I awoke to Fran Kelly struggling to elicit Richard Denniss’ point about an emissions cap acting as an implicit floor this morning. (Update: TAI Report) Even asking him the same set of questions twice didn’t seem to help. You need to unpack the underlying assumptions of the debate as it’s being conducted in Australia over to understand the beauty of The Australia Institute’s formulation. Continue reading ‘Emissions Caps as (Social) Floors’
Tag Archive for 'emissions trading'
As Peter Wood notes, the Treasury modeling for the Carbon Pollution Reduction Scheme contains some rather dodgy assumptions: as he puts it: “There is no way in hell that the international community could accept a 5% reduction from Australia that corresponds to a 550 ppm target, or 15% corresponding to a 510 ppm target. These targets would involve Australia free-riding on other countries emission reductions.” On that basis, you’d have to agree with Peter that Australia’s standard approach to climate change negotiations - attempt to negotiate a position that involves doing as little as possible - is likely to continue.
However, there is a fair bit of good news in the Treasury report. As previously noted, paying developing countries for permits is likely going to be a major source of “our” emissions reductions for some time. I don’t have a huge problem with this; emissions are a global problem, and paying for clean technologies in developing countries is likely to be a win for both us and those developing countries. So getting a deal that ensures the largest pool of permits available for purchase is in Australia’s direct financial interest. But there’s more: the Treasury modeling seems to indicate that it’s not only Australia who benefits from joining a deal now, rather than later. According to Box 5.4 of the Treasury report:
Subsequently, when these developing economies join the global emissions trading scheme, their mitigation costs are higher than if they had joined earlier. A larger part of the economy now has to adjust to the emission price, resulting in larger distortions or allocative efficiency losses in the economy and larger declines in returns to capital.
In contrast, those that join the global trading scheme at or near the beginning receive a relative benefit once all regions join. As a result of the larger declines in returns to capital experienced in delayed-entry economies, early-entry economies receive relatively more investment, leading to higher levels of capital stock.
Continue reading ‘Modelling says: do a deal, and make it a good one’
…unless you already know and like the answers you’re going to get. You’d reckon that the Opposition might have learned its lesson on that. It seems like they might need another one, given their response to the impending release of the Treasury modeling on the economic effects of the ETS:
Mr Robb says the Government must include recent global events before it finalises the scheme in its White Paper by the end of the year.
“We will be demanding that the White Paper is not released until such time as the Government has made some attempt to assess the impact of this financial meltdown around the world,” he said.
Well, the government could have done that, but Robb probably wouldn’t have liked answers when they came back.
Continue reading ‘In politics, don’t ask questions…’
It seems that even the business lobby thinks that the the Liberal Party’s continued bleating for the delay in ETS introduction - the latest excuse, as pointed out by Ken at Surfdom being the credit crunch - isn’t a great idea. From the Oz:
“If the Government pulled the plug and delayed the system now, the level of uncertainty would be even more difficult to deal with,” said Maria Tarrant from the Business Council of Australia.
“It is critically important for business to know exactly what the Government is planning and if they pulled back now it would be highly problematic, but the economic situation makes it even more important that it gets the design of the scheme right.”
Minerals Council of Australia chief executive Mitch Hooke said a “delay would just add to the uncertainty. All of my concerns can be addressed by the Government getting the design, the framework right.
Continue reading ‘Emissions trading still on course for 2010′
Oh dear. Anyone who’s still getting their ‘news’ from SMH needs their head examined:
Subsidy for bulbs wasted:
THE flawed scheme to cut greenhouse gas abatements by giving away lightbulbs has squandered an estimated $60 million of NSW taxpayers’ money, the State Opposition says….An assessment of the scheme by the Opposition has found that NSW Greenhouse Abatement Credits issued by the Government have been largely wasted. It was claimed initially that as many as 80 per cent of the lightbulbs given away were installed. But later surveys found most households never installed them, and that only four out of 10 of the lightbulbs were ever used.
‘Later’ being the operative word there, rather than ‘recently’. The changes to the installation rate occured after an audit in 2006, sending all the businesses operating under the Demand Side Abatement Rule to the wall. Despite insistent pleas for transitional arrangements until a national scheme could be brokered, none was given and around 1000 people lost their jobs in companies like Neco and Easy Being Green. Some forms of structural adjustment are more equal than others…
The real story here is the upcoming ‘Super Saturday’ of by-elections. (Guy Beres has an excellent analysis). Continue reading ‘SMH Death Spiral - Emissions Trading Edition’
Australia’s total greenhouse emissions, assuming a 450ppm target and “backstop technology”. Source: Garnaut Review Final Report, Figure 23.6
It’s out today. LP bloggers will have more during the day as it’s digested, but here’s an open thread for instant analysis and commentary. Please also feel free to link in comments to other posts or articles.
By way of preview, a number of climate scientists have released an open letter to Kevin Rudd (text here):
The Garnaut Review concluded that an emission reduction target for Australia of 25% below 1990 levels by 2020 would be an equitable contribution to the international effort required to achieving this outcome. As a group of Australia’s leading climate change scientists, we urge you to adopt this target as the minimum requirement for Australia’s contribution to an effective global climate agreement.
In Crikey yesterday, Bernard Keane contrasted the apocalyptic prophesies of doom emanating from business with the rather lame reality of the government’s proposals to date.
Nightmare stuff. Imagine how bad it would be the Government had actually proposed a serious effort to reduce our carbon emissions?
As Keane notes in another article, the release of the Treasury modelling today:
should provide a welcome corrective to much of the hysteria generated by modelling commissioned by rentseeking industry groups.
Keane also observes that Garnaut will be talking about adaptation strategies and costs in this report as well.
Note: Related post from dk.au on public opinion, polls and climate change.
Update: The report has now been released and can be downloaded from here.
Update: From Crikey, Bernard Keane on Garnaut at a glance and Clive Hamilton on politics trumping science.
Elsewhere [dk.au]: Barry Brooks is also running an open thread at his blog Climate Dilemma [ht: Peter Wood in comments]
Joshua Gans comments on Chapter 14 (TEEIIs) which he argues is “dramatically superior” to the Green Paper solution of free permits. He also renews his call for border adjustment taxes:
In my opinion, it would be better to bite the bullet and, at least for imports, assess the carbon cost of those imports and tax them. This will get the price signals right and also put pressure on trading partners to put in their own emissions trading schemes so as to avoid that tax.
If this is accurate, it’s the most important thing to come out of Kevin Rudd’s mouth in quite some time:
Kevin Rudd was explaining the benefits of clean coal technology during a meeting with the coal industry today when he said the necessary stabilising point to tackle climate change is an emissions level of 450 parts per million by 2050.
Not because he’s right. 450ppm almost certainly isn’t low enough to stabilise the climate acceptably close to the historical norm. But a 450ppm target is a hell of a lot closer to the mark than Labor has been prepared to go in the past.
And if throwing $100 million of government money at an International Clean Coal Institute is what it takes to make such a target politically palatable, I’d reckon I’d live with that.
Only three weeks after the official close of submissions (many businesses asked for an extension) it looks like we might see a White Paper as soon as the 3rd of October. This suggests the government has a clear idea of the short-medium term trajectories they want to pursue. If the volume of shrill, anti-innovative blackmail sentiment is anything to go by, my guess is that we’ll see yet another ETS that doesn’t do a lot of, well, Carbon Pollution Reducing.
Elsewhere: Peter Browne writes at APO:
A
new[previously reported by Mark] analysis of the attitudes of people who swung to Labor at last year’s election suggests that acting to reduce climate change can be a vote winner – in fact, according to the data, it might be the vote winner. In two quite different surveys [including one where “young people were under-represented in [the] sample”], the single most important issue nominated by vote-changers was global warming. In both cases, it rated ahead of the other issue generally regarded as a vote-changer, industrial relations.
The latest round of critiques of the Garnaut report have emerged, this time from some of Australia’s best-known climate scientists. They all argue that Garnaut should be telling the Australian government to push for a more aggressive global deal, rather than passively accepting a weak deal. While it’s hard to be sure in the context of a short media report, they would also seem supportive of the idea of Australia unilaterally going further even if there is only a weak deal.
Given that, I thought I’d look at one possible scenario; where the 550ppm global deal is signed, but Australia unilaterally goes for a target proportional with its responsibilities under a 450ppm deal. How much would that cost Australia?
Watching Insiders today, I heard lots on the latest Garnaut report. Sadly, there seems little evidence that anybody (notably including Brendan Nelson) has bothered to read it in detail. Nobody seems to have grasped, for instance, that Garnaut is arguing for a fundamentally different type of target allocation - per-capita targets, rather than absolute targets that suit countries with declining populations like most of Europe.
But there’s another point that doesn’t seem to have permeated into Insiders‘ non-random sample of the commentariat (with the exception of Brian Toohey). If you look at the press release, it seems that a 10% cut in absolute emissions by 2020 (a 30% cut per head of population) as part of a global agreement, will cost us less than a 5% cut (25% per capita) without one. What’s going on?
Continue reading ‘Garnaut targets, lesson #2 - international linkage’
There’s been a lot of criticism of the emissions targets suggested in the Garnaut Review’s supplementary modelling report. But there hasn’t been a great deal of explanation as to how he came up with them, which might be useful to make slightly more sophisticated critiques. In that light, here’s my attempt to explain where his targets comes from.
WorleyParsons’ PR coup last week indicated a thirst for big interventions into an otherwise rather bleak energy policy landscape1. The ~$100k feasibility study regurgitated by the MSM (and analysed by Robert here) was, as Brian alluded to, chump change from their handsome profiteering from Canada crapping all over its Kyoto commitments under the Harper Government. It remains to be seen whether WP actually capitalises on its good press and goes ahead with the projects, or simply banks the warm and fuzzies and continues its search for business opportunities elsewhere. If the projects do progress beyond the speculative phase, it would raise some interesting questions around the diversification of a business like theirs into solar (rather than, for example, consolidating its interests in various carbon intensive fields). Continue reading ‘How to live with emissions?’
- Two particular stories stand out: (1) Australia’s main carbon capture collective, CO2CRC, flagged the need for an additional $300m to keep the ball rolling on their research; and, (2) In a move which underlines their uninsurability, Parliament moved on legislation to protect Carbon Capture and Storage projects should they leak (or damage lifeforms we have little to no understanding of) ↩[back]
Recent comments
ATTN FDB, Mindy, Pavlov's Cat, Lefty E, Nabakov, Lefty E [...]
kymbos, kymbos, BH, David Irving (no relation), Pavlov's Cat, Helen [...]
Lloyd Morcom, Chris (a different one), sublime cowgirl, Darin, Paul Burns, Kingsley [...]
sublime cowgirl, Fine, steveh, wizofaus, grace pettigrew, wbb [...]
Paul Burns, Baraholka, Paul Burns, Adrien, joe2, Paul Burns [...]
Ambigulous, suz, Colin, un ami des beaux arts, adrian, suz [...]
Legal Eagle, Michael Sutcliffe, Mark, Tyro Rex, Adrien, Posey [...]
Bilko, Paul Burns, Dave Bath, Bilko, Nabakov, Adrien [...]
Paul Burns, Darlene, Darlene, via collins, MikeM, glen [...]
Leon, Derek, Down and Out of Sài Gòn, tigtog, Bingo Bango Boingo, Mark [...]
rosieblue, Lefty E, wankaroo, What me banal?, FDB, Eye'm A Love Man, Ooh Baby, Eye'm A Love Man [...]
RobWindt, Pappinbarra Fox, Ai! Que Dolor!, Patrick B, peter jones, Paul Burns [...]