Paris update: Anticipation and hyperbole

Delegates have arrived in Paris and the behind the scenes discussions have begun. Negotiators are meeting in strategy sections and informal consultations to coordinate positions and, hopefully, ensure that the formal negotiations happen smoothly after the fanfare of the leaders’ statements tomorrow.

Canada and Japan’s multi-billion dollar commitments to support the world’s poorest nations participate in climate change solutions are a welcome boost heading into this week (see a box at end on chronology of climate finance commitments).

From an Australian perceptive, we head into the Paris meeting with an unprecedented commitment from both major Parties that we must achieve net zero emissions.

As I was getting on the plane to Paris, the Opposition Leader outlined the ALP’s commitment to Australia achieving net zero emissions by 2050 (more on this below). From the Commonwealth heads of government meeting (CHOGM) in Malta, the Prime Minister stated, “It [Paris] is a step along the way to achieving a net zero emission world.’’

Long-term emissions goals such as this will be on the agenda on Paris, but more importantly, these statements offer a rare opportunity to reset some of the hyperbole in recent domestic policy discussions. How it achieves net zero emissions over coming decades is now a key test of any party’s policy to clean up and modernise our economy.

However, the unusual convergence on what our ultimate objective is has been marred by some of the domestic debate around ALP’s emissions goals. Business have largely been constructive in their responses and focused on the need, regardless of the targets set, to have scalable, durable and investable domestic climate policy (see, for example, media statements from BCA and AiGroup). However, a number of government statements in response require scrutiny:

–  ALP target would be a massive hit on the economy: This is not supported by evidence. All independent economic modelling in Australia has shown that cleaning up our economy would see economic growth continue strongly. Putting aside that this modelling explicitly ignores the economic impacts of climate change itself, any cost to businesses and the economy is largely determined by the policy to achieve the target not that target itself. For example, the modelling commissioned by the government shows that the overall economic cost of achieving a 45 per cent reduction in emissions by 2030 through domestic and international action is the same as achieving a 26 per cent reduction through domestic action alone (See below figure).

–      The ALP’s target is stronger than other countries: This is incorrect. The average of emissions reductions targets of other developed countries, on 2005 levels, is around -35 per cent by 2030. This is less than the ALP’s target but more than the governments. However, a number of countries including Germany (-45 per cent), Norway (-44 per cent), Switzerland (-51 per cent) and the UK (-49 per cent) have comparable or stronger targets than the ALP’s proposal.

 A straight comparison against a 2005 base year also misses a critical point.

Australia, over the last two decades had done much less than many other nations to limit emissions. As a result we still have the highest emissions per person and most pollution intensive economy of any developed nation. By not bringing per person emissions and emissions intensity down to levels comparable to others we are asking other nations to continue subsidising our lack of action.