Australia's carbon emissions: simple maths, hard choices

Australia produces barely 1 per cent of the world's total CO2 emissions. This is a trivially small figure in the global context, putting us well down the list (16th) of global emissions. To recycle an often-quoted example, even if we somehow removed all people, animals, power stations and vehicles from Australia so that our emissions fell to zero, the reduction in the global total would hardly be noticed. An analogy from the economics textbooks is that Australia is an emissions-taker, not an emissions-maker. Our aggregate emissions are so small that we cannot independently have any influence on the global outcome: that is driven by the big polluters such as China, USA, India, Russia and Japan. The dilemma is that when we turn from the national aggregate to emissions per person, we shoot up the international rankings, occupying an eye-watering position as the second-worst carbon emitter in the world.

How on Earth do we get from a low aggregate ranking to being one of the world's highest emitters on a per capita basis? Most of us can remember enough school maths to know that when you divide by a small number you get a large result. Accordingly, Australia's total emissions of 361,262 kilotonnes put us in a respectable 16th position globally. Divide by our small population of approximately 23.5 million and the result is 15.4 kilotonnes. Now we occupy the second spot in the per capita league table.

Dramatic they may be, but emissions per capita are almost irrelevant. Any country's emissions are driven principally by its geography and economic structure. Australia is an energy-intensive economy. We have aluminium smelting, which has been colourfully described as "congealed electricity". We generate a substantial proportion of electricity from coal. We have major agricultural activity. With long distances between a small number of cities, our transport sector is responsible for a large share of emissions.

It is this structure which explains our emissions, and it is the total that matters for policy, telling us the magnitude of the task. Other things equal, a more populous country will always have lower emissions per capita.

Per capita measures of CO2 cannot be dismissed out of hand. While they are essentially a residual rather than causal or explanatory measure, those high emissions per capita leave us badly exposed to international criticism, vividly seen in MP Craig Kelly's recent interview on British television. When the weather presenter accused Australia of being one of the world's highest polluters, she did not bother to disguise the implication that we are morally at fault. In doing so she belied the expertise she claimed, but the damage was done. The impression conveyed was that we have been living high off the hog and blithely contributing to global warming.

There is, second, the question of logic. If we argue that Australia's high per capita emissions signal the need for urgent action, does that mean that China (per capita emissions rank 47) or India (rank 158) can do the opposite, taking no further action despite being among the world's biggest emitters in aggregate terms?

Third, high emissions per capita feed the misleading idea that this summer's bushfires can be directly attributed to Australia's own carbon emissions. Pollution can sometimes create localised outcomes (think of car exhausts in a congested city), but in the general case atmospheric circulation makes CO2 emissions a global issue. If our bushfires were caused by our own emissions, why don't other weather-related disasters around the world correlate systematically with a country's per capita emissions?

Our second-worst rank in emissions per person may warrant only low marks for hard-nosed policy relevance, but cannot be ignored. Australia likes to think of itself as a good international citizen. To be tarred as a small population enjoying an enviable lifestyle at the expense of poorer countries does not sit well. That ill-informed outburst by a weather presenter on British television may have done us a favour by highlighting how others see our alleged failure to tackle high emissions.

This summer's bushfires have been transformative. There is ample evidence that the fires were not unprecedented. Nor is there a shred of evidence that they can be attributed to Australia's own emissions. But the perception has taken hold that the fires were caused largely by the global warming for which our own high emissions are partly to blame. For those cautious about the role of CO2 emissions, and who have a considerable "yuk factor" for stunts by St Greta of Thunberg, Adani protesters or marching schoolkids, the "evidence" that emissions and global warming were to blame could be seen every night on television. The lack of genuine evidence does not alter the fact that the bushfires created their own perceived reality. "Quiet Australians" have moved on.

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Third, the arithmetic indicates that our emissions make no significant difference to the global total. Chief Scientist Alan Finkel has argued that if all low-emission countries took the position that their contribution is insignificant, then none would act. The logic is clear, but there would be a significant "free-rider problem", with a temptation to cheat by any individual country that knew its behaviour would have no measurable effect on the global total.

Getting countries to agree to the Kyoto and Paris protocols was like herding cats. Large polluters such as China and India justifiably resent any proposal that might limit their ability to become as affluent as Western countries. The low emitters are mostly low-income countries that see no reason why they should do the heavy lifting. As a good international citizen, it is not in our interest to risk being named and shamed as one of the worst emitters on a per-person basis. We must be seen to be pulling our weight.

If we put these elements together, the outlines of a policy can be discerned. As one element in a long-run, cost-effective target for electricity generation and emissions reduction, a feasibility study for a power station using Queensland's low-emission coal would make good sense. As a standalone policy, it utterly fails to match Boris Johnson's cut-through plans for electric cars in Britain.

At a stroke, Boris (doesn't everyone call him Boris?) has defined the direction for emissions reduction and industrial restructuring in Britain. It's doubtful if Australia should copy that specific policy. Our distances and population density are quite different. What we do need is a comparable overarching policy that will define the objectives and approach, harness the hopes, and dispel the fears of the new "perceived reality" unleashed by the bushfires.

There are at least two overarching policies that we might consider. The first is to build upon Ross Garnaut's vision that Australia has the potential to thrive in a future post-carbon world. We have unparalleled renewable energy resources. We have the necessary scientific skills. The importance of this idea does not lie so much in its specifics, but in addressing the concern that major CO2 reductions in Australia would mean forgoing our comparative advantage in energy-intensive activities. Garnaut argues that we can combine those energy resources with our scientific skills to become a home - indeed, a superpower - for renewable energy in a post-carbon world.

A further possibility is to think of setting a target for zero net emissions, together with a map of how we get there. The idea of zero net emissions is rapidly becoming fashionable, but needs to move from the vaguely aspirational to the specific. If coupled with at least the framework of the Garnaut vision, it would offer a positive approach and not merely the usual impression that zero net emissions will cost jobs and incomes. It does not mean pfaffing around with quasi-theological debates about this or that target for solar or wind. Such talk doesn't even come close to addressing the concerns stirred by the bushfires. A new coal power station in Queensland may well be consistent with a target for zero net emissions, but it should take its place as one element of the "big idea" exemplified in Boris' announcement but so embarrassingly missing in this post-bushfire era in Australia.