Why Australia holds the roadmap to lead the energy transition
As time runs short on the world’s decarbonisation chances, Australia can still lead the way to a more sustainable – and equitable – energy future
Time is running out to prevent the worst effects of global warming, and as climate justice issues arise alongside potential solutions, it’s clear there are complex decisions and trade-offs to make to keep the world below two degrees warming. However, the data shows that catastrophic climate change is still preventable – if we pull the right levers of change.
First, we must define the problem correctly, which requires prioritising critical social and economic considerations even as the world pushes to decarbonise. The same challenges inherent in this transition globally are also challenges Australia must deal with – from shoring up vulnerable communities so they’re not left behind to addressing human rights issues in supply chains – making it imperative that we address them head-on and with a plan.
As Dr Michele Roberts, Academic Director of AGSM and Associate Dean (Post-Experience) at UNSW Business School, explained recently at the AGSM 2024 Professional Forum, circumstances are forcing a focus on sustainable leadership at home. “Australia is a leader in the global energy transition – whether we like it or not, whether we’re doing well or not, and whether we’re the leader the world needs us to be”, she told an audience of alumni, industry partners and researchers, in the final session of an event centred on “sustainable leadership in an accelerating world”.
Whether Australia provides good or bad leadership is the question, as the window for getting this right quickly closes. The masterclass session, “embedding sustainable leadership in your organisation”, was aimed at getting business leaders to think about what it will take to lead the energy transition well. “The statistics tell you loud and clear that we have a corner office in the global energy transition,” Dr Roberts said. “As the world’s third largest exporter of fossil fuels, we are going to lead this energy transition one way or another.”
Tipping points
Joined by Mark Rowland, Chief Collaboration Officer at climate action enabler Greenhouse, Dr Roberts aimed to drive home the imperatives of the energy transition for Australian business leaders. They focused on the “one-way doors” we may already be passing through and the necessity of a multifaceted approach, showing that if we pull the right levers, even limiting warming to 1.5 degrees is still possible.
It should start with setting a clear problem definition, according to Dr Roberts, who helped develop AGSM’s new MBA in Sustainable & Inclusive Business. This is how the climate scientists in the program work: the first step is identifying “how we know we have a problem and then defining that problem clearly”.
When it comes to carbon emissions, the problem appears plain. “Over the last 10,000 years, in the period that humans have been thriving on Earth, carbon levels in the atmosphere have been pretty stable right up to the Industrial Revolution,” Dr Roberts explained. “And then you can see this incredibly sharp and relatively quick spike in atmospheric carbon.”
Another concept climate scientists rely on to understand the challenge is tipping points. It’s a “critical concept” because “really, what it shows us is that we don’t actually know how long we have left” to stop climate calamity, said Dr Roberts, who pointed out that there are various climate systems on Earth, and one system passing the point of no return can have a domino effect on others. For example, as perma-frost melts, it warms the oceans; one of the tipping points climate scientists are most worried about is coral reefs dying off meaningfully. Worryingly, that will likely occur before global warming even reaches 2 degrees.
“We get this horrible series of one-way doors that we’ll go through with potentially irreversible effects on our climate, so we don’t actually know how long we have left,” Dr Roberts said.
Shrinking carbon budget
As we miss decarbonisation deadlines, others get pushed forward, making it harder to make the needed change in time. As this “carbon budget” changes, the world needs to adjust its targets; we now have less than 20 years to keep the world below 2 degrees warming by transitioning the entire global economy, with an 80 per cent chance of success if we can achieve net zero by 2042.
“But the reality is we don’t have until 2042 because we’re continuing to emit more and more carbon,” Dr Roberts explained. And on the current trajectory – if countries fail to meet their nationally determined contributions for UN targets and continue their current carbon emissions – baseline global warming will reach 3.3 degrees.
“The carbon emitted in the atmosphere is going up every year; it’s not going down,” she said. “We used to talk about needing to get to below 2 degrees by 2030; that’s already moved to a deadline of 2029. So, as we fail to hit targets, as carbon keeps going higher, our deadlines are being brought forward.”
However, it’s not just about decarbonisation and meeting UN targets. Wrapped up in these necessary aims are questions of climate justice that societies must reckon with for any transition to be genuinely sustainable. “The reality is, most of us in this room will still survive 3.3 degrees in our comfortable Sydney apartments and homes – but our small island nations will be wiped out at 3.3 degrees,” Dr Roberts said.
It all adds up to a complex problem definition, where we must keep the Earth as close as possible to 1.5 degrees warming compared with pre-industrial levels without exacerbating climate justice issues. “We’ve got to get the economy to net-zero emissions at a pace that keeps within the carbon budget. And to do all this while balancing the social and economic issues that we must address to create a just transition,” Dr Roberts said.
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Prioritising climate justice
Dr Roberts emphasised the importance of prioritising climate justice issues alongside efforts to reduce emissions, both globally and in Australia. For developed countries in particular, pressure is growing for more accountability.
“We have historical responsibility; those who are going to suffer the worst impacts of climate change, who are going to lose their land to rising sea levels, hurricanes, extreme weather events are those who have emitted the least carbon,” she said. “There is global agreement that policies and strategies must favour those people, the people who contributed least to the problem, and developed economies must also find the funds for those countries that will be worst affected to prepare for resilience and adaptation.”
Moreover, climate justice is not just a question of global problems or problems affecting developing or geographically vulnerable countries as the world decarbonises. “We also know, even here in Australia, that if we risk doing something to the energy system that drives up energy prices, our most vulnerable people will suffer and be impacted most, so there are huge issues with energy poverty,” Dr Roberts said.
Climate refugees are another pressing concern, she said, with estimates that climate change will displace more than 216 million people worldwide by 2050. “Here in Australia, we’ve already got people in Lismore being told they can’t rebuild their homes due to climate change. We’ve got people in the Tiwi Islands who are losing large parts of their land.”
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And there are massive human rights issues embedded in renewable energy production. “If we look in renewable energy supply chains, we can see that in critical minerals, like cobalt in the Congo, there are issues of enforced labour, of child labour, of incredibly unsafe working conditions,” Dr Roberts said. These concerns apply to many of the critical minerals essential to any move away from fossil fuels.
“There are no easy wins in the renewable supply chain,” she said. Particularly in Australia, it will be essential to support communities affected by moving away from fossil fuel industries. “Fossil fuel and coal mining communities are unlikely to make a strong transition to a carbon-free economy,” Dr Roberts said.
“Yes, there’ll be more jobs created in the renewable energy sector than there have been in coal mining, but they’re not necessarily going to be the same communities that get to transfer straight over into renewable energy,” she added. “There are huge climate justice issues for coal mining communities that will suffer, and we know, globally, that women and indigenous communities suffer most when we see a coal mine or fossil fuel community close down.”
Pulling all the right levers
The good news, as Mr Rowland and Masterclass participants found in an interactive team activity using the En-ROADS global climate simulation program, is that there is still time to meet decarbonisation goals while also promoting climate justice. The key, Mr Roland and Dr Roberts explained, is knowing how to identify the required trade-offs and to make reasonable ones.
For example, the UN’s Sustainable Development Goal (SDG) 13 aims to achieve the goals of the Paris Accord: staying as close to 1.5 degrees of warming as possible. At the same time, the goal of SDG 2 is to eliminate hunger by 2030.
“There are more than 700 million people hungry in the world right now, 3 billion people who don’t have money to afford quality food, and yet the population is growing,” Dr Roberts pointed out. “And so how will we limit greenhouse gases, particularly methane from livestock and meat, which is so critical?” she asked. “How will we control this while the population is growing and we need to use fewer resources? It’s two goals: a socioeconomic goal fighting against our climate goal. How will we feed an ever-growing population that is already hungry?”
The priorities that will make the most significant difference in stopping climate change, she said, are increasing renewable energy, phasing out coal, oil and gas, and introducing a carbon price. But balancing out the socioeconomic issues means it’s not that straightforward. Using the simulation, the teams found the best strategies involved pulling multiple levers across all settings, including energy use and sources, population and economic growth, transport, building and industry, rather than focusing solely on energy.
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Dr Roberts and Mr Roland stressed that this is where Australia has an opportunity to be a strong leader in the transition. “There are very few countries on Earth poised better to deal with the energy system than Australia,” Dr Roberts said. “Dealing with energy will get us a lot of the way there, and then we will have to address agriculture.” More than 20 per cent of global emissions come from the agriculture sector, including food packaging and transport.
“If we think of a roadmap to net zero, number one is to transition away from fossil fuels and deal with coal, switch to renewable energy, electrify everything,” Dr Roberts said, summarising the groups’ insights. “When electrification is not possible, use other renewable energy sources like hydrogen, improve energy efficiency, stop deforestation, remove process emissions and introduce a well-staged carbon price. And for anything that is left, when there’s no other hope, use carbon capture and storage. That’s your roadmap.”
Finally, Dr Roberts and Mr Roland urged attendees to take what they’d learned and apply it as business leaders. “What I hope you will learn from today is that 1.5 degrees is still achievable, but not for much longer,” Dr Roberts concluded. “We have got all the levers that we need to pull, and we have a good idea of how to pull them, and the order to pull them in, to get us to 1.5 degrees global warming.”