australia’s LNG sector remains little acknowledged. Photograph: Dazman/Getty Images/iStockphoto

The global oil and gas industry has crashed. In mid-June, BP – formerly British Petroleum – slashed the value of its assets by US$17.5bn and revealed plans to cut its workforce by 15%.

It forecast the price of oil would be a third lower than expected for decades to come and said it may be forced to leave new fossil fuel discoveries in the ground.

It was later joined by Royal Dutch Shell, which announced its own US$22bn writedown, with its vast gas business – including major liquefied natural gas (LNG) developments in Australia – expected to take the heaviest toll.

Wood Mackenzie, a global energy research and consultancy group, says the fall in value is industry-wide, estimating US$1.6tn has been wiped from the sector this year, with more to come.

While oil and gas are not alone in struggling in the face of biggest economic slump in nearly a century, WoodMac says its carnage cannot solely be blamed on Covid-19. The economic reality of the climate crisis is also starting to bite.

“It’s about fundamental change hitting the entire oil and gas sector,” WoodMac’s vice-president for corporate analysis, Luke Parker, said.

“Just a few years ago, few within the oil and gas industry would even countenance ideas of climate risk, peak demand, stranded assets, liquidation business models and so on. Today, companies are building strategies around these ideas.”

If that reflects the global picture, the story among Australia’s oil and gas businesses – which until recently have been enjoying booming growth selling LNG to Asia, and driving most of the increase in national greenhouse gas emissions – is less clear.

The idea of stranded assets due to climate change is not new. It suggests carbon-intensive projects potentially worth trillions risk becoming next-to worthless – stranded – if investors abandon them in favour of emissions-free technology, as required to meet the goals of the Paris climate agreement.

In Australia, the risk is recognised by the country’s major financial institutions and regulators, and has increasingly become a focus of shareholders. Earlier this year they gave resolutions calling for climate action and transparency at oil and gas companies Woodside Energy and Santos more than 50% and more than 40% support, respectively.

Activist shareholders are not persuaded by suggestions support for gas is justified as it emits less than coal when burned, and point to studies suggesting it may release more emissions than previously thought.

‘Double-whammy effect’

On coal, where the concept of climate risk is increasingly accepted, Australia’s second-largest superannuation fund, First State Super, last week announced it would divest from any company that earns more than 10% of revenue from thermal coal mining. It followed an earlier, similar statement by Hesta, and three of Australia’s four major banks promising to soon stop supporting thermal coal.

But the possibility of major assets being stranded is only occasionally acknowledged across politics, media and the industry.

The federal resources minister, Keith Pitt, responded to First State Super’s announcement by saying it was “mystifying” that a fund would deny its members a “solid and attractive investment opportunity” in coal based on “misguided ideology”.

Australian oil and gas companies have been hurt by the shutdown, with decisions on more than $80bn of new LNG projects put on hold and Oil Search this month laying off a third of its workforce. But the local industry’s public position on what the future holds differs from its competitors in Europe.

In response to questions about Shell and BP’s writedowns, the Australian Petroleum Production and Exploration Association (Appea), representing oil and gas producers, did not mention climate risk.

Andrew McConville, Appea’s chief executive, said Covid-19 and the ongoing low oil price were having a “double-whammy effect” and that it would remain an “incredibly challenging time” for the sector even after the broader economy began to recover. But he said the industry was accustomed to cyclical commodity prices and would be “here for the long term”.

“Energy demand, and oil demand with it, will recover as travel restrictions are eased and economic activity resumes over time,” McConville said. “The right regulatory and fiscal policy settings will help ensure that Australia remains a competitive destination for oil and gas investments into the future.”

The Morrison government agrees, having backed the idea of a “gas-fired recovery” from coronavirus after a drop in domestic gas prices. Its National Covid-19 Coordination Commission, led by the former Fortescue Metals executive Nev Power, has focused on gas-related recommendations.

Neither the government nor the commission has explained how lower gas prices would encourage increased private investment unless it is backed by substantial public support. Even if that were in the offing, analysts believe maintaining low prices would be a pipe dream given production costs in new Australian gas fields are recognised to be high.

This, in part, is what is driving the push to install gas import terminals along the Australian east coast.
While it may seem ridiculous to starting buying fossil fuels from overseas while the country mines huge amounts for export, experts believe it may be the cheapest gas option – if the Morrison government and industry are determined to back new gas infrastructure rather than accelerate a switch to cheaper renewable energy.

Big investors may ultimately drive change

Analysts and investor representatives say it is still unclear how much weight climate risk will be given in oil and gas investment decisions in Australia in the short-to-medium term.

Zoe Whitton, the head of ESG research with the financial services multinational Citi, says Australia’s outlook is arguably different to some other oil and gas producers as it mostly extracts gas, not oil. It also mostly sells to north Asian countries, where investment patterns are less clear and have been interpreted as backing both fossil fuels and renewable energy.

It means that compared to Europe, views on gas still range from it being seen as a legitimate transition fuel to any support for it being clearly at odds with where the rest of the world is pulling. Whitton says investors are increasingly, but not uniformly, in the latter camp.

Gas may be a transition fuel for some regions, but not at any price and not forever
Zoe Whitton

“The local [companies] face the same pressure that the internationals do,” she says. “There is a process of negotiation going on between companies and investors, but I don’t expect the locals will respond to the global signal in a uniform way or a rapid way.

”Whitton believes the future of the local gas industry may be clearer once world-leading models published recently by more than 60 central banks, under the banner of the Network for Greening the Financial System, give a local, rather than just a global, picture. The Australian Prudential Regulation Authority has begun the job of producing that data.

It could, for example, give investors a better picture of whether Santos’s controversial $3.6bn Narrabri coal-seam gas proposal has a viable future.

“The truth is gas may be a transition fuel for some regions, but not at any price and not forever,” Whitton says. “So the question is at what price, and for how long?”

Emma Herd, the chief executive of the Investor Group on Climate Change, representing institutional investors with funds worth about $2tn, says there is clear evidence an industry-wide structural change is under way. “Covid is to some extent attaching a rocket to a trend we were seeing anyway,” she says.

She says Australia is part of that trend, but agrees with Whitton that it is a slightly different conversation than in some parts of the world. “Australia is saying its gas will continue to be competitive and its markets will hold up as others go down. The big question is: is that true?”

The obvious question is if Shell and BP can do it, why can’t Australian companies?
Emma Herd

Herd says if there is any analysis to support the idea that the local gas industry will thrive while others crash it has not been publicly released.

The lack of information is driving calls for fossil fuel companies to release data on their “scope 3 emissions” – in basic terms, the carbon pollution that results from the fossil fuels a company sells.

Herd says including information on scope 3 emissions in financial reporting is vital for investors to understand financial risk in a world that has pledged to cut emissions, and driving the push at recent annual general meetings for greater disclosure.

“The obvious question is if Shell and BP can do it, why can’t Australian companies to the same extent?” she says.

“What we need to see for our gas companies is reporting at the asset [project] level, not just at the company level. We need the data to assess risk. That could change the viability of some of their projects.”

Australia’s oil and gas companies did not engage on the question of climate risk. Santos declined to comment while spokespeople for Woodside and Origin Energy said the companies periodically reviewed their portfolio of assets. Origin said several factors contributed to the valuation “including commodity prices, interest rates, exchange rates and costs”.

Whitton suggests big investors, who may ultimately drive change faster than governments, have additional criteria.

“A lot of investors are saying ‘look, if I have 10 futures and if in five of those futures gas is an answer and in five it is not, but renewable energy is an answer in all 10, then you can see where the greater risk lies,” she says.

“The reality is when you have a really wide range of future scenarios the risk of stranded assets is higher. And the risk of stranded assets is higher in Australia just by dint of the higher likelihood that people will take a bet on oil and gas compared to the EU, where they won’t.”

Links

• Trouble with gas: the Coalition is betting on the fossil fuel for recovery – but the sums don't add up
• Australia could create hundreds of thousands of jobs by accelerating shift to zero emissions – report
• Is the Coalition's gas nirvana just an attempt to have its fossil fuel cake and eat it too?
• Environmental investigations: ‘A mockery’: Great Barrier Reef Foundation raises just $21m of $357m target
• Environmental investigations: Tasmania's 'precious' swift parrot habitats marked for logging despite expert warnings
• Environmental investigations: Australia's register of threatened species critical habitat not updated in 15 years
• Environmental investigations: Transport slump during lockdown reduced Australia's carbon pollution by 7% in April, but experts warn of rebound

(AU) A Biden Win Would Change Our Climate Policy

AFR - Alan Mitchell

Wishful thinking, or timely intervention?

After reading Grattan Institute's checklist of changes needed to get the economy from the fiscal cliff to modest recovery, you might think Anthony Albanese's bid for a climate change consensus is destined to end up in the “wish list” the former Grattan boss John Daley is warning us about.

But in the current rapidly changing political environment, I wouldn't be so sure.

Well ahead in the polls: If Joe Biden were comfortably elected, the global politics of climate change and emissions reduction could change quite quickly.  Bloomberg

The big change, of course, is in the United States, where Donald Trump's handling of the anti-racism protests and the surging coronavirus infection rates has seen his popularity slide.

Trump's position is looking dire. He is trailing Joe Biden in most of the national polls, with younger members of his 2016 support base reportedly turning away from him. His approval rating, which peaked in April at 50 per cent, has fallen to the low 40s.

That, the Brookings Institution's William Galston points out, is dangerously close to rates of popular disapproval that preceded the defeats of incumbent presidents Jimmy Carter and George Bush snr.

A Republican pollster quoted in London’s Financial Times did not attempt to put a gloss on the President’s position: “If the election were held today, it is pretty obvious that Joe Biden would be elected president, comfortably.”

If Biden were comfortably elected, the global politics of climate change and emissions reduction could change quite quickly. The Democratic nominee's promise is to achieve a "100 per cent clean energy economy” with net zero emissions by 2050.

Australian voters would recognise that we would have no choice but to follow the US lead.

But to protect US competitiveness and jobs, he also plans to “use every tool of American foreign policy to push the rest of the world to raise their ambitions alongside the United States”.

“We can no longer separate trade policy from our climate objectives,” his policy documents say. “The Biden administration will impose carbon adjustment fees or quotas on carbon-intensive goods from countries that are failing to meet their climate and environmental obligations.”

Brutal choice

The European Union has been considering a similar border carbon tax. Together the world’s two largest export markets could be presenting their trading partners with a brutal choice: either pay a carbon tax to yourselves, or pay it to us.

The governments of Brazil and Malaysia have accused the EU of a new form of colonialism. Biden’s campaign documents talk about putting the US “back in the driver’s seat”.

Strong US leadership has been the key missing ingredient in the climate policy debate in Australia and elsewhere.

Australia is too small to unilaterally make a significant difference to the quantity of global carbon emissions. The argument for Australia making economically damaging emissions cuts has had to rest on the hope of leading international change by example.

Under the Biden policy, Australia would be contributing to a far more reliable emissions reduction strategy. Moreover, Australian voters would recognise that we would have no choice but to follow the US lead, especially if it was seen as an important contribution to Australia’s wider strategic association with the US.

Of course, with coal representing a major part of Australia’s comparative advantage, emissions reduction will be a big economic adjustment and a huge political challenge.

However, Biden would, in effect, be giving the Morrison government political "cover". It would be an opportunity for the Coalition parties to win back a generation of Australian voters and to embrace an economically efficient and cost-effective emissions reduction policy.

Research by the Productivity Commission early last decade found that a carbon price, imposed as an emissions trading scheme or a tax, would cut emissions at a fraction of the cost of the policies then in place.

This is a crucial issue. As the emissions cuts deepen, the cost of meeting our climate policy obligations will rise exponentially. Last year, the International Monetary Fund estimated that Australia would need a carbon price of more than $US75 ($109) a tonne to meet the Abbott government’s Paris emissions reduction commitments.

On the Productivity Commission’s evidence, alternative non-price measures would be far more expensive.

Morrison government ministers have rejected the IMF estimate, but the government has an obvious interest in fudging the cost of emission reduction, as does the Opposition Leader. Albanese now also claims that a carbon price is no longer necessary.

So far, they have got away with it.

But, thanks to President Trump’s incompetence, Australia’s political game of climate change may be about to become more demanding.

Links

• The plan meant to unite Biden and Bernie voters on climate is finally here
• Can we follow the French out of gridlock on climate?
• Greens announce ambitious new emissions targets in line with Paris
• Australia must hit net zero by 2050 to meet Paris: scientists
• Australia's emissions reductions falling short of climate commitment

(AU) Hundreds Of Children's Shoes Laid Out In Silent Brisbane Climate Protest

The Age - Lucy Stone

Hundreds of pairs of children's shoes have been laid in front of Brisbane's City Hall to demonstrate the impact of climate change on future generations, in a silent protest by Extinction Rebellion.

The circular installation set up in King George Square on Saturday morning used shoes temporarily donated by charities.

Hundreds of pairs of children’s shoes laid out outside City Hall for an Extinction Rebellion protest. Credit: Lucy Stone

Organised by a west Brisbane branch of the climate change activist group, the installation was titled For Our Childrens' Sake and was inspired by other protests across the world during the year.

Activists Sue Melloy and Bill Cruickshank said it was important to send the message to governments that while current generations were experiencing the impacts of climate change, "it's actually going to be far worse for our children, and our children's children"."We've laid out these hundreds of pairs of children's shoes to give that message, for a fairly COVID-safe protest," Ms Melloy said.

"Many people in XR are grandparents and very middle-class, very law-abiding people stepping up to the game.

They were laid out in concentric circles, with messages. Credit: Lucy Stone

"So we just wanted to do an action that was at the other end of the spectrum, so very law-abiding, more of a vigil."

Ms Melloy said both of them still believed in the XR ethos of disruption to get attention, and had been arrested for breaking the law at other protests.

Mr Cruickshank said multiple scientific reports clearly showed delaying action on climate change would worsen the lives of future generations significantly.

New research published earlier this month found heatwaves had become more frequent and longer lasting in Australia and globally, in an accelerating trend.

The shoes were laid out in concentric circles, each pair side by side, with several Extinction Rebellion flags in the centre and messages written on paper and cloth along several pairs of shoes.

"Our children and their children are, in all probability, going to have a worse life because of climate change than we do," Mr Cruickshank said.

"Things are on the decline if we don't do something about it."

Links

• Meet The 8-Year-Old Climate Activist Cleaning Up India
• Children Of The Crisis
• Every Child On Earth Faces 'Existential Threats' From Climate Change, Report Finds
• How Climate Experts Think About Raising Children Who Will Inherit A Planet In Crisis
• Health Impacts Of Climate Change On Children Don't Need Exaggerating
• Q&A: Short-Term 'Tribal' Politics Is Failing On Climate Action, John Hewson Says
• One Thing You Can Do: Talk To Your Children About Climate Change
• Our Young Girls Are Bearing The Burden Of Climate Action. But Should They Be?