Emissions targets are easy, but the ‘how’ is hard part

Anthony Albanese has taken a big rhetorical step, committing Labor to the transformative carbon neutral target of net zero emissions by 2050. In placing this forward marker, the Opposition Leader joins premiers, chief ministers and Boris Johnson, host of the UN climate summit in November. All aboard the Glasgow express! In a speech on Friday, Mr Albanese said his target should be “non-controversial”, adding climate change was real and needed a real response. We agree, but targets are easy — it’s the “how” that counts. “We are disappointed that after more than a decade Australia still hasn’t settled our long-term emissions reductions policy,” the Business Council of Australia says. “That’s why we continue to advocate for a credible policy that puts us on track to reach net zero emissions by 2050.” To get there we must invest $22bn a year, every year, on technology.

Having been repudiated by voters last May, with all policies on the table, Labor must tread carefully when it comes to policy formulation ahead of the next federal election. Although, as key stakeholders told Labor’s poll post-mortem, Bill Shorten’s failure to tell voters what his ambitious emissions target — by 2030, a 45 per cent cut on 2005 levels, with 50 per cent of power from renewables — would cost was a major factor in the party’s miserable primary vote of 33.3 per cent. To be credible in this space, Labor not only will need to explain the costs and benefits, it also will have to present a strategy to get to net zero. More than 70 countries have pledged to achieve the target but few have detailed how.

Mr Albanese noted our “climate wars” had seen a decade wasted on getting cleaner and cheaper energy for families and business. It’s true, the fractures within the major parties have failed to get a policy consensus on least-cost, market-based carbon dioxide abatement. But political dysfunction has, somehow, not been able to impede genuine progress in transitioning to a lower emissions economy. Companies and households have got on with the job. A nationwide wave of wind and solar developments has put Australia on track to become one of the world’s biggest users of renewable energy, Paul Garvey reports on Saturday. Such is the frenzy of new projects that parts of the electricity grid are unable to accommodate the power now being generated. Australian households are purchasing rooftop solar panels at a rate unmatched anywhere in the world. More than $20bn has been committed to new renewables projects across the nation in the past two years.

The pace of change means the nation’s progress is being closely watched and has become known internationally as “the Australian experiment”. Modelling by Bloomberg New Energy Finance, based on the pure economics of clean energy, not policy, predicts Australia will sit just behind Europe as one of the world’s most renewable-powered regions, with 84 per cent of our power to come from clean sources by 2050; it could reach 50 per cent by 2030 without any new policy. This week mining giant Rio Tinto said it would build its first solar farm and battery installation in the Pilbara. It also may electrify its fleet of mining trucks and trains. Even without a carbon price, the company is backing solar over gas on efficiency and cost.

Despite all the bluster about a lack of clear policy in Australia, in reality the market is moving, as it should. Scott Morrison said on Friday that current policies were driving the move to clean energy. He pointed to a $500m hydrogen energy strategy; billions on the Snowy 2.0 project for pumped hydro; funds for the MarinusLink interconnector between Tasmania and Victoria, and the Battery of the Nation project. He inked a $2bn deal with NSW for new gas capacity and clean energy pilot projects. This evolving plan, funded by taxpayers, is the latest iteration of Tony Abbott’s direct action. When you factor in federal and state fuel taxes, exploration bans, clean energy targets and schemes, and all manner of regulation, there is an implicit carbon price that influences behaviour. We often hear business yearning for certainty or threatening a capital strike. Yet people still take risks and make long-term investments. That’s the nature of capitalism; it creates and destroys — perhaps that’s the only certainty.

Who can predict what the world will look like in 2050? Leaders continually refine their game plans. For now, the Morrison government’s play on climate and energy policy is to back human ingenuity. It points to the “bottom-up” uptake of clean energy by households and business as evidence the market is reducing emissions. The Coalition, like Labor, is navigating the fraught politics of coal-fired power. Yet finance capital is making decisions on this, regardless. A middle way for emissions reduction could be found through innovators, such as the boron-hydrogen fusion project we wrote about on Friday. The Coalition has opted for an investment road map, to examine more than 100 technologies including hydrogen, carbon capture and storage, biofuels, lithium production and advances in agriculture to cut methane emissions. The Prime Minister is betting applied science will take the heat out of climate politics, as well as the planet.