Government-owned firms like Snowy Hydro can do better than building $600 million gas plants

Arjuna Dibley, The University of MelbourneThe Morrison government today announced it’s building a new gas power plant in the Hunter Valley, committing up to A$600 million for the government-owned corporation Snowy Hydro to construct the project.

Critics argue the plant is inconsistent with the latest climate science. And a new report by the International Energy Agency has warned no new fossil fuel projects should be funded if we’re to avoid catastrophic climate change.

The move is also inconsistent with research showing government-owned companies can help drive clean energy innovation. Such companies are often branded as uncompetitive, stuck in the past and unable to innovate. But in fact, they’re sometimes better suited than private firms to take investment risks and test speculative technologies.

And if the investments are successful, taxpayers, the private sector and consumers share the benefits.

Wind farm — If government-owned firms led the way in clean energy technologies, society would benefit.
Shutterstock

Lead, not limit

Federal energy minister Angus Taylor announced the funding on Wednesday. He said the 660-megawatt open-cycle gas turbine at Kurri Kurri will “create jobs, keep energy prices low, keep the lights on and help reduce emissions”.

Experts insist the plan doesn’t stack up economically and may operate at less than 2% capacity.

But missing from the public debate is the question of how government-owned companies such as Snowy Hydro might be used to accelerate the clean energy transition.

Australian governments (of all persuasions) have not often used the companies they own to lead in clean energy innovation. Many, such as Hydro Tasmania, still rely on decades-old hydroelectric technologies. And others, such as Queensland’s Stanwell Corporation and Western Australia’s Synergy, rely heavily on older coal and gas assets.

Asking Snowy Hydro to build a gas-fired power plant is yet another example – but it needn’t be this way.

Snowy Hydro has been funded to build a $600 million gas plant, but it could do better.
Shutterstock

The burning question

Globally, more than 60% of electricity comes from wholly or partially state-owned companies. In Australia, despite the 20-year trend towards electricity privatisation, government-owned companies remain important power generators.

At the Commonwealth level, Snowy Hydro provides around 20% of capacity to New South Wales and Victoria. And most electricity in Queensland, Tasmania and Western Australia is generated by state government-owned businesses.

But political considerations mean government-owned electricity companies can struggle to navigate the clean energy path.

For example in April this year, the chief executive of Stanwell Corporation, Richard Van Breda, suggested the firm would mothball its coal-powered generators before the end of their technical life, because cheap renewables were driving down power prices.

Queensland’s Labor government was reportedly unhappy with the announcement, fearing voter backlash in coal regions. Breda has since stepped down and Stanwell is reportedly backtracking on its transition plans.

Such examples beg the question: can government-owned companies ever innovate on clean energy? A growing literature in economics, as well as several real-world examples, suggest that under the right conditions, the answer is yes.

State-owned Stanwell Corporation is reportedly back-tracking on plans to mothball its coal plants early.
Stanwell Corporation

Privatised is not always best

Economists have traditionally argued state-owned companies are not good innovators. As the argument goes, the absence of competitive market forces makes them less efficient than their private sector peers.

But recent research by academics and international policy institutions such as the OECD has shown government ownership in the electricity sector can be an asset, not a curse, for achieving technological change.

The reason runs contrary to orthodox economic thinking. While competition can lead to firm efficiency, some economists argue government-owned firms can take greater risks. Without the pressure for market-rate returns to shareholders, government enterprises may be freer to invest in more speculative technologies.

My ongoing research has shown the reality is even more complex. Whether state-owned electric companies can drive clean energy innovation depends a great deal on government interests and corporate governance rules.

For example, consider the New York Power Authority (NYPA) which, like Snowy Hydro, is wholly government owned.

New York Governor Andrew Cuomo has deliberately sought to use NYPA to decarbonise the state’s electricity grid. The government has managed the company in a way that enables it to take risks on new transmission and generation technologies that investor-owned peers cannot.

For instance, NYPA is investing in advanced sensors and computing systems so it can better manage distributed energy sources such as solar and wind. The technology will also simulate major catastrophic events, including those likely to ensue from climate change.

These investments are likely to contribute to greater grid stability and greater renewables use, benefiting not just NYPA but other electricity generators and ultimately, consumers.

Such innovation is nothing new. Also in the US, the state-owned Sacramento Municipal Utility District built one of the first utility-scale solar projects in the world in 1984.

Andrew Cuomo in front of flag — NY Governor Andrew Cuomo is using a state-owned company to aid the clean energy transition.
Mary Altaffer/AP

The way forward

More could be done to ensure Australian government-owned corporations are clean energy catalysts.

Clean energy technologies can struggle to bridge the gap from invention to widespread adoption. Public investment can bring down the price of such technologies or demonstrate their efficacy.

In this regard, government-owned companies could work with private technology firms to invest in technologies in the early stages of development, and which could have significant public benefits. For instance, in 2020, the Western Australian government-owned company Synergy sought to build a 100 megawatt battery with private sector partners.

But many problems facing state-owned companies are the result of ever-changing government policy priorities. The firms should be reformed so they are owned by government, but operated at arm’s length and with other partners. This might better enable clean energy investment without the politics.

Arjuna Dibley, Visiting Researcher, Climate and Energy College, The University of Melbourne

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

These Aussie teens have launched a landmark climate case against the government. Win or lose, it’ll make a difference

Five of the eight young plaintiffs. From left: Ava Princi, Izzy Raj-Seppings, Ambrose Hayes, Veronica Hester, Laura Kirwan.
Equity Generation Lawyers

Laura Schuijers, University of Melbourne

On Tuesday, eight young Australians aged 13-17 filed a class action seeking an injunction to prevent federal Environment Minister Sussan Ley approving a new coal project expansion.

They are bringing their case to the Federal Court. They argue if Whitehaven’s Vickery coal mine expansion in New South Wales is approved, it will contribute to climate change which endangers their future.

Saying the environment minister owes the young plaintiffs a duty of care is a novel approach. In their view, signing off on a new coal project will breach that duty. Such an approach to a climate change case has not been tested before in Australia, and would chart new territory if successful.

Although a legal victory would appear difficult on these grounds, the implications of this case are already significant. They show young people, determined to fight for action on climate, will continue to find new ways to hold powerful people to account.

What is the case about?

The case concerns a proposal to construct an open-cut coal mine, about 25 kilometres north of the NSW town of Gunnedah. It’s an extension project, meaning it will expand a mine that has already been approved, increasing its coal production by about 25%, and emissions by 100 million tonnes of greenhouse gases over the life of the project. The coal would be exported.

Like many mining proposals, this one has been divisive. Farmers worry about competing for water, and the local community has expressed concern over the environmental record of the coal company.

Yet in August, the NSW Independent Planning Commission approved the proposal, finding the expansion is in the public interest, given the forecast jobs and revenue. It has not yet received federal approval.

What are the teenagers arguing?

The young plaintiffs are not bringing their case under environmental law, which would be the traditional way to launch a legal challenge objecting to a coal mine.

Environmental law invites government decision-makers to balance competing concerns — such as economic benefits versus environmental impact — with no clear stipulation as to how much weight to give each relevant factor.

There is limited recourse to argue a decision is wrong because the positive and negative impacts were not given particular priority by a minister. This means decision-making on major projects is largely within the political realm.

Instead, the plaintiffs are arguing the environment minister shouldn’t approve the coal proposal because doing so would breach a duty of care owed by the minister to protect them from the harmful impacts of climate change. This includes more frequent extreme weather events, and destruction of the natural systems that support human life.

The case has parallels with a landmark Dutch case, where it was successfully argued in 2019 that the Dutch Government breached its duty of care to its citizens through inadequate action on climate change.

For the Australian case to succeed, the Court will first need to consider whether a duty of care exists in Australian law. There is no statutory duty (under laws created by the parliament), so the Court would need to “find” the duty as existing in common law.

Then, the plaintiffs would need to establish that the duty would be breached by the environment minister signing off on the coal project.

Will it succeed?

Establishing both these things is likely to be very difficult in our legal context. From past cases, we know Australian courts have been reluctant to find a causal link between climate change and individual projects, even large mines. However, this link was found in a NSW case last year.

The court is likely to look closely at the particular relationship between the minister and the vulnerable young people, who will be strongly impacted by climate change but have no voting rights. It will consider whether they represent a particular class of individuals, in relation to which the minister has a responsibility.

One of the plaintiffs’ lawyers recently highlighted a case that potentially paves the way to support this idea. In 2016, the Federal Court found the immigration minister Peter Dutton owed a duty of care to a vulnerable refugee with a history of trauma, who was detained on Nauru.

One thing in the current case’s favour is that, similar to the Dutch case, the plaintiffs are not seeking monetary compensation. If they were, the difficulty for the courts to determine what future obligation the government might have to pay out young people would, almost undoubtedly, prohibit success.

What’s also interesting about this case, unlike the Dutch case or the famous Juliana case that was recently quashed in the US, is that it’s not asking the government for broad-scale policy action on climate change. It’s only concerned with one coal mine approval. This is a more straightforward remedy which a court could be more willing to grant.

Beating the odds

If the case successfully established a duty and that it was breached, this would open up the possibility future coal approval decisions would also breach the duty — somewhat of a Pandora’s box.

Although we will have to wait and see what the Court says, the suit will draw attention to the government’s climate policies, whether or not it succeeds.

If the case succeeds, it might compel the government to stop approving any coal mines that would significantly contribute to climate change. If it doesn’t, it will remind us that it’s up to the government to respond to the threats climate change poses, rather than the courts.

Either way, the teenagers in this case are part of a growing number of people willing to find creative avenues to pursue action, even if it means taking a long shot. And beating the odds is exactly how the law tends to evolve.

Laura Schuijers, Research Fellow in Environmental Law, University of Melbourne

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

Morrison government plan to scrap water buybacks will hurt taxpayers and the environment

Quentin Grafton, Crawford School of Public Policy, Australian National University

The Morrison government today declared it will axe buybacks of water entitlements from irrigators, placating farmers who say the system has damaged their livelihood and communities.

Instead, Water Minister Keith Pitt says the government will scale up efforts to save water by upgrading infrastructure for farming irrigators in the Murray Darling Basin.

The move will anger environmentalists, who say water buybacks are vital to restoring flows to Australia’s most important river system. It also contradicts findings from the government’s own experts this week who said farm upgrades increase water prices more than buyback water recovery.

The government has chosen a route not backed by evidence, and which will deliver a bad deal to taxpayers and the environment.

A farmer stands in the dry river bed of the Darling River — The government will no longer buy water from farmers for the environment.
Dean Lewins/AAP

A brief history of water buybacks

Farmers along the Murray Darling are entitled to a certain amount of river water which they can use or sell. In 2008, the federal Labor government began buying some of these entitlements in an open-tender process known as “buybacks”. The purchased water was returned to the parched river system to boost the environment.

In 2012, the Murray Darling Basin Plan was struck. It stipulated that 2,750 billion litres of water would be bought back from irrigators and delivered to the environment every year. The buyback system was not universally supported – critics claim buybacks increase water prices, and hurt farmers by reducing the water available for irrigation.

The Coalition government came to office in 2013 and adopted a “strategic” approach to water buybacks. These purchases were made behind closed doors with chosen irrigators.

In a review of these buybacks released last month, the Australian National Audit Office found many of these taxpayer-funded deals were not good value for money.

The federal government ordered the review after controversy involving the 2017 purchase of water from two Queensland properties owned by Eastern Australia Agriculture.

The government paid A$80 million for the entitlements – an amount critics said was well over market value. The deal was also contentious because government frontbencher Angus Taylor was, before the purchase, a non-financial director of the company. The company also had links to the Cayman Islands tax haven.

Keith Pitt speaks in Parliament as Prime Minister Scott Morrison watches on — Water Minister Keith Pitt, pictured during Question Time, is the minister responsible for the new approach.
Mick Tsikas/AAP

Infrastructure subsidies: a flawed approach

The Coalition government is taking a different approach to recover water for the environment: subsidising water infrastructure on farms and elsewhere. This infrastructure includes lining ponds and possibly levees to trap and store water.

The subsidies have cost many billions of dollars yet recover water at a very much higher cost than reverse tenders. This approach also reduces the water that returns to streams and groundwater.

The justification for water infrastructure subsidies is that they are supposedly less damaging to irrigation communities. But the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) concluded in a report published this week that on-farm water infrastructure subsidies, while beneficial for their participants, “push water prices higher, placing pressure on the wider irrigation sector”. This is the very sector the subsidies purport to help.

So why would the government expand the use of water infrastructure when it costs more and isn’t good value for money? The answer may lie in this finding from the ABARES report:

Irrigators who hold large volumes of entitlement relative to their water use (and are frequently net sellers of water allocations) may benefit from higher water prices, as this increases the value of their entitlements.

Farmers with limited entitlement holdings however may be adversely affected, as higher water prices increase their costs and lowers their profitability.

In other words, the “big end of town” benefits – at taxpayers’ expense – while the small-scale irrigators lose out.

Missing water

Adding insult to injury, the Wentworth Group of Concerned Scientists released a detailed report this week showing the basin plan is failing to deliver the water expected, even after accounting for dry weather. Some two trillion litres of water is not in the rivers and streams of the basin and appears to have been consumed – a volume that could be more than four times the water in Sydney Harbour.

The Wentworth Group says stream flows may be less than expected because environmental water recovery has been undermined by “water-saving” infrastructure, which reduces the amount of water that would otherwise return to rivers and groundwater.

This infrastructure, on which taxpayers have spent over A$4 billion, has not had the desired effect. Research has found those who receive infrastructure subsidies increased water extractions by more than those who did not receive subsidies. That’s because farmers who were using water more efficiently often planted thirstier crops.

Dusk at Menindee Lakes in the Murray Darling Basin — The government took a strategic approach to water buybacks in the Murray Darling Basin.
Shutterstock

We deserve better

It’s clear taxpayer dollars are much better spent buying back water entitlements, through open tenders, rather than subsidising water infrastructure. We can, and must, do much better with water policy.

Today, the federal government has doubled down on wasteful spending at taxpayer expense – in a time of a COVID-induced recession.

So what is on offer from the Morrison government? Continuing to ignore its own experts’ advice and delivering yet more ineffective subsidies for water infrastructure. Our rivers, our communities, and all Australians deserve much better.

Quentin Grafton, Director of the Centre for Water Economics, Environment and Policy, Crawford School of Public Policy, Australian National University

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

‘A wake-up call’: why this student is suing the government over the financial risks of climate change

Jacqueline Peel, University of Melbourne and Rebekkah Markey-Towler, University of Melbourne

As the world warms, the value of “safe” investments might be at risk from inadequate climate change policies. This prospect is raised by a world-first climate change case, filed in the federal court last week.

Katta O’Donnell – a 23-year-old law student from Melbourne – is suing the Australian government for failing to disclose climate change risks to investors in Australia’s sovereign bonds.

Sovereign bonds involve loans of money from investors to governments for a set period at a fixed interest rate. They’re usually thought to be the safest form of investment. For example, many Australians are invested in sovereign bonds through their superannuation funds.

But as climate change presents major risks to our economy as well as the environment, O’Donnell’s claim is a wake-up call to the government that it can no longer bury its head in the sand when it comes to this vulnerability.

Katta O'Donnell smiles at the camera in a long-sleeved black top. — Katta O’Donnell is bringing the class action lawsuit against the Australian government.
Molly Townsend

O’Donnell’s arguments

O’Donnell argues Australia’s poor climate policies – ranked among the lowest in the industrialised world – put the economy at risk from climate change. She says climate-related risks should be properly disclosed in information documents to sovereign bond investors.

O’Donnell’s claim alleges that by failing to disclose this information, the federal government breaches its legal duty. It alleges the government has engaged in misleading and deceptive conduct, and government officials breached their duty of care and diligence.

This is a standard similar to that owed by Australian company directors. Analysis from leading barristers indicates that directors who fail to consider climate risks could be found liable for breaching their duty of care and diligence.

O’Donnell argues government officials providing information to investors in sovereign bonds should meet the same benchmark.

Climate change as a financial risk

Under climate change, the world is already experiencing physical impacts, such as intense droughts and unprecedented bushfires. But we’re also experiencing “transition impacts” from steps countries take to prevent further warming, such as transitioning away from coal.

Combined, these impacts of climate change create financial risks. For example, by damaging property, assets and operations, or by reducing demand for fossil fuels with the risk coal mines and reserves become stranded assets.

This thinking is becoming mainstream among Australian economists. As the Australian Prudential Regulation Authority’s Geoff Summerhayes put it:

When a central bank, a prudential regulator and a conduct regulator, with barely a hipster beard or hemp shirt between them, start warning that climate change is a financial risk, it’s clear that position is now orthodox economic thinking.

Why safe investments are under threat

Sovereign bonds are a long-term investment. Katta O’Donnell’s bonds, for example, will mature in 2050. These time-frames dovetail with scientific projections about when the world will see severe impacts and costs from climate change.

And climate change is likely to hit Australia particularly hard. We’ve seen the beginning of this in the summer’s ferocious bushfires, which cost the economy more than A$100 billion.

Over time, climate risks may impact sovereign bonds and affect Australia’s financial position in a number of ways. For example, by impacting GDP when the productive capacity of the economy is reduced by severe fires or floods.

Frequent climate-related disasters could also hit foreign exchange rates, causing fluctuations of the Australian dollar, as well as putting Australia’s AAA credit rating at risk. These risks would reduce if the government took climate change more seriously.

Already, some investors are voting with their feet. Last November, Sweden’s central bank announced it had sold Western Australian and Queensland bonds, stating Australia is “not known for good climate work”.

Unprecedented, but not novel

O’Donnell’s case against the federal government is an unprecedented climate case, even if its arguments are not novel.

Australia has been a “hotspot” for climate litigation in recent years, but the O’Donnell case is the first to sue the Australian government in an Australian court.

Previous cases suing governments have often raised human rights, such as the high-profile Urgenda case in 2015 against the Dutch government – the first case in the world establishing governments owe their citizens a legal duty to prevent climate change.

The O’Donnell case is also unique in its focus on sovereign bonds. But cases alleging misleading climate-related disclosures are themselves not new.

In Australia, shareholders sued the Commonwealth Bank of Australia in 2017 for failing to disclose climate change-related risks in its 2016 annual report. The case was settled after the bank agreed to improve disclosures in subsequent reports.

In another headline-making case, 23-year-old council worker Mark McVeigh is taking his superannuation fund, Retail Employees Superannuation Trust, to court seeking similar disclosures.

The O’Donnell case builds on this line of precedent, extending it to disclosures in bond information documents. As such, courts will likely take it seriously.

What precedent might it set?

If the O’Donnell case is successful it could establish the need for disclosure of climate-related financial risks for a range of investments.

At a minimum, a ruling in O’Donnell’s favour may compel the Australian government to disclose climate-related risks in its information documents for investors. This might make people think twice about how they choose to invest their money, especially as investors seek to “green” their portfolios.

It could also give rise to litigation using the same legal theory in sovereign bond disclosure claims against other governments, much in the way that the Urgenda case has spawned copycat proceedings from Belgium to Canada.

Whether the case provides the impetus for further government action to improve the effectiveness of Australia’s climate policies remains to be seen.

Still, it’s clear climate-related financial risks have entered the corporate boardroom. With this case, they’ve now come knocking at the government’s door.

Jacqueline Peel, Professor of Environmental and Climate Law, University of Melbourne and Rebekkah Markey-Towler, Research assistant, University of Melbourne

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

Let there be no doubt: blame for our failing environment laws lies squarely at the feet of government

Peter Burnett, Australian National University

A long-awaited draft review of federal environment laws is due this week. There’s a lot riding on it – particularly in light of recent events that suggest the laws are in crisis.

Late last week, the federal Auditor-General Grant Hehir tabled a damning report on federal authorities’ handling of the Environment Protection and Biodiversity Conservation (EPBC) Act. Incredibly, he found Australia’s premier environmental law is administered neither efficiently or effectively.

It followed news last month that mining company Rio Tinto detonated the 46,000 year old Juukan rock shelters in the Pilbara. The decision was authorised by a 50 year old Western Australian law –and the federal government failed to invoke emergency powers to stop it.

Also last month we learned state-owned Victorian logging company VicForests unlawfully logged 26 forest coupes, home to the critically endangered Leadbeater’s possum. The acts were contrary both to its own code of practice, and the agreement exempting VicForests from federal laws.

As relentless as Hehir’s criticisms of the department are, let there be no doubt that blame lies squarely at the feet of government. As a society, we must decide what values we want to protect, count the financial cost, then make sure governments deliver on that protection.

Destruction of the Juukan caves drew condemnation.
Richard Wainwright/AAP

Shocking report card

I’ve been involved with this Act since before it began 20 years ago. As an ACT environment official reading a draft in 1998 I was fascinated by its complexity and sweeping potential. As a federal official responsible for administering, then reforming, the Act from 2007-2012, I encountered some of the issues identified by the audit, in milder form.

But I was still shocked by Hehir’s report. It’s so comprehensively scathing that the department barely took a trick.

Overall, the audit found that despite the EPBC Act being subject to multiple reviews, audits and parliamentary inquiries since it began, the Department of Agriculture, Water and the Environment’s administration of the laws is neither efficient nor effective.

While the government is focused on efficiency, the lack of effectiveness worries me most – especially findings concerning so-called “environmental offsets”. These are measures designed to compensate for unavoidable losses, such as creating a nature reserve near a site to be cleared.

In the early years of the law, offsets were rare. By 2015 they featured in almost 90% of decisions, dropping to about 75% last year. In effect, we now rely on offsets to protect the environment.

The Auditor-General found that the absence of guidance and quality control for offsets has led to “realised risks”.

the department accepted offsets for damage to koala habitat in 2015 that did not meet its offset standards.
WWF Australia

For example, offsets must be mapped and disclosed publicly, to ensure their integrity. But not only did the department fail to create a public register, in 2019 it stopped loading offset data into its systems altogether. This makes it likely offsets will be forgotten and so either destroyed later, or put up a second time and thus double-counted.

Hehir cites one example where the department accepted offsets for damage to koala habitat in 2015 that did not meet its offset standards. After negotiations with the developer and involvement from the Minister’s office, the department accepted the offsets. Worse, the developer secured a futher non-complying offset for a second development in 2018, arguing for consistency with the previous decision.

Apart from politicisation and failure to protect the environment, this case reveals a significant legal issue. Under administrative law, a decision is invalid if it has regard to an “irrelevant consideration”. An offset in one development in 2015 is surely irrelevant to an offset in another development in 2018.

Offsets aside, the Auditor-General higlighted key risks such as high volumes of unapproved land clearing for agriculture, and non-compliance in residential and mining developments. The department had proposed actions to address the issues, but made no progress on them.

And the report found arrangements to monitor whether approval conditions had been met before work started on a project were inadequate, which “leaves the department poorly positioned to prevent adverse environmental outcomes”.

At the end of the day, the federal department doesn’t have the tools to distinguish whether an environmental effect is the result of its own regulations, or other factors such as state programs or extreme weather. Essentially, it doesn’t know if the Act is delivering any environmental benefits at all.

The corroborree frog, which is critically endangered.
Taronga Zoo

How did this happen?

The EPBC Act itself remains a powerful instrument. Certainly changes are needed, but the more significant problems lie in the processes that should support it: plans and policies, information systems and resourcing.

As I wrote last month, between 2013 and 2019 the federal environment department’s budget was cut by an estimated 39.7%.

And while effective administration of the Act requires good information, this can be hard to come by. For example the much-needed National Plan for Environmental Information, established in 2010, was never properly resourced and later abolished.

Officials are constrained here. The audit scope does not extend to the government decisions shaping departmental performance. And the department loyally refrains from complaining that government decisions leave it few options.

So while the audit office and the department might believe extensive government cuts are the underlying problem, neither can say so. I’m not excusing the department’s poor performance, but it must manage with what it’s given. When faced with critical audit findings, it can only pledge to “reprioritise” resources.

Vicforests illegally logged Leadbeater’s possum habitat.
D. Harley/Flickr

A national conversation

There is a small saving grace here. Hehir says the department asked that his report be timed to inform Professor Graeme Samuel’s 10-year review of the EPBC Act. Hehir timed it perfectly – Samuel’s draft report is due by tomorrow. Let’s hope it recommends comprehensive action, and that the final report in October follows through.

Beyond Samuel’s review, we need a national conversation on how to fix laws protecting our environment and heritage. The destruction of the Juukan rock shelters, unlawful logging of Victorian forests and the Auditor-General’s report are incontrovertible evidence the laws are failing.

I don’t believe we can lock nature up. But we must look after the things that enable nature to provide not just life, but quality of life. This includes a stable climate, our Indigenous and non-Indigenous heritage and the resilience that comes from nature’s richness and diversity.

Peter Burnett, Honorary Associate Professor, ANU College of Law, Australian National University

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

Albanese pledges Labor government would have 2050 carbon-neutral target

Michelle Grattan, University of Canberra

Anthony Albanese will commit a Labor government to adopting a target of zero net emissions by 2050, in a speech titled “Leadership in a New Climate” to be delivered on Friday.

The opposition leader’s embrace of this target, which the ALP also took to the last election, is in line with the policies of state and territory governments, many companies and the Business Council of Australia. It is also the public stand of some Liberal moderates but is totally rejected by the Nationals and hard-line Liberals.

Prime Minister Scott Morrison has refused to adopt it.

“Currently no one can tell me that going down that path won’t cost jobs, won’t put up your electricity prices, and won’t impact negatively on jobs in the economies of rural and regional Australia, ” he said this week.

In his speech, released ahead of time, Albanese also says a Labor government would never use Kyoto credits to meet Australia’s Paris targets, as the government will do if that is necessary.

And Albanese again condemns the government for putting $4 million into a feasibility study for a coal-fired power station in Collinsville, Queensland.

But Albanese is leaving until closer to the election the shorter-term emissions reduction target Labor will adopt.

At the last election it committed to a 45% reduction in emissions by 2030. Labor first took that target to the 2016 election and Albanese has previously said it was a mistake not to review it before the 2019 poll.

He says in his speech the 2050 carbon-neutral target should be “as non-controversial in Australia as it is in most nations”.

“This will be a real target, with none of the absurd nonsense of so-called ‘carryover credits’ that the prime minister has cooked up to give the impression he’s doing something when he isn’t.

“That’s not acting. It’s cheating. And Australian’s aren’t cheaters.”

On the Collinsville project, he says: “Let’s be clear. There is nothing to stop a private company investing its money in such a proposal. The reason it hasn’t is it doesn’t stack up.”

The $4 million is “just hush money for the climate sceptics who are stopping any real reform and who stopped the National Energy Guarantee supported by Turnbull, Morrison and Frydenberg.

“It’s pathetic. If it made sense the market would provide funding.

“The climate sceptics are market sceptics as well,” Albanese says.

“Investors will not contribute because the economic risks are simply too great. The costs are higher and rising. And the cost of alternatives like renewables is lower and falling.

“Everyone in the electricity sector knows that the only way a new coal power plant will be built in Australia is through significant taxpayer subsidies, including a carbon risk indemnity that the Australian Industry Group estimates would cost up to $17 billion for a single plant.

“That’s why one hasn’t been opened since 2007, construction hasn’t begun on one since 2004 and tenders haven’t been called this century,” Albanese says.

Meanwhile the terms of reference for the bushfire royal commission, released by Morrison on Thursday steer away from the issue of emissions reduction.

They acknowledge “the changing global climate carries risks for the Australian environment and Australia’s ability to prevent, mitigate and respond to bushfires”. But the inquiry is to report on

improving coordination across all levels of government in managing natural disasters

improving preparedness, resilience, and response in dealing with natural disasters

whether changes are needed to Australia’s legal framework for the involvement of the Commonwealth in responding to national emergencies.

Michelle Grattan, Professorial Fellow, University of Canberra

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

States shine as federal government flounders this summer – now they should lead on climate change

Jennifer Menzies, Griffith University

The recent federal government response to the bushfire crisis and the “sports rorts” affair are symptomatic of a deeper political malaise – role confusion.

Since the roles and responsibilities of the federal government have become untethered from Australia’s Constitution through a range of High Court decisions, there are no principles to guide what is a meaningful role for the Commonwealth. This means it dips into areas that are the responsibility of the states.

Funding local sports clubs, for example, replicates existing state and local government programs. But it has become a key campaign tool for the federal Coalition government to be “seen” to be relevant to issues affecting local communities.

The Disaster Recovery Funding Arrangements have given Australia a framework for a world-class response to natural disasters. With four categories of assistance, the federal government provides funding for relief and recovery. This summer, after being accused of being to slow to respond, the Commonwealth is forging a new role for itself by deploying the Australian Defence Force. Again, it wants to be “seen” to be responsive.

This role instability means the federal government campaigns on issues under the jurisdictional control of the states and territories. When the prime minister changes, so do the areas of the federal government’s interest. The Commonwealth’s approach to managing the relationship with the states and territories is unstable and can veer from the cooperative to the coercive, from benign neglect to micro-managing program outcomes.

The culture of the federal government stands for the political culture in Australia. This is underpinned through most political commentary being generated by journalists based in Parliament House in Canberra. They promote a world view forged by constant interaction with federal ministers and senior bureaucrats.

Yet the political culture in Canberra is not the same as the political culture within state governments. While the federal government can cherry-pick when and what issues to become involved in, the states keep all the big service-delivery systems in Australia ticking over. They keep building hospitals, managing law and order, educating children, building and operating infrastructure and managing population and natural resources.

There are a number of reasons why state governments have created a more effective platform to deliver on their responsibilities.

The past couple of decades has seen the rise of managerialist, non-ideological and pragmatic premiers. These leaders have become more sophisticated in how they approach issues. They are genuinely responsive to the community through mechanisms like community cabinets held regularly in regional towns and ministerial consultative and advisory committees.

State leaders are comfortable with and have initiated accountability regimes (still lacking federally) and have become experienced crisis managers who are willing to lead in such a situation. Because service delivery requires them to be less ideological and more pragmatic, they are not riven by the kind of ideological fervour that prevents the federal government from acting on issues such as climate change.

Finally, with Queensland adopting fixed four-year parliamentary terms, the federal government is now the only jurisdiction with an erratic election timetable called by the prime minister for political advantage. Four-year terms allow for the business of government to progress in an orderly manner and through the parliament. It brings a steadiness and certainty missing from the more febrile arrangements in place federally.

The states bring stability and ballast to our federation. Since commissioning the original Garnaut report in 2007 they have acted to address the challenge of climate change. They have implemented mitigation and adaptation policies. They do this because they are vulnerable to the impacts of climate change such as extended droughts, coastal erosion, inundation and natural disasters. All have the target of zero emissions by 2050.

While the federal government struggles to find a meaningful role for itself in the 21st century, there is greater scope to harness the stability the states provide. A collective agreement between the states on emission targets is a good starting point. If all states and territories agreed on an approach, Australia would have a national plan without the need for federal government involvement.

As we enter another week of parliamentary theatrics, perhaps the time has come to turn to the workhorse of the federation for action on climate change – the states.

Jennifer Menzies, Principal Research Fellow, Policy Innovation Hub, Griffith University

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

I’ve won cases against the government before. Here’s why I doubt a climate change class action would succeed

Bushfire-related class action suits against the government have had little success in the past, but there are other benefits to pursuing a case.
Steven Saphore/AAP

George Newhouse, Macquarie University

This summer’s bushfire apocalypse has caused many Australians to express their fury at a federal government they feel is either in denial about the impact of climate change or failing to address it sufficiently.

To many, the fact the Morrison government did not act on warnings from former firefighting chiefs or take meaningful action to implement a natural disaster plan is further evidence of a broken political system and a political elite that isn’t listening.

When you consider the full impact of the bushfires, it is no wonder there are now calls for a class action lawsuit to hold our government accountable for these failures and its inaction on climate change.

I’ve brought several class action suits against the government on issues such as asylum seekers and breaches of privacy. Though climate change class actions might be possible elsewhere in the world, here in Australia, there are many obstacles to success.

Legal precedent for climate change suit

Many environmental activists have been emboldened by a significant legal victory by the Dutch environmental group, Urgenda Foundation. For seven years, the Urgenda Foundation has been fighting the Dutch government to force it to reduce Holland’s greenhouse gas emissions by 25% from 1990 levels by the end of 2020.

In December, the Dutch Supreme Court upheld the finding of the Hague Court of Appeals that the government is obligated by the European Convention on the Protection of Human Rights to take

suitable measures if a real and immediate risk to people’s lives or welfare exists and the state is aware of that risk.

The ruling further stated

the obligation to take suitable measures also applies when it comes to environmental hazards that threaten large groups or the population as a whole, even if the hazards will only materialise over the long term.

The case marked the first time a government has been required by the courts to take action against climate change.

Urgenda’s success has led to similar legal strategies in a host of countries, including Canada, France, Germany, India, New Zealand, the UK and the US. Australia, however, is missing from the list.

The reason is that a climate change class action is unlikely to succeed here because we do not have the equivalent of the European Convention on Human Rights incorporated into our legal system.

Without a bill of rights or other laws that mandate precautionary measures to mitigate climate change, it is unimaginable that an Australian judge would make a ruling requiring our government to take measures to reduce carbon emissions.

Class action suits against companies

Nevertheless, our courts still have a role to play in cases related to natural disasters, particularly when the cause of damages is clearly identifiable.

There have been successful class action suits against businesses that were found to be responsible for igniting bushfires.

For instance, survivors of the devastating 2009 Black Saturday fires in Victoria received a payout of A$500 million from the power company SP AusNet after the courts ruled the fires were caused by poorly maintained powerlines. It was the largest settlement in Australian legal history.

In the current bushfire crisis, however, there is no faulty powerline to point to as the cause of the destruction. And when it comes to suing the government for failing to take steps to prevent a bushfire, things get much trickier.

The 2009 Black Saturday fires killed 173 people and burned 450,000 hectares of land.
Andrew Brownbill/AAP

What is required to sue the state

For starters, it is doubtful the federal government would ever be held responsible for the current crisis because the states and territories are responsible under Australian law for bushfire fighting and land management.

Our courts are also reluctant to impose a duty or liability on any government regarding its policy-making functions – including how to prepare for a fire season. The courts have likewise been reluctant to mandate how a government allocates resources and how they make day-to-day fire management decisions.

As a result, claimants in bushfire cases have had to argue the government owed them a common law duty of care. And this can only be determined through a complex evaluation of the relationship between the person who is harmed and the state.

When our courts have considered claims arising from bushfires in the past, they have tended to put limits on the ability of individuals to take action against the state.

For example, when the Mount Stromlo Observatory was destroyed in the 2003 Canberra bushfires, one of the affected parties, Electro Optic Systems Pty Ltd, sued the state of NSW.

The case alleged the state’s Rural Fire Service and National Parks and Wildlife Service owed a duty of care to the plaintiffs and that its fire-fighting strategy was flawed. As a result, the state should be held responsible for any losses.

Because the direct cause of the fire was a lightning strike, the ACT Court of Appeal found the state did not owe a duty of care to property owners to prevent harm caused by the spread of the bushfire.

Prime Minister John Howard visits the bushfire-damaged Mount Stromlo Observatory in 2003.
David Foote/AAP

Why legal action is important, even if it fails

One final question remains: are our courts really the best place to address political inaction on climate change?

Court proceedings are slow and expensive. They will take years to reach finality, as the Urgenda case shows. And the climate crisis requires urgent action both locally and internationally.

But despite the fact a successful class action along the lines of Urgenda is doubtful in Australia, there are some who may go forward with a case.

Many advocates believe that arguing for a reduction of CO₂ emissions in court would provide a compelling, fact-based case they could use to demand change from the government. And this process might give those who are concerned about our planet some hope in dark times.

George Newhouse, Adjunct Professor of Law, Macquarie University

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

Australia: Bushfire Warnings Ignored

The link below is to an article on how the warnings of fire chiefs in Australia have been ignored by governments across the country – meanwhile, the bushfire threat escalates.

For more visit:
https://www.theguardian.com/commentisfree/2019/nov/14/we-have-warned-governments-for-years-that-climate-change-is-worsening-bushfire-danger

Procurement’s role in climate change: putting government money where policy needs to go

Governments can choose to spend money in ways that support climate change policy, including a shift to electric vehicle fleets.
from http://www.shutterstock.com, CC BY-ND

Barbara Allen, Victoria University of Wellington

This story is part of Covering Climate Now, a global collaboration of more than 250 news outlets to strengthen coverage of the climate story.

For three years in a row, the World Economic Forum’s Global Risks Report has identified climate change as the gravest threat for global business and industry.

The disruption of supply chains in food, medicines and even recycling from climate-related events poses innumerable problems for nations. But one way of dealing with various facets of climate change is levering change through central government procurement.

Policies that govern supply and how goods, construction and services are procured are increasingly important as the capacity to mitigate through government purchasing choices faces greater pressure.

As New Zealand is considering zero carbon legislation, new government procurement rules take effect in October.

The rules include broader outcomes, connecting wider social and environmental priorities to procurement processes. This is the first time New Zealand lays out specific rules about how the government plans to use its own purchases to help fulfil its wider promises.

Charging ahead with EVs

A cabinet paper on effective government procurement policy, released in late 2018, laid out four outcomes, one of which focused on supporting the transition to a net zero emissions economy and meeting the government’s goal of significantly reducing waste by 2020.

The policy’s priorities include reducing the emissions profile of the government vehicle fleet and reducing emissions from fossil fuels used in electricity generation and in direct production of industrial heat. Describing the government’s intention, Economic Development Minister David Parker said:

We are looking beyond just the price of what we purchase, to ensure procurement is contributing to the transition to a low-carbon economy, inclusive growth and prosperity.

The government’s commitment is to make its own vehicle fleet emissions-free by 2025-26. When replacing vehicles, chief executives of government agencies must purchase vehicles with emission profiles substantially below their current fleet average.

The government fleet – at 14,995 vehicles (with only 0.24% electric) – has a job on its hands. But already it is reporting that emissions have dropped between April and July 2019. The reduction is partly due to 400 fewer vehicles and minor shifts in driving patterns.

This is a gutsy move, especially given cost implications and market challenges. But jurisdictions such as Germany and Sweden have promoted renewable sources for some time through legislation and multiple instruments including procurement that supports innovation. Others, such as Transport London, have been shifting to electric public transport fleets.

New Zealand has been conservative in its approach to linking procurement with objectives beyond “best value”, which is nearly always interpreted as least cost. But times are changing. A growing number of people in most agencies are trying to raise the profile of procurement beyond a purchasing exercise.

Procurement as opportunity and responsibility

Leaving the market to decide how taxpayer funds are spent through a clunky contracting process is missing an opportunity to procure the best services and infrastructure, as well as increasing workforce skills. Research on sustainable procurement has grown and the topic now features at the OECD.

There are different targeted approaches. One is an “emissions dashboard”, which shows the average emissions profile of each agency’s fleet and tracks emission reductions. But dashboards are only indicative, given the inevitable variation in reporting across organisations and the underlying reasons why an agency might have a high emissions rating.

Australia’s Indigenous procurement policy has used a very targeted approach requiring 3% of government contracts go to Indigenous business by 2027. Māori Development Minister Nanaia Mahuta has been looking at the potential for something similar in New Zealand. A report on the benefits of indigenous procurement policies is expected.

Planning to replace vehicle fleets is a tangible use of the procurement lever to move towards lower emissions. But to support a fairly rapid change, supply chains need to be taken into consideration to ensure enough electric vehicles are available.

While there are many technical issues to resolve, New Zealand’s approach to procurement is a step in the right direction. Procurement can’t do everything at once, but it is an important instrument that needs to be directed at policy problems, underpinned by research and evidence.

Barbara Allen, Senior Lecturer in Public Management, Victoria University of Wellington

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

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Tag Archives for government

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Albanese pledges Labor government would have 2050 carbon-neutral target

States shine as federal government flounders this summer – now they should lead on climate change

I’ve won cases against the government before. Here’s why I doubt a climate change class action would succeed

Legal precedent for climate change suit

Class action suits against companies

What is required to sue the state

Why legal action is important, even if it fails

Australia: Bushfire Warnings Ignored

Procurement’s role in climate change: putting government money where policy needs to go

Charging ahead with EVs

Procurement as opportunity and responsibility

Lead, not limit

The burning question

Privatised is not always best

The way forward

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A brief history of water buybacks

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O’Donnell’s arguments

Climate change as a financial risk

Why safe investments are under threat

Unprecedented, but not novel

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Shocking report card

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A national conversation

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Legal precedent for climate change suit

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Charging ahead with EVs

Procurement as opportunity and responsibility

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