Friday, December 20, 2019

Climate Change: Planning for failure again

Last night the government introduced its latest proposals for the Emissions Trading Scheme. While the Zero Carbon Act has established a process for setting long-term carbon budgets, the government still needs to set an interim one. In addition, it needs to set volumes for planned ETS auctions and the prices for the "cost containment reserve". Unfortunately, looking at the details, its just another plan for failure.

We'll start with the process: the government has set its budget by requiring emissions to hold steady at 2020 levels for two years, then decreasing them linearly towards the net-zero-for-everything-but-our-largest-polluters 2050 target. This gives them a provision budget of 354 million tons. They then deduct off everything that isn't covered by the ETS (agriculture), and the expected level of free allocation (big polluters), and an allowance for using up stockpiled Russian fraud (about a third of it). And this leaves them with an auction budget of 80 million tons for 2021 - 2025, as depicted below:

So far, so good. It seems sensible, even if there are uncertainties over free allocation volumes, or how many more credits will be stockpiled next year due to using the fixed-price option, or whether their new one will just make the whole budget a joke again. But there's a bigger problem, and that is that their chosen pathway is absolutely inconsistent with our 2030 Paris target. And they admit this explicitly:

The domestic emissions pathway proposed by the provisional emissions budget will mean that unless there are significant reductions in the second half of the 10-year period, we will need to find additional emissions abatement to meet our Paris Agreement Contribution over the period 2021–30. For example, if the emissions budget continued on the straight-line pathway towards the Zero Carbon Act 2050 target, an additional 63 Mt CO2-e of abatement would be required to meet the Paris Agreement Contribution budget of 601 Mt CO2-e between 2021–30. This difference in volume could potentially be achieved through international cooperation.
[Emphasis added]

So, they're planning to fail, and planning to hide that failure with more Russian fraud, just like they did with Kyoto. And even if you accept that this is legitimate, we're currently locked out of international carbon markets, and negotiations on reopening them fell over messily at the Madrid COP over some countries wanting to double-count and include bullshit and open loopholes for even more fraud, and those problems seem insurmountable. So its a hell of a gamble. Effectively, by committing to inadequate domestic action, they're going for hope as a policy again - and specifically, hope that someone else will do something, so we don't have to. This is neither sensible, nor moral.

Additional: I should note: we are in this situation because National set a target and then did absolutely nothing to achieve it. In fact, they did their best to increase emissions with pollution subsidies and Russian fraud (plus mega-roads, irrigation subsidies, and more oil drilling). But regardless: we have a target, and we have to meet it. And the government's response is basicly "nah, fuck that, too hard". And that is simply not good enough.