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Green-energy superpower

Nov 6, 2019 • 18m40s

Ross Garnaut – the man who wrote the Rudd government’s response to climate change – says Australia has more to gain from a zero-carbon future than any other developed country.

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Green-energy superpower

115 • Nov 6, 2019

Green-energy superpower

[Theme music starts]

ELIZABETH:

From Schwartz Media, I’m Elizabeth Kulas. This is 7am.

Ross Garnaut wrote the blueprint for Australia’s response to climate change. As the politics fell apart, he became interested in the economic opportunities of a zero-carbon future. He says Australia has more to gain than any other developed country.

[Theme music end]

ELIZABETH:

So Ross, let's start with this trip that you took through the Murray-Darling Basin and out to Lake Mungo.

ROSS:

Well, through the first half of August, Jane, my wife and I, took a journey right through the Murray-Darling. Started at Lake Mungo.

ELIZABETH:

Ross Garnaut is Professorial Fellow at the University of Melbourne and author of the Garnaut Climate Change Review. His most recent book is Superpower: Australia’s Low-Carbon Opportunity.

ROSS:

We then turned up the Darling to Menindee, famous for its grapes and fruits and vegetables. But regrettably famous today for a plague of dead fish, which came to all of our attention about a year ago.

[Music starts]

Archival tape — Unidentified female:

‘I don't even think heartbreaking begins to describe, ummmm, what we're seeing behind us. There are tens of thousands, if not hundreds of thousands of native fish that have just floated to the top…’

Archival tape — Unidentified male:

‘And look at these iconic fish of Australia being treated like this. Youse have to be bloody disgusted with yourself. You politicians and cotton grower manipulators…’

ROSS:

It was once the source of Broken Hill's water, but now its dry, the Menindee Lakes, so they put a new pipeline through to the Murray and are raiding the Murray to supply Broken Hill with water. So everywhere you’re struck by the stark empty bed of the Darling.

[Music starts]

Archival tape — Unidentified female:

‘I can remember growing up we used to get the dinghy down here and we used to sit in the inner tubes of tires and just float down for hours and hours and they are some of the best memories that I have growing up…’

ROSS:

Used to be one of the great waterways carrying cargo in Australia. Hard to imagine today that it had ever played that role.

Archival tape — Unidentified female:

‘So we’re in the base of the Darling River right now there is absolutely no water. It is completely bone dry and it is absolutely devastating to see this occur.’

ELIZABETH:

So dryness, is that the overarching impression?

[Music ends]

ROSS:

Yeah. Dryness and reminders of what had been. It’s a very sad reality that water allocations under the Murray-Darling plan are based on historical availability of water, and not based on what the science said was going to happen to availability with climate change.

I went back as I was writing the book to a document around the time of the plan. And I saw the CSIRO report that said the Murray-Darling plan had available to it good science on climate change, but unfortunately it didn't take it into account.

ELIZABETH:

Just before the Murray-Darling Basin Authority was formed to design this plan, you were commissioned to write the first of two governmental climate reviews, one in 2008 and then again in 2011. What was that process like?

ROSS:

Public policy was already going into a dark place when I did those reviews, especially the second. The time of the first review, it was commissioned by all the state governments of Australia and then the Commonwealth joined it — so it had the support of every government in Australia: federal, state and territory. It had the support of the Opposition. The leader of the Opposition in the Federal Parliament was Malcolm Turnbull. He was a strong supporter, I regularly briefed him and his frontbench colleagues on how things were going and there was generally a constructive approach to dealing with the problem. By the time of the second review, chaired by the Prime Minister, Julia Gillard, we had lost that bipartisan support.

Archival tape — Unidentified male in parliament:

‘Mr Speaker, it has become very clear in the House today that there are many on that side of the House who are climate change skeptics, Mr Speaker.’

Archival tape — Unidentified parliamentary speaker:

‘Order, order.’

ROSS:

And politics had become rancorous not only over this issue, but probably especially over this issue.

Archival tape — Unidentified parliamentary speaker:

—‘Order, order — ‘

Archival tape — Unidentified male in parliament:

‘So I asked the Prime Minister—

Archival tape — Unidentified parliamentary speaker:

—‘Order, — ‘

Archival tape — Unidentified male in parliament:

— will she seek a mandate for her carbon tax before she introduces legislation into this House? Will she seek to make the next election a referendum on her unnecessary new tax?’

Archival tape — Unidentified males in parliament jeering in unison:

‘Here, here.’

ELIZABETH:

So that's between ‘08 and 2011.

ROSS:

Yes. That turned out to be rather an important time. Now, it was a difficult time to be involved in public policy. It was a time when astroturfing had been invented so that business interests who didn't want new policies would hire PR agents to create a...an online grassroots movement opposing you. And because of all of that was new. Today, it's just part of the corrupt online experience of contemporary Australia and the contemporary world. But then it was new and a bit of a shock.

It became much more difficult to say things as they were, to simply explain the realities and the truth underlying public policy choices, because the media environment and the political environment had become so bitter and divided.

ELIZABETH:

What was it like working in that new environment?

ROSS:

It's as if what was real is what you say is real. if what was real is what the Twitter feed says is real. There’s a chasm between that and true knowledge. And it's in that chasm that good policy has been lost.

ELIZABETH:

And from your position within the sector, what would you say that Australia has to gain as a country, from where we stand right now?

ROSS:

Well, Australia has the strongest interest among developed countries in the success of the global effort on climate change. First, we have got the strongest interest in avoiding climate change because we are the most vulnerable to climate change of all the developed countries, so that's a good reason why we want the world to succeed. But the other reason is that we've got the most to gain economically. We've got the resources that can cause us to do very well economically in the zero-emissions world economy.

ELIZABETH:

And is it really the case now that we need to figure out policy that will allow that innovation to happen in the private sector?

ROSS:

Yes so, we had it for a while, the policies that were in place from 2012 to 2014 started getting the change underway and that was very effective. But it didn't last for long.

[Music starts]

ROSS:

We won't get back to exactly the same politics and the same policies. That's a reality leftover from history. Emissions trading scheme does it best, but you can do it without that, unless you can make a start without it. But there, there are things that we can do that will support a rapid transition in Australia.

ELIZABETH:

We'll be right back.

[Music ends]

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ELIZABETH:

Ross, we're talking about renewable energy and the opportunities in this sector for Australia. What's happened since you wrote those two climate reviews?

ROSS:

They've been big changes in a number of areas. Most importantly, I suppose, in policy and in the economics. but on policy, we've had policy incoherence since then and that's slowed down investment it's made it more difficult for business to get on with the job of making use of immense opportunity. But alongside that, and I suppose more surprising, we've seen radical reductions in the cost of renewable energy.

I'd been expecting reductions in cost, all of the modeling on which my 2008 review was based built in assumptions based on the best advice that the cost of solar energy would fall by a few percent per annum. Well, what actually happened is that over the decade after that costs fell by 85 percent, far faster than had been anticipated, so that the cost of electric energy from solar and wind sources ended up by now lower than the cost of coal. That's something that hadn't been anticipated at the time.

ELIZABETH:

And yet, at the same time, Australia is probably more deeply invested than ever in an old energy economy in 2019.

ROSS:

Yes, since 2008, we've had that huge natural gas boom. The new export industry from Gladstone in Queensland.

[Music starts]

Archival tape — Unidentified male:

‘Well first LNG means culmination of a massive effort by a committed and very significant team…’

Archival tape — Unidentified female:

‘... it’s a huge privilege to be a part of. Exciting not only for Santos and our partners but for Australia as an export, LNG is leading the way in energy…’

[Music ends]

ROSS:

Coal exports are much bigger now than they were then. So we're more deeply invested in the old energy economy than before. But at the same time, we've seen very rapid growth in new energy. We're living with those contradictory developments at the moment and we have to resolve them in the period ahead.

ELIZABETH:

So Ross let's talk through what you're saying are the opportunities for this country. Does the whole thing stem from cheap, zero-emissions energy?

ROSS:

Yes, that's the biggest single advantage of Australia. We can do that more cheaply if we do it properly than any other country. We've got by far the richest resource endowment of solar and wind of all the developed countries.Our wind and solar resources is truly exceptional. Absolutely. And relative to the size of our own economy, overwhelming.

Electricity is still our biggest source of emissions, and getting rid of those emissions is important in itself. But globally, much more important is how zero-emissions electricity at very low cost can take the emissions out of a lot of industry and could take the emissions out of transport. Doing all of those things together means we'll be producing a lot more electricity in Australia. We'll be producing it more cheaply and more reliably than now. And ahh that will be a base for a lot of new industries.

ELIZABETH:

So should Australia be able to create zero-emissions energy source that well exceeds the needs of domestic supply? What are the other opportunities there?

ROSS:

Economically, the most valuable and incidentally the most important for global emissions would be the processing in Australia of mineral ores that are currently processed with very large emissions overseas.

Just take iron ore. Australia's by far the world's main source of iron ore. About 60 per cent of world exports come from Australia. We supply 70 per cent of China's iron ore imports. China produces half of the world's steel. Producing that steel in China ahh represents about, on its own, about three and a half per cent of global carbon emissions.

ELIZABETH:

Hmm.

ROSS:

So it will be cheaper to use Australian renewable energy to make hydrogen, turn Australian iron ore, iron oxide, into iron metal here than it will be to send Australian renewable energy to Asian countries for use abroad.

ELIZABETH:

In other words, right now in Australia we export coal to China, which is used to power the production of steel. So we're exporting both the coal and the iron ore in that process. And you're saying that in a zero-emissions economy, because energy will be cheaply available here and not easily exported, that would be far better off doing that process domestically, and then exporting the steal as a finished product?

ROSS:

That's right, we're better off. But also, China is better off and the world's better off, of course, because you end up with zero emission time at reasonable cost.

ELIZABETH:

And what would be the size of that proposition be for Australia economically?

ROSS:

If we turn a quarter of our iron ore exports into iron metal and half of our alumina exports into aluminum metal through renewable energy, then that would be a substantially bigger industry than all of our current coal and natural gas exports.

ELIZABETH:

Let's move now to biomass. What is it? What are the opportunities that exist there, both in terms of manufacturing material and as a method of drawing carbon from the atmosphere?

ROSS:

Well, modern chemical industry is based on using hydrocarbons and carbon, out of fossil energy all plastics come from that source. In the zero-emissions world economy. We won't be getting our chemical manufacturers from those sources. We'll need to get it from renewable carbon, from biomass. For example the Mallee and the Mulga, Mallee is a marvelous Australian plant, it's adapted to the fire-prone Australian environment. You can harvest the Mallee plant on the edges of the West Australian wheat belt.

The Mallee trunk is underground and that keeps growing, sequestering carbon as you harvest the biomass on top. It needs innovation we’ve got to find low cost ways of harvesting and using the biomass, but that's going to be the raw material for chemical industry once we can no longer use coal and gas and oil.

ELIZABETH:

You’ve briefly touched on sequestration there, what are the opportunities for creating carbon stores in Australia?

ROSS:

Beyond soil, and soil’s a big one, we can manage pasture in different ways. We wastefully use pasture if we eat it right down to the ground all of the time and that leaves land vulnerable to erosion. More generally, just through more careful management of our woodlands than to weaken sequester immense quantities of carbon manage that in a different way and you can easily add a tonne or more per hectare of carbon a year. And the numbers, given Australia's land area, can be truly transformational.

ELIZABETH:

Ross, what you're describing in many ways is exceptionally exciting in a space that is otherwise relatively depressing if you encounter in the news on a day to day basis. What you're saying is, we could be a leader in zero-emissions energy, we could export that energy, metals could be refined using that energy and exported to the world, we could be a hub of sequestration, we could be a superpower in this new world that was future oriented. How likely is it that that's going to actually happen, do you think?

ROSS:

Well, that depends on how long Australians can be irrational beyond the normal limits of human irrationality.

[Music starts]

ROSS:

We're already testing those limits. I find it hard to believe that knowledge of that benefit won't overwhelm the resistance. So if you ask me what are the chances of us taking advantage of it, I would say it's fairly large, but it does depend on the knowledge of the opportunity getting around.

I'm hoping that focus on the opportunity, the reality of the opportunity will cause enough people to change their mind for it to become much easier for governments to take strong action in support of the transition and to oppose it. And if the whole world does make the shift to zero emissions, economic activity by the middle of the century, then we've got huge advantages in that world.

ELIZABETH:

Ross, thank you so much.

ROSS:

Very good to be with you.

[Music ends]

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[Theme music begins]

ELIZABETH:

Elsewhere in the news:

US President Donald Trump has begun the process of formally exiting the Paris climate accord. Signed in 2015, withdrawing from the deal will take over a year, meaning the Trump administration won't be able to finalise its exit until a day after the presidential elections that are due in November 2020.

And in Australia, the Coalition’s attempt to crackdown on climate boycotts and activist groups could be in breach of the constitution. Academics have warned the government that its proposed changes to competition law would risk breaching the implied freedom of political communication.

In a statement on Monday, the Attorney-General Christian Porter said the government was considering ways to target boycotts or protests designed to harm, quote “Australian businesses that are doing nothing other than lawfully providing goods and services to mining projects”. Porter also revealed the government was considering reforms to prevent what he called the growing presence of litigation funders in class action suits targeting the mining sector.

This is 7am. I’m Elizabeth Kulas. See you Thursday.

[Theme music ends]

Ross Garnaut wrote the blueprint for Australia’s response to climate change. As the politics fell apart, he became interested in the economic opportunities of a zero-carbon future. He says Australia has more to gain than any other developed country.

Guest: Economist and author of Superpower Ross Garnaut.

Background reading:

Superpower by Ross Garnaut, published by Black Inc.
The Saturday Paper
The Monthly

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7am is hosted by Elizabeth Kulas. The show is produced by Emile Klein, Ruby Schwartz, Atticus Bastow and Elle Marsh. Our editor is Erik Jensen. Our theme music is by Ned Beckley and Josh Hogan of Envelope Audio.

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115: Green-energy superpower