Six things we learned about the Australian government’s response to the climate crisis | Energy

Emissions are falling – but not fast enough

The latest Australian emissions data tells a slightly complicated story, mainly due to the Covid-19 shutdown years. Have emissions increased under Labor, as the Coalition and Greens claim? Or is that just in comparison with those during lockdowns? 

Emissions fell slightly last financial year – about 3m tonnes, or a 0.7% drop – and are now estimated to be 28.2% below 2005 levels. This followed a small post-pandemic rise the year before.

A progress report by the Climate Change Authority gives the backdrop to this: pollution declined rapidly when Covid hit, largely because we stopped driving and flying as much, and has plateaued over the three years since. Its conclusion is that emissions are falling but not fast enough.

Climate pollution needs to be reduced on average by 15m tonnes a year between now and 2030 to reach the government’s legislated target (a 43% cut below 2005 levels). 

Projections suggest this is possible under existing policies – if everything goes according to plan. The biggest driver of this should be the capacity investment scheme, a program to underwrite 32GW in new large-scale renewable energy and batteries before the end of the decade. That is roughly equivalent to building half the current capacity of the grid again.

But it is worth remembering what scientists say: that Australia should be making a deeper cut by 2030 and setting a much more ambitious target for 2035 in the months ahead, to live up to the goals of the landmark Paris agreement.

Renewables are taking off

The positive news is that solar and wind energy are now being added to the grid at a record pace. The Clean Energy Regulator says 7.2GW to 7.5GW are expected to be installed this year, beating the previous best year in 2020.

A little less than half of this capacity is in rooftop solar panels, mostly on homes. At the other end of the scale the government has approved what are expected to be the two largest windfarms in the country – MacIntyre in Queensland and Golden Plains stage 1 in Victoria. 

With an influx of renewables expected, the regulator expects a “material step up” in the share of electricity coming from zero emissions sources next year. Renewable energy is forecast to deliver 45% of the total, up from less than 39% over the past 12 months. 

In a separate report, the Australian Energy Market Commission says this should be good for power bills. Household costs are projected to fall over the next decade as long as the rollout of renewables, energy storage and transmission lines continues.

The commission estimates that an average household that “fully electrifies” (has solar panels and replaces cars and gas appliances with electric alternatives) could cut their annual energy spending by 70%, or $3,500 – once they have dealt with the upfront costs.

Is the safeguard mechanism working?

We shouldn’t put too much weight on it but the Climate Change Authority report gives the first snapshot at what is happening with the safeguard mechanism, a Coalition-era policy that Labor tightened to limit emissions at major industrial sites.

The performance of the mechanism matters – the 215 or so sites it covers are responsible for 31% of pollution. According to preliminary data, emissions across these sites fell slightly, by 2.9m tonnes of Co2, last financial year in absolute terms.

Some caveats: it is not clear the extent to which this dip was driven by the safeguard or by other factors – for example, if higher energy prices reduced output at some companies.

According to the environment department’s emissions projections report, the absolute cut in emissions from polluters covered by the safeguard is expected to be only 13% by 2030 and 46% by 2040. Both are less than the nation-wide reductions expected over that period.

The industrial cuts are forecast to be greater once use of the carbon offset market – a contentious system that allows companies to buy credits said to represent emissions cuts elsewhere while continuing to pollute – is counted.

Who knew? Fossil fuels add pollution

Speaking of fossil fuels, the Climate Change Authority gives a picture of the impact of new and expanded coal and gas developments that have been approved, calculating they will add 21m tonnes of CO2 within Australia between now and 2030.

These emissions are dwarfed by what will be emitted once the coal and gas is shipped overseas and burned for energy. But the offshore pollution is not counted against Australia under international greenhouse accounting rules.

Labor’s climate policies are yet to kick in

This is a key point. The Climate Change Authority says Labor’s climate policies – including the capacity investment scheme, the reformed safeguard mechanism, the vehicle efficiency standard to encourage cleaner car uptake, and the $22.7bn Future Made in Australia program – have largely not been around long enough to have had an impact.

But it says they “have improved Australia’s prospects of cutting emissions in line with the national 2030 target” as long as they are delivered on time.

A final word of warning

The authority points out there have been a series of revisions to Australia’s emissions accounts – particularly, changes in estimates of how much CO2 has been released or absorbed by the land and forests.

These changes have made it easier to reach the 43% target. The authority stresses they “should not be mistaken for signs that the transformations required for decarbonising the economy have commenced”.

In other words, updates to the greenhouse books does not mean Australia is cleaning up its act.

The revisions have been significant. This year alone, the estimate of how much the country emitted over the past four years was reduced by 79m tonnes of CO2.

The authority does not suggest there is anything sinister going on. It says revisions are an important part of ensuring accuracy and a 2022 UN expert review did not identify “any material issues”.

But the favourable changes reinforce that, while the 2030 target may be within reach, there is still a long way to go in cleaning up the economy.