The Coalition’s Climate Change Conundrum

The bushfires in Australia these past few months have brought to the fore discussions on the local effects of climate change. With drier conditions fuelling longer and more intense fire seasons, Australia will continue to be vulnerable to fire events, like this year’s, that have devastating effects on people’s lives and on the country’s unique wildlife. This fire season has highlighted the necessity of Australia finding a way to limit its carbon emissions and shifting its energy production toward more sustainable technologies, yet to do so the country faces some serious impediments.

Presently, coal generates around 75 percent of Australia’s electricity, as well as forming a major export industry; Australia is the third largest exporter of fossil fuels behind Saudi Arabia and Russia. A dramatic phasing out of Australia’s coal industry would require a major realignment of the country’s power generation – with untold knock-on effects for all other industries and households – as well as a considerable decline in export revenue.

However, a new book by Ross Gaurnaut, professor of economics at the Australian National University (ANU) titled Superpower: Australia's Low-Carbon Opportunity, argues that Australia has the potential to be a renewables superpower, and make the transition relatively seamless. The country has ample land and the right environmental conditions to construct solar mega-projects, as well as establish large wind farms, which combined can not only service Australia’s energy needs, but also provide energy to much of Southeast Asia. There is also potential to create a considerable hydrogen power industry, as well as use the country’s mineral wealth to become a major battery manufacturer.

Yet this vision of Australia’s energy future is currently restricted by the absence of a solid legislative framework that can send the right market signals to shift Australia’s energy industry toward these projects. Over the past decade attempting to establish any kind of policy around energy production and consumption has become the third rail of Australian politics. The recurring hostile internal party coups that have dominated the country’s recent politics have mostly been driven by wrangling over an attempt to establish a future energy policy and implement a carbon pricing system.

Elements within the conservative coalition of parties (known locally as simply the Coalition) – and their media allies – are staunchly opposed to any action limiting Australia’s carbon emissions, and will thwart all attempts to create any kind of regulatory framework, even if it means taking down a prime minister from their own coalition. Furthermore, many within these parties see their slim victory at last year’s federal election as being due to harnessing the economic anxieties of a number of marginal electorates in central Queensland, where coal mining remains a large employer. This, in turn, provides them with the political incentive to maintain their recalcitrant behavior.

It remains one of the great ironies of Australian politics that – as the senior coalition partner – the Liberal Party has been the major impediment to the flourishing of a considerable renewables market. Ignoring liberal economic theory, the party has actively sought to halt the processes of creative destruction within the energy industry and instead protect the inefficient status quo, despite the vast comparative advantages that Australia has in future energy sources like solar. In an era of exponential technological change, when markets can shift rapidly, Australia risks being left flat-footed as other countries capitalize on new technologies.

More than political parties in any other Western country, the Coalition has politicized climate change, turning the issue into a prominent “left/right” marker of identity. Yet in doing so they’ve placed themselves at odds with increasingly stark realities in the country, where a hotter and drier climate has the potential to make catastrophic events like this summer’s bushfires more frequent. The Coalition may consider its recent electoral success a result of its discounting of climate change as a considerable threat, but this may not last. Many of the country’s wealthiest and best educated electorates – seats the Liberal Party have never lost – are beginning to show signs of deep suspicion toward the party. In last year’s federal election, former Prime Minister Tony Abbott (an arch-climate skeptic) lost his seat to an independent candidate who campaigned specifically on environmental issues. Many other seats with similar demographics had heavy swings away from the party.

Beyond this, the Coalition is undermining Australia’s foreign policy objectives by alienating its Pacific Island neighbors, which are on the frontlines of the effects of climate change and feel its impacts as existential threats. This, along with the devastating impact of the country’s ongoing bushfires, may generate the impetus for the Australian government to start taking its environmental responsibilities seriously, but unless the Coalition can reconcile itself to the realities of climate change Australia will continue to sabotage itself.