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Australia’s Carryover Climate Credits Are Setting a Dangerous Precedent

As Australia attempts to cheat the Paris agreement with carryover climate credits, there are fears they could kick off a domino effect of climate inaction.

What do Prime Minister Scott Morrison, US President Donald Trump and Brazil’s President Jair Bolsonaro have in common?

Well, Trump’s taken to Twitter to spew the conspiracy that global warming was “created by and for the Chinese”, Morrison told Australians “don’t be scared” when he brought a lump of coal into parliament in 2017, and Bolsonaro claimed environmental issues only matter to “vegans who eat vegetables”.

Last year, all three countries were literally up in flames while their respective leaders stonewalled against acting on climate change.

But even so, Australia’s the only nation that’s attempting to cheat the Paris Agreement by using ‘carryover climate credits’ from a previous treaty.

While the US and China toiled together behind-the-scenes to unify on climate change under the Paris Agreement in 2014, Australia is dodging its obligations through a technical loophole.

What are carryover climate credits?

Richie Merzian, Director of The Climate and Energy Program at The Australia Institute says Australia has been using its surplus credits from the Kyoto Protocol to justify meeting a lower emissions target in the Paris Agreement.

The use of carryover credits reduces Australia’s 2030 target from 26% to only a 14.3% reduction below 2005 emissions levels using 2018 projections, according to The Australia Institute.

That means Australia is using credits that experts say have no legal basis to meet more than half of its emissions targets.

“It’s like getting a gold star for finger painting in kindergarten and then trying to use that to make up for an exam you failed in high school maths.”

“What happened under the Kyoto Protocol was that Australia negotiated a very easy emissions target for itself,” Merzian says.

“It was actually an emissions increase that Australia was allowed to meet and because it was so easy to meet this target, Australia ended up with a surplus of credits.”

“Now Australia is trying to import all its surplus credits under one treaty to meet its obligations under a different treaty.”

“It’s like getting a gold star for finger painting in kindergarten and then trying to use that to make up for an exam you failed in high school maths.”

So, why is Australia claiming it has surplus credits from another treaty?

Australia’s so-called ‘overachievement’ in the Kyoto Protocol occurred during former Prime Minister John Howard’s era when deforestation was substantially reduced, according to Professor Kate Crowley from The Centre for Environmental Law at The University of Tasmania.

However, experts say the idea Australia has ‘earned’ these credits is actually untrue.

Under the Kyoto Protocol, Australia was actually allowed to increase its emission targets to 8% in the first period of the agreement, according to Crowley. The country also offset its reductions to cut energy, transport or carbon emissions by focusing on reduced land clearing.

“It was really a do-nothing, Swiss cheese approach to meeting our targets. From Australia the subtext is: ‘we’ll do anything but actually reduce emissions.’ That’s why we were a pariah and got the Fossil of the Day award at the Conference of the Parties last year,” Crowley says.

Could Australia inspire a domino effect of climate inaction?

While working against the collective spirit of the Paris Agreement, Australia could embolden major polluters like China, Brazil and India to follow its lead of sidestepping its treaty obligations.

Under the Kyoto Protocol, developing nations were allowed to produce carbon credits which they could then sell to developed countries to help them meet their emissions targets.

“Brazil, India, China have ended up with hundreds of millions of these credits. They want to carry some of these credits over into the Paris Agreements. But a lot of countries have said, let’s clear the board and start again,” Merzian says.

“It’s like everyone competing in a running race and Australia gets to start halfway down the track. Australia has found a way to say they’ve joined the agreement but not really reduce its emissions.”

“What makes that argument harder is when there’s a developed, industrialised country like Australia that purely in its own self-interest is trying to negotiate by carrying over these credits that weren’t really even earned.”

New Zealand, the UK, Sweden, Germany, Denmark, and The Netherlands have all chosen to disregard their climate credits, claiming using them is not in the spirit of the Paris Agreement.

While international law on climate change isn’t strong enough to force Australia to play fair and ditch its carryover credits, many countries have outed Australia for its lack of action. At the UN’s climate talks in Madrid last December, 100 countries voiced their desire to ban Australia’s accounting loophole. And some European nations like Sweden have even spoken about placing trade sanctions on Australia if it doesn’t start reducing emissions, according to Crowley.

“It’s like everyone competing in a running race and Australia gets to start halfway down the track. Australia has found a way to say they’ve joined the agreement but not really reduce its emissions,” Merzian says.

Why has so little been done to combat climate change?

This summer, a staggering 10 million hectares have been burnt, more than 2,500 homes have been destroyed and half a billion animals have been cremated in the unprecedented fires.

Australia has faced extreme drought, hailstorms, flooding and smoke blanketing cities. The country’s capital had the world’s most polluted air – ahead of highly-populated cities like Beijing, Jakarta and Delhi – on New Year’s Eve. But the apocalyptic scenes haven’t been enough to inspire the government to take global warming seriously.

“Because we’re large, we don’t see the threat of rising sea levels, but now we’re feeling the fear of bushfires,” Crowley says.

“If our forests start burning there’s no back-up, most of Australia is desert. Most of our population live along coastal areas that are now burning. There’s nowhere to go.”

“If our forests start burning there’s no back-up, most of Australia is desert. Most of our population live along coastal areas that are now burning. There’s nowhere to go.”

After around two-thirds of Australians were affected by the bushfires, climate anxiety grew and tens of thousands of protestors marched demanding action and calling for Morrison to be sacked after he absconded from the crisis to enjoy a family vacation to Hawaii.

NSW Premier Gladys Berejiklian said the coalition catch cry: “now is not the time to talk about climate change”.  Months later –as intended — the conversation has dissipated into thin air.

Meanwhile, new research from The Australia Institute, released this month, shows global warming has made summer one month longer in just two decades.

Despite 64% of Australians now wanting action on climate change, according to The Australia Institute’s 2019 report, climate change is still a divisive topic in parliament.

There’s been a particular reluctance for politicians to table policy on climate change since Labor Prime Minister Julia Gillard’s bungled carbon tax.

Crowley says the Coalition spooked voters with the lie that the carbon tax would increase household electricity prices. Support for climate change at the time dropped to just 50% due to that untruth, Crowley told Rolling Stone Australia.

“Our politicians are sitting there voting against it and representing their parties and political donors. They’re not representing our community that generally wants action,” Crowley says.

“Tony Abbott was really effective at hammering home what the carbon tax was going to cost. It was really false advertising because the scheme brought forward by Gillard had an offset for the costs on low-income earners,” Crowley says.

Protecting what Australians view as the country’s ‘invaluable’ mining industry has also come at the cost of climate action, climate experts say.

Research from Australia Institute in 2011 showed Australians believe the mining industry employs nine times more people than it actually does.The survey also revealed Australians also believe the mining industry accounts for three times the economic activity than it does and that it’s 30 per cent more Australian-owned than it actually is.

Multi-million dollar mining companies and influential lobby groups have held politicians hostage and stopped them from acting in the best interest of their constituents, according to Crowley.

“When we tried to get a Mining Resource Rent Tax, we had a prime minister cut off at his knees over it,” Crowley says.

“If we had clear, transparent donations where donors weren’t allowed to break up donations into a lot of small donations, we could break the nexus between politicians and the fossil fuels industry. People don’t talk about that, but it’s where it comes from.”

What will it take to move Australia forward?

Independent politicians, who are free from party expectations, are often more capable of championing change and presenting bills that address divisive issues like climate change.

Independent Member for Warringah Zali Steggall, who toppled Tony Abbott last election, is introducing a bipartisan climate bill into parliament in late March.

Rather than proposing any specific mechanisms to tackle climate change, the bill sets a goal of reaching net zero emissions by 2050, with emission targets to be reviewed every five years.

The legislation is modelled off the UK’s Climate Change Act and draws inspiration from framework laws that are already in place in New Zealand and Ireland.

Steggall told Rolling Stone Australia the bill is a “sensible transition that allows our systems to adapt and our economy to be effective.”

“Climate change policy was pretty much weaponised by my predecessor Tony Abbott. For personal gain, I think he ignored the greater good,” Stegall says.

“In the election, for me, it was a really important thing to point out that [climate change] is not a left or right issue. It is in fact an issue that will impact all of us. Climate impacts won’t discriminate. Climate needs to be a bipartisan approach,” she says.

Steggall says she’s been consulting with businesses who need longer term policy from the government than three-year election terms.

“From a fiscal point of view, for the private sector to have certainty for private investments, it’s kind of like an insurance against our short three-year terms. You actually would have laws and policies in place that sets out a long-term strategy on climate.”

“At the moment we’re not preparing ourselves and setting ourselves up to be a key player in the future, which I think is really disappointing. We’re damaging our international reputation and putting ourselves at risk of being left behind.

“We have great opportunity to be an energy superpower of the future with new technologies, hydrogen, large-scale renewables, we have the biggest continental mass that is well-suited for renewables than any other continent. We definitely have an advantage, but we’re failing to take it.”

Steggall’s climate bill that would assess not only Australia’s emissions but the economic element of transitioning to renewables has won support from experts, including both Crowley and Merzian.

“Zali Steggall’s plan is the most sensible, a-political, overarching plan under which a lot of individual actions that are being talked about could take place,” Crowley says.

“Her language is quite appealing to conservatives because it’s about economics and risk. It’s not really telling governments what instruments they should use but it’s saying ‘let’s put this in a framework of action and the action will steepen over time and be reviewed every five years’.”

Crowley says The Greens ‘Green New Deal’ championed by Adam Bandt could also be enacted under Steggall’s bill.

“The fossil fuel industry is starting to collapse but the renewable industry is starting to become a great economic prospect.”

The Green New Deal, proposed in both the US and UK, plans an industrial transformation that involves clean energy and renewables.

“A Green New Deal is investing in environmental technology to offset climate change but also create jobs and stimulate the economy,” Crowley says.

But for Steggall, a conservative who’s sandwiched in the centre of the political spectrum, the Green Deal isn’t “entirely realistic”.

“I agree that we need to decarbonise and move away from fossil fuels as quickly as possible but if we’re having to argue to get everyone to agree to get to net zero by 2050, I just think that sometimes with the Greens, it’s just as a little too much.”

“Under the Climate Bill we’ve got the independent climate change commission, which is an expert base, and they can assess the science as it develops.. and adjust recommendations for what is the responsible, sensible way of progressing.”

While some say Australia might have to be dragged kicking-and-screaming into climate action by the international community, Crowley says the mining industry is not forever.

“The fossil fuel industry is starting to collapse but the renewable industry is starting to become a great economic prospect. So, I feel hopeful that the economics will tip the situation, and it’ll be something that politicians just can’t ignore anymore.”

Eden is a journalist and news nerd who speaks dodgy Spanish and spends too much time on the twitterverse @edengillespie.