Understanding Climate Risk

Science, policy and decision-making

75 Gigatonnes and counting

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Late last year Andrew Revkin of the New York Times blog DotEarth got in touch with a few people to ask their view of Australia’s carbon legislation. He followed up with a question asking whether the legislation was any good if Australia’s large coal exports weren’t included. Can the  US and Australia slake China’s coal thirst and still claim CO2 progress? He got views both pro and con. I ended up writing a post that was glass half  empty – glass half full.

One of the most vocal critics of the domestic policy was Guy Pearse, author of Quarry Vision and High and Dry, an essay and book about the relationship between Australia’s mining industry, politics, and climate policy. I was interested in how much CO2 Australia was likely to export, but had come up high and dry. So I asked Guy what the numbers were. Coincidently he was putting together estimates for current and future projects for a talk at the Woodford Folk Festival, so I offered to have a look at the temperature and CO2 budget effects. Guy’s estimate is that Australia will export about 75 Gigatonnes CO2 conservatively between now and 2050.  That’s 10% of the total budget estimated by the German agency WBGU (pdf) that can be emitted from 2008 to give a 2 in 3 chance of avoiding 2°C.

Guy says:

I estimate that Australian coal exports will generate around 75Gt CO2 between now and 2050 – perhaps another 5Gt will come from domestic coal use, and 8-10 Gt from LNG if the expansion of coal seam gas proceeds. In rough terms, between now and 2050, Australian fossil fuel could account for about 1/8th of the remaining carbon budget for 2 degrees C. This highlights the global significance of the coal boom now unfolding in Australia. I have also tried to break the Australian coal rush down to explain the CO2 emissions company by company in terms more readily understandable for the general public. So, for example:

  • The proposed GVK/Hancock mines in the Galilee Basin are equivalent to a 6% increase in the global car fleet (another 63 million cars);
  • the Waratah mines (excluding Carmichael East — yet to be quantified) are like increasing international aviation by 1/3rd;
  • the new Xstrata mines are like doubling Australia’s coal fired power stations;
  • the Adani mine (just one project) is like doubling Queensland’s emissions;
  • the proposed Mejin mine is like doubling the emissions of 60 small countries;
  • the new Peabody mines in Australia almost equate to adding the CO2 emissions of Pakistan,
  • the Bandanna mines are like doubling Australia’s agricultural emissions.

Even the emissions from smaller players have a staggering impact – e.g.,

  • the annual emissions from Aston/Whitehaven’s new mines, or of QCoal’s mines will each be greater than all the CO2 saved by all the hybrid cars ever sold world-wide;
  • The new mines of the relatively small Jellinbah Coal add nearly 100 times as much CO2 as is saved by all he household solar panel installations in Australia.

Tallied up, the new/expanded coal mines in Australia add about 1.75Gt of CO2 annually – about 11 times what the Australian government estimates will be saved by the carbon tax legislation that recently passed Parliament. By 2020 or soon thereafter, Australia is exporting nearly twice as much CO2 as is Saudi Arabia today. If these numbers are not already an underestimate, as I believe they probably are, they will soon be. New mines are being announced ever month or two—quickly rendering CO2 calculations redundant. Nonetheless, I thought you might find this information useful. Needless to say, it’s hard to see how this sort of expansion in coal production is consistent with any effective global climate change response.

Go see his whole presentation here. I had a look at how it affected the chances of reaching the 2°C climate policy target, estimating it changed the chances of avoiding (or exceeding it) by a net 4%. I also had a look at the contribution to global temperatures. Using an emission scenario designed to avoid 2°C peak temperature during 2100, it increased the peak by 0.02°C and delayed it by 5 years, and increased temperature in 2100 by about 0.03°C. That doesn’t sound like much but given that temperature has already risen by about 0.8°C, it adds up.

The 75 Gt CO2 is more than double my estimate to 2050 of 32.4 Gt CO2 based on the Treasury-MMRF baseline estimate to 2030.  If we followed current policy of -5% to 2020 and -80% by 2050 total Australian emissions would be 15.1 Gt CO2, so by 2050 all going well, we would export 5 times more CO2 than we would save at home.

This clearly demonstrates that if Australia wants to avoid exceeding 2°C, and enjoy the benefits of avoided damages, like having at least part of the Great Barrier Reef in a halfway decent state, both domestic and international policies are needed. Which is why the government’s stance at the recent Durbin UNFCCC CoP meeting, not pushing for an international agreement, made very little sense. Any coal Australia exports needs to be within an international policy context that is consistent with domestic policy.

Furthermore, the non-resource sectors of the Australian economy are quite weak. Returns from mining are also weak and will continue to be for some years as the investment in new mines is depreciated. Mining also does not contribute to employment in any significant way. When the resource boom passes, and there is some evidence it has peaked (but not coal perhaps), it will be more on a par with the rest of the economy. It makes more sense to invest in the transformation to a low carbon economy as soon as possible, rather than balancing the domestic budget deficit – one of the lowest in the world. Such investment will have a long-term upside. There may be some coal export within that mix, but the current open slather makes no sense, economically or environmentally. The coal industry is not as economically important to the national economy as it thinks it is. Unless it pays its way through a resource rent tax which is re-invested in sustainable development, following the Norwegian model. We don’t need an industry that makes a few people rich but in the long run harms everyone else .

Updated Jan 7, 13:22

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Written by Roger Jones

January 6, 2012 at 1:12 am

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