The climate wars rage on interminably. A new perspective might help us see the way forward more clearly.

Australians have reason to worry that climate change is set to do great damage to our wide brown land and to the entire planet. We seem to be struggling up a down escalator, battling our way forward but in fact going backwards.

Climate Change and Energy Minister Chris Bowen is working to cut Australia’s emissions, mainly in the power sector and heavy industry. At the same time, the government of which he is part has set modest targets for emissions reduction and keeps approving big extensions or new projects to produce more coal and fossil gas for export.

Meanwhile, climate scientists tell us the outlook keeps getting darker.

This June, a team of 60 prominent climate scientists published a report in the journal Earth System Science Data, which said that human activities between 2020 and 2024 released 200 billion additional tonnes of carbon dioxide and equivalent greenhouse gases into the atmosphere, causing the earth to trap more heat. As a result,

• The rate of warming of the Earth’s surface has accelerated to 0.27 degrees per decade, compared with 0.20 degrees in the 1990s and 2000s;
• The Paris goal of no more than 1.5 degrees Celsius of warming over pre-industrial levels (averaged globally over five years) is likely to be breached within another three years; and
• The rise in average sea levels, caused by thermal expansion of the oceans and melting of land-based ice, has also accelerated, from 1.85 millimetres a year over the twentieth century to 4.5 millimetres a year over the last decade.

Yet, in a fiery and belligerent address to the UN General Assembly last month, US President Donald Trump said that climate change is “the greatest con job ever perpetrated on the world”, that the scientific consensus on climate change was created by “stupid people” and that clean energy sources such as wind and solar “don’t work” and are “too expensive”.

Fresh perspective

There is a different way to look at this whole situation, for which I am indebted to a new report by UK think-tank Ember.

Ember says arguments on energy and climate change are usually framed in one of two ways: the climate view, centred on emissions, policy targets and the moral obligation to fix climate change; and the incumbent energy view, centred on fossil fuels, slow change and business-as-usual. Of course, the advocates on either side don’t find much common ground with the other.

Ember says both sides are missing something big that is going on around us: a vast revolution in energy technology.

This is relevant to Australia for two reasons. If we ride the wave of technological change like a good surfer, our emissions will come down rapidly. And whether we catch the wave or not, the demand for our fossil fuel exports will fall sharply as the rest of the world adopts the new technology.

The reasons that lie behind the revolution have little to do with climate change.

The main technologies involved are solar and wind generation, batteries and heat pumps. All of these have in common that their costs per unit have been falling rapidly, by around 20% for each doubling of the total number of units installed. This will continue without limit in a virtuous circle. The more of them are made, the better and cheaper they get. Fossil fuels, on the other hand, get more expensive as the best resources are exhausted. The units of the new tech are small, compared with fossil power stations, which means they can be installed almost anywhere. And they depend ultimately on inexhaustible energy from the sun and the weather, not from burning minerals laid down over the ages and then dug up and shipped in vast quantities around the world. Moreover, solar and wind resources are widely distributed, which means most countries can reduce their dependence on expensive fossil fuel imports at varying prices. Australia is particularly well placed in this regard.

Ember says the advantages of new electric technology are so strong they will in time displace fossil-based energy in most applications throughout the world. This is regardless of what Trump says.

We still need the Paris Agreement to push emissions reduction along as fast as possible and so spare the world from the worst ravages of climate change.

The clear leader of the electric revolution is China. They were smart enough to spot the opportunity years ago. They invested large amounts in the technology. Now, they dominate world trade in solar panels, wind turbines, batteries and electric vehicles. They continue to innovate, lodging more patents in electric technology than the rest of the world combined.

In its home market, China has installed more solar and wind power than the rest of the world and put more electric cars, vans, trucks and buses on its roads.

China’s emissions have reached a plateau and appear to have begun to drop, five years before they promised under the Paris Agreement. In parallel, China’s use of fossil fuels has plateaued and may have begun falling. China is so big, with 50 times Australia’s population, that it is the “pivot” country: when its demand for fossil fuels falls, so goes the world.

Whenever demand for a commodity falls, prices drop and the higher-cost producers are in trouble.

Implications

This has several implications for Australia.

First, we can expect demand for our exports of thermal coal and liquefied natural gas to dwindle and in future years to fall quite steeply. Already, thermal coal exports have levelled off (in part because of lower-cost competition from Indonesia), and some of the higher-cost mines have closed.

Federal Environment Minister Murray Watt recently approved the continuation of Woodside’s huge Northwest Shelf LNG operation until 2070. I don’t expect to be around then, but if I were I would be surprised to see it still going. The same goes for many other coal and gas projects. I hope not too much of my super is invested in them.

We need to speed up the transition to renewable power and the electrification of many uses of energy in the home, in transport and in industry and commerce. It is absurd that no new wind farms have reached final investment decisions this year. More than a century ago, when the telecommunication revolution was in full swing, the regulation of telecoms was made a federal power in our new constitution. A brave government would do the same now for electricity to help unblock the terribly unwieldy approval processes.

Ross Garnaut and Rod Sims of the Superpower Institute have long advocated more investment in industries based on our favourable wind and solar power potential. I am sure this is right, as soon as we can get bulk power costs trending down. The early targets should surely be the businesses that already want to transition, such as aluminium and zinc smelting. “Green” steel looks like a very big opportunity, if much harder, and should be in the queue.

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