Labor’s climate policy could remove the need for renewable energy targets


Tony Wood, Grattan Institute

The federal Labor Party has sought to simplify its climate change policy. Any suggestion of expanding the Renewable Energy Target has been dropped. But there is debate over whether the new policy is actually any more straightforward as a result.

One thing Labor did confirm is its support for an emissions intensity scheme (EIS) as its central climate change policy for the electricity sector. This adds clarity to the position the party took to the 2016 election and could conceivably remove the need for a prescribed renewable energy target anyway.

An EIS effectively gives electricity generators a limit on how much carbon dioxide they can emit for each unit of electricity they produce. Power stations that exceed the baseline have to buy permits for the extra CO₂ they emit. Power stations with emissions intensities below the baseline create permits that they can sell.

An EIS increases the cost of producing electricity from emissions-intensive sources such as coal generation, while reducing the relative cost of less polluting energy sources such as renewables. The theory is that this cost differential will help to drive a switch from high-emission to low-emission sources of electricity.

The pros and cons of an EIS, compared with other forms of carbon pricing, have been debated for years. But two things are clear.

First, an EIS with bipartisan support would provide the stable carbon policy that the electricity sector needs. The sector would be able to invest with more confidence, thus contributing to security of supply into the future.

Second, an EIS would limit the upward pressure on electricity prices, for the time being at least.

These reasons explain why there was a brief groundswell of bipartisan support for an EIS in 2016, until the Turnbull government explicitly ruled it out in December.

Moving targets

Another consideration is whether, with the right policy, there will be any need for firm renewable energy targets. This may help to explain Labor’s decision to rule out enlarging the existing scheme or extending it beyond 2020.

If we had a clear policy to reduce emissions at lowest cost, whether in the form of an EIS or some other scheme, renewable energy would naturally increase to whatever level is most economically efficient under those policy settings. Whether this reaches 50% or any other level would be determined by the overall emissions-reduction target and the relative costs of various green energy technologies.

In this scenario, a separately mandated renewable energy target would be simply unnecessary and would probably just add costs with no extra environmental benefit. Note that this reasoning would apply to state-based renewable energy policies, which have become a political football amid South Australia’s recent tribulations over energy security.

An EIS is also “technology agnostic”: power companies would be free to pursue whatever technology makes the most economic sense to them. Prime Minister Malcolm Turnbull explicitly endorsed this idea earlier this month.

Finally, an EIS would integrate well with the National Electricity Market, a priority endorsed by the COAG Energy Council of federal, state and territory energy ministers. State and territory governments may find this an attractive, nationally consistent alternative that they could support.

Strengths and weaknesses

A 2016 Grattan Institute report found that an EIS could be a practical step on a pathway from the current policy mess towards a credible energy policy. Yet an EIS has its weaknesses, and some of Labor’s reported claims for such a scheme will be tested.

In the short term, electricity prices would indeed rise, although not as much as under a cap-and-trade carbon scheme. It is naive to expect that any emissions-reduction target (either the Coalition’s 26-28% or Labor’s 45%) can be met without higher electricity costs.

Another difficulty Labor will have to confront is that setting the initial emission intensity baseline and future reductions would be tricky. The verdict of the Finkel Review, which is assessing the security of the national electricity market under climate change policies, will also be crucial.

Despite media reports to the contrary, Chief Scientist Alan Finkel and his panel have not recommended an EIS. Their preliminary report drew on earlier reports noting the advantages of an EIS over an extended renewable energy target or regulated closure of fossil-fuelled power stations, but also the fact that cap-and-trade would be cheaper to implement.

Labor has this week moved towards a credible climate change policy, although it still has work to do and its 45% emissions-reduction target will still be criticised as too ambitious. Meanwhile, we’re unlikely to know the Coalition government’s full policy until after it completes the 2017 Climate Change Policy Review and receives the Finkel Review’s final report.

Australians can only hope that we are starting to see the beginnings of the common policy ground that investors and electricity consumers alike so urgently need.

The Conversation

Tony Wood, Program Director, Energy, Grattan Institute

This article was originally published on The Conversation. Read the original article.

Climate change doubled the likelihood of the New South Wales heatwave


Sarah Perkins-Kirkpatrick, UNSW; Andrew King, University of Melbourne, and Matthew Hale, UNSW

The heatwave that engulfed southeastern Australia at the end of last week has seen heat records continue to tumble like Jenga blocks.

On Saturday February 11, as New South Wales suffered through the heatwave’s peak, temperatures soared to 47℃ in Richmond, 50km northwest of Sydney, while 87 fires raged across the state amid catastrophic fire conditions.

On that day, most of NSW experienced temperatures at least 12℃ above normal for this time of year. In White Cliffs, the overnight minimum was 34.2℃, a new record for the state’s highest observed minimum temperature.

On Friday, the average maximum temperature right across NSW hit 42.4℃, beating the previous February record of 42.0℃. The new record stood for all of 24 hours before it was smashed again on Saturday, as the whole state averaged 44.0℃ at its peak. At this time, NSW was the hottest place on Earth.

A degree or two here or there might not sound like much, but to put it in cricketing parlance, those temperature records are the equivalent of a modern test batsman retiring with an average of over 100 – the feat of outdoing Don Bradman’s fabled 99.94 would undoubtedly be front-page news.

And still the records continue to fall. Mungindi, on the border of NSW and Queensland, broke the Australian record of 50 days in a row above 35℃, set just four years ago at Bourke Airport, with the new record now at 52 days.

Meanwhile, two days after that sweltering Saturday we woke to find the fires ignited during the heatwave still cutting a swathe of destruction, with the small town of Uarbry, east of Dunedoo, all but burned to the ground.

This is all the more noteworthy when we consider that the El Niño of 2015-16 is long gone and the conditions that ordinarily influence our weather are firmly in neutral. This means we should expect average, not sweltering, temperatures.

Since Christmas, much of eastern Australia has been in a flux of extreme temperatures. This increased frequency of heatwaves shows a strong trend in observations, which is set to continue as the human influence on the climate deepens.

It is all part of a rapid warming trend that over the past decade has seen new heat records in Australia outnumber new cold records by 12 to 1.

Let’s be clear, this is not natural. Climate scientists have long been saying that we would feel the impacts of human-caused climate change in heat records first, before noticing the upward swing in average temperatures (although that is happening too). This heatwave is simply the latest example.

What’s more, in just a few decades’ time, summer conditions like these will be felt across the whole country regularly.

Attributing the heat

The useful thing scientifically about heatwaves is that we can estimate the role that climate change plays in these individual events. This is a relatively new field known as “event attribution”, which has grown and improved significantly over the past decade.

Using the Weather@Home climate model, we looked at the role of human-induced climate change in this latest heatwave, as we have for other events before.

We compared the likelihood of such a heatwave in model simulations that factor in human greenhouse gas emissions, compared with simulations in which there is no such human influence. Since 2017 has only just begun, we used model runs representing 2014, which was similarly an El Niño-neutral year, while also experiencing similar levels of human influence on the climate.

Based on this analysis, we found that heatwaves at least as hot as this one are now twice as likely to occur. In the current climate, a heatwave of this severity and extent occurs, on average, once every 120 years, so is still quite rare. However, without human-induced climate change, this heatwave would only occur once every 240 years.

In other words, the waiting time for the recent east Australian heatwave has halved. As climate change worsens in the coming decades, the waiting time will reduce even further.

Our results show very clearly the influence of climate change on this heatwave event. They tell us that what we saw last weekend is a taste of what our future will bring, unless humans can rapidly and deeply cut our greenhouse emissions.

Our increasingly fragile electricity networks will struggle to cope, as the threat of rolling blackouts across NSW showed. It is worth noting that the large number of rooftop solar panels in NSW may have helped to avert such a crisis this time around.

Our hospital emergency departments also feel the added stress of heat waves. When an estimated 374 people died from the heatwave that preceded the Black Saturday bushfires the Victorian Institute of Forensic Medicine resorted to storing bodies in hospitals, universities and funeral parlours. The Victorian heatwave of January 2014 saw 167 more deaths than expected, along with significant increases in emergency department presentations and ambulance callouts.

Infrastructure breaks down during heatwaves, as we saw in 2009 when railway lines buckled under the extreme conditions, stranding thousands of commuters. It can also strain Australia’s beloved sporting events, as the 2014 Australian Open showed.

These impacts have led state governments and other bodies to investigate heatwave management strategies, while our colleagues at the Bureau of Meteorology have developed a heatwave forecast service for Australia.

These are likely to be just the beginning of strategies needed to combat heatwaves, with conditions currently regarded as extreme set to be the “new normal” by the 2030s. With the ramifications of extreme weather clear to everyone who experienced this heatwave, there is no better time to talk about how we can ready ourselves.

We urgently need to discuss the health and economic impacts of heatwaves, and how we are going to cope with more of them in the future.


We would like to acknowledge Robert Smalley, Andrew Watkins and Karl Braganza of the Australian Bureau of Meteorology for providing observations included in this article. This article was amended on February 16, 2017, to include updated weather observations.

The Conversation

Sarah Perkins-Kirkpatrick, Research Fellow, UNSW; Andrew King, Climate Extremes Research Fellow, University of Melbourne, and Matthew Hale, Research Assistant, UNSW

This article was originally published on The Conversation. Read the original article.