Biden says the US will rejoin the Paris climate agreement in 77 days. Then Australia will really feel the heat


Christian Downie, Australian National University

When the US formally left the Paris climate agreement, Joe Biden tweeted that “in exactly 77 days, a Biden Administration will rejoin it”.

The US announced its intention to withdraw from the agreement back in 2017. But the agreement’s complex rules meant formal notification could only be sent to the United Nations last year, followed by a 12-month notice period — hence the long wait.

While diplomacy via Twitter looks here to stay, global climate politics is about to be upended — and the impacts will be felt at home in Australia if Biden delivers on his plans.

Biden’s position on climate change

Under a Biden administration, the US will have the most progressive position on climate change in the nation’s history. Biden has already laid out a US$2 trillion clean energy and infrastructure plan, a commitment to rejoin the Paris agreement and a goal of net-zero emissions by 2050.

As Biden said back in July when he announced the plan:

If I have the honour of being elected president, we’re not just going to tinker around the edges. We’re going to make historic investments that will seize the opportunity, meet this moment in history.

And his plan is historic. It aims to achieve a power sector that’s free from carbon pollution by 2035 — in a country with the largest reserves of coal on the planet.

Biden also aims to revitalise the US auto industry and become a leader in electric vehicles, and to upgrade four million buildings and two million homes over four years to meet new energy efficiency standards.

Can he do it under a divided Congress?

While the votes are still being counted — as they should (can any Australian believe we actually need to say this?) — it seems likely the Democrats will control the presidency and the House, but not the Senate.

This means Biden will be able to re-join the Paris agreement, which does not require Senate ratification. But any attempt to legislate a carbon price will be blocked in the Senate, as it was when then-President Barack Obama introduced the Waxman-Markey bill in 2010.

In any case, there’s no reason to think a carbon price is a silver bullet, given the window to act on climate change is closing fast.




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What’s needed are ambitious targets and mandates for the power sector, transport sector and manufacturing sector, backed up with billions in government investment.

Fortunately, this is precisely what Biden is promising to do. And he can do it without the Senate by using the executive powers of the US government to implement a raft of new regulatory measures.

Take the transport sector as an example. His plan aims to set “ambitious fuel economy standards” for cars, set a goal that all American-built buses be zero emissions by 2030, and use public money to build half a million electric vehicle charging stations. Most of these actions can be put in place through regulations that don’t require congressional approval.

And with Trump out of the White House, California will be free to achieve its target that all new cars be zero emissions by 2035, which the Trump administration had impeded.

If that sounds far-fetched, given Australia is the only OECD country that still doesn’t have fuel efficiency standards for cars, keep in mind China promised to do the same thing as California last week.

What does this mean for Australia?

For the last four years, the Trump administration has been a boon for successive Australian governments as they have torn up climate policies and failed to implement new ones.

Rather than witnessing our principal ally rebuke us on home soil, as Obama did at the University of Queensland in 2014, Prime Minister Scott Morrison has instead benefited from a cosy relationship with a US president who regularly dismisses decades of climate science, as he does medical science. And people are dying as a result.

Obama on climate change at the University of Queensland.

For Australia, the ambitious climate policies of a Biden administration means in every international negotiation our diplomats turn up to, climate change will not only be top of the agenda, but we will likely face constant criticism.

Indeed, fireside chats in the White House will come with new expectations that Australia significantly increases its ambitions under the Paris agreement. Committing to a net zero emissions target will be just the first.

The real kicker, however, will be Biden’s trade agenda, which supports carbon tariffs on imports that produce considerable carbon pollution. The US is still Australia’s third-largest trading partner after China and Japan — who, by the way, have just announced net zero emissions targets themselves.

Should the US start hitting Australian goods with a carbon fee at the border, you can bet Australian business won’t be happy, and Morrison may begin to re-think his domestic climate calculus.

And what political science tells us is if international pressure doesn’t shift a country’s position on climate change, domestic pressure certainly will.




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With Biden now in the White House, it’s not just global climate politics that will be turned on its head. Australia’s failure to implement a serious domestic climate and energy policy could have profound costs.

Costs, mind you, that are easily avoidable if Australia acts on climate change, and does so now.The Conversation

Christian Downie, Australian Research Council DECRA Fellow, Australian National University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Climate change: why Sweden’s central bank dumped Australian bonds



Sweden’s central bank ways it will no longer invest in assets from governments with large climate footprints, even if the yields were high.
Shutterstock

John Hawkins, University of Canberra

What’s happening?

Suddenly, at the level of central banks, Australia is regarded as an investment risk.

On Wednesday Martin Flodén, the deputy governor of Sweden’s central bank, announced that because Australia and Canada were “not known for good climate work”.

As a result the bank had sold its holdings of bonds issued by the Canadian province of Alberta and by the Australian states of Queensland and Western Australia.


Martin Flodén, deputy governor Sveriges Riksbank Central Bank of Sweden

Central banks normally make the news when they change their “cash rate” and households pay less (or more) on their mortgages.

But central banks such as Australia’s Reserve Bank and the European Central Bank, the People’s Bank of China and the US Federal Reserve have broader responsibilities.

They can see climate change affecting their ability to manage their economies and deliver financial stability.

There’s more to central banks than rates

Reserve Bank deputy governor Guy Debelle. Extreme events not cyclical.
DAVID MOIR/AAP

As an example, the new managing director of the International Monetary Fund Kristalina Georgieva warned last month that the necessary transition away from fossil fuels would lead to significant amounts of “stranded assets”.

Those assets will be coal mines and oil fields that become worthless, endangering the banks that have lent to develop them. More frequent floods, storms and fires will pose risks for insurance companies. Climate change will make these and other shocks more frequent and more severe.

In a speech in March the deputy governor of Australia’s Reserve Bank Guy Debelle said we needed to stop thinking of extreme events as cyclical.

We need to think in terms of trend rather than cycles in the weather. Droughts have generally been regarded (at least economically) as cyclical events that recur every so often. In contrast, climate change is a trend change. The impact of a trend is ongoing, whereas a cycle is temporary.

And he said the changes that will be imposed on us and the changes we will need might be abrupt.

The transition path to a less carbon-intensive world is clearly quite different depending on whether it is managed as a gradual process or is abrupt. The trend changes aren’t likely to be smooth. There is likely to be volatility around the trend, with the potential for damaging outcomes from spikes above the trend.

Australia’s central bank and others are going further then just responding to the impacts of climate change. They are doing their part to moderate it.

No more watching from the sidelines

Peter Zöllner of the Bank for International Settlements launched the Green Bond Fund.
BIS

Over thirty central banks (including Australia’s), and a number of financial supervisory agencies, have created a Network for Greening the Financial System.

Its purpose is to enhance the role of the financial system in mobilising finance to support the transitions that will be needed. The US Federal Reserve has not joined yet but is considering how to participate.

One of its credos is that central banks should lead by example in their own investments.

They hold and manage over A$17 trillion. That makes them enormously large investors and a huge influence on global markets.




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As part of their traditional focus on the liquidity, safety and returns from assets, they are taking into account climate change in deciding how to invest.

The are increasingly putting their money into “green bonds”, which are securities whose proceeds are used to finance projects that combat climate change or the depletion of biodiversity and natural resources.

Over A$300 billion worth of green bonds were issued in 2018, with the total stock now over A$1 trillion.

Central banks are investing, and setting standards

While large, that is still less than 1% of the stock of conventional securities. It means green bonds are less liquid and have higher buying and selling costs.

It also means smaller central banks lack the skills to deal with them.

These problems have been addressed by the Bank for International Settlements, a bank owned by 60 of the central banks.

In September it launched a green bond fund that will pool investments from 140 (mostly central bank) clients.

Its products will initially be denominated in US dollars but will later also be available in euros. It will be supported by an advisory committee of the world’s top central bankers.




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It is alert to the risk of “greenwashing” and will only buy bonds that comply with the International Capital Market Association’s Green Bond Principles or the Climate Bond Initiative’s Climate Bond Standard.

Launching the fund in Basel, Switzerland, the bank’s head of banking Peter Zöllner said he was

confident that, by aggregating the investment power of central banks, we can influence the behaviour of market participants and have some impact on how green investment standards develop

It’s an important role. Traditionally focused on keeping the financial system safe, our central banks are increasingly turning to using their stewardship of the financial system to keep us, and our environment, safe.The Conversation

John Hawkins, Assistant professor, University of Canberra

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Australia’s only active volcanoes and a very expensive fish: the secrets of the Kerguelen Plateau


Evening light on a Heard Island icescape. The island is part of the Kerguelen Plateau, which is being jointly studied by France and Australia.
Matt Curnock

James Dell, University of Tasmania

Stretching towards Antarctica lies a hidden natural oasis – a massive underwater plateau created when continents split more than 100 million years ago.

Straddling the Indian and Southern Oceans, the Kerguelen Plateau is three times the size of Japan. It’s farthest depths are four kilometres below the surface; its islands form one of the most isolated archipelagos on Earth. These include Heard Island and McDonald islands, Australia’s only active surface volcanoes.




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Australia and France share a territorial border across the Kerguelen Plateau and work together to study it. The most recent findings, The Kerguelen Plateau: Marine Ecosystems and Fisheries, have been published by the Australian Antarctic Division.

The collaboration has fostered new knowledge of the Kerguelen Plateau as a unique living laboratory – and as the home to one of the world’s most expensive fish.

Bird activity behind a research vessel near the Kerguelen Plateau.
Paul Tixier

Tracking the Patagonian toothfish

Volcanic activity pumps vast amounts of minerals such as iron into the water, making the Kerguelen Plateau a biological hotspot.

The plateau hosts populations of Patagonian toothfish, or Dissostichus eleginoides, a predatory fish that lives and feeds near the bottom of the Southern Ocean. The brownish-grey fish grow up to 2 metres long, live for 60 years and can weigh 200kg. The species is often marketed as Chilean seabass.

Australia and France have worked together since the early 2000s to eliminate illegal, unregulated and unreported fishing, to understand the toothfish’s population dynamics and surrounding ecology. As a long-lived top predator with a broad diet, they have a key role in the structure of communities inhabiting the seafloor.

A location map of the Heard and Macquarie islands.
AAD

The toothfish is also economically important. Its snow-white flesh is prized as rich, good at carrying flavour and rich in omega-3 fatty acids. Catches command high market prices: prepared fillets have sold for more than A$100 per kg in recent years.

Approved commercial fishing vessels catch Patagonian toothfish around the plateau. Over the past few decades, scientific observers on fishing boats have tagged and released more than 50,000 toothfish at the Australian islands. This, along with annual surveys, biological sampling and data collection, has shed light on the species’ biology and population ecology.

This informs management measures such as total allowable catches and “move on” rules, where vessels must cease fishing in an area once a predetermined weight of non-target fish has been caught.




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The nations continue to manage toothfish populations, as well as fish, seabirds and marine mammals that interact with fishing activity.

The shallow banks of the plateau support a spectacular diversity of long-lived sponges, brittle stars, anemones, soft and hard corals and crustaceans. These fragile and slow-growing communities are vulnerable to disturbance. Fishing gear fitted with automated video cameras helps locate and protect sensitive areas, and Australia and France have established marine reserves and managed areas across the plateau.

Patagonian toothfish are prized in the restaurant industry for their rich flesh.

A unique underwater oasis

The plateau’s islands are incredibly isolated and provide the only breeding and land-based refuge for birds and seals in this part of the Southern Ocean.

Submarine volcanoes, some of them active, surround the islands and are particularly abundant around the younger McDonald Islands.

The plateau cuts across the strong current systems that sweep around the South Pole. This thrusts deep, cold water, enriched with volcanic minerals, to the surface then back to the seafloor. In turn, this powers a food chain stretching from small zooplankton to fish and predators such as Patagonian toothfish, penguins and albatross, and diving marine mammals such as elephant seals and sperm whales.




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Carbon and nutrients returned to the seafloor support diverse communities of invertebrate and fish species that could not inhabit this location if not for the plateau.

The orientation and location of the Kerguelen Plateau make it a canary in the coalmine for understanding the southward shift in marine ecology due to climate change. As sea temperatures rise and ocean currents shift, plant and animal species will move south in search of cooler waters.

Recent modelling suggests those species most at risk from climate change in this region are those sedentary or slow-moving invertebrates, such as sea urchins.

King penguins at Corinthian Bay, Heard Island.
Matt Curnock

Policy backed by science

Work continues to build comprehensive maps of the seafloor, deploy a network of ocean robots to collect physical and biological information, and use French and Australian fishing fleets for research.

The plateau’s waters are in the region overseen by the Commission for the Conservation of Antarctic Marine Living Resources, an international treaty body. French-Australian research is presented to the commission at meetings in Hobart each year to guide management decisions.

The cross-country partnership is a model for international scientific cooperation and fisheries management. In the context of a changing climate, these efforts will provide insight into future impacts on natural systems throughout the Southern Ocean.The Conversation

James Dell, Post Doctoral Fellow, University of Tasmania

This article is republished from The Conversation under a Creative Commons license. Read the original article.