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Speech
Federal Minister for the Environment and Heritage
The Hon Dr David Kemp, MP

Renewable and Sustainable Energy Roundtable Side-event, COP 9, Milan
9 December 2003

Australia's Domestic Climate Change Approach


How encouraging it is to see the Australian Renewable and Sustainable Energy Roundtable playing a key part in this Conference. You are great ambassadors for the practical work we are doing to combat climate change and for the technical excellence of Australian industry.

Managing climate change risks is a challenge for the global community - and for each and every country. None of us can do it alone - certainly not relatively small emitters like Australia. But action at the domestic level will help to build the confidence among parties necessary to underpin effective action at the global level.

Tonight I will tell you a little about the action that Australia is taking domestically to tackle greenhouse emissions.

Australia's Approach in Climate Change

But first let me sketch our overall approach on climate change. Australia accepts the IPCC's conclusions in relation to climate science as the most authoritative available. We also understand the uncertainties highlighted in the IPCC's reports - both with respect to the future path of possible global emissions and with respect to the effect of those emissions on temperature. Each of these accounts for about half of the variation in possible temperature outcomes for 2100. Our knowledge about both these sources of uncertainty has to be improved.

That temperature range - from 1.4C to 5.8C - is currently very wide. It is probable that globally we could cope with temperature changes at the lower end of this range - although not without some significant difficulties in particular regions. At the other end of the spectrum scientists tell us that we are running the risk of catastrophic, cumulative changes in our climate system. The global task, in which Australia will play an active role, is to manage this risk to ensure that we avoid taking a path that irreversibly leads to these potentially catastrophic outcomes.

We need to remove as much of the uncertainty in the science and economics which provides the basis for these projections as possible, and to understand more about the possible impacts of climate change at the national and regional level. The more certain the science and economics, the more readily will governments commit to the actions, and inevitably the costs, needed to manage climate change risks. The more certain the science and economics the less the risk that governments will commit to the wrong policy responses - with all the costs that those could entail. I will come back later in this speech to the contribution that Australia is making to Climate Science and Impacts.

At this time there is no agreement at inter-governmental level or through the IPCC regarding a safe path for global emissions of greenhouse gases to take. Some have talked about stabilizing global greenhouse gas concentrations in the atmosphere at broadly double pre-industrial levels by the end of the century as being consistent with temperature changes of 2C or less, and those temperature changes in turn as being consistent with avoiding the most dangerous outcomes for humanity and nature.

For the sake of illustration, if this line of argument is accepted, the IPCC reports suggest that global emissions will have to be reduced by 50-60% from "business as usual" projections by the end of the century.

Three conclusions would follow from this:

  1. All major emitters will have to be involved in the task.
  2. Cost effective technology will have to play a vital role if expectations of living standards are not to be dashed by the cost of controlling emissions - technology development and deployment requires vibrant, creative and growing economies as well as the right incentives.
  3. The developing world will need to follow a development path far less carbon intensive than the developed world has taken.

At the minimum these outcomes will not be achieved without the engagement of all of the top six emitters which cover some 70% of global emissions- the US, EU, Russia, China, Japan and India - and probably the top 12 in which Australia is included, which would bring the total emissions covered to over 80%. It seems implausible that a sustainable basis for effective action will be possible without all these parties being comfortable about the mutual consistency of their efforts, and trust that none is taking advantage of the others.

Australia will contribute to the confidence building needed to achieve a genuinely effective global approach. We also want to make sure that Australian industry is positioned to push the technology frontier forward to a less greenhouse intensive future.

This is why we have committed to achieving our Kyoto target of 108% of our 1990 emissions levels, even though we are not ratifying the Protocol, and why we have embarked on an ambitious domestic climate change programme.

Domestic Action

The Australian Government has invested nearly $1 billion to fund a range of climate change measures across the economy, including the energy, transport and agricultural sectors.

The measures we have already taken are expected to deliver annual emissions abatement of around 67 million tonnes by 2008-12 - the equivalent of taking all of Australia's cars, trucks and buses off the road.

As a result Australia is within striking distance of its Kyoto target. Maintaining our current efforts together with a successful outcome to current negotiations in relation to landclearing with the Queensland Government and farm groups would provide additional assurance we will close the remaining gap.

While the current uncertainty about the course of global negotiations and the lack of clarity around the path to emissions reductions for our regional competitors for inbound investment inevitably restrains the long term signals it is appropriate to give the Australian economy at this time, this does not mean that we are focused only on the period to 2012.

We are making careful, targeted investments in developing the technologies that will deliver a vibrant economy with a lower greenhouse signature. These include work through the CSIRO flagship program "Energy Transformed" on zero-emissions coal technologies involving gasification and geosequestration of greenhouse gas by-products, on low emissions direct energy use through broader application of distributed energy production powered by natural gas, on the hydrogen economy and on low emission hybrid vehicles for the transport sector. But of course, our greatest intervention so far has been to support a greater role for the renewables sector, including through the Mandatory Renewable Energy Targets (MRET) scheme.

Australia's Approach to Renewables

Australia recognises the importance and potential of renewable energy in reducing greenhouse gas emissions and improving the sustainability of energy supply. Australia is blessed with an abundance of good solar, wind, water and biomass resources. About 6% of total energy use in Australia comes from renewable energy. In the electricity sector, current use of renewable energy contributes nearly 11%. This is expected to expand significantly in Australia in the next decade.

The Australian Government is providing a major boost to renewable energy as a key part of its overall strategy for reducing Australia's greenhouse gas emissions.

The Government, in partnership with industry, launched a Renewable Energy Action Agenda three years ago, to underpin the renewable energy industry in Australia, based on a competitive energy market with clear signals provided to investors.

This Action Agenda aims to grow annual industry sales to $4 billion by 2010 and industry is playing a key role in its implementation.

The Action Agenda reflects a multi-pronged approach that has five key strategies:

A Renewable Energy Technology Roadmap has followed on from the Action Agenda. This outlines a long-term research and development plan that defines the industry's collective future and establishes clear pathways forward. Other more detailed roadmaps are now being developed for areas of special interest such as photovoltaics.

I would now like to turn to some of the Government's key policies and programs.

Key Policies and Programs

The Mandatory Renewable Energy Target, known as MRET, is a cornerstone of the Government's strategy for growing the Australian renewable energy industry. It requires the sourcing of 9,500 gigawatt hours of extra renewable electricity per year by 2010 through to 2020 - which is enough power to meet the residential electricity needs of four million people. It is a world first in creating a national renewable energy market that is backed by legislation, using an innovative market-based system of tradeable certificates.

The MRET measure has performed strongly since coming into force in April 2001. It has generated a high level of renewable energy project planning and development activity, especially in the wind sector.

Industry has taken up the challenge of delivering new renewable energy projects. MRET is just over two years old but is already delivering significant investment and jobs - a situation that we hope to see continue. I understand that all in the industry are awaiting the Government's response to the Tambling Report on the MRET scheme. The report will be tabled by January 18 next year, and the Government will respond as soon as possible after that.

Coupled with this expanded market through MRET, our suite of programs have been successful in project delivery and technology support.

Over the past five years, we have allocated over $300 million to programs that have encouraged deployment of existing renewable energy technologies, commercialisation of innovative new technology, and industry capacity building.

Our programs address a range of approaches, such as supporting solar power in homes and community use buildings; supporting the installation of renewable energy in remote areas; providing venture capital for small innovative renewable energy companies; showcasing Australian technology; supporting the commercialisation of renewable energy technologies; and reducing greenhouse gas emissions from road transport.

Furthermore, the Australian Government recognizes the potential of hydrogen to deliver significant economic and environmental benefits. In May this year, Australia hosted an international conference in Western Australia on future challenges and strategies for a Hydrogen Economy and, in October, the National Hydrogen Study was released and its recommendations are being considered by the Government.

Through the market pull provided by the Mandatory Renewable Energy Target, and our support for the commercialisation and deployment of innovative renewable energy technologies, we are growing and developing a significant industry sector.

Successes

The results of our initiatives speak for themselves.

International Cooperation

Our investment in this industry is obviously significant.

It gives us an important asset in international confidence building.

We are currently progressing bilateral cooperation on climate change with the United States, the European Union, Japan, New Zealand, and as I announced recently, China.

These relationships provide a framework to engage on climate change policy issues, to enhance our contribution to the development of global science and to focus on practical and measurable outcomes that benefit both countries.

They complement multilateral initiatives including partnerships that emerged from the World Summit on Sustainable Development. For example, the APEC Energy Working Group partnership projects that we jointly sponsor are investigating ways to increase the uptake of alternative fuels, identify financing mechanisms for energy efficiency measures, and develop cleaner energy in villages in developing countries in the Asia-Pacific. Australia also participates in the International Partnership for the Hydrogen Economy, which we signed up to in November.

In all of these relationships we aim to build the opportunity for the private sector to contribute its entrepreneurial skills, knowledge, networks, and resources. We strive to include business more broadly in international collaboration initiatives. Our co-sponsorship of the Australia-New Zealand Conference and Trade Expo 2004 in Auckland next November is a case in point. It seeks to leverage climate change-relevant commercial expertise and develop opportunities.

Science: Climate Change - Australian Guide

I started this speech talking of climate science and promised to return to it in closing. Good policy is based on sound science. Sound science must be a global enterprise. Australia plays a key role in the Global Climate Observing System and in climate science more broadly. I am delighted to use your forum to launch a major new publication that describes some of this contribution and will help deepen global understanding of climate change.

Climate Change: An Australian Guide to the Science and Potential Impacts is the most up-to-date and comprehensive guide to the science of climate change in Australia and the Southern Hemisphere.

The Australian Government has identified climate change and technological responses as a key national research priority. Australian scientists play the leading role in understanding Southern Hemisphere systems. The dynamics of the Southern Ocean are unique and are recognised internationally as a key driver in the global climate system, yet they are not well enough understood.

We are helping to fill this critical information gap, for example through advancing understanding of the Antarctic Circumpolar Current - the world's largest ocean current system - and the impact it has not only on our regional climate patterns but on the broader global climate. We are also gaining a greater understanding of the Antarctic Vortex, a 30-kilometre high circumpolar jetstream winding around the Antarctic, that appears to be spinning faster as a result of stratospheric ozone depletion and greenhouse gas emissions.

Of course our research into the many factors that impact on the health of coral reefs, particularly the impact of raised sea-surface temperatures, is already recognised as world leading.

Some pre-print copies will be available at the Australian display stand.

Conclusion

In policy and technology, as well as in science, Australia continues to develop and share its expertise to help arrive at long-term solutions to climate change.

Our approach to energy must continue to support economic growth and development, while also contributing to reduced air pollution and greenhouse gases, and developing new technologies.

The delivery of competitively priced, sustainable and secure energy sources is an issue for everyone. The Australian Government has made this a high priority. We welcome the efforts of the renewable energy industry which is taking up the challenge and actively contributing to greenhouse and energy goals.

We look forward to continued collaboration to find the best way forward, and invite others to seek and share expertise with our Government and industry.

I wish the Roundtable well for the future, and would like to thank you for this opportunity to speak today.

Thank you.

Commonwealth of Australia