Category Archives: Global warming

Size of the task

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Opera House, Sydney HarbourIt is desirable to reduce greenhouse gas emissions so that the greenhouse effect doesn’t get out of hand and warm the world by amounts not seen for millions of years.

And should this warming happen too fast for our production systems to adjust, then desire must become an imperative.

Fair enough.

Now let’s consider the size of the task.

If we convert the current global energy use into oil equivalents – that is combine all the coal, oil, gas, hydroelectricity, nuclear and alternative sources and convert the energy we gain from them into the energy we get from a barrel of oil – we use the equivalent of 10 million barrels of oil an hour.

Or, if you prefer, 1,590 million litres an hour.

That’s enough to liquid to fill over 15,000 Olympic sized swimming pools every 24 hours or in less than two weeks fill Sydney Harbour, onE of the largest natural harbours in the world.

Plus this number is, believe it or not, getting larger by the day thanks to more people and rapid growth in demand from emerging economies.

10 million barrels an hour is colossal demand. No wonder superannuation funds invest in fossil fuel energy.

Perhaps the next time you lounge with a G&T by a swimming pool, imagine the pool, and a few thousand more, full of oil, and you may glimpse the size of the task.

Our energy demand is simply vast. And thanks to availability, some legacy issues and economics, most of this demand comes from fossil fuels. Partly because of the volume and locked in infrastructure for generation and delivery energy generation is a tough thing to shift, requiring huge investment in alternative sources, a clunky transition period, and unbridled commitment to change.

And because it will take time, any shift will require great tenacity.

It is a big ask and very unlikely that we will take on this transition voluntarily. It will be both difficult and costly. The engineering task alone is staggering: reworking energy grids, distributed generation, engine conversions and replacement. Even the decision to keep the grid or move to a distributed model is a big one.

Then there is the economics. New monies must be found to develop alternatives at scale and monies found to support uptake of what will initially be more expensive energy sources. Then those who have already invested heavily in fossil fuel power risk lost dividends, losing out to new investors. And more of us have invested than we might realize. Superannuation funds that will pay out for many a retirement, like the low risk of traditional energy investments.

The US and Europe are oil and coal dependent because their entrepreneurs and investors backed fossil fuels. New wealth in China, India and South America can be more flexible. They will invest for the far side of the transition, in the new technologies, not the status quo. In 100 years time it is unlikely that the old west will hold the purse strings, which is actually ok, if a little scary for those who have already invested.

Sydney Harbour

So the size of the task is huge, not just because we gobble 10 million barrels an hour, but also because we are not nimble enough economically to act swiftly.

So when the debate on a carbon price uses hip pocket rhetoric, remember the size of the task and know that change to something this big it is not going to be cheap

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It finally happened

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After back stabbing, vacuous argument and dithering for long enough for us to have been in and out of the next ice age, and despite (or perhaps because of) a hung parliament, yesterday Australian politicians passed a carbon pricing bill through the lower house by a couple of votes.

Champagne all round for the warmers, gnashing of teeth for the deniers and plenty of “why did they do that?” from the majority of the populace more concerned with their own stuff.

And a wry smile from the historians, for this is truly a moment for them to record.

It is the point at which a conservative country in a remote corner of the western world, bound to a colonial past that created significant wealth by exploiting natural resources, made a tentative, but hugely symbolic step towards accounting for externalities.

A brown economy allowed its politicians to introduce a policy that starts to capture the hidden environmental costs of doing business. Those costs that never make it onto the company accounts, the externalities, or what the policy people prefer to call spillover effects.

On the balance sheets of 500 companies and organisations with the largest greenhouse gas emissions there will now be a line item that will show they have made payments for an environmental impact. Not from a point of pollution into the creek that runs by their factory, or for installing mufflers to counteract machine noise, or the filters and scrubbers to remove particulates from the smoke stack, but for an invisible and diffuse environmental effect.

Truly this is historic.

And what history will record is that on 12th October 2011 Australia made its move down the road of major economic reform. It started the process of converting from a fossil fuel based economy with centralized energy infrastructure built with entrenched investment structures; to a fluid, entrepreneurial, environment friendly era of economic development.

And this happened because it realized that even though a capitalist system fits the human psyche like a glove, capitalism is not sustainable unless profit is real. It cannot be profit declared by hiding costs in the environment. For, in the end, the environment stops absorbing those costs and closes down, cutting off production.

There will, of course, be u-turns and moments of doubt about this historic decision. There will also be kick back from the old ways that claim emissions are just hot air. And those claims may turn out to be true.

Only this path is as inevitable as peak oil, because even if it’s not about emissions, it is about knowing and accounting the true environmental costs of doing business.

Only then we can live well and live within our means.

Who’s behaviour are we trying to change?

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The Australian government has just released its clean energy future legislation, a long awaited climate change policy framework.

In line with other jurisdictions the focus is emission reduction by putting a price on carbon to change behaviours away from dirty, fossil fuel based energy and industry to a cleaner, more efficient economic system. Clean energy futures is an elaborate, and in many ways clever, market based system for the commercial exchange of what amount to licenses to pollute, is transitioned in through a tax on the 500 heaviest emitters.

Hit commercial entities with a cost and, on the assumption that the hit hurts, they will do their upmost to avoid it. They are expected to be rational after all. Some will cop the cost and simply pass it on to their customers. But this will benefit their competitors who choose to become more efficient and change to less carbon intensive activities. So the market will sift the options and favour the cleaner ones. Exactly what is wanted.

In this case $25 billion over 5 years is the hit – evened out it is $1 million a year per entity – and that sounds like it should hurt enough to prompt a change. Some entities will become more efficient, trade to get the best price for what they must pay for and, eventually, transition to clean practices.

So we have a system to change the behaviour of… the 500 heaviest emitters.

Only why do these companies emit? For the majority it is because they supply energy or goods to the market at a profit. In other words they have customers, ultimately us.

In the formulation of the clean energy future policy, the $25 billion raised from emitters will go back to consumers through raising the tax threshold at a cost $15 billion and another $10 billion to support exposed jobs. This is so that should the emitters pass the cost of their permits on to the consumer or cut costs in the form of jobs, it is not too painful for those on the receiving end. Us again.

No collective hurt there. And so no change in behaviour.

Propping up the consumer also eases the pain on the emitters and reduces the incentive to change.

At some point it will be necessary to try and change our behaviours too; or even the most intricate of policy formulations will be a waste of effort and opportunity.

The missing link

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Some years ago I wrote an essay entitled ‘What if it’s not emissions’. I was not in denial or even sceptical about climate change, more concerned that we had become fixated with emission reduction as the solution to climate change. So convinced had we become that it was a given that if emissions came down, we would have fixed that awkward problem and all will be well with the world.

My real issue was that we risked putting all our eggs into the emission reduction basket.

Burning landfill site, GaboroneAfter more years of political inaction than seems decent, the Australian government has just released a clean energy future policy on climate change. And, guess what? We still have the same fixation. The proposal is all about emission reduction, initially through a tax on pollution followed by a cap and trade system to make emitting greenhouse gas so expensive that no rational business could afford such behaviour.

It might be about emissions, but the policy formulation sees only a modest reduction target – 5% below 2000 emission levels by 2020. This means in 2020 Australia is pledging to emit 509 million tCO2e in greenhouse gases or 56 million less than it did in 2009.

Only by 2020, even with the proposed intricate emissions reduction policy fully functional, emissions of 679 million tCO2e are predicted.

Actual emissions will increase because the Australian population will grow in numbers at roughly 890 people per day, the economy will grow and so will affluence. Economic growth will require energy to follow the historical trend of a doubling in consumption every 30 years. And although the policy does talk about energy efficiency and alternative sources, the required capacity increase will inevitably be met by traditional means.

Emissions growth will leave a shortfall in the target of 170 million tCO2e or 30% of current emissions. So it would seem that the emissions reduction basket has few eggs.

This again begs the question ‘What if it’s not emissions?’

Let us accept what the science tells us and agree that it is emissions that are a significant driver of the current climate warming. What the policy shows is that, rather like American debt ceiling, we cannot quite admit the severity of the problem. And, more importantly, we lack the courage to tackle the problem head on. It is just too hard and too scary.

And this would actually be ok if we hadn’t missed the critical issue in all this.

We have stopped talking about how 7 billion people are going to sustain growth in affluence on a warming planet. We have forgotten about adaptation. Forgotten that we will need to use water wisely, deliver sustainable production on farms, and manage our landscapes when the temperatures change, rains forget to fall, seasonality shifts, severe weather events become more frequent and the sea levels rise.

Less than $1 billion of the $25 billion revenue generated from the carbon tax will go incentive land management through carbon offset projects. They will mostly be Kyoto compliant activities such as permanent tree plantings and flaring methane – just as the international agreement to proceed with a second commitment period of the Kyoto protocol teeters.

There will be money for biodiversity initiatives. Good stuff, but just more of what we have already been doing.

What happened to incentives to revegetate the landscape and put carbon back into the soil? The critical activities that will help us manage that scarce water, produce reliable quantities of food and help save what is left of nature. Missing, presumed dead.

Seems like we should ask again, ‘What if it’s not emissions?’

Forest for the trees

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There is a consensus among climate scientists that the net greenhouse gas emission reductions we must achieve to keep warming below dangerous levels cannot happen without the agricultural sector. They are right, it can’t.

There are three reasons for this assertion.

The first is that emission reductions from energy efficiency, mitigation and renewable projects will struggle to keep pace with ever-growing emissions from global energy demand. Mitigation projects in energy sectors will slow emission rates but leave legacy emissions in the atmosphere.

The second reason follows from a need to deal with this legacy. Smart agricultural and forestry practices can suck back CO2 and store it in vegetation and soil – so-called biosequestration. In Australia the sequestration potential in agriculture alone is 100 million tonnes of CO2 emissions (CO2e) per annum, or a quarter of Australian anthropogenic emissions with the bonus that soil with more carbon in it is far better for production that soil with less.

The third reason, and the big one, is land clearing. Globally we are still cutting down forests to grow food at a rate of 35,000 hectares a day, or an area equivalent to the urban footprint of Sydney every five days. On its own, this source accounts for 18 per cent of global emissions.

The problem is how to reduce land clearing.

We have cleared vegetation ever since we invented agriculture some 10,000 years ago and even the Ancient Greeks knew that clearing altered climate. Yet we can’t stop ourselves, because mechanised agriculture has become the engine of prosperity from Persia to Pennsylvania. It is quite something to tell a government minister that his government should forego the economic opportunity and the social security a robust agricultural sector brings. “Why not develop available land,” he will say, “there are mouths to feed.”

It is much easier to sell the idea of keeping the trees to the indigenous land owner, who is pained when forced to fell his trees to fund his children’s education.

And this is the nub of the matter. For what we have cleared are forests – vast stands of carbon locked up in the timber and in the soil that supports the trees (at least 40 per cent of the carbon even in the tallest rainforest is in the soil as plant roots and organic matter). Even where the logs are taken for product, clearing releases the carbon from the tree branches and roots through fire or decomposition and as exposed soil dries out, so the carbon oxidises to the atmosphere.

Enter a hugely contentious solution called REDD, reducing emissions from deforestation and degradation. The text of the Copenhagen accord describes what it means:

“We recognise the crucial role of reducing emission from deforestation and forest degradation and the need to enhance removals of greenhouse gas emission by forests and agree on the need to provide positive incentives to such actions through the immediate establishment of a mechanism including REDD-plus, to enable the mobilisation of financial resources from developed countries.”

In short, the west pays to avoid deforestation and so help reduce that 18 per cent slice of global emissions.

REDD, and its latest manifestation REDD-plus (same idea but with wider scope), are criticised for two reasons.

REDD projects amount to welfare payments to the developing countries where the projects reside. And welfare is disliked by both giver and recipient.

Then there is a vociferous green argument against the market approach to delivery as in this case there will be cowboys and governments who rip off the funds before they reach the resource owners. So despite the accord, REDD has been slow to start.

Lost somewhat in this debate on clearing is another mechanism for reducing degradation of forests, Improved Forest Management (IFM).

This is where emission reduction comes from projects on lands designated for forestry. Mitigation is achieved through combinations of longer harvest rotations, improvements to silviculture, better harvest practices and a specific category of protecting forests that would otherwise have been logged.

Whatever the specifics IFM is more like a commercial transaction, industry to industry, and is more comfortable to buyers. The outcome is better managed forests that continue to sequester carbon while emissions are avoided. In the developing countries where these projects are most likely, the forests also remain to supply traditional use.

It would be unfortunate if arguments over REDD derailed or slowed the “immediate establishment of a mechanism …to enable the mobilisation of financial resources from developed countries,” as stated in Copenhagen, because IFM already exists as a mechanism that can deliver.

It would be cheeky to call IFM green, but it is definitely not REDD.

 

This piece first appeared in Climate Spectator in 2010.

Climate change policy: Does Australia need it?

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The other day I listened to a presentation from the CEO of a company in the carbon game. Branching out from bio-energy, this company has developed smart technology to grow algae using the CO2 emitted from coal fired power stations.

It was an impressive story. The algae do what algae do in high-tech plastic bags and convert carbon dioxide to plant material at a claimed rate of up to 800 t per hectare (for comparison average wheat yield in Australia hovers around 1.5 t per hectare).  A quarter of the algal biomass harvested is extractable as vegetable oil and the rest as vegetable protein (dry pellets). The potable water byproduct is recycled back into the bags for the next batch of algae.  The list of salable items that can be manufactured from the algal produce was endless.

If I were an investor I would be muscling my way through the heavy hitters already camped outside the guys office and buy whatever shares I could. Not surprisingly the owners see no need to sell shares in the company to the public.

And the thing was that this particular entrepreneur, with a genuine smile on his face, did not care one iota about a carbon price, greenhouse gas emissions or a climate change policy. Why would he? He had salable products (oil and protein) that a host of buyers wanted, and he was making them from industrial waste (CO2) that everybody wants to get rid of. He had found a great win-win. And when that happens it’s all good, including in this case a powerful combination of greenhouse gas abatement and mitigation with the bonus of food production.

No doubt you are thinking, ‘Oh, but there has to be a catch’. And maybe there is in the scalability, sources of nitrogen, finding enough land next to power stations or many others we haven’t conjured up. The point is though, that the combination of smarts, entrepreneurship and willing investors can be a powerful tool when let loose on a problem.

If business actions can fix the climate problem, then why do we need policy? The reason is this. There are only a few courageous entrepreneurs and, especially in Australia, even fewer risk taking investors. This means that the rest, the mainstream who are risk averse and a tad timid, need help to solve the problem; and this is the role of policy. For policy can provide support, encouragement rules for a social climate that help us help ourselves.

Since the Australian government dumped its own Carbon Pollution Reduction Scheme, an emissions trading solution to what Prime Minister Rudd has called ‘the greatest moral challenge of our age’, the media has talked of backflips and the taxi drivers have expressed their disappointment at broken political promises. All the people I have spoken to are just a bit depressed at it all.

These reactions to political weakness are inevitable because we do need policy, we need it to give us confidence and in the case of climate change policy we need it now.

Greens

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Recent raucous debate on climate change In the Australian parliament resulted in the Greens, a minor party with environmental leanings, voting twice with the opposition against a Climate Pollution Reduction Scheme (CPRS) policy proposed by the government.

The CPRS legislation was an emissions trading scheme that would leverage market forces to drive behaviours of consumers and investors to cleaner more efficient energy options to lower emissions. I say ‘was’ because the policy option has just been shelved. This decision means that climate change will not be a central item in either government or opposition campaigns in the upcoming election, handy for both major parties.

And why did the Greens oppose the legislation? Because, they said, it did not go far enough. It was too weak and too kind to the heavy polluters. The reduction targets were a joke, so the rhetoric went.

This is a curious position for green politicians to take. The CPRS was an attempt to restructure the way we generate our energy and a mechanism that would money would be made from climate change adaptation measures. In other words legislation that would push more funds towards environmental benefit than any previous conservation measures in the country’s history. Instead there is no climate change policy and no serious debate on climate change legislation likely for at least another two years, possibly longer. And without a policy there is no emissions target at all.

Someone once said that the perfect can get in the way of the good. After the excesses that brought us anthropogenic climate change, it would be irony indeed if the desire for excess in redress scuppered the good.

Steady as she goes for carbon emissions

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actual-emissions-projections2

I love this graph.

It comes from the Australian governments economic modeling of their Carbon Pollution Reduction Scheme (CPRS), the work by their economists that helped them to decide on how to configure the government effort to reduce carbon emissions.

Bear in mind they have set themselves a target of reducing emissions to 60% below 2000 levels by 2050.

That is to reach around 200 Mt CO2e.

What the graph tells us about Australian emissions is this:

  • At present we are at a tick under 600 Mt CO2e
  • If business proceeds as usual with no mitigation (black line), emissions rise steadily until we hit 1,000 Mt CO2e by 2050
  • In the CPRS scenario actual emissions (dark blue line) do not decline at all until 2030
  • The light blue line, that is the purchase of permits from overseas, parallels the business as usual line.

So this CPRS scenario projects is that actual emissions stay as they are now and Australia buys its reduction target through the purchase of overseas credits.

The government is saying that, economically, they need to keep things as they are, change only slowly, get more efficient to avoid increasing emissions too much and buy our way to the target reductions.

Or put another way. Despite great sunshine, wind a plenty, tidal and geothermal options Australia will continue to rely on coal for its energy.

The politicians will parade their CPRS as fantastic green policy, the way to preserve the environment, keep jobs, and deliver peace of mind over climate change.

The trouble is that they are colour blind and must have very sore behinds from their vantage point on the fence. Why act now when you can act later.

Don’t you just love them.

M