Time for states to step up on climate, carbon and clean energy

With the turmoil at the national level on renewables just one sorry example, there are very good reasons why states should be stepping up on climate action.  There are some positive but piecemeal signs but they and their national counterparts need to embrace the reality that you can’t have a plan for climate without a plan for decarbonisation. Others are doing so

Around the world business leaders like India’s leading industrialist Ratan Tata and CEO of multinational Unilever Paul Polman have called for a net zero carbon emissions global economy by 2050. The radical lefties at the World Bank and the OECD also support this outcome.

The UK last month saw an astonishing tripartite agreement amongst leading political parties. They agreed there should be a phaseout of unabated coal power and implement short-term targets linked to long-term the internationally agreed goal of avoiding two degree warming above pre industrial levels. China’s investments in clean energy now outstrip investments in fossil fuels with a growing toolbox of policies including pilot emissions trading schemes that may evolve into a national scheme next year.

The positive news is that growing policies there and elsewhere seem to be having an impact. The International Energy Agency just reported that, for the first time, global emissions from energy have peaked while global economic growth has continued.

There are glimmers of hope in Australia. The fact that the Government’s Intergenerational Report acknowledged the goal of avoiding two degrees warming was welcome.  It is also positive that the ALP is openly talking of decarbonisation.

Yet at the national policy level things remain grim.  Australia is the only country to have axed an emissions trading scheme and its market backed limit on carbon pollution.  The Government has taken the axe to the body of the renewable energy industry, with investment hemorrhaging.

At a state level, governments need to ponder the folly of outsourcing policy development on emissions reduction to a national level so wracked by uncertainty and turmoil. Fortunately many state governments are reconsidering their role and the risks of leaving their economies and communities at the fluttering whims of national leadership.

There are some mutterings of a COAG agreement that emissions reduction, or mitigation, is a national responsibility.  While that may have been an expressed intent, and perhaps even sensible when we had a flexible limit on over 60 per cent of Australia’s emissions under the carbon laws, it is no longer relevant or prudent. And no explicit agreement was reached.

The Climate Institute today released a Discussion Paper on State decarbonisation strategies which outlines five areas that should be covered:

1. Setting binding emission limits on major emitting facilities (e.g. industrial processes, power generators) while again exploring inter-state emissions trading
2. Incorporating carbon costs and the benefits of emission reduction into policy and planning processes and remove arbitrary barriers to clean energy developments
3. Using procurement and management policies to help build markets for lower emission goods and services
4. Continuing to develop and link energy efficiency policy frameworks
5. Providing assistance in various forms: funding, technical, regulatory, training

Many of these policies make good sense by themselves and carry co-benefits in health, emergency services, efficiency and cost savings. As CSIRO has noted climate change impacts are already being felt across states and will worsen. States have a responsibility to reduce rather than increase climate risks and costs.  There are really no excuses with states having direct powers and responsibility for pollution and planning laws as well as, to varying degrees across the states, energy infrastructure and management.

Delaying action on decarbonisation doesn’t just delay action on productivity and innovation as the global transition to modern, smart and clean energy systems gathers pace.  It risks states missing out on the opportunities in skills, manufacturing and services and risks the development of high carbon ghettoes, the modern day equivalent of rust bucket regions.  Delaying action risks saddling state governments and economies with stranded assets such as obsolete energy infrastructure and exposes communities to significant job losses and economic uncertainty.

There are plenty of examples of state governments taking up these tactics. In the United States, 29 states have binding renewable energy targets, 10 participate in emission trading, and 20 have energy efficiency obligations. Canada’s Ontario has phased out coal power and British Columbia has launched the first revenue-neutral carbon tax in North America. California and Quebec have established international carbon trading.

Australia’s history is one of state leadership, NSW introduced the world’s first carbon market and a proliferation of policies as well as talk of taking that market national at state level helped precipitate John Howard’s support for a national emissions trading scheme.

There are examples of action in some states but as yet no comprehensive plan. In Victoria there are positive moves afoot in addition to aspirational targets but its still not an integrated plan.  NSW’s talk of being the Australian “California of Clean Energy”, and the oppositions focus on renewables, is also welcome but piecemeal.

Politicians love to say they have a plan for the future, but you can’t have a plan for the future without a plan for climate change, and you can’t have a plan for climate change without a plan for decarbonisation. Australia’s State and National politicians need to step up to that reality.

John Connor, CEO, The Climate Institute