Opinion Editorial published in the Herald Sun, Wed 1 October 2008. Note that the Herald Sun version was trimmed in editing. The full version, hyperlinked, with a few key statements about energy costs included, is reprinted below.
The Garnaut Climate Change Review is now complete. Its brief was to “examine the impacts of climate change on the Australian economy, and recommend medium to long-term policies and policy frameworks to improve the prospects for sustainable prosperity.”
To me, the concept of sustainable prosperity is the key to turning climate change mitigation into a win-win scenario. I’ll explain why in a moment. But first, some background.
Ross Garnaut, the economics professor from the Australian National University who had oversight of the review, was criticised by many climate scientists for proposing weak carbon emissions reduction targets. After all, the mainstream science says we are close to, or have already overshot, the level of atmospheric carbon dioxide that causes dangerous climate change.
Yet Garnaut’s initial proposal would have us increasing carbon dioxide by another 44%. This is a compromise goal, but one he considers feasible. After all, the difficulty in reaching international agreements on how each nation might wind back their carbon output is immense.
This mismatch between the policy and the science poses a significant problem. With it, we cannot hope to avoid most of the really serious economic and environmental impacts of global warming.
Garnaut calls it the ‘diabolical problem’.
But what if we are looking at the problem from the wrong way around? What if the diabolical problem is really just the ultimate gold-plated opportunity for the next economic revolution?
A reliable and continually growing supply of cheap, easily generated energy was the driving force behind the industrial revolution and modern communications age. This, in turn, has brought us high standards of living, amazing technological breakthroughs, and sustained economic growth.
The catch is that this cheap, reliable energy has come from fossil fuels such as coal and oil. Huge stores of carbon, buried safely for millions of years, are now being released back into the air by us at an astounding rate. Hit the climate system with a shock like this, and it hits back. Hard.
Experts also admit to another, little discussed problem. Our energy infrastructure needs a major overhaul, to replace ageing equipment and increase its capacity to supply more energy to an expanding economy. The International Energy Agency’s price tag is $US 22 trillion by 2030.
Then there is the peaking of fossil fuel supplies.
We are close to the point where we’ve reached maximum global oil production. Black gold, Texas tea – it’s getting harder and harder to squeeze out of the rocks at an economically competitive price. And demand from China for oil is growing fast. Prices are rising as a result, and they’re not ever heading back to the inexpensive days of the 1980s and 1990s.
It’s not only oil. There’s plenty of coal left in the ground (at least in some locations), but much of it is difficult to mine (it’s deeply buried), or it’s too hard to get it quickly enough to the heaviest users due to supply bottlenecks. The price of thermal coal, as a result, has tripled in the last 12 months.
So, we need more energy to prosper. But traditional sources of energy, based on fossil fuels, are becoming scarcer and more expensive. Their extensive use also causes dangerous climate change.
Put this way, the decision to invest heavily – and rapidly – in renewable energies like geothermal (hot rocks), solar thermal (desert mirrors), wave and wind power, and rooftop photovoltaic systems, is a no brainer. These technologies offer the only way to achieve an ongoing, growing energy supply. What’s more, unlike carbon-based energy, they are getting cheaper, not more expensive.
The Garnaut Review recognises these core issues, but its focus remains too heavily directed towards emissions reductions targets. I’d argue that if we concentrate most of our effort on helping the market get the renewable energy solution right, then carbon emission will fall rapidly as result. It’s an emergent property of fixing the energy supply. It doesn’t need to be an explicit aim.
Oh, and we get a prosperous, sustainable economy to boot. Win-win.