Last updated October 25, 2019 at 3:24 pm
Exports of fossil fuels are not only bad for the environment, but place us in a vulnerable position with other countries moving to renewable energy, say experts.
Why This Matters: The dollars are declining and we’re smashing the environment, so why keeping exporting it?
Plus, we’ve been named the biggest coal exporter. It was estimated that last year, we exported 386 million tonnes of coal, worth around $67 billion.
But, there’s the risk of major countries turning away from coal. Add this to our greenhouse gas emissions, many are looking at whether phasing out our fossil fuel exports is a realistic idea. And if so, how urgently do we need to act?
Australia isn’t on track to reach minimum Paris target
Australia signed the Paris Climate Agreement in 2016, pledging to reduce the country’s greenhouse gas emissions by 26% to 28% against 2005 levels by 2030.
It sounds like we’re on the right track. But, a 2018 government report shows that with current efforts, Australia wasn’t even going to reach our minimum Paris emissions reduction targets.
With the approval of the Adani coal mine earlier this year, showing that our coal industry is only growing.
“Australia has one of the highest per capita levels of emissions in the developed world. But we’re also a significant producer and exporter of fossil fuels,” he says.
“This is something of an ethical minefield. Discussion of emission reduction in Australia usually focuses on reducing domestic emissions. Yet the emissions produced from our fossil fuel exports are twice as much again as our domestic emissions, and we need to reduce these rapidly.”
He says reducing our individual carbon footprints is good, but that won’t stop exports.
“Acting collectively as a society to phase out fossil fuel exports is a better intervention to prevent climate change.”
Major countries are moving away from coal
Tim Buckley, Director of Energy Finance Studies Australasia at the Institute for Energy Economics & Financial Analysis (IEEFA), says that countries are starting to move away from thermal coal.
“In India, the price of wind and solar has dropped 50% in the last three years. It is now cheaper to generate electricity from wind and solar in India than it is to generate domestic coal-fire powered generation; it’s about 20% cheaper. It’s about 50% less than imported coal-fire powered generation.”
Buckley also explains that as China, India and Japan move away from thermal coal to other sources of energy, Australia as a supplier of coal will have to respond.
“The fact that export thermal coal markets are in terminal decline is a given if the world is to deliver on the 2016 Paris Climate Agreement.”
How will companies cope without fossil fuel exports?
Stuart Palmer, Head of Ethics Research at Australian Ethical Investment, says that reducing global emissions to zero requires collective action from governments, companies and consumers, and that collective action of this type is challenging to achieve.
“Investors have a crucial role to play in this. They can shift capital away from high-emitting activities to the businesses and infrastructure needed for a net zero world. They can also use their influence to encourage climate action by the companies they invest in and to promote more constructive climate policy debate,” he says.
Corinne Schoch from Global Compact Network Australia, says that there are cases where countries have successfully moved away from fossil fuels that we can learn from.
“Potentially, we could learn from Germany’s efforts to manage the Ruhr Valley coal industry,” she says. “It shut down in 2017 without sacking a single worker. In 1968, Germany placed all its coal mines into one company, but it also had the remit to manage the decline of the industry. It worked closely with state governments, unions, business and communities.”
Schoch says Australia needs a national authority to manage the decline of the coal industry and others disrupted by technology and low carbon policies.
“Communities, business, unions, local and state governments are crying out for federal leadership, for clear, bipartisan policies and a knowledge base of solutions,” she says. “Inaction is not an option. We need courage and the right people in the room to face the mounting uncertainty confronting this industry and others.”
Three experts will discuss the impact of Australia’s fossil fuel exports on climate change will be discussed at a Climate Transition Lecture hosted by the Practical Justice Initiative (PJI) at UNSW Sydney on September 17.
More information on the event can be found here.