Paris emissions target is driving us to futile self-harm
Prime Minister Malcolm Turnbull. The Coalition needs to rediscover how it won power
It is tempting to see this as Australia’s Brexit moment, where the mainstream calls time on the political class’s willingness to surrender our sovereignty, not to Brussels and the EU on a wide range of issues, but to Paris and the UN on energy.
The analogy is tempting but imperfect because we have been here before and the mainstream, to this point, has not been given a choice.
Malcolm Turnbull will face open revolt over his national energy guarantee; the outstanding questions are how widespread it will be, whether it derails the policy and/or his prime ministership, and whether Australia regains its cheap energy advantage or continues to squander it. Amid the political, business, bureaucratic, academic, engineering and media debate on the NEG, one thing is missing — the main point.
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Endless discussions about targets, inputs, carve-outs and bolt-ons perhaps are fascinating and certainly involve myriad political deals and intrigue, but they all avoid this central issue that they take as a given.
That is, of course, the commitment to reduce carbon dioxide emissions in this country by at least 26 per cent by 2030.
Should we be doing this? What is the cost? What is the benefit? Who pays? Who profits? What would be the alternative approaches and their consequences? So bizarrely distorted to the green Left is our national debate that there is more discussion about higher targets than there is about the futility of the Paris commitment.
Think about how politicians were, quite rightly, eventually excoriated for embarking on a National Broadband Network without a cost-benefit analysis, yet we have seen a range of climate-motivated federal and state energy policies spend billions of dollars, distort markets and cause increases in prices and decreases in reliability with nary an assessment of their cost or benefit.
The showdown between Canberra and the states on the NEG will take weeks to unfold. Yet, tragically for the Prime Minister and the nation, there are only two main trajectories on offer: either his plan to impose and manage a reduction in Australia’s emissions is rejected by Labor states, with Turnbull in limbo and the sector in dysfunction, or it is endorsed to be implemented in a bipartisan way without recourse to voters, so that the Coalition partyroom will be asked to embrace a climate and energy policy that is acceptable to Victorian Premier Daniel Andrews, among others. Oh dear.
Apart from being the result of a noodle-nation conflation of federal and state responsibilities working at cross-purposes, this imbroglio carefully avoids the core questions.
What is really at stake here is whether Australia inflicts more economic pain on itself in order to meet an emissions reduction target that cannot possibly make a scintilla of difference to the global environment or climate in this country or anywhere else.
Even Chief Scientist Alan Finkel has admitted we could shut this nation down and evacuate it, reducing our emissions to zero, and the effect on climate would not be discernible.
The US withdrew from the Paris Agreement, China and India are expected to deliver no more than business as usual (that is, emissions growth as normal) and most other nations that have made emissions reductions commitments simply won’t meet them.
Global emissions continue to rise. Yet this nation-continent that cites cheap energy as one of its great natural advantages — so great that we export cheap energy to China, South Korea, Japan and India — seeks to continue to make its energy more expensive and less reliable in order to meet its targets.
This is futile self-harm — an attempt by Australia to signal its climate virtue no matter the expense to pensioners and their power bills or industry and its input costs.
It is the epitome of gesture politics and the consequences have already been dramatic — power bills through the roof, an entire state blacked out and manufacturing jobs lost.
Yet at no election have Australian voters endorsed this approach. Indeed, with the possible exception of Kevin Rudd in 2007, voters have always endorsed the less aggressive approach on climate and energy, only to see their governments drift with the activist zeitgeist away from their mandates.
Rudd came in on the back of a bad drought and the Al Gore and Nicholas Stern scares. He made much of John Howard’s refusal to ratify the Kyoto Protocol even though Australia was meeting its target. He then promised a modest emissions trading scheme, and dropped it at the first sign of grapeshot.
The Coalition dumped Turnbull for trying to accommodate this plan and Tony Abbott eradicated Labor’s majority even though Julia Gillard pledged not to introduce a carbon tax.
She broke that promise, Labor switched back to Rudd, and Abbott won a landslide on a promise to repeal the carbon tax. On current settings, at the next election voters will face a Hobson’s choice — one ambitious, costly and risky emissions reductions target or another.
No matter what negotiations proceed between Canberra and the states or what compromises are put to next week’s Coalition partyroom, there will be government MPs who oppose the NEG in parliament. They will portray this as a vote on whether or not the Paris Agreement should dictate our energy policy. It is about economic sovereignty — about costs and benefits.
And that is the question that needs to be debated. Whether the Paris targets are achieved by a carbon tax, emissions trading scheme, regulation, emissions intensity scheme, renewable energy target, an NEG or any combination of the above is really neither here nor there — these are merely competing interventionist models to deliver the policy goal.
Voters might like a say on whether the goal is worthwhile, particularly in light of the known costs and, at best, undetectable benefits.
Abbott, of late, has begun to make this argument — not bad for the man who, as prime minister, committed to Paris. Perhaps he has learned from his mistakes. Has Turnbull?
The risks of massive government incentives to boost renewable energy have already been laid bare. Other countries simply are not doing this to themselves.
Nations that are meeting targets either rely on nuclear or large-scale hydro, or have benefited from a price-driven switch from coal to gas. But most nations could not care less, no matter what aspirations they mutter at Paris.
The economic consequences of this issue could hardly be more obvious and it matters on its own merits (should UN commitments be allowed to penalise our economic growth, distort our energy market and create financial and economic pain for no environmental advantage?) but it is also a harbinger of a broader malaise.
It is about politicians forgetting their basic roles and becoming increasingly detached from constituents they are only too willing to patronise.
When various governments can ban greyhound racing, consider sugar taxes or restrict Codral cold tablets, they demonstrate an authoritarian tone, nanny-state disposition and a disconnect with voters. Sanctimonious, post-material concerns should be the last items on the agenda for serious governments, but unlike doctors, who must “first, do no harm”, politicians are constantly looking for new laws and extra spending to make their mark.
Climate-driven energy policy is the ultimate manifestation of this self-serving, self-referencing and self-damaging trend.
And the NEG is its latest iteration. With both major parties on board along with most journalists, academics and bureaucrats, not to mention businesses looking for more subsidies, investment certainty or both, the debate has not been about first principles but about mere details.
Instead of avoiding harm they debate ways to achieve futile goals while minimising harm.
ABC opinionista Jonathan Green tweeted an alarmist article during the week about how some scientists believe global warming is already out of control and that current targets are redundant. Green used it as an opportunity to lament the lack of unanimity around the NEG.
Lost on him and others, apparently, is that such catastrophic scenarios render the NEG absurd. Likewise National Farmers Federation chief Fiona Simpson, who uses drought to push the case for the NEG, ignoring the incontestable reality that it can have no impact on climate. So the NFF is pushing more expensive and unreliable energy as an additional burden on drought-stricken farmers. Science and facts are eschewed.
Voters might prefer cheap, reliable power and, crucially, their nation deciding its own destiny. Defending sovereignty — in this case economic sovereignty — is a powerful and logical motivation. This is the Brexit link.
There is a reckoning to be had and, possibly, harnessed.
The Coalition needs to rediscover how it won power. If it doesn’t, along with the country it will pay a high price.
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