It's time for the new Great Barrier Reef expert panel to wade into the issue


Ove Hoegh-Guldberg, The University of Queensland

Federal environment minister Greg Hunt has announced the make-up of the Independent Expert Panel of 16 leading experts who will advise the government on actions and priorities relating to the Great Barrier Reef. As an Australian who is passionate about the future of our Reef, I am honoured to have been selected and stand ready to serve.

Over recent years there have been lots of panels, and even more reports, about the Reef and its health. So what will the new one bring to the table?

We will mainly be advising on how best to progress with the Reef 2050 Plan – the umbrella for protecting and managing the Great Barrier Reef from today until 2050. It is a key component of the federal and Queensland governments’ response to the recommendations of the UNESCO World Heritage Committee.

Recent concerns over whether or not the Great Barrier Reef should be added to the official list of World Heritage In Danger rested partly on whether or not state and federal governments are taking appropriate steps to reverse the Reef’s clear decline over the past several decades.

The Reef 2050 Plan, announced earlier this year by Prime Minister Tony Abbott and Queensland Premier Annastasia Palaszczuk, together with federal and state environment ministers, aims to protect the Outstanding Universal Values (OUV) that define the Great Barrier Reef World Heritage Area.

The plan consists of hundreds of actions, as well as several clear targets, such as:

  • Improving water quality by reducing dissolved inorganic nitrogen loads in priority areas by at least 50% by 2018, on the way to achieving an overall reduction of 80% in inorganic nitrogen by 2025.

  • Reducing pesticide loads by at least 60% in priority areas by 2018

  • Improving the net condition of natural wetlands and riverside vegetation by 2020

  • Stabilising or increasing the populations of dolphins, dugongs and turtles by 2020.

While the plan been criticised by the Australian Academy of Science as being too modest in scope, these targets nevertheless represent a considerable challenge, particularly given the short deadlines. And the targets and deadlines are consistent with the seriousness of the specific problems facing the Great Barrier Reef.

The new independent expert panel features a balance of expertise, including ecologists, water quality experts and climate change experts, as well as agricultural and conservation scientists. Australia’s Chief Scientist Ian Chubb will chair the panel, which besides supporting the implementation and review of the Reef 2050 Plan will also advise on the Reef Water Quality Protection Plan, help guide the Reef Trust, and perform other related actions aimed at reversing the downward trend of the Reef’s health.

This panel will also interact with the recently established Great Barrier Reef Water Science Task Force, chaired by Queensland’s Chief Scientist Geoff Garrett. Given the complex set of arrangements for protecting the Great Barrier Reef, Queensland will also be looking at the issue from its own perspective.

All eyes are now on Australia, with this being the first of many steps to be taken by the federal government to reverse the decline of one of the nation’s (and the world’s) greatest environmental assets. With a rapidly changing climate posing one of the severest threats the Great Barrier Reef, federal government leadership is also required at the United Nations Paris climate summit later this year.

Reducing Australia’s contribution to carbon dioxide and other greenhouse gases remains an urgent priority. Meanwhile, tackling the ever-present dangers from declining coastal water quality remains critically important for Australia and its Great Barrier Reef.

The Conversation

Ove Hoegh-Guldberg is Director, Global Change Institute at The University of Queensland.

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The carbon tax wasn't a 'slug' to the economy and Direct Action may be a waste of money


Michael Harris, University of Sydney

Federal Environment Minister Greg Hunt, writing in the Fairfax opinion pages, has said that the now abolished carbon tax was a far more expensive way to reduce Australia’s carbon emissions than the Direct Action policy that replaced it.

He writes:

The carbon tax was a A$15.4 billion slug on the Australian economy – that works out at a cost of just over $1,300 a tonne for the emissions reduced.

It appears the Minister has taken the A$15.4 billion in revenue collected by the carbon tax and divided it by the “less than 12 million tonnes” of emissions reduction, to get just over $1,300 a tonne for the emissions reduced.

But tax revenues collected on emissions have no business being included in a calculation of the costs of reducing emissions. Measuring the cost of a tax on overall economic activity is not the same as measuring how much revenue was collected — not least because the revenue raised could be used elsewhere in the economy to provide infrastructure or mitigate against climate change.

Costs of emitting versus reducing carbon dioxide

Let’s consider what we’re measuring and why.

The social cost of carbon measures the expected cost to society of emitting “one more unit” of carbon into the atmosphere. Flipped around, it tells us the benefit of not emitting that tonne of carbon.

Estimates of the social cost of carbon depend both on our knowledge of the future impacts of warming, and the assumptions built into models to quantify these impacts on society. Unsurprisingly, they are controversial and subject to debate.

Hunt’s assertions relate to the cost of reducing carbon emissions per tonne; in principle we can compare this to the social cost of carbon, which tells us the benefit of emissions reductions.

His claim is that the cost of reducing emissions has been vastly decreased by using a subsidy approach (as in Direct Action) rather than a tax.

However, the first thing to understand is that the amount of tax collected under the carbon pricing scheme reflects taxes paid on actual emissions, not reductions in emissions.

There is also a difference between costs to the economy, and transfers within it. The amount of revenue raised through any tax is not a cost; it is simply a transfer from one “pocket” to “another”. The money has not been destroyed, and it remains available to be spent on something. It has distributional consequences, obviously, as the “pocket” where that money sits has changed, but total spending power within the economy remains undiminished. (Moreover, Australians received compensation via the tax system after the carbon tax was introduced.)

By contrast, the cost of a tax is what the economy – not an individual person or business enterprise – has lost as a result of the existence of the tax. Lower labour supply, fewer goods and services produced – these are the things we would typically count when assessing the burden imposed on an economy from any tax instrument. Hunt hasn’t provided credible estimates of these kinds of impacts.

Is there any simple way to quantify the costs of emissions reductions? In terms of the cost to individual businesses, the carbon tax was initially priced at A$23 a tonne. That means that for every tonne of greenhouse gases a liable business did not emit, they would save A$23. We would expect businesses to reduce any emissions they could where the cost to them was less than A$23 per tonne.

In other words, the amount of emissions reduction comes at a cost to that business of A$23 a tonne or less – not $1,300 a tonne.

Is Direct Action superior anyway?

If we assess the unit cost of emissions reduction under the previous carbon price as being (in the order of) A$23 per tonne, compared to $13.95 per tonne under the Direct Action policy, does this make the current scheme a winner anyway?

Not necessarily. First, ongoing revenue from the carbon tax can be used to fund, for example, public infrastructure investments, or to allow cuts to other more economically harmful taxes.

The cost of payments under Direct Action, by contrast, have to be funded by taxes elsewhere, or borrowed funds.

Second, the Direct Action scheme only involves commitments to reduce emissions, which have yet to occur, and may not be successfully achieved.

Third, emissions reductions contracted under the scheme may be offset by emissions increases elsewhere. Experts are concerned that the safeguard mechanism designed to prevent this has been weakened so much as to render it ineffective. This means there’s no guarantee that emissions reductions purchased under the scheme will translate to national emissions reductions, even though that’s what they are meant to represent.

The implication of all this is that Direct Action’s cost-effectiveness is unknown, and as things stand, possibly unknowable.

The Conversation

Michael Harris is Senior Fellow in the School of Economics at University of Sydney.

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Broad coalition formed to seek common ground on tackling climate change


Michelle Grattan, University of Canberra

Major business, union, research, environment, investor and social groups have formed the Australian Climate Roundtable in an effort to “put the climate policy debate on common ground and offer a way forward”.

The group’s formation comes just weeks before the Abbott government announces Australia’s emission reduction target for post-2020, in the run-up to the United Nations climate change conference in Paris later in the year. China is expected to announce its target imminently.

The organisations signing up to a set of joint principles are the Australian Aluminium Council, the Australian Conservation Foundation, the Australian Council of Social Service, the ACTU, the Australian Industry Group, the Business Council of Australia, the Energy Supply Association of Australia, the Investor Group on Climate Change, the Climate Institute and WWF Australia.

While there have been previous alliances in the climate debate, this is by far the most extensive and inclusive.

In its statement, the roundtable said that Australia’s major political parties supported the global community’s goal of limiting climate change to less than 2° centigrade above pre-industrial levels.

“That important but challenging objective will require deep global reductions in greenhouse gas emissions, with most countries including Australia eventually reducing net emissions to zero or below.”

The broad coalition had come together “because climate change and climate policy both impact our missions and our members. We believe Australia should play its fair part in global efforts to avoid 2° centigrade and the serious economic, social and environmental impacts that unconstrained climate change would have on Australia.”

Avoiding unconstrained climate change would provide important benefits and opportunities to Australia, the roundtable said.

But “delayed, unpredictable and piecemeal action will increase the costs and challenges of achieving the goals and maximising the opportunities”.

“We found that groups with very different constituencies and missions have much in common,” on the issue, the statement said. Climate change had been a “tumultuous area of policy development on a major challenge for Australia”.

“We thought it important to reset the objectives, principles and key priorities to make the next phase of policy development as civil and constructive as possible.”

The agreed principles did not prescribe a single solution, the roundtable said. Rather, they set out common ground on which more detailed policy could be constructed.

They have been discussed with both major parties and the roundtable said it looked forward to “further constructive dialogue”.

The statement of principles says that policy should “be capable of achieving deep reductions in Australia’s net emissions in line with our overall goal; provide confidence that targeted emissions reductions actually occur; be based on an assessment of the full range of climate risks; be well designed, stable and internationally linked; operate at least cost to the domestic economy while maximising benefits; and remain efficient as circumstances change and Australia’s emissions reduction goals evolve”.

The costs of climate policy should be spread fairly within the community, avoiding disproportionate impacts on vulnerable people.

“To attract and sustain investment over the long term, the underlying climate policy framework should be stable, offer predictable processes for important decisions and enjoy broad political support.”

Australian Industry Group chief executive Innes Willox said that the “shared recognition that we need to maintain competitiveness while reducing emissions over time is a major advance and a solid platform for future policy stability”.

Business Council of Australia chief executive Jennifer Westacott said: “There is now overwhelming common ground on the need for a more certain and meaningful approach to emissions reduction”.

ACOSS CEO Cassandra Goldie warned that the poor would be hardest hit by the negative impacts of climate change and the least able to adapt – the only way to develop stable and equitable policies was to work together.

Energy Supply Association CEO Matthew Warren said: “Effective and efficient measures to reduce emissions and meet the challenges of the 21st century will need to be delivered over a generation or longer. They require broad, common support and enduring policies”.

Climate Institute CEO John Connor said the shared position should “renew, revitalise and guide discussion” and “help build a resilient Australia prospering in a zero carbon global economy”.

At the Liberal federal council on Saturday a motion sceptical of climate change was headed off by shunting it to a committee.

Listen to the Politics with Michelle Grattan podcast, with Labor environment spokesman Mark Butler, here or on iTunes.

http://www.podbean.com/media/player/nv27e-56fabbThe Conversation

Michelle Grattan is Professorial Fellow at University of Canberra.

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