Climate change

Too hot to handle?

PUBLISHED : Tuesday, 11 December, 2007, 12:00am
UPDATED : Tuesday, 11 December, 2007, 12:00am

Australia's belated signing of the Kyoto Protocol on greenhouse gas emissions and the presence of new Prime Minister Kevin Rudd at the UN conference in Bali on climate change are hugely important. This is one subject on which Australia, a distant-end, middle-ranking power, has a capacity to punch above its weight. However, it is not at all clear that Canberra itself is prepared to push for the extent of change required if it is to be a leader rather than a laggard, and to go beyond rhetoric to the economic realities of cutting carbon emissions.

The climate-change issue was certainly one factor in the landslide victory of Mr Rudd and his Labor Party in last month's polls. His predecessor John Howard's obdurate opposition to the Kyoto treaty had, for a long time, been regarded with equanimity by much of the electorate. They were content to see Australia hanging on to US President George W. Bush's coattails, as it also did on Iraq.

But the worst drought in recent history convinced many that climate change is a real threat to Australia itself. It is debatable whether there is a direct connection between the drought and climate change, but it came at an ideal moment for the global-warming advocates, and Mr Rudd.

The Kyoto commitment is important not because Australia, with a population the size of Taiwan, is a significant global contributor. It is because it has one of the highest per capita emissions, is a big exporter of fossil fuels and has long been the closest of all allies of the US; under Mr Howard, Canberra was more obedient than even Britain. Australia's conversion thus makes it easier than ever for the US itself to turn climate change from a heresy into a creed worthy of a crusade. That may happen even if a Republican replaces Mr Bush in the White House.

Mr Rudd's commitment to Kyoto, his first move after winning the election, has not only made him look good at home. It has also enabled him to present himself internationally as an agent of change. Australian media, keen to have for once a prime minister who goes down well in most capitals, has been quick to see the country playing a major role on climate change. Mr Rudd has presented himself as a go-between who can bring the developed and developing worlds closer together on this issue. Australia is presented as a potential intermediary and arbiter; the Putonghua-speaking Mr Rudd is seen as someone who can help obtain China's agreement to tighter limits for developing countries.

The reality is rather different. Australia may now be a leader, compared with the US and perhaps Canada, in terms of willingness to get beyond Kyoto to much more stringent targets for 2020. Mr Rudd has committed Australia to a 60 per cent emissions reduction by 2050, but that's so far away it is meaningless. It doesn't yet have a 2020 target, other than a 25 per cent to 40 per cent starting point for negotiations.

And whatever it may promise for the future, Australia has a long way to go to catch up with Europe. There, records are patchy but some countries have done spectacularly well in energy saving and the advance of renewables such as solar (notably in none-too-sunny Germany) and wind power.

What Australia has yet to count, however, is the cost of cutting emissions - the cost to the consumer of the kind of fuel taxes which in Europe and Japan encourage small, energy-saving vehicles. And, most of all, the cost to the economy and employment of moving away from coal-based energy. Two states, Queensland and New South Wales, are major coal exporters and have large (Labor-voting) constituencies to consider as well as the money and influence of 'big coal'. Victoria's power comes mainly from the brown coal of the Latrobe Valley, east of Melbourne.

At some time in the future, 'clean coal' or 'carbon capture' may become realities. But they are unlikely to be on hand before 2020. In principle, much of Australia's coal power could be replaced by solar energy. Even if solar-cell technology does not progress as fast as hoped, deserts and lots of sunshine provide potential for vast amounts of conventional solar power - but at a higher direct cost than fossil fuels, not to mention the cost of coping with a declining coal industry.

Uranium is another source of non-carbon energy which Australia possesses in abundance. But nuclear power is not acceptable domestically, and opposition to uranium exports, though weaker than it used to be, may block sales to several countries, including India.

Australia's conversion to cleaner power is being promised at a time when the economy is, superficially at least, very strong and the government has a large budget surplus. Yet, underlying the boom which Mr Rudd inherits is a record trade deficit persisting despite record prices for most of Australia's commodity exports and high domestic debt levels.

For now, the trade deficit is easily financed. But, if global conditions turn against him, Mr Rudd's difficulty in redeeming his Bali rhetoric with action will increase dramatically. His promises are admirable, but the road to electoral disaster is paved with good intentions.

Philip Bowring is a Hong Kong-based journalist and commentator