3 Atmosphere | 2 Climate | 2.3 Effectiveness of management

State of the Environment 2011 Committee. Australia state of the environment 2011.
Independent report to the Australian Government Minister for Sustainability, Environment, Water, Population and Communities.
Canberra: DSEWPaC, 2011.

3 Atmosphere

2.3 Effectiveness of management

At a glance

If Australia is to achieve the national 2020 target of a 5% reduction in greenhouse gas emissions below 2000 levels, the range and effectiveness of abatement measures being applied in both the public and private sectors will need to be greatly increased. This is the key aim of Securing a Clean Energy Future, the Australian Government’s climate change plan released in July 2011, which sets out details of a mechanism to establish a price on carbon and drive reductions in emissions via least-cost means. The plan also builds on existing measures, such as the legislated 20% Renewable Energy Target and the Carbon Farming Initiative, to promote development of renewable energy sources, energy efficiency and action to sequester carbon. At the time of writing (July 2011), the Australian Government proposes to introduce the necessary supporting legislation to parliament before the end of the year.

Current governance is complex, because three tiers of government need to be involved in working with the private sector and the community to plan for and implement effective mitigation and adaptation measures. Coordination of federal and state programs has improved via actions by the Council of Australian Governments (COAG). Understanding of the science of climate change as it relates to Australia is continuing to improve, as is confidence in modelling projections at both national and regional scales. There is extensive support for policy and priority setting at a national level through the initial Garnaut Climate Change Review (2008) and subsequent review update (2011) and through an improved national greenhouse gas emissions reporting system. The Australian Government has established a broad (‘three-pillars’) strategy, underpinned by the Renewable Energy Target, an energy efficiency strategy and a national adaptation framework that was adopted by COAG in 2007.

The Australian Government has committed around $15 billion to climate change initiatives. States and territories are also applying significant resources to mitigation and adaptation programs.

As a developed country that is a signatory to the United Nation’s Framework Convention on Climate Change, every four years Australia submits a national communication on climate change that sets out the national strategy to address climate change and reports on progress made over the reporting period. In Australia’s most recent national communication (the fifth), which was submitted in 2010, the government describes its climate change strategy as comprising ‘three pillars’: mitigating emissions, adapting to unavoidable climate change and helping to shape a global solution (Figure 3.17). As the communication notes, the strategy and key policies and measures it encompasses have been informed by:

  • a significant improvement in the national climate science research effort
  • a comprehensive, in-depth analysis to identify the best mix of approaches to deal with climate change (the Garnaut Climate Change Review)
  • extensive consultation with business and the community.42
Figure 3.17

CPRS = Carbon Pollution Reduction Scheme; UNFCCC = United Nations Framework Convention on Climate Change

Source: Australian Government Department of Climate Change and Energy Efficiency42

Figure 3.17 Australia’s three-pillar climate change strategy
Text description of Figure 3.17

2.3.1 Understanding and research

Information about climate change and its likely impacts is the first requirement of good adaptation and mitigation policies. This requires strengthening of the climate-related research effort in Australia. Garnaut,13 p. xli

In the six years since the fourth national communication, international climate change science has advanced significantly, through many hundreds of studies of the complex, interacting processes driving change in the atmosphere, oceans and terrestrial systems. The base of empirical evidence has greatly expanded, as have the power and sophistication of climate change modelling at global, continental and regional scales. This has enabled better informed and more precise understanding of risks and analysis of opportunities to mitigate and adapt to future change.9,6162

Australia is recognised as being particularly vulnerable to the effects of climate change.25,63 Acting on the need to improve our understanding of the risks to the environmental systems that support our economy and to identify opportunities to manage such risks via mitigation and adaptation, the Australian Government established the National Climate Change Adaptation Research Facility in 2007 and the National Framework for Climate Change Science in 2009. It also committed to substantial investments in climate science: $31.2 million over four years from 2009 for the Australian Climate Change Science Program (with matching contributions from CSIRO and the Bureau of Meteorology); $387.7 million in research infrastructure over four years to increase Australia’s capacity to respond to climate change and improve protection of Australia’s marine territory; and a number of scientific partnerships between CSIRO, the Bureau of Meteorology, and state and territory governments.42,64 (Details of grants made under the Australian Climate Change Science Program can be accessed at the Department of Climate Change and Energy Efficiency website.a)

In December 2007, Australia ratified the Kyoto Protocol and established a new Department of Climate Change (now Climate Change and Energy Efficiency) to take the lead across government on climate change, providing a focus for policy development and advice, both domestically and internationally. Since then, Australia’s system for measuring and reporting on GHG emissions and energy use by major industry sectors and for estimating losses and gains from vegetation and soil sinks (the National Greenhouse Gas Inventory) has substantially improved. This reporting system underpins Australia’s commitment under the protocol to a GHG emissions target of 108% above 1990 levels for the first commitment period (2008–12). The statutory framework for this system was established in 2007 with the introduction of the National Greenhouse and Energy Reporting Act 2007. The Act streamlines reporting with the establishment of a single reporting point for emissions and energy data and, since 2008, mandates reporting by companies exceeding thresholds for emissions and energy production. The framework also enables Australia to meet its reporting requirements under the Kyoto Protocol through the establishment of a national registry of emissions units. Planning and quality control systems associated with the national inventory have also been strengthened.42

2.3.2 Planning and strategy

Governments have a key role to play in mitigation of, and adaptation to, climate change, including:

  • supporting scientific studies that are unlikely to be undertaken by the private sector (particularly relevant to the Australian Government)
  • providing information to the private sector and the community to encourage and assist adaptation (relevant to all tiers of government, but of particular importance to state, territory and local governments)
  • adopting policy settings that facilitate adaptation and a regulatory framework that supports, rather than distorts, effective market signals (a critical role for the Australian Government, but one that state and territory governments can significantly reinforce)
  • employing policy mechanisms such as land-use planning, building codes and product standards to deal with situations where short-term market responses may act to restrict longer term adaptive action (primarily relevant to state and territory governments, but also to the Australian Government for setting minimum energy performance standards and the Building Code of Australia, and to local governments, which play an important role in on-ground implementation)
  • fully factoring climate change into planning, resourcing and managing the provision of public goods and services such as public health and safety, emergency services, flood and coastal protection, water supply, drainage and sewerage services, protection of public lands, parks and reserves, fisheries and other natural resources (relevant to all three tiers of government, but especially to state, territory and local governments).

A key part of the Australian Government’s three-pillars strategy has been the introduction of a price on carbon to drive reductions in emissions via least-cost means. An initial attempt in 2008–10 to do this by means of an emissions trading scheme (the Carbon Pollution Reduction Scheme) failed to gain bipartisan support in parliament and did not proceed.

In July 2011, the Australian Government released its new plan for the introduction of a price on carbon (titled Securing a Clean Energy Future). Although the plan has four components (a carbon price, renewable energy, energy efficiency and land-based action to sequester carbon), the critical element is a mechanism to put a price on carbon and thereby stimulate least-cost abatement measures.47

Unlike the earlier failed attempt to move directly to a carbon emissions trading scheme, the plan involves moving to a trading scheme via a three-year transitional period. During this period, starting from 1 July 2012, facilities directly emitting 25 000 tonnes or more of CO2-e per year (excluding transport fuel emissions) and large suppliers of natural gas will have to buy and surrender to the Australian Government a carbon permit for each tonne of GHG they emit. The government will issue as many permits as businesses need to cover their emissions. The starting price will be fixed at $23 per tonne, increasing by 2.5% per year in real terms. GHGs for which permits will have to be purchased are carbon dioxide, methane and nitrous oxide, and PFC emissions from the aluminium sector. Existing legislation relating to synthetic GHGs will be used to apply an equivalent tax on manufacturing and import of all the synthetic GHGs covered by the Kyoto Protocol—HFCs, PFCs and sulfur hexafluoride. In combination, this will cover around 60% of Australia’s emissions, including emissions from electricity generation, stationary energy, some business transport, nonlegacy waste, industrial processes and fugitive emissions. (Emissions from agriculture will not be covered.)

On 1 July 2015, the fixed price (or carbon tax) period will be replaced by an emissions trading scheme (ETS). Under the ETS, the government will set an annual carbon pollution cap that will determine the number of permits issued. Market forces will then act to influence the price of a permit at any time. However, for the first three years of the scheme, a ceiling and floor price will be in place to limit extreme price volatility. The ceiling will be set at $20 per tonne above the anticipated international price, rising by 5% per year in real terms. The floor price will start at $15 per tonne and increase by 4% per year in real terms. The role of the ceiling and floor price will be reviewed in the third year of operation of the ETS. From the outset of the ETS, businesses will be able to purchase international permits from credible carbon markets. Until 2020, businesses will be able use international permits to meet up to 50% of their required permits each year. (This restriction will be reviewed in 2016.)

Fifty per cent of the revenue from the carbon pricing mechanism will be used to assist households to deal with price impacts. The balance will be divided between supporting a range of industries directly or indirectly affected by the introduction of a carbon price (including energy-intensive, trade-exposed industries) and expanding existing funding for clean energy and energy efficiency programs.

The plan provides for a legislated independent expert body (the Climate Change Authority) to advise government on matters such as future pollution caps, indicative national emissions trajectories and long-term emissions budgets, and the progress made towards national reduction targets. Legislation will also establish a clean-energy regulator to administer the carbon pricing mechanism.

Although a carbon price will not apply to agriculture, the plan will continue the existing Carbon Farming Initiative to encourage and support farmers and land managers to reduce emissions and store carbon in soil and vegetation. Funding for such actions will be available through an ongoing Biodiversity Fund ($946 million over the first six years) and an ongoing Carbon Farming Futures program ($429 million over the first six years).

Under the plan, the existing Renewable Energy Target will be complemented by the establishment of a new statutory authority, the Australian Renewable Energy Agency, which will provide funding for projects through a range of competitive grants programs. The agency will consolidate existing funding of $3.2 billion over nine years to support innovation in renewable energy and will make additional funds available. In addition, a Clean Energy Finance Corporation will be established to invest in the commercialisation and deployment of renewable energy and in enabling technologies, energy efficiency and low-emissions technologies.

Emissions reduction targets for 2020, to which the Australian Government had already committed, have been maintained, and the long-term target (2050) has increased from 60% to 80% of 2000 levels (Box 3.4). To meet the government’s minimum emissions reduction target (a 5% reduction from 2000 levels by 2020) in the face of projected continuing growth in emissions will require abatement of at least 159 MtCO2-e (23%) by 2020.

At the time of writing (July 2011), the Australian Government proposes to introduce the necessary supporting legislation to parliament before the end of the year.

Box 3.4 Australia’s climate change targets

Emissions

Kyoto target: to limit net increases in greenhouse gas emissions to an average of 108% of 1990 levels across 2008–12. Australia is on track to meet this target, largely due to a significant reduction in land clearing during the late 1990s, which was achieved via controls at state level.

2020 target range: to achieve emissions reductions of between 5% and 25% below 2000 levels by 2020:

  • 5%—an unconditional commitment even in the absence of an international commitment
  • 15%—a target Australia is prepared to adopt if there is a global agreement that falls short of securing atmospheric stabilisation at 450 parts per million (ppm) CO2-e, but under which all major economies commit to significant emissions reductions and advanced economies accept reductions comparable with Australia’s
  • 25%—agreed by Australia in Appendix 1 to the Copenhagen Accord, provided the world agrees to an ambitious global deal capable of stabilising levels of greenhouse gases in the atmosphere at 450 ppm CO2-e or lower.

2050 target: In July 2011 (as part of its Securing a Clean Energy Future plan) the Australian Government increased the national 2050 emissions reduction target from a 60% reduction on 2000 levels to an 80% reduction. Developed countries need to achieve a 60% reduction to stabilise global greenhouse gas levels in the range 450–550 ppm by 2050. At 450 ppm, the estimated likelihood of limiting global mean temperature rise to 2 °C above pre-industrial levels is around 50%. At 550 ppm, a rise of 3 °C is likely. The Commonwealth Scientific and Industrial Research Organisation (CSIRO) estimates that around 97% of the Great Barrier Reef will be bleached each year if temperatures rise to within this range.

Energy efficiency

Renewable Energy Target: to source 20% of Australia’s electricity supply from renewable resources by 2020.

Sources: Australian Government;65 Australian Government Department of Climate Change and Energy Efficiency;66 United Nations Framework Convention on Climate Change;67 Garnaut;13 Preston & Jones68

2.3.3 The role and coordination of different levels of government

An overarching Australian Government strategy—implemented via a range of policies, plans and programs—is essential if Australia is to succeed in mitigating climate change and addressing key areas of vulnerability through adaptation. However, in Australia’s federal system, it is also imperative that other Australian governments play their part in the national initiative and that their actions are coordinated effectively with those of the Australian Government.

Table 3.2 lists examples of key climate change policies and strategies established at state and territory level. In addition to seeking to mitigate climate change through means such as renewable energy targets, electricity feedback tariffs and energy efficiency programs, each jurisdiction’s policies and strategies focus on the need to identify vulnerabilities and opportunities associated with climate change and to implement appropriate adaptive actions.

Table 3.2 Examples of key state and territory climate change policies and strategies
State/territory Policy response or strategy Comment
Australian Capital Territory (ACT) Weathering the Change—the ACT Climate Strategy 2007–2025  
Electricity Feed-in (Renewable Energy Premium) Act 2008  
New South Wales Greenhouse Plan  
Draft Climate Change Action Plan To replace Greenhouse Plan
Greenhouse Gas Reduction Scheme (formerly the Greenhouse Gas Abatement Scheme) Trading aspects to cease when a national emissions trading scheme commences
Renewable energy target  
Promotion of energy-efficient buildings Encourages adoption of National Australian Built Environment Rating System
Northern Territory (NT) Climate Change Policy A $34-million action plan that commits NT to becoming carbon neutral by 2018
Provides a plan for lowering land clearing rate and protecting coastal wetlands
Queensland ClimateSmart 2050 State climate change strategy
ClimateSmart Adaptation 2007–2012 Action plan for managing effects of climate change
Smart Energy Policy  
Renewable Energy Fund  
South Australia Tackling Climate Change—South Australia’s Greenhouse Strategy 2007–2020 Deals with a range of mitigation and adaptation actions
Electricity (Feed-in Schemes—Solar Systems) Amendment Act 2008 Bill to amend 2008 Act introduced in April 2011 to increase benefits while limiting total cost of scheme
Residential Energy Efficiency Scheme  
Draft Adaptation Framework A guide to government agencies, local government, nongovernment organisations, business and the community
Tasmania Framework for Action on Climate Change  
Community Grants Programs Micro-grants (up to $3000) and ClimateConnect grants (up to $30 000)
Victoria Taking Action for Victoria’s Future—Victorian Climate Change White Paper, 2010 Comprehensive framework that addresses mitigation and adaptation
Climate Change Act 2010 Deals with a range of matters, including providing for an emissions reduction target of 20% by 2020; establishing property rights in forestry, carbon sequestration and soil carbon; empowering the Environment Protection Authority to regulate emissions
Climate Change Adaptation Plan and community-based climate change preparedness programs Key adaptation actions under the white paper
Victorian Renewable Energy Target Scheme Sets annual statutory targets and issues renewable energy certificates
Western Australia Climate Change Adaptation and Mitigation Strategy Under development
Low Emissions Energy Development Fund $30 million available to support development of technologies
Residential feed-in tariff scheme Provides eligible residential system owners with a subsidy rate of 40 cents per kilowatt-hour for energy exported to the electricity grid

Sources: Parliament of Australia,35 state and territory agency websites

In February 2008, the Australian Government commissioned a strategic review of all climate change programs (the Wilkins review69) ‘to determine whether existing climate change programs are efficient, effective and complementary to the Carbon Pollution Reduction Scheme (CPRS)—so that climate change can be addressed at least cost to the economy’.70 The review recommended, among other things, a reduction in the number of federal programs and a clarification of roles of the Australian and state and territory governments. More specifically, it suggested a rationalisation of activities, with the Australian Government to focus on mitigation measures and the states and territories to concentrate on adaptation via the Council of Australian Governments (COAG) National Adaptation Framework, which aims to build our capacity to manage climate change impacts and reduce vulnerability in key sectors and regions. However, in the three years since the release of the Wilkins review, it has become clear that a thorough rationalisation of activities along these lines is unlikely to be practicable, given the important role of state and territory governments in areas such as promotion of energy efficiency and renewable energy sources, land use planning and public transport.

In responding to this element of the Wilkins review, the Australian Government emphasised the importance of COAG in engaging the states and territories. Examples of cooperation and coordination cited included finalising the expanded national Renewable Energy Target scheme, developing the COAG Energy Efficiency Strategy, adopting the National Adaptation Framework in 2007, reviewing existing climate change programs and developing new initiatives.70

Local government, as the tier of government closest to the community, has a particularly important role in engaging businesses and community groups in identifying key vulnerabilities to climate change (and potential opportunities); setting priorities; and developing and implementing adaptation strategies that take full account of local conditions, resource availability and community capacity to deal with change. As Professor Garnaut notes:

The appropriate adaptation response will always depend on a range of local circumstances. Therefore, unlike the mitigation effort, adaptation is best seen as a local, bottom-up response. Garnaut,13 p. 363

Local government actions to mitigate and adapt to climate change have been assisted in Australia and internationally by Cities for Climate Protection® (CCP®)—an international campaign initiated by the International Council for Local Environmental Initiatives (ICLEI), which ‘provides a framework for local governments to integrate climate protection policies with actions that address immediate municipal concerns’.71 Between 1998–99 and 2007–08, Australian councils participating in the CCP Australia campaign reported a total abatement of 18 million tonnes of CO2-e.72 In 2009, as part of the rationalisation of programs following the Wilkins review, Australian Government funding of around $1.5 million per year for the CCP® program was halted on the basis that it was not complementary to the CPRS. The decision, which was strongly criticised by local government and the Australian Greens party, attracted limited media attention (e.g. see Cubby73). Under its present title, CCP—Integrated Action®, the campaign continues to assist local governments and their communities with action to mitigate climate change (CCP-Mitigate®) and to adapt to climate change (CCP-Adapt®).

In the final analysis, although action by all tiers of government will be needed to adapt to climate change, ‘adaptation is a shared responsibility—governments, business and the community all have a stake and a role in responding to climate change impacts’.74

2.3.4 Management outputs and outcomes

Efforts by government, the business sector and the broader community to reduce GHG emissions are essential to minimise the degree of climate change and associated consequences. Table 3.3 summarises the projected reductions in emissions from major abatement policies and measures put in place by the Australian and state and territory governments. The projected reduction averaged across each year during the Kyoto commitment period (2008–12) is 56 MtCO2-e, and the projected reduction in 2020 is 109 MtCO2-e.

Table 3.3 Projected annual reductions in greenhouse gas emissions from government policies and programsa
Schemeb Kyoto period (2008–12) average
(MtCO2-e)
2020
(MtCO2-e)
Renewable Energy Target 8.8c 29.9c
  • Large-scale Renewable Energy Target
8.6 26.3
  • Small-scale Renewable Energy Scheme
0.2 3.7
National Strategy on Energy Efficiency 14.3c 42.6c
  • Equipment Energy Efficiency Program
6.3 20.3
  • Energy efficiency requirements: building codes
4.2 11.8
  • Mandatory disclosure requirements: buildings
<0.1 <0.1
  • Framework Cool Efficiency Program
0.1 0.4
  • Phase-out of incandescent lighting
1.0 1.9
  • Phase-out of inefficient water heaters
0.1 4.1
  • Energy Efficiency Opportunities Program
2.7 4.2
Queensland Gas Scheme 2.2 4.3
Victorian Energy Efficiency Target and Energy Saver Incentive Scheme 0.2 1.6
Greenhouse Gas Abatement Program 3.4 3.6
Greenhouse Challenge Plus 5.3 2.6
Biofuel Act 2007 (New South Wales) 0.1 0.3
New South Wales and Queensland land clearing legislation 18.0 18.4
Other measures 3.8 5.7
Total 56 109

MtCO2-e = megatonnes of carbon dioxide equivalent

a These estimates do not attempt to indicate the economic efficiency of programs or to calculate the cost per tonne of abatement.

b Only a selection of policies and measures are presented here. Overlap between policies and measures has been deducted from these estimates. Therefore, each estimate reflects the net abatement attributed to that policy or measure.

c Figures may not total to the number shown due to rounding

Source: Australian Government Department of Climate Change and Energy Efficiency46

However, due to the long lifetimes (decades or centuries) of most GHGs30 and the length of time for oceans to adjust to changes in the temperature of the atmosphere, even if emissions were to cease completely, the world’s climate will continue to change for centuries. Under realistic scenarios involving the cessation of carbon dioxide emissions, the elevated global surface temperature and thermal expansion of the oceans associated with carbon dioxide will persist for more than 1000 years.75 As there will be some unavoidable consequences of climate change, it is critical that strategies to adapt to inevitable climate change are developed and implemented, particularly in areas of greatest vulnerability to change. In Australia, our natural ecosystems, coastal communities and water security are particularly vulnerable, having a limited range of ability to cope with climate change (Figure 3.18).25

Commenting on Australia’s vulnerability, the IPCC noted in 2007:

… even if adaptive capacity is realized, vulnerability becomes significant for 1–2 °C of global warming. Energy security, health (heat-related deaths), agriculture and tourism have larger coping ranges and adaptive capacity [than natural ecosystems, coastal communities and water security], but they may become vulnerable if global warming exceeded 3 °C. Intergovernmental Panel on Climate Change25

Since then, further studies suggest that the risks may be more immediate than indicated by the IPCC.9

Figure 3.18

Source: Intergovernmental Panel on Climate Change25 (Figure 11.4, p. 529, as modified in CSIRO63)

Figure 3.18 Vulnerability to climate change aggregated for key sectors in the Australia and New Zealand region, allowing for current coping range and adaptive capacity

Scale refers to increase in global average temperature. The temperature range of 2–5 °C indicates the range of warming that would result if the world’s current emissions path is projected to 2070.

Assessment summary 3.2—effectiveness of climate change management
Component Summary Assessment grade Confidence in grade Confidence in trend
Ineffective Partially effective Effective Very effective
Greenhouse gases and climate change Understanding: Good understanding of broad processes and improving confidence in modelling projections at both national and regional scales. Extensive support for policy and priority setting at national level through initial Garnaut Climate Change Review (2008) and subsequent review update (2011) and through an improved national greenhouse emissions reporting system      Improving    Limited evidence or limited consensus  Adequate high-quality evidence and high level of consensus
Planning: Australian Government has established a broad (‘three-pillars’) strategy underpinned by a legislated 20% Renewable Energy Target and Energy Efficiency Strategy. In July 2011, the government released a plan to establish a price on carbon and encourage least-cost abatement measures. Legislation to give effect to this is expected to be introduced to parliament in the latter half of 2011. A National Adaptation Framework was adopted by COAG in 2007. Level of strategic planning to mitigate and adapt to climate change varies considerably from state to state (e.g. in relation to adaptation to potential impacts of sea level rise)    Improving      Limited evidence or limited consensus  Limited evidence or limited consensus
Inputs: Around $15 billion committed to climate change initiatives by the Australian Government. Significant funds are available to support climate science at both national and state levels. Significant resources are also being applied by states and territories to mitigation and adaptation programs    Improving      Limited evidence or limited consensus  Adequate high-quality evidence and high level of consensus
Processes: Governance is complex, with three tiers of government needing to be involved. Coordination of federal and state and territory programs has been improved via COAG actions    Improving      Limited evidence or limited consensus  Limited evidence or limited consensus
Outputs and outcomes: Current and projected levels of success of federal and state and territory abatement programs are limited. To achieve the national 2020 target of a 5% reduction in greenhouse gas emissions below 2000 levels, abatement measures will need to be greatly increased  Unclear        Limited evidence or limited consensus  Limited evidence or limited consensus
Recent trends  Improving  Stable Confidence  Adequate high-quality evidence and high level of consensus
 Deteriorating  Unclear Limited evidence or limited consensus
 Evidence and consensus too low to make an assessment
Grades  Very effective  Effective  Partially effective  Ineffective

COAG = Council of Australian Governments