Abbott's action - direct hit or direct flop?

Past experience, like the 1998 Howard-Democrats greenhouse gases program, shows that the success of direct action schemes lie largely in the details. Will the Coalition apply the lessons of the past?

With the Abbott government pinning all its hopes on its 'direct action' scheme to meet its stated commitment to a 5 per cent emissions reduction by 2020, it is worth exploring the past failures and lessons arising from direct action approaches.

Because Australia has ratified the Kyoto Protocol, a failure by the government on direct action would not only be failure for the Australian people, but a national failure as well as a failure to meet our international emissions reduction commitments.

To put direct action in context, it is important to examine past approaches to direct action in Australia and internationally, and lessons from that experience.

When John Howard was negotiating the GST package with the Democrats in 1998, the Democrats were pushing action on climate change as the quid pro quo for their support for the GST. At the time I was one of the senior government officials involved in negotiating the fine details of elements of this package between then-senators Robert Hill and Lyn Allison. One of these “fine details” was the $400 million Greenhouse Gas Abatement Program, aka “direct action”.

Six lessons

In providing advice to the Democrats and the Howard government on the greenhouse gas abatement program, we took every effort to ensure that the program would lead to additional abatement and not just support activities that were going to happen anyway. The importance of this cannot be understated. This is the first essential aspect of any direct action scheme worth the name:

1. Measurable and additional abatement

The challenge with the GGAP, and with any direct action approach, is to ensure that funding for projects is made for abatement that is measurable, as well as environmentally and financially additional: that is, that it would not have occurred in the absence of government funding. Many direct action GGAP projects were proposed, and many were not supported because they failed to meet this 'additionality' test. Once projects were approved through this rigorous process, more still failed because they could not produce the stated abatement objectives.

2. Payment on delivery, not on promise

With GGAP, payment was only made on abatement outcomes, and abatement outcomes were very rarely achieved, so much of the allocated funding ended going back to consolidated revenue. As a consequence, the GGAP never fulfilled its objectives and was massively underspent – only a portion of the $400 million allocated to the program was spent.

3. Independent, expert verification

It is essential that extremely robust methodologies are developed, accredited, and utilised with any direct action approach. This requires independent expert input. The Kyoto Mechanisms – the Clean Development Mechanism and Joint Implementation – demand such rigour and so should any direct action approach in Australia. With the CDM and JI, the UNFCCC (United Nations Framework Convention on Climate Change) has an independent methodological panel that accredits and approves the methodologies provided by project proponents. Any direct action scheme applied in Australia requires an independent panel of experts across all abatement methodologies and projects to be at all credible.

4. Credibility requires international consistency and must lead to permanent abatement

Having said all that, it has to be clear from the outset that direct action projects must use methodologies that are agreed internationally, otherwise they won't contribute to our international commitments under the UNFCCC or the Kyoto Protocol. On this point it should be noted the stated reliance of the new government on soil carbon but that methodologies are still being developed and agreed internationally.

For projects to meet our international commitments, they also have to deliver abatement that is permanent. In the case of soil carbon, it is problematic because one drought event can remove any soil carbon that may have been built over the previous decade.

5. Action does not happen overnight

The government's commitment is a 5 per cent reduction in emissions by 2020 – only seven years away. With the GGAP, it took months to establish the program and guidelines, more months to approve methodologies then more still to determine which projects met the strict program criteria. Projects then took months to get off the ground, and a few years into the program, very little abatement had actually occurred. This was also the experience with the CDM and JI internationally: 24 months after kick-off, around only 20 abatement methodologies had been approved by the CDM methodologies panel. It takes years for abatement to occur after projects commence. With tree planting, it takes up to 10 years to start getting any significant abatement. Infrastructure projects take several years to be planned, approved, then built.

6. Direct action needs real and meaningful outcomes

For a direct action scheme to result in meaningful climate action, it needs to position Australia to be a leading zero emissions economy.

Effective climate action is easy to spot. It will see more renewable energy plants built, more zero emissions buildings, more electric vehicles, more high speed rail, more land use change that reduces emissions and fewer coal-fired power stations. Not just investment in the status quo.

Many will be aware of how much Australia is slipping behind other leading economies in investment in green tech. Australia can use direct action to catch up. The United States has just finished the largest solar thermal plant in the world. India is building the largest solar PV power plant. What is Australia doing in this space?

Effective climate action will see us going forwards well beyond 5 per cent emissions reduction by 2020. Direct action must reposition Australia to move beyond zero emissions for the 21st and 22nd centuries.

Dr Stephen Bygrave is the chief executive of climate solutions think-tank, Beyond Zero Emissions. He has worked on climate change nationally and internationally for the past 20 years.

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