First, the good news: Australia will, as expected, comfortably meet its Kyoto emission reduction target, and won’t get into trouble with the international community when its report card is due at the end of 2012.

Even though emissions from the electricity sector will have grown by 51% from 1990 through to 2012, the last-minute deal negotiated at Kyoto by Senator Robert Hill — which allowed Australia to claim reduction of land clearing after levelling half of Queensland just before the baseline year — means it will deliver on its generous national quota of 108% of its 1990 emissions. It will likely come in at just over 106%, and will no doubt give itself a gold star for doing so.

Now, the bad news. The task of meeting Australia’s pledge to the Copenhagen Accord has just gotten a lot harder. The government’s latest emissions trajectory report reveals emissions growth shows little sign of abating in the short term, and may accelerate because of the impact of the massive LNG projects off the north-west of the country and increased coal exports.

While the government will use the statistics to underline the case for a carbon price, as climate change minister Greg Combet did yesterday, the increased target makes the politics of that push a lot harder, given the fractured nature of the debate in Australia. And any further delays will simply make the situation worse, as widely predicted.

Higher emissions targets mean a higher carbon price and more severe impacts. And it may get even more complicated, because the government also expects more coal-fired power stations to be built and has expressed doubts about the ability to meet the 20% renewable energy target by 2020.

The report prepared by the Department of Climate Change has added an extra 21 million tonnes of CO2e to Australia’s projected annual emissions account to 690 million tonnes by 2020 — even after the reductions obtained by current policies such as the RET, energy efficiency measures and assorted other abatement schemes. It means that for Australia to meet its bipartisan pledge of a 5% reduction from 1990 levels by 2020, it will now have to cut its annual emissions by 160 million tonnes of CO2e by the end of the decade, instead of the previous estimate of 139 million tonnes.

The required cut from business-as-usual jumps from 20% to 23%. On per capita terms, the task jumps from 27% to 29%. If Australia goes to a 15% reduction target from 2000 levels, as some argue it should given the pace of international action, then its abatement task swells to 216 million tonnes of CO2e, or 31% from business-as-usual.

If Australia was to go to a 25 % cut — as argued by the Greens and agreed to by the government should global efforts actually deliver on the Copenhagen target of limiting average temperature rises to 2°C — then the reduction target becomes 272 million tonnes of CO2e, a cut of 39% below business-as-usual and up towards 50% in per capita terms.

The latest estimates find that more than half of Australia’s emissions growth between 2010 and 2020 will come from export demand, which is increasing fugitive emissions from coal mines and oil and gas projects, as well as direct fuel combustion emissions from LNG projects. Ironically, the paper says that if international action on climate change was to accelerate, this would lead to a reduction in Australia’s emissions because demand for coal would fall, but it says the demand for export gas would increase and have a flow-on effect on emissions for Australia from their extraction.

Environmental groups, and the Greens, have been pushing for the LNG emissions to be taken into account, although their estimates of emissions have been considerably higher. They have argued that such projects should be required to deal with those emissions, rather than increasing the abatement task for the rest of the economy. Only state-based requirements have called for any effort to abate the emissions on a minority of the proposed projects.

The long-term scenario is even more depressing. Combet says that without a carbon price, some 10,000MW of new coal-fired power stations will be built from 2020-2030, sending the country’s emissions account to more than 800 million tonnes of CO2e — a rise of 44% over 2000. This is even after taking into account the fact the rest of the world will want less of Australia’s energy exports by that time.

Combet says that, given the report, the position of the Coalition under Tony Abbott is untenable. And anyone, bar those who dispute the science of climate change, would agree.

Interestingly, Combet also appeared to be drawing a line in the sand on the creeping cuts to complementary measures — highlighting the importance of schemes such as the RET and the energy efficiency initiative to deliver more than 109 million tonnes of abatement a year by 2020. “A carbon price can work with appropriately targeted energy efficiency and renewable energy policies to drive the necessary transformation of our economy,” he said in a statement.

This was welcomed by Greens Senator Christine Milne, but she also noted that the government’s energy policy and climate policy are on a collision course, and it needs to go further. She drew on Professor Ross Garnaut’s recent updates, which suggest that Australia could create as much wealth from its clean energy resources as it does from its fossil fuel stocks. And industries such as aluminium production, after a period of some pain, would emerge stronger in the long run.

*This article was originally published on Climate Spectator

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