One of Labor’s election promises on energy and emissions is to strengthen the existing cap-and-trade system for major carbon emitters, known as the Safeguard Mechanism. Under this, major polluters are required to buy or surrender carbon credits to offset any direct emissions that exceed an agreed baseline. Labor’s plan is to lower emission baselines for these issuers over time. “Governments will then have to resist industry pressure to keep the ambition low,” Jotzo says, warning that the industry will lobby hard to loosen baselines.
This is exactly what happened under the coalition government after it set up this cap-and-trade scheme. Companies constantly pushed for adjustments to their baselines, which ultimately resulted in a 32 percent increase in the emissions they were allowed to produce.
Another pillar of the Labor election platform was the national electric vehicle strategy. in 2020, less than 1.4 percent of all light vehicles sold in Australia were electric vehicles, compared to about three quarters of all light vehicles sold in Norway that year. In total, only 0.12 percent of all light vehicles in Australia are electric. Manufacturers such as Volkswagen have not entered the Australian market due to a lack of incentives for EVs.
So go into the elections, Labour promised to abolish import duties and lower taxes on some EVs, and to accelerate the rollout of charging infrastructure. But they haven’t gone far enough yet, says Jotzo. “They have not committed themselves to doing what in many countries is the main driver for the use of electric cars, which is introducing emission standards for the entire fleet,” he says. Requiring all automakers to meet emissions targets across their range encourages massive investments in electric vehicles to offset the emissions of petrol and diesel models.
But the biggest fly in Australia’s climate action ointment is fossil fuel reserves – particularly coal and gas – and the question of how to safely and smoothly transition the country from those for both domestic use and export.
“Because it’s an extractive resource, the government owns it, generates royalties for the government, and renewables don’t,” said Samantha Hepburn, a professor and expert on mining and energy law at Deakin University in Melbourne. Sustainable projects, on the other hand, will generate very little revenue for the government. “When we talk about energy transition, I don’t think that sentence really gets it — it’s a revolution.”
Some progress has been made in the field of renewable energy during the coalition government. A long-running target renewable energy required large-scale power producers to generate 33 terawatt hours of renewable energy by 2020, and this was easily met in 2019. decline in investment on new projects.
Labor’s ‘Powering Australia’ policy now promises to upgrade the grid to allow for better integration of renewables, invest in tanning beds and community batteries across the country, and deploy low-emission technologies.
But the current global gas crisis, triggered by Russia’s invasion of Ukraine, has plunged Australia into a world of energy misery that is largely self-made. There are no export controls on the vast East Coast gas reserves, which are now being sold at unbelievable prices on the international market, and none are reserved for domestic use. Domestic gas prices have therefore skyrocketed and there is not yet enough renewable energy to catch up. Meanwhile, Australia’s aging network of coal-fired power plants has been steadily phasing out over the past decade.
