Paris climate negotiations: Daily updates

This blog roll will be updated daily with Erwin's insights and commentary from the Paris climate summit. To access other COP21 related materials, visit the Institute's Paris climate negotiations page.

​For media enquiries, please contact Brinsley Marlay on bmarlay@climateinstitute.org.au or
+61 (0)2 8239 6299.


Paris Agreement - It is done

Dec 13

The world has agreed to the first binding agreement which commits all countries to scale up action on climate change towards net zero emissions. It is a historic agreement and one many, including myself, would have not thought possible as little as a month ago. For The Climate Institute’s initial response to the outcome you can have a look here .

 
Much will be written over the days, weeks and years ahead about today and what got us here. At its heart it is about people.
 
Communities around the world have been embracing clean energy. This has driven down costs, accelerated policy change and allowed business to invest with confidence in the now unstoppable transition away from traditional fossil fuels.
 
Business leaders have assessed the risks of climate change and said enough is enough. They want governments to get out of the way and clear the path towards the future that many companies now see as inevitable.
 
Government officials have also sweated blood, sweat and tears (literally) to get us to today. Mostly unseen, endless hours of poring over text, coordinating strategies between countries, and advising their political leaders. It is a tough and thankless task.
 
Passionate NGOs have kept us all honest on what we are trying to achieve. Reporters have asked hard questions and communicated to the world.
 
For me, I started tracking this process before the agreement of the UN Framework Convention on Climate Change in 1992. I feel numb. This is a mix of exhaustion and the implications of the outcome today not having sunk in. Time will tell but today I feel we turned a corner. The future is brighter than it was yesterday.


Australia has joined so called “Coalition of High Ambition” in Paris

Dec 11

Members of this group support:

  1. The ambition mechanism, which I consider the beating heart of the Paris Agreement;
  2. Firm recognition of the below 1.5°C temperature goal;
  3. A clear pathway for a low-carbon future;
  4. Five-yearly updates; and
  5. A strong package of support for developing countries, including delivery of $100 billion per annum.

The group includes a diverse range of nations, for example, the US, EU, Canada, Norway, Germany, Brazil, the Marshall Islands, Colombia, Tuvalu, Gambia, and Mexico.
 
The Climate Institute’s initial comments would be:
Australia joining a diverse group of nations to ensure the best possible action in Paris is a positive development. The government has signalled strong commitment to limiting warming to below 1.5°C and scaling up collective support for the world’s poorest nations to US$100bn per year. This commitment will need to be backed by action at home for this support to be seen as credible through time.


Calm before the storm

Dec 11

For an observer, the final days of a climate summit are a mix of quiet and anticipation. Negotiations are behind closed doors and you wait and wait and wait for news of when the final text will emerge and advance to the decision making body of the conference. This body is called the COP and its final formal plenary meeting is where any agreement must be finally forged.
 
The French Presidency are currently saying the final text will be out by 9am (Paris time) tomorrow with a decision in the COP around 2pm.
 
Overnight governments met to react to the latest version of the draft agreement, and have been meeting privately since to find compromised positions. There was progress last night, but over the past 12 hours many have been worried that China, India, Venezuela and Saudi Arabia are taking measures that risk moving the negotiations towards a lowest common denominator outcome. There has been opposition to stronger long-term emissions reductions goals and attempts to water down what most countries want - an agreement that will ensure everyone steps up emissions reductions every five years. Brazil, Mexico and a range of other developing countries have shown greater willingness to push for a better outcome.
 
The USA, Australia, the EU and other developed countries can help bolster against these risky moves by being flexible on short term collective climate finance goals and the regular updating of finance contributions (from them as well as developing countries willing to do so). This could also help unlock the issue of differentiation that has plagued the talks since the beginning.
 
Now is the time for countries to move beyond brinkmanship and towards leadership. China, in particular, has a responsibility as an emerging great power to help deliver the best possible agreement in Paris.


Sleepless nights and saving the world in Paris

First published on Dec 11, in Crikey.

Another draft of the final COP21 climate agreement is out. There were a lot of bleary eyes at the conference centre today after negotiators worked through the night. Parties first met as a cohort to give “indaba” responses to the draft released yesterday, and then split up to smaller groups to hash out the areas that will need more work to find consensus.

“Indaba” refers to a process where each member at the table gets to speak and be heard. The inclusive process has a Zulu name that first appeared in the 2011 Durban meeting. That meeting provided the key breakthrough that recognised that all countries, including China and India, would offer broad climate action commitments. The Kyoto model, where only developed countries make emission reduction commitments, formed the basis pf a major argument used by some against the UN process and climate action more generally.

Among the usual lamentations about the exhausting negotiation process, there were also murmurs of agreement that yesterday’s text was an improvement. But not everyone saw their priorities in there yet.

As Thursday has now drawn to a close with a text that is mostly clear of square brackets (which highlight disagreements or alternative options). It suggests broad agreement on a range of issues but the following remain clearly contested:

  • how to build a common system of transparency for country actions;
  • how to address unmanageable climate change impacts in vulnerable nations; and
  • how to financially support poor nations participate in climate change solutions.

This is a strong, carefully balanced text. It includes the formal review and updating of targets every five years starting, in 2019. This would be done against the reference to limiting global warming below 1.5-2°C by the end of the century and achieving net zero emissions or ‘emissions neutrality (the science on this suggests all greenhouse gases would need to be at net zero by 2050 to have a chance at 1.5°C and between 2060 and 2070 for 2°C. CO2 emissions from energy and industry, which last longer in the atmosphere, would need to be at zero earlier than other gases). Finance contributions would be scaled up to the poorest and this would be tracked through time.

There are a number of challenges in here for Australia, which will need to recognise that its pollution reduction targets are more aligned to 3-4°C warming and would leave us with the petro-state of Saudi Arabia as the highest per capital polluters in 2030.

However, this text is not the final agreement. With a desire to present a penultimate version in the morning and make history by closing the meeting on time, with a final agreement Friday evening Paris time, the French president of the COP has called for “solutions indabas”.

The journey to where we are now in Paris has been a long and difficult one; ministers could still tumble at the final hurdle.


Progress in Paris but next 24 to 36 hours crucial for COP21

First published on Dec 10, in Lowy Interpreter.

Negotiations between countries have delivered a cleaner text that identifies more clearly the political choices to be made on the big issues. Negotiators have made good progress on capacity building, technology transfer and adaptation, and this demonstrates a real commitment from countries to deliver a balanced outcome as COP21 enters its final days.

The pledge from the US, delivered in an address by Secretary of State John Kerry, to double its grant-based public climate finance to around US$800 million per year should also help foster a cooperative spirit at the meeting. However some major questions are still to resolved. These include:

  • How to strengthen emissions reductions every five years?
  • How to distinguish between developed and developing countries in the agreement — if at all?
  • How to scale up financial support for the world’s poorest nations to participate in climate change solutions?

The draft agreement has the ingredients of an outcome that can boost global action (the national targets set out below are an example of this). Good will, creativity, ambition and compromise are now required to bring it all together. The next 24-36 hours are critical.

Options to update targets in the agreement
The draft text states that countries' efforts should represent a progression of effort beyond their previous commitments. There can be no backsliding.

In the draft agreement and accompanying draft decision are elements that would see countries reviewing and updating pollution reduction targets every five years (but beginning before 2020). These are summarised in the table below.

National targets would be anchored by an agreement to limit global warming to less than 1.5°C- 2°C, and countries are being invited to develop long-term emissions targets by 2020. The Australian government has said it will be reviewing is domestic policy settings in 2017-18.


The China Paradox 

Dec 9

China came to Paris with a reasonably good story to tell. Its actions to modernise its economy and invest in clean energy over the last decade have had arguably the biggest impact on global emissions than any other country. It is now the world’s biggest investor in clean energy and as the Global Carbon Project notes China’s fossil fuel emissions are expected to decline by about four per cent in 2015. China is also contributing billions of dollars to help the world’s poorest nations participate in climate change solutions.

Diplomatically, expectations on China’s role have been high. This contrasted the sore memories of the role that many perceived they played in Copenhagen to undermine a more ambitious outcome. 
 
In advance of the Paris meeting, high-level statements with the US and France signaled the country’s willingness to be constructive in Paris. Its national interests lie in an effective global response climate change. Cleaning up air pollution and reducing energy imports is good for the health of their people and economy. Climate change will hit China as well as the rest of the world and it is already well position to be the global industrial hub for clean energy.
 
Here in Paris, these high expectations have not yet been met in the negotiating rooms. China has shown flexibility on some issues, like recognising calls from vulnerable nations to reflect limiting global warming to less than 1.5oC in the new agreement for example. However, China is also a member of the Like Minded Developing Country (LMDC) group (The LMDC negotiating bloc consists of varied developing countries that represent nearly half of the world’s poor. It includes Algeria, Argentina, Bolivia, Cuba, China, Dominica, Ecuador, Egypt, El Salvador, India, Iran, Iraq, Kuwait, Malaysia, Nicaragua, Philippines, Qatar, Saudi Arabia, Sri Lanka, and Venezuela).
 
The LMDC group and some of its members, like Saudi Arabia and Venezuela, has been attempting to block progress and intentionally slowing down the negotiations. In just one of many examples, last night they called for line-by-line negotiations on the draft agreement in an open forum. They do this under the pretext of supporting a process that is transparent to the world. Which are nice words, but the reality is this is just an attempt to undermine the process the French Presidency has been running, which engages ministers in smaller group discussions on the core issues so they can be resolved in a timely manner. It is an explicit attempt to damage the leadership of France.
 
Over the next few days there may be fireworks from the LMDCs or its members, like Saudi Arabia, as they try to create a sense of crisis in the talks. This can be done by exploiting UN procedures and blocking the required consensus on issues or process. This will be done so they can extract a more modest outcome from Paris.
 
China has a good story to tell the world. It is time for them to stand aside from those who don’t like what the story says – the world is moving away for traditional fossil fuels.


Memo to Paris climate delegates

First published on Dec 8, in Crikey.

Trying to follow what happens at a climate summit is a bit like trying to swim up a waterfall. Negotiators are meeting behind closed doors, businesses are spruiking their wares, and NGOs are rushing from meeting to meeting, pushing governments to do more. It is a gushing torrent of ideas, advocacy and activity.

Foreign Minister Julie Bishop arrived in Paris on the weekend and hit the ground running. She delivered Australia’s ministerial statement to the rest of the world around lunchtime Monday. Her speech largely reiterated past statements by Prime Minister Malcolm Turnbull and committed to funding programs to help women engage in climate change decision-making (go to any energy policy conference in Australia and you will see why this is needed — they are all-male affairs). She reiterated that the “new agreement must promote further ambition and action over time”.

Building further action through time is one of the core ingredients for the outcome in Paris. Past climate agreements have not established a system for political leaders to regularly stand up among their peers to commit to do more. We saw the start of this process in advance of Paris when countries representing over 95% of global emissions put forward new emissions reduction targets. If implemented, we will be on a path for just under 3 degrees of global warming — better than the path of 4-6 degrees we were on before the Paris process.

From COP21 in Paris, most countries are trying to establish a system where countries will come back to the table every five years to update and progress their targets. This process will continue until we are on a pathway that limits warming to less than 2, or even 1.5 degrees.

In this regard, two things here are different from past summits.

First, the desire from most countries to deliver a durable agreement that can stand the test of time. Investors, communities and the climate can’t afford the time it will take for the global community to negotiate a brand-spanking new agreement every time they gather. So, future major summits should be more focused on stocktaking global action and finding ways to step it up, not be about reinventing international frameworks and rules every few years.

Secondly, never before has there been such recognition from a broad range of countries that warming of 2 degrees is too risky. So we need to consider limiting warming to less than even 1.5 degrees. This goal has created solidarity among many vulnerable countries in the developing world. Developed countries such as the USA, China, Australia and those within the European Union have also been open to recognising this in the agreement.

In her speech, Bishop re-iterated the messages from the government’s innovation statement. But when it comes to climate action that will avoid two, and let alone 1.5 degrees warming, national policies will matter as much as technological innovation. In Australia’s energy system, for example, all the best innovations will only be deployed around the edges — unless we have a plan to replace the ageing and inefficient coal-fired power stations that are blocking the modernisation of the power system.

As we enter the rapids of the last week of the Paris summit, we are in a position where the key elements exist for an outcome that can build on recent momentum and boost global action. A best possible outcome from the meeting is now possible. It is up to ministers to knuckle down and find the compromises that will deliver a durable agreement that keeps countries coming back to the table with stronger actions.


Paris Climate Summit: Progress video blog

Dec 7

Deputy CEO of The Climate Institute, Erwin Jackson, is on the ground in Paris - here's Erwin's the progress update at the mid-point of the summit.

Paris Climate Summit: progress update from The Climate Institute on Vimeo.


Ministers need to lead to deliver best possible Paris agreement

First published on Dec 7, in The Sydney Morning Herald.

If you have ever given up a really bad habit, you know how hard it can be. Negotiating an agreement that seeks to accelerate the transition from our habitual use of fossil fuels to clean energy right across the world is tough. This is not a surprise, and is reflected in the difficult progress counties have made in Paris last week on the new draft global climate change agreement.

Over the first week in Paris we have seen highs and lows.

At the beginning of the week, over 150 leaders from around the world kicked the summit off on a high. Most sent a very clear message – addressing climate change is central to our ability to maintain the health and prosperity of our citizens and economies. Many, including the USA and China, clearly identified that with action comes opportunity. The message was we can and must transition to clean energy because it is central to economic growth and security.

Some may dismiss such statements as rhetorical or just symbolism. This fails to acknowledge the art of politics in the UN process. The clear message from leaders sets the bar their negotiating teams have to meet. It signals the political direction of travel to the public and investors around the world.

Our Prime Minister, amongst others, highlighted the need to achieve net zero emissions. How domestic policies help achieve net zero emissions within a handful of decades is now the bar against which they will need to be judged.

We also saw substance in the leaders’ remarks. USA, China, India, Australia and 16 other countries committed to double investment over the next five years into the research and development of clean energy. India launched an international solar alliance of more than 120 countries. The alliance aims to bring government, industry and research institutions together to rapidly increase investment in solar power generation. The African Union and African Development Bank jointly pledged to double the whole continents energy generation capacity, using only renewables.

Even if these announcements were only implemented in part, they will have real economic impacts. Global power sector investments in clean energy already outstrip investments in fossil fuels, and implementing these commitments will only boost that further. However, in Australia innovation investments will be empty symbolism for decades if there is no modernisation plan to replace existing coal fired stations with clean energy.

After the fanfare of the leaders’ statements, officials got down to work and we quickly came back down to earth. Traditional tensions emerged, particularly around how to scale up financial support for the vulnerable and poor nations. Tensions have been exacerbated by the regressive role Saudi Arabia, in particular, had been playing. The petro state knows that its economy based on the development of oil is not well positioned for a world where investment in clean energy far outstrips investment in fossil fuels. Like a wounded bull, it is attempting to damage progress that would facilitate greater action around the world.

Now, the question is are we on the way back up? We entered the Paris meeting with a draft agreement that was over 50 pages long. The new draft to be considered by Ministers next week is now just over 20.

The new draft agreement includes the ingredients of effective outcome in Paris that can further boost global action. Options exist to update targets every five years towards the agreed less than 2oC global warming goal, define a collective system to ensure the actions countries take are transparent, and support the world’s most vulnerable nations participate in climate change solutions.

An agreement that includes these elements can reinforce the signal to communities, investors and businesses around the world that action to limit pollution and shift to clean energy is an unstoppable force. This can be achieved but it is going to require strong political leadership from ministers when they arrive next week.

So as the negotiations gear up for the engagement of Ministers this week, including Australia’s Foreign Minister, most of the elements that would continue to drive global action are in the draft agreement. Momentum in the real economy continues to grow and it is now up to ministers to find the compromises that will see Paris accelerate the transition to a net zero emissions, climate neutral, global economy.

Assessment of where are we at in Paris – field is still wide open
Before Paris, The Climate Institute released an analysis of the key issues and possible outcome scenarios. This concluded that the Paris agreement won’t fix everything but the best possible agreement will be one that very clearly sets the world on a path to the international goal of avoiding global warming of 2°C above pre-industrial levels and meets three key criteria – Is it bankable? Does it build trust and accountability? Is it fair? The below graphic gives an overview of current negotiations against these criteria.

The attached graphic maps the progress that political and real economy actions around the meeting, and the elements of the current draft agreement against the scenarios for Paris that The Climate Institute has outlined. The scenarios are:

  • Catalyst: The agreement sets the scene for countries, business and investors to accelerate actions to end emissions through time.

  • Momentum: The process to step up action is less defined, but the 2°C goal is kept in sight. Domestic actions develop over time and new targets are set.

  • Patchwork: Lack of clarity on key issues, but investment in clean energy and climate solutions continues within those countries and industries, seeing action as part of their own long term prosperity.


A slow grind

Dec 5

Ministers will be arriving in Paris on Sunday and will be looking to see a new draft of the agreement with the options that are up for consideration clearly defined. With just over 24 hours until this deadline hits, many negotiators are foregoing sleep while they find ways to bridge the gaps between countries’ different positions. The clearer the choices between different proposals are in the draft text, the easier it will be for ministers to engage with and find compromises. It will avoid them not discussing issues that are not central to an effective outcome in Paris.
 
The lines that some countries have taken during the meeting have been fluid. Identified as an obstacle to progress earlier in the weak, India is now showing more flexibility on some issues. The hard-line politics of countries like Saudi Arabia and some other petro-states may be starting to backfire as they seek to undermine the strong emissions goals that are in the interests of the most vulnerable developing countries. The head of the US delegation has stated he believes a progressive coalition is starting to emerge.
 
There is no doubt that progress over the next 24 hours is going to be difficult and frustrating. What is encouraging is that while we have seen table banging from countries on a range of issues, this has not been accompanied by the bile and vitriol that marred the last big meeting in Copenhagen.
 
Negotiating an agreement that seeks to accelerate the transition from polluting fossil fuels to clean energy right across the world is tough. This is not a surprise.


Tough and uneven progress

First published on Dec 3, in Lowy Interpreter.

The pace in Paris is picking up. Delegates are moving from meeting to meeting, negotiating on the elements of the agreement. Even big delegations are struggling to keep up.

We will not get a good sense of what will have been accomplished this week for a day or so but it is fair to say that progress is uneven. This is being driven by certain regressive countries in the Like Minded Developing Country group attempting to suck energy out of the process and weaken the effectiveness of a possible agreement. Saudi Arabia, a wealthy and diplomatically effective oil state, is the focus of much frustration.

Some areas outside the formal negotiations are moving forward, however.

The US has been proactively engaging with small island states on the issue of how to rebuild after severe and unavoidable loss and damage caused by climate change. Finding common ground on this issue would build trust between developed nations and the world’s most vulnerable countries.

Reaching agreement on how to provide financial support for the world’s poorest countries will be crucial to achieving more substantial progress in the coming week. To that end, developed country flexibility would be constructive on these issues:

  • ensuring there are regular opportunities to pledge new financial commitments after 2020
  • ensuring the current goal of US$100 billion of public and private finance by 2020 is the floor for future contributions
  • ensuring the majority of public financing is used to help countries adapt to increasing impacts of climate change

Flexibility in these areas could help unlock more constructive engagement from developing countries on regular updates of national emissions targets, greater transparency of the actions countries are taking through measuring, reporting and verification (MRV), and greater finance contributions from emerging economies in the future.

Finally, The Climate Institute has looked at Australia’s 2030 per capita emissions compared to other developed and G20 countries. Meeting the government’s 2030 target could see our per capita emissions fall to 16 tonnes - still much higher than other developed countries, and the highest of any G20 country, aside from Saudi Arabia.

*The LMDC negotiating consists of developing nations that represent nearly half of the world's poor. It includes Algeria, Argentina, Bolivia, China, Cuba, Dominica, Ecuador, Egypt, El Salvador, India, Iran, Iraq, Kuwait, Malaysia, Nicaragua, Philippines, Qatar, Saudi Arabia Sri Lanka and Venezuala.


Down to work

Dec 2

With the fanfare of Monday’s leaders’ event over, officials are getting down to work on the details of the Paris agreements.

With 150 heads of state in attendance, the leaders segment of this meeting was different from previous years. Many spoke to why climate change matters to their national interests and highlighted the benefits action will have for their economic prosperity. This reflects that climate change is now increasingly seen as a strategic risk that must be addressed. Disappearing are the days where action on climate change is seen as a burden or impediment to economic growth.

The pressure will now be on officials and ministers to deliver an effective outcome that facilitates accelerated investment in zero emission solutions.  

Officials have been working in different groups since last night in efforts to develop a draft agreement with concise options for ministers to consider next week (see guide to contact groups below). Progress is slow but the spirit constructive. Some long days are ahead.


Paris climate talks: helping dirty power get clean

First published on Dec 1, in Crikey.

Day one of the Paris climate talks has concluded with Australia confirming one commitment and making two surprise pledges. There’s been no time to feel jetlagged.

What does this all add up to? Some steps forward, but still not the strides needed to achieve the goals — which are rapidly becoming mainstream and which the Prime Minister has recognised — of avoiding 2 degrees warming by reducing emissions to net zero levels.

Let’s start with the good bits. Prime Minister Malcolm Turnbull announced Australia would ratify the second commitment period of the Kyoto Protocol. Ratifying a treaty we have already signed might not sound like a major step forward. But given that Australia let nine years lapse between signing and ratifying the first period of Kyoto, this is a signal to the rest of the world that Australia is taking its international commitments more seriously. Interestingly, within the Doha amendment to the Kyoto Protocol is Australia’s full 2020 target range — not just the 5% cut that the government talks about, but the commitment to raise the target, potentially to 15% or 25%, depending on conditions of global action that the Climate Change Authority says have been met.

Turnbull also announced a doubling of funding for clean energy research and development by 2020, as part of the 20-nation Mission Innovation pledge. This is accompanied by the Breakthrough Energy Coalition of 28 investors — including Microsoft founder Bill Gates, Facebook’s Mark Zuckerberg and Amazon CEO Jeff Bezos — that will back companies in the 20 countries to get clean energy technologies “out of the lab and into the market”.

Of course, deploying new technologies requires a supportive and stable investment environment, features that are absent from Australia’s power sector, thanks to the slashing of the Renewable Energy Target (RET) and the removal of a price that would end the ability of coal- and gas-fired generators to pollute for free. We have no exit program for old coal stations, and, beyond the reduced RET, no on-ramp for clean energy.

Turnbull also pledged $1 billion by 2020 to help poor and vulnerable countries access clean energy and protect themselves from the physical impacts of climate change (“climate finance”). It is encouraging the government recognises the need for this support, but this is less impressive than it might sound. A $200 million annually merely returns nominal funding to the levels provided between 2010 and 2013. There’s no sign of any scale-up strategy here. Canada, by contrast, has scaled up its commitment to $2.5 billion.

Finally, Australia was reportedly going to sign up to the Fossil Fuel Subsidy Reform Communique endorsed by 30 other countries, including Canada, the United States and New Zealand. But reports suggest it pulled out at the last minute. Previously, Australia has supported G20 statements for reform of “inefficient fossil fuel subsidies”, while defining subsidies to exclude any Australian policies such as the diesel fuel rebate.

That might not wash any longer. As the fossil fuel subsidy communique notes: “The International Monetary Fund views that fossil fuel prices should reflect not only supply costs but also environmental impacts like climate change and the health costs of local air pollution.”

The Climate Institute has calculated that the polluting parts of the energy sector benefit from an annual carbon subsidy of $14 billion to $39 billion. The total carbon subsidy to electricity between now and 2030 would reach $165 billion to $500 billion.

So day one is a wrap: Australia has taken some steps forward, but recognising the need for net zero emissions means we need to be looking to modernise and clean up our economy. That requires more policy substance than is on offer yet.

Anticipation & hyperbole  

First published on Nov 30, in Lowy Interpreter.

The delegates have arrived and the behind the scenes discussions in Paris are well underway. Negotiators are meeting to discuss strategy and informally coordinate positions. The aim is to ensure formal negotiations proceed smoothly after the fanfare of the leaders' statements tomorrow.

Canada and Japan's multi-billion dollar commitments to support the world's poorest nations participation in climate change solutions are a welcome boost heading into the week. See below for the chronology of climate finance commitments:

From an Australian perceptive, we head into the Paris meeting with an unprecedented commitment from both major political parties that we must achieve net zero emissions. On Friday, as I was getting on the plane to Paris. Opposition Leader Bill Shorten, outlined the ALP's commitmentto Australia achieving net zero emissions by 2050 at the Lowy Institute (more on this below). From the Commonwealth Heads of Government Meeting in Malta, the Prime Minister stated, 'It [Paris] is a step along the way to achieving a net zero emission world'.

Long-term emission goals such as this will be on the agenda in Paris. But, more importantly, these statements offer a rare opportunity to reset some of the hyperbole in recent domestic policy discussions. How a party plans to achieve net zero emissions over coming decades is now a key test of its 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 the ALP's emissions goals. Businesses have largely been constructive in their responses and focused on the need, regardless of the targets set, to have scalable, durable and domestic climate policy they can invest in(see, for example, media statements from the Business Council of Australia and AiGroup). However, a number of Government statements in response to the ALP's commitment 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 the fact 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, themodelling commissioned by the Government shows that the overall economic cost of achieving a 45% reduction in emissions by 2030 through domestic and international action is the same as achieving a 26% reduction through domestic action alone.

The ALP's target is stronger than other countries
This is incorrect. The average emission reduction target of other developed countries, on 2005 levels, is around -35% by 2030. This is less than the ALP's target but more than the Government's. However, a number of countries including Germany (-45%), Norway (-44%), Switzerland (-51%) and the UK (-49%) have comparable or stronger targets than the ALP's proposal.

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

Over the last two decades Australia has done much less than many other nations to limit emissions. As a result we still have the highest emissions per person and the 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.


Paris climate talks: The world has changed since Copenhagen 

First published on Nov 20, in Lowy Interpreter.

The Paris climate negotiations, which seek to deliver the next global framework for reducing emissions, kick off in just over a week. As we head into Paris, it is fair to say that close observers are optimistic but nervous.

The draft agreement is 50-odd pages long, and a number of key political issues remain to be resolved. Sticking points include:

  • How do we ensure that countries regularly ratchet up emission reduction action through time.
  • How  – if at all – does the agreement capture the fact that that countries are at different stages of development? What does this mean for the contribution of less-developed countries to global action?
  • How do we ensure that the world's poorest nations are supported, financially and otherwise, to participate in climate change solutions and adapt to its impacts?

But there is also cause for confidence. The Paris negotiations seek to establish an agreement for a new common international framework that will drive domestic action. For the first time, the agreement will call for domestic actions from all countries, a critical step toward keeping warming below the 2°C threshold. This 2°C threshold is what the international community has agreed, through time, we will avoid.

The careful planning and political leg-work ahead of Paris will, it is hoped, ensure we avoid theutter chaos that marked the Copenhagen summit in 2009.

Moreover, the world has changed significantly since then.

First, climate change is no longer seen as solely an environmental issue. Governments, national security agencies, central bankers, institutional investors, health professionals, major global businesses and many others now regard climate change, and the global response to it, as a major strategic issue that must be managed. 

More and more countries have policies to limit emissions. At Copenhagen in 2009, there were some 420 climate change laws and policies at a domestic level. By the end of 2014, there were over 800. 

Another major development is the rapid transformation of the energy sector. Renewable energy is now the world's second-largest source of electricity. The scale of uptake and rapid cost reductions is giving countries the confidence to commit to reduce emissions.

Ahead of the Paris meeting, over 150 countries have also put forward initial emission reductions targets, covering nearly 90% of global emissions. These targets vary in their degree of strength and credibility, but they also show how meetings like Paris can increase global action. Without the looming climate negotiations, many countries, including Australia, would not have felt pressure to put forward new targets and implement new domestic policies to achieve them. As a result, we're closer to the 2°C target than we would otherwise be.

Analysts suggest that achieving these targets would put the world on track to almost 3°C global warming. This is a significant improvement on previous projections of global action, which put warming at 4°C or more, but still falls short of the sub-2°C limit. The targets also imply a significant acceleration of action to decarbonise high-emissions sectors such as electricity. For example, these targets would see investment in renewable energy increase to become the world's dominant source of electricity by 2030.

Finally, businesses are increasingly seeing climate change as a strategic issue that needs to be proactively managed. Climate change is already having wide-ranging economic effects, which are expected to become more intense. There is a growing trend of investment managers, with long-term horizons or fiduciary duties, considering the effects of climate change on their members. 

Throughout 2015, a number of Australian businesses have released statements showing their willingness to take action on climate. The Australian Climate Roundtable brought business, investor, union, research, environment and welfare groups together. A statement was released encouraging Australia to do its bit on climate change. In September, leaders from AGL, BHP Billiton, GE, Mirvac, Santos, Unilever, Wesfarmers and Westpac Group published a statement that supports an effective Paris agreement outcome. 

This provides some optimism for the future, regardless of the outcomes of the Paris meeting. If the core political issues in the meeting are resolved, the outcome can be a further catalyst for global action to address climate change. 

Yet, regardless of the outcome, business, investors, communities and governments will not turn their backs on the global boom in clean energy. That train has left the station. After Paris, it will be up to our political leaders to come together to ensure Australia minimises the risks of this transition while maximising the opportunities for our nation. 

The Climate Institute has released a brief on the potential outcomes from Paris, which can be accessed here. You can also view our animation on why Paris matters.

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