Australia’s Climate Change Authority is reported to be considering recommending an increase in Australia’s emissions abatement target to a 15 per cent reduction from 1990 levels by 2020 from the current target of 5 per cent.
The report, in the Australian Financial Review, has explosive political implications given the inability of the Coalition to produce a credible climate policy. But it should not come as a surprise: firstly given the extent and cost of abatement that has already been achieved in Australia, and which could be achieved, as ClimateWorks pointed out in a report earlier this week, and secondly because of the developments in science and policy action. And, of course, by what is required by the science, which is a minimum of 25 per cent.
A new analysis by global investment bank HSBC underlines this last point, and suggests that the upcoming reports to be released by the Intergovernmental Panel on Climate Change (IPCC) – its first update in six years – will provide more impetus for decisive action to reduce greenhouse gases, and precipitate a range of new policy initiatives.
The first report on the physical science basis of climate change (WG I) will be released in late September, just weeks before the CCA is due to deliver its draft conclusions on Australia’s emissions abatement targets, and the caps that should be set in its emissions trading scheme.
The other two IPCC reports – on Impacts, Adaptation and Vulnerability, and Mitigation of Climate Change – will be released about six months later, about the time that the CCA will be completing its own study.
HSBC notes that the last time the reports were released, in 2007, the conclusion that “warming of the climate system is unequivocal, as is now evident from observations of increases in global average air and ocean temperatures, widespread melting of snow and ice, and rising global average sea level”, catalysed a range of action with 157 new climate policies implemented over the following two years.
The economists – Zoe Knight and Nick Robbins – expect that the new evidence to come to light in the new reports will provide further evidence that scientific indicators and weather extremes are moving in a manner consistent with global warming, and precipitate a new round of action. Indeed, they say there is clear evidence that this is already occurring.
This has important considerations not just for policy-makers but also investors, given that these reports are likely to cause more funds managers to reflect on the implications of a “carbon budget” that would provide absolute limits on the burning of fossil fuels.
Here are the 7 key reasons the HSBC economics provide that support their conclusions.
Land temperatures have become more extreme: This chart below shows the shifting magnitude of land temperature anomalies through the decades for the Northern and Southern Hemispheres. From 1951 to 1961, only 1% of the land area in the northern hemisphere was exposed to temperatures higher than 3 standard deviations from the mean for 1951–1980. But from 2001-2011, 11% of land area was exposed to temperatures higher than 3 standard deviations, and 1% of land area, an area roughly twice the size of France, was incurring heat extremes of 5 standard deviations from the mean. The same trend is true in the Southern Hemisphere.
Temperatures are rising: The economists note global average temperature has risen by around 0.8°C since pre-industrial levels, as shown in chart 3 (below right). The World Meteorological Organisation noted in July that the past decade was the warmest decade recorded since modern measurements began around 1850.
“Despite this, throughout 2013, climate sceptics have re-emerged, claiming that there has been a hiatus in warming. Our view, which is consistent with a 97% consensus of scientists, is that warming is still happening,” HSBC notes, although there is still difference of opinions about future modelling.
It expects the September IPCC report to S present a range of long-term forecast temperature outcomes according to different assumptions on anthropogenic radiative forcing components.
Indicators are consistent with warming: HSBC says there are ten main indicators that scientists use to determine the extent of climate change, and they are all trending in the direction associated with warming.
These include surface sea temperatures, land temperatures, marine air temperatures, changes to sea level, lower tropospheric temperatures, ocean heat content and specific humidity readings, as well as arctic sea ice, glacier mass balance, and Northern Hemisphere annual snow extent.
Recent reports suggest that oceans have absorbed about 90% of the heat added to the climate system, although there is uncertainty around how much heat is absorbed at greater depths of more than 1,000m and the impact this has on temperatures. The IPCC report could provide clarity around that issue.
Extreme events have picked up in line with temperature rises: The next charts show that, since the 1950’s, the number of extreme events (classified as droughts, floods and wildfires) has increased, broadly in line with temperature rises. And chart 5 shows that the costs have escalated in the two most recent decades, from around $US59 billion during the 1980s. In 2010, the hottest ever recorded year (when the global temperature was recorded as 14.66°C), the costs of damages related to floods and droughts in that year alone amounted to $US52 billion, and were mostly flood-related.
Attribution assessments are increasing: Scientists have turned to making assessments of the attribution of climate change to weather events in order to answer the question ‘Is climate change affecting historical weather norms? This enables policy makers, insurers, electricity providers and businesses to develop strategies to enable climate adaptation as scientists identify the likelihood of an event occurring more frequently. For example, the American Meteorological Society notes that the drought that occurred in Texas in 2011 is 20 times more likely to occur now than it was in the 1960’s.
AR5 and policy: the HSBC economists say science has been crucial for shaping the policy agenda. The first IPCC assessment report was published in 1990, but these charts below show that a ramp-up in policy introduction came in 1999 after the second assessment report (1996), and again in 2008 after the fourth assessment report in 2007. “We expect another pick-up in policy introduction to be driven by other factors in addition to carbon, such as air pollution and health, changing economic structure and water constraints,” they write.
AR5 is a necessary, but unlikely to be a sufficient, greenhouse gas reduction driver: The HSBC economists say that the suite of AR5 reports will provide sustained justification for action to reduce greenhouse gases, despite opposition. “The reports include submissions from top scientists, are a global collaboration, and have been a work-in-progress for five years.
In conclusion, the HSBC economists note that past assessment reports have not been without fault. “Working with a large number of authors leaves room for error and potential for climate sceptics to discredit the science, as happened post the fourth assessment report,” they write.
“We see a risk that, in the effort to determine a consensus between scientists, the conclusions could be diluted, giving climate change sceptics more leverage. Nevertheless, we think the reports remain important for bridging the gap between science, policy, and business, and generally furthering climate change knowledge.”
The economists are encouraged by the recent collaboration between the US and China (which together account for 40% of global CO2 emissions), and it believes that UN Framework Convention on Climate Change (UNFCCC) process will remain intact as it aims for a post 2020 emission reduction deal to be agreed in December 2015.