This article highlights the global failure to address the most important requirement to minimise the climate threat, the phasing out of fossil fuels.

It also explains why Australia’s 2035 emissions reduction target of 62%-70% is closer to a totally inadequate 32%-40% when related solely to fossil fuel usage.

As close to 80% of greenhouse gas emissions come from fossil fuels, the key requirement to minimise the climate threat is to rapidly reduce the use of these fuels and phase them out as quickly as responsibly possible. A responsible phase-out aims to ensure a safe and reliable supply of energy at the lowest cost consistent with minimising the climate threat, whilst ensuring the well-being of workers, families and communities affected by the transition to clean energy.

In addition to causing dangerous global heating, fossil fuels create major health problems. Millions of people across the globe die annually from air pollution, primarily caused by the extraction, transport and burning of such fuels. It is in the best interests of humanity for fossil fuels to be left in the ground to the greatest extent responsibly possible. Even if they were not causing dangerous planetary heating, fossil fuels should still be phased out.

Emissions reporting requirements of the Paris Agreement do not provide for fossil-fuel emissions to be separately reported. Consequently, emissions reduction targets and reports of progress towards meeting targets do not provide an accurate account of changes to fossil fuel usage. This is explained later in this article.

The overwhelming evidence is that the world isn’t even trying to phase out fossil fuels. Phasing out fossil fuels is a major undertaking that requires a global plan, but there is no plan and there are no indications there is any intent to create a plan.

None of the major fossil-fuel producing countries have shown any interest in even phasing down production.

Gas is a major problem because many countries, including Australia, are supporting it on the basis that it is a transition fuel. Gas is not a transition fuel; it is a major fossil fuel that should be phased out as quickly as responsibly possible. A recent scientific study carried out at Cornell University found that exported LNG is 33% more polluting than coal over a 20-year period. Most Australian gas is LNG and most of it is exported.

Currently, there is a lot of discussion about the government’s 2035 emissions reduction target, and there are many vastly differing opinions regarding whether or not Canberra has got it right. However, Australia’s domestic emissions are quite small on a global scale, and consequently if this country falls behind by a year or two in achieving its target, it won’t make a significant difference globally. It’s the speed of global decarbonisation that will determine to what extent the world avoids the worst consequences of the heating planet. A more important discussion would be about Australia’s contribution towards global decarbonisation. Australia is failing badly in this regard and will continue to be an impediment to strong climate action while it continues to support fossil fuels.

Australia’s domestic emissions are minimal in comparison with emissions from the coal and gas it exports. Since it was first elected, the Albanese Government has approved 31 fossil fuel projects. Just one of these, the recently approved North West Shelf extension, is one of the largest fossil fuel projects in Australian history, enabling huge quantities of gas exports through to 2070. Over its lifetime it will facilitate the release of about 4.4 billion tonnes of CO2. This is approximately 10 times Australia’s current annual domestic emissions.

Australia could make a significant contribution towards minimising the climate threat by advocating globally for the creation of a plan to phase out fossil fuels. However, the Albanese Government won’t do this because it doesn’t want to bring on a fight with the fossil fuel industry and its powerful supporters.

All developing nations with reserves of coal, oil or gas understandably want to develop these reserves. Guyana and Brazil provide examples of novel ways of justifying the development of fossil fuel reserves. Both countries claim fossil fuel revenue will help them transition domestically to a clean energy future!

There is an accelerating global increase in renewable energy, and there is a view that this will solve the fossil fuel problem. Governments certainly like people to think this, because it helps them get off the hook regarding their support for fossil fuels. However, the increase in renewable energy is not part of a transition; it is adding to energy supplies, not replacing fossil fuel energy.

The demand for energy is expected to grow massively in the coming years, and if the world continues to support fossil fuels, as appears likely, fossil fuel usage will remain high, and it will be impossible to avoid the worst consequences of a heating planet.

A case is being made that continuing reductions in the cost of renewable energy will lead to the phase-out of fossil fuels. However, if this happens, it will be far too slow to avert a climate catastrophe.

Another important factor is that the fossil fuel industry is a powerful marketing machine that is quite capable of maintaining a strong position in a rapidly growing energy market. It will take intervention from national governments to drive fossil fuels out of the energy mix, and all the evidence indicates this won’t happen.

Carbon offsetting has become a major global problem because it is enabling fossil fuel corporations to meet climate targets whilst continuing to maintain and even increase production.

Carbon offsetting is intended to accelerate decarbonisation of the global economy. For example, company “A” is a cement manufacturer, where technology has not yet been developed to enable it to decarbonise its operations. In the meantime, it can contribute to global decarbonisation by providing finance to company “B”, that is able to decarbonise its operations, but requires finance.

The Paris Agreement calls for a balance between sinks and sources of emissions. Greenhouse gases going into the atmosphere are reduced as close to zero as possible and any residual emissions are balanced by permanent removals from the atmosphere.

The largest application of offsetting relates to sequestering carbon in the land, for example by paying farmers to change practices to increase carbon sequestration on their land, or to finance tree planting and the preservation of forests. A serious flaw is that there is no balance between the emissions from burning fossil fuels and pollution drawn down from the atmosphere. Fossil fuels release CO2 instantly and it stays in the atmosphere for centuries, whereas carbon sequestered in the land varies all the time, especially now the world is experiencing increasingly severe weather events, for example wildfires that release massive amounts of CO2 into the atmosphere. However, even if emissions reductions from carbon sequestration did balance emissions from using fossil fuels, offsetting should still be minimised because minimising the climate threat requires both a rapid phase-out of fossil fuels and maximising carbon sequestration.

The offsetting process has evolved and there are now companies that run businesses that identify potential carbon sequestration opportunities and create carbon credits that are traded in carbon markets. When you find that the large fossil fuel corporations are major buyers of carbon credits, you realise that the scheme has been compromised by vested interests. Companies whose core business is extracting and selling fossil fuels can’t accelerate decarbonisation, they are doing the opposite!

It is clear that an initiative aimed at speeding up global decarbonisation is being invalidly used. The requirement to reduce greenhouse gas emissions as close to zero as possible is being ignored. Instead, the offsetting mechanism is being used to help justify the ongoing use of fossil fuels, especially the approval of new projects. Australia is guilty of this. For example, the Beetaloo Basin LNG development in the NT was approved on the basis that all the domestic emissions would be offset. (The major emissions from the burning of the gas weren’t taken into account because these are the responsibility of the country that uses the gas!)

The reality is that offsetting is essential for the Albanese Government because it is the only way Australia can achieve globally acceptable emissions reduction targets whilst continuing to approve new coal and gas infrastructure.

It is hard to understand why something so obviously contrary to minimising the climate threat has been allowed to continue, until you realise there is no organisation with the authority to stop it. If a country wants to use carbon offsetting to support fossil fuels this is what it does. And this has become a massive global problem as all the major fossil fuel producing countries are using offsetting to help justify supporting fossil fuels, including the approval of new projects.

The UN is well aware of the problem. In 2021, the UN Secretary-General established a High-Level Expert Group to address net-zero commitments. The group’s report was launched at COP 27 in November 2022. The recommendations included:

• Markets for carbon credits cannot undermine genuine emissions reduction efforts.
• Targets must be reached through real emissions cuts.
• Fossil fuels must be phased out and renewable energy scaled-up.

Increasing carbon sequestration is a vitally important part of minimising greenhouse gases in the atmosphere. However, it doesn’t have to be financed by companies which want to offset their emissions. If the world was serious about phasing out fossil fuels, it would redirect trillions of dollars from subsidising fossil fuels to pay for carbon sequestration initiatives.

There is a strong case that the whole concept of allowing companies to offset emissions, instead of decarbonising their operations, is counter-productive. When the most important action to minimise the climate threat is to rapidly reduce fossil fuel usage, surely it would be better for companies to finance decarbonising their operations instead of purchasing carbon credits that enable them to meet climate targets while continuing to use fossil fuels?

Emissions reporting is not providing accurate information regarding progress in phasing out fossil fuels for two main reasons. One relates to the way in which emissions are recorded and reported in accordance with the Paris Agreement (Nationally Determined Contributions). Emissions from across the economy, some not involving the use of fossil fuels, are presented as a single figure. A major complicating factor is that “emissions” from the land sector, known as “Land Use, Land-Use Change and Forestry” (LULUCF) are merged with emissions from fossil fuels. LULUCF emissions are hard to calculate and are mainly arrived at through modelling. They are easy to fudge by governments wanting to claim emissions reductions without doing the hard work related to phasing out fossil fuels.

From an Australian perspective, LULUCF has been very helpful to successive federal governments in claiming that Australia is doing well in meeting emissions reduction targets. Australia chose 2005 as its baseline year for reporting under the Paris Agreement. Conveniently for subsequent reporting (and meeting targets!), 2005 was a peak year for deforestation emissions. Consequently, all subsequent emissions reporting has had a “built-in” reduction that now is in excess of 20% of total emissions reductions.

The other problem that adds to the difficulty in accurately accounting for actual fossil fuel usage is that emissions that have been offset are classed as emissions reductions, even though they are not actual reductions; the fuel is still being used, and emissions are still entering the atmosphere. Climate Action Tracker is a scientific research initiative that tracks government climate action globally. Its latest report for Australia states that “currently less than a third of the reductions achieved by companies covered by the Safeguard Mechanism were for real emissions reductions and two-thirds due to the use of offsets". The Safeguard Mechanism is Australia’s main policy instrument for reducing industrial emissions.

When LULUCF reductions are taken into account, together with the extensive use of offsetting, the government’s 2035 emissions reduction target of 62%-70% is closer to 32%-40% when related to actual fossil fuel emissions reductions. This is a very weak target for the key requirement to phase out fossil fuels.

It is highly likely that with the expected major global increase in the demand for energy, the use of fossil fuels will remain high, irrespective of the extent to which renewable energy is developed. The fallout of this is that the world will suffer the full consequences of the heating planet. The only way to avoid this is for advanced economy nations to come together and create a plan for the equitable responsible phase-out of fossil fuels. Currently, there is little likelihood of this happening. It would require political courage to take on the fossil fuel industry, something that many governments, including the Australian Government, don’t have.

The Albanese Government likes to talk about its vision for Australia to become a renewable energy superpower. The government needs to understand that if Australia and many other countries continue to support fossil fuels, there won’t be any renewable energy superpowers. The outcome will instead be that the world will be fully occupied dealing with the devastation resulting from unmitigated climate change.

The views expressed in this article may or may not reflect those of Pearls and Irritations.