Following months of agonising negotiations inside the government ranks, the prime minister finally released his plan to achieve zero emissions by 2050 on Tuesday. There was not a lot of novelty in the plan. Eighty five percent of the emission reductions will be achieved by current technologies, the balance will employ technologies that do not exist or possibly the use of nuclear energy.
Mr Morrison said the plan would harness technology to get "the balance right" between protecting jobs and industries in the transition to a decarbonised economy, telling reporters in Canberra:
"Australians will set our own path by 2050 and we'll set it here by Australians for Australians.
"It is not a revolution but a careful evolution to take advantage of changes in our markets."
The 120 page plan that was released on Tuesday afternoon had a series of targets that had to be achieved to ensure the necessary emission reduction. These involve developing technologies that allow scalable production of products like green steel, green hydrogen and green aluminium. This will bring the price of these products down and mean they are internationally competitive. This in turn will encourage large scale private investment. The PM said:
"It will not shut down our coal or gas production or exports, it will not impact households, businesses or economy."
Under the plan, a review of the 2050 policy will be conducted every five years by the Productivity Commission focused on how rural and regional communities are faring.
The main policy mechanisms proposed in the plan include investment in technology, incentives and offsets designed to facilitate the energy transition.
The government has committed to spending $20 billion on low emissions technologies by 2030. This is not new money and there is no evidence of big handouts to the Nationals.
Modelling of the plan will be released in due course, according to the prime minister. However, modelling that purports to show what the industrial and agricultural profile of Australia will look like in 30 years’ time will be of limited value. The conclusions of the Productivity Commission’s five yearly analysis are likely to be much more valuable, particularly if they are based on detailed micro-economic analysis of individual geographical areas.
The politics of this continuing soap opera are hard to read. At his press conference on Tuesday, the prime minister made it plain that the election would be held in May after a March or April budget. Given the current state of Newspoll this seems like a prudent move: at the moment the government is behind on the two-party preferred vote 54-46 per cent.
Scott Morrison will be hopeful that climate change will recede as an issue once the Glasgow conference is over and that voters’ attention will be focused on the economy and the management of the pandemic. By election time the economy should be going full throttle and people will be free to travel.
The biggest threat on the horizon is global inflation, which could see interest rates rise. Ironically the inflation is primarily due to a shortage of fossil fuels.
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