Climate reports show need for rational, effective action

In dealing with climate change, Australia needs a judicious rather than conspicuously ambitious approach, in line with – not ahead of – comparable nations. Taken at face value, which needs a leap of faith because they are more speculation than fact, the National Climate Risk Assessment and the National Adaptation Plan released by Climate Change and Energy Minister Chris Bowen contain a yawning gap.

Accept for a moment the doomsday scenarios are accurate. These include more than a 400 per cent increase in heat-related mortality in Sydney if temperatures increase by 3C above pre-industrial levels; 1.5 million people under threat from rising sea levels; more communicable diseases; inability to work and study; severe impacts on Indigenous communities; food and water insecurity; a loss of ecosystems; financial shocks; more than $500bn wiped from property values by 2050; and national security risks. But even with the most severe measures to reduce greenhouse gas emissions, Australia produces just over 1 per cent of the world’s total.

Mitigating the impact of climate change effects predicted in the reports largely would depend on measures in four regions that accounted for two-thirds of global fossil-fuel carbon emissions in 2021. That is, China (31 per cent), the US (14 per cent), the EU (7 per cent) and India (7 per cent). Australia, as a good global citizen, should contribute to cutting emissions, but nations with the largest carbon footprints must lead the way.

Mr Bowen released the reports on Monday, a few days before the government announces its climate target for 2035. Last week, Canadian Prime Minister Mark Carney joined other world leaders in watering down expectations of what his country can achieve, adopting a relatively conservative 45-50 per cent 2035 target on 2005 levels. The last thing Australians need is alarmist panic, such as Greens leader Larissa Waters calling for net zero by 2035.

Long experience shows the science is too inexact for risking policies that would jeopardise Australians’ living standards and the wider economy. As Grattan Institute energy and climate change senior fellow Tony Wood told The Australian, forecasters “tend to be making it up” when predicting the long-term impacts of climate change and emission-reduction policies, given there are so many uncertainties about the transition to a low-carbon economy. And as Graham Lloyd writes, authorities do not have a good track record with near-term forecasts and the jury is out on whether it will be any better for the longer term.

Policy decisions based on predictions can cost taxpayers dearly. Long-range predictions made at the height of the millennium drought that city dams would never fill again led to billions of dollars being wasted on desalination plants that have become white elephants. There is also legitimate disagreement about the impact of a doubling of carbon dioxide in the atmosphere.

A report by the US Department of Energy, produced by scientists outside the consensus, Lloyd points out, concluded that “carbon dioxide-induced warming appears to be less damaging economically than commonly believed, and that aggressive mitigation strategies could be more harmful than beneficial”.

While Mr Bowen urged Australians to read the reports, members of the public can only wonder about the accuracy of claims cited from Britain and from the Insurance Council of Australia that $1 invested through resilience initiatives could result in a return on investment of $9.60 to $10. That said, it is also crucial to try to gauge the risks of inaction for the nation. Treasury’s intergenerational report, Tom Dusevic writes, has predicted that hotter days and natural disasters could lead to even lower productivity growth, reducing economic output by between $135bn and $435bn by 2063.

According to a paper from Actuaries Institute chief executive Elayne Grace to an ABS-RBA conference in June, insurance is becoming increasingly unaffordable, with 1.61 million households facing premiums that cost the equivalent of four weeks of gross household income. For those in high-risk areas, it can become a downward spiral as homes become uninsurable, reducing in value.

A prudent and rational approach to climate change mitigation should employ the most cost-effective engineering and technologies, with gas, of which we have plenty, as a transition fuel. Nor should efficient, workable options, such as privately funded small modular nuclear reactors, be ruled out on ideological grounds. Rational policy to produce the greatest cost benefits for households, industry and the economy is the challenge.