Runner Up: Jeremy Burke, ‘Leave the Lights On: Your Emissions Reduction Efforts Are Pointless’ [Australian Fabian Society]


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		Home Resources Event Papers 2009 Runner Up: Jeremy Burke, ‘Leave the Lights On: Your Emissions Reduction Efforts Are Pointless’ Following the Carbon Pollution Reduction Scheme (‘CPRS’) White Paper release, comment and discussion has concentrated on the targets announced. While these targets fail a scientific research test, the actual CPRS will fail any fairness test. A Research Paper by Dr Richard Denniss, of The Australia Institute, has put the Scheme design under the spotlight. The particularly concerning aspect is that the CPRS will set a cap and a floor to Australian emissions. This implication can be seen from a seemingly innocuous statement in the CPRS Green Paper (subsequently altered in the White Paper): “As long as the cap remains unchanged, the total abatement outcomes will remain the same”. In these 15 words the Government kicks sand into the faces of the millions of Australians taking action to mitigate emissions every day. The message is clear; no matter what you do, it will not matter. Emissions will be fixed and any action to decrease household or business demand will not decrease them. Not by one tonne. Individual actions like replacing globes, installing insulation and solar water heaters and collective actions like Earth Hour, will be to no avail. Succinctly described by Dr Denniss, the CPRS only varies “who pollutes and what price they pay to do so”. Sure your action will decrease your personal demand for emissions credits. But this will only lead to a decrease in the market price of permits. Other (dirtier) market participants will purchase permits rather than undertake abatement opportunities that the market price should dictate as economically attractive. A light switched off in Melbourne will lead to extra emissions at a cement factory or power station. Surely this is not the true intention of the Scheme? Yet the Green Paper acknowledged the reality when discussing complementary Schemes: “within a fixed cap, reductions in emissions in one part of the economy simply result in more emissions elsewhere”. So without appropriate complementary measures we say goodbye to GreenPower reducing emissions. Will the Department of Climate Change inform the 800,000 voluntary GreenPower customers that they no longer have the ‘power to make a real difference’? That they will just be passive end users of a carbon price, not active emission reduction agents. Despite these issues opportunity remains for positive community based emissions abatements. The Government should introduce a number of mechanisms to allow individuals to mitigate their emissions in a positive manner, fulfilling their desire to reduce overall Australian emissions and rewarding them for their impact on decreasing the emissions price in the market. Firstly, the Government should move from focusing on maintaining standards of living to focussing on moving rapidly to a low-carbon economy that will ultimately save our standard of living and decrease ongoing living expenses. Rather than cash assistance and tax offsets the Government should provide direct incentives to households to lead emissions abatement, while acknowledging and rewarding efforts already undertaken. By expanding the Climate Change Action Fund to include individuals, and creating and distributing Emission Reductions Credits (‘ERC’s’), we can enable further low cost abatement opportunities to be rapidly realised. Having no redeemable monetary value (and not being tradeable) the ERC’s would enable individuals, households or collective groups to choose how they want to pursue individual abatement opportunities. Individuals could decrease the cost of purchasing efficient light bulbs, installing insulation and/or solar heating, purchasing a bike or catching public transport. The ERC’s could be created with an appropriate multiplier to determine their redemption value. The greater the expected benefit to the community the greater the multiplier. For example installing insulation may be valued at a $200 redemption value and efficient light bulbs at $50. ERC’s could also bridge the incentive gap between tenants and landlords, preventing direct Government intervention being required. ERC’s will enable individuals to indicate how they want to respond to climate change. No more focus groups or market research, individual ERC redemption would speak for itself. Using this information the Government could better direct further resources to areas where the lowest abatement cost opportunities are being neglected. People will engage in discussing how to respond to climate change, rather than being concerned about inaction. Households, sporting groups, community organisations and workplaces will be abuzz with discussions on abatement opportunities that will kick start the transition to a low-carbon economy. No more negativity about what to do or guilt at a collective lack of action. We will be incentivised and empowered to respond and engage at all levels of the community. Secondly, the annual emissions abatement GreenPower generates should be specifically excluded from the following year’s pool of auction credits, and not count towards any Renewable Energy Targets. Thirdly, to further encourage voluntary abatement a portion of the CPRS credits should be set aside for larger voluntary abatement activities. This ‘top-slicing’, as it is referred in North America, can then be claimed by individuals or groups undertaking abatement actions exceeding those covered by the ERC’s. As Dr Denniss notes payments for emissions abatement will be received by the emission reducing party, enabling the gains to accrue to the party that deserves them. Climate change and the environment are key concerns across the world. Thousands have marched across Australia to demand action and the Alternative Technology Association is experiencing 25% annual growth in members and has readership of nearly 70,000 for its quarterly publication on sustainable living. The signs for positive action exist; collective interest and goodwill now just have to be harnessed. So to Prime Minister Rudd and Minister Wong the challenge is clear. The people of Australia have spoken with their actions, voices and votes already. The Rudd Government can create an emission trading scheme that engages and incentivises communities to meet the climate change challenge and leads the world on positive individual actions. Or we can all fail in the greatest challenges of our times. Let’s move on from discussing emissions reductions to actually achieving them. And let’s do it quickly and together!