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Tuesday, 30 June 2015 23:41

Can Direct Action meet Australia's Greenhouse Gas Emissions Target?

Under the United Nation's climate change agreement Australia’s current greenhouse gas emissions reduction task is to reduce its emissions by 5% below 2000 levels by 2020.

This equates to emissions of no more than 530 Mt CO2-e in the financial year ended 2020. Without taking account of intended reduction measures, domestic emissions are projected to be 656 Mt CO2-e in 2019–20 and the total reduction required over the period 2013 to 2020 is 236 Mt CO2-e.

Mt CO2-e is total greenhouse gas emissions in millions of tonnes with non carbon dioxide greenhouse gases, such as methane converted to an equivalent CO2 warming potential

The table below gives a history of emissions recorded under the National Greenhouse Gas Inventory.

Financial year

      (Mt CO2-e)       

Change in emissions
(Mt CO2-e)




























The reduction task has declined significantly compared with the projections made in previous years when it was expected that emissions would increase each year. The following reasons have been given for the reduction:

  • lower electricity demand due to uptake of household solar, energy efficiency and higher retail electricity prices
  • worse than expected agricultural conditions due to drought
  • lower manufacturing output due to industrial closures
  • weaker growth expectations for local coal production due to a fall in international coal prices

Direct Action Climate Change Policy

The main plank of the Australian Government’s policy to achieve the emissions reduction goal is the Direct Action Climate Change Policy. This involves companies putting up projects that will reduce emissions relative to a previous baseline level at a competitive cost.

There are three inherent problems with this idea:

  • money is given to projects that would have gone ahead anyway, thus taking funding away from other worthy projects
  • the way reductions are calculated could potentially penalise those who have already made cuts, while others will not be penalised for doing nothing to reduce emissions even if they are below best practice
  • it is not clear what will happen to successful bidders who do not meet their commitments

The outcome of the first auction in April 2015 under the Policy is expected to achieve a reduction of 47 Mt CO2-e at an average cost of $14 per tonne. The cost of the projects is a total of $660 million out of $2.55 billion that has been allocated from the budget up to 2020.

About 60% of the projects are carbon sequestration such as farmers fencing off and/or revegetating part of their land. About 38% relates to the capture of methane from land fill and other waste reduction measures. There are small amounts from changes to savannah burning, piggery management and transport.

There are many causes for concern that the reduction target will be not achieved.

There is still a long way to go and the allocated budget looks to be inadequate. For example, if the cost or abatement in future auctions is also $14 per tonne then the money currently available will buy only 182 Mt, 54 Mt short of the target. The government might be caught short with very little time to make amends.

Many of projects have timeframes of 7 to 10 years and will take some time to get established but have only 6 years to achieve the contracted carbon reduction.

The farm carbon reduction may not lead to permanent sequestration or weather conditions may lead to less growth than expected.

The main shortcoming of the plan is that the major polluters are missing. It appears there is no incentive for projects to lock-in long term energy efficiency measures and conversion to renewable energy sources.

Australia needs to make a commitment for major reductions in emissions beyond 2020 if we are to make a fair contribution to the goal to limit climate change. The Climate Change Authority has recommended a reduction of 30% on 2000 emission levels by 2025. There is currently no plan beyond 2020 that will go anywhere near making a significant difference.

Reference: Department of the Environment Fact Sheet.

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