CarbonSignal

The Age reports that in the first poll since the release of the Australian Government’s Green Paper on Carbon Pollution, 68% of the respondents support action on climate change, even if this raises the cost of living.  Further, 77% believe that Australia should take action regardless of the rest of the world.

In contrast, gas producer Woodside told the Financial Times that emissions trading would “hit our returns and stop our new projects going forward, when we are part of the solution”.  Woodside claims to be part of the solution because gas is a less carbon-intensive fuel than coal.  The LNG exporters claim that they are doing the world a big favour by providing a “clean energy source” for Asia.

If the LNG exporters could prove that the gas they export to Asia is displacing coal-fired power then they would be able to lobby for carbon credits under the Kyoto protocol’s Clean Development Mechanism (CDM).  But of course… they can’t… because they’re not.

The public wants action while the energy-intensive industries that were left out of the Government’s concession plan are demanding a ride on the free-permit gravy train, and the politicians are caught in the middle.

Meanwhile, The West reports that Greens Senator Brown demands that an independent panel run by scientists rather than MP’s should set the emissions trajectory, so as to save politicans from “ferocious lobbying”.  Perhaps the same panel should set the allocation of free permits as well.  The Federal Government’s proposal to compensate the coal industry and practically exempt the aluminium industry suggests that when it comes to hard reforms, the politician’s hands are tied.

In a recent interview with the McKinsey Quarterly, Amory Lovins of the Rocky Mountain Institute noted that

Most chief executives assume that smart engineers are already doing everything they should do to cut costs.  CEOs don’t see all the market failures … most companies behave as if they’re capital constrained, so they defer or simply don’t approve these investments.

This statement is consistent with the majority of our corporate clients.  Engineers can often easily identify ways to improve the efficiency of a process, but project budgets are typically centred on minimisation of capital expenditure at the expense of higher running costs.  Energy efficient technology typically requires a larger upfront investment, but the running costs are reduced through efficiency gains.  The sharp rise in oil prices and the impending Emissions Trading Scheme signal that energy (and therefore running costs) will be more expensive in the future.

If this decision-making paradigm persists then many Australian companies may find themselves holding stranded assets with uncompetitive running costs locked in for the lifetime of the equipment.  Lovins goes on to note:

Even without risk-adjusting your discount rates, saving energy is among the highest-return investments anywhere.

Welcome to HAC’s regular blog site.  This is where we come to share our thoughts and ideas; where we get a little ‘creative’ and seek your feedback; and where we share our hard-won secrets!

Watch this space for blogs on emerging policy responses to climate change and emissions, on cutting-edge technological responses and solutions, along with case studies of our corporate clients who are turning today’s challenges into tomorrow’s market opportunities.

And when it comes to feedback, don’t hold back.  This is a place for airing diverse views on complex subjects, where history and our life experiences won’t always hold the answers.  We’re going to have to think well-outside the square if we’re all - communities and economies alike - going to flourish in a carbon constrained future.  There’s only one way we can rise-up, and that is together!

Welcome… from Glen, Jamie, Colin, Marg, Marc, Peter, Ray, Matt, David and the extended HAC team.

HAC is pleased to announce that starting July 7, the HAC team will be complemented by the considerable skills and experience of Margaret Gollagher.

Margaret conducted her PhD on corporations and sustainability at Murdoch University’s Institute of Sustainability and Technology Policy, Australia’s premier sustainability research institute. During her time at Murdoch, Margaret lectured and tutored in sustainability, and was a key member of local and international sustainability research programs.

As Principal Policy Adviser for Sustainability to the Western Australian Minister for Planning and Infrastructure, Margaret provided state and national level advice. Her primary duties included overseeing the development of two important policy documents focussing on climate change - the Climate Change, Environment and Energy component of the Australian Transport Commission’s National Transport Policy Framework and the Western Australian Transport Emissions Reduction Strategy. Both required the development of policy initiatives that will complement the Australian Emissions Trading Scheme. Margaret was also a member of the Western Australian Water and Climate Change Cabinet Subcommittee and Senior Officers Group.

Previously, Margaret was a sustainability consultant with EarthCare, developing and implementing sustainability initiatives at Multiplex’s Vale residential development in Perth, Western Australia. She also worked for the Western Australian Department of Environment and Conservation as a Community Education Officer, using behaviour change strategies to help businesses to reduce diesel emissions in the Perth air shed.

Margaret is a guest editor of the international journal, Business Strategy and the Environment. She is a member of the Greening of Industry Network and the Western Australian Sustainability Practitioners Association.