South Korea

The election of Joe Biden to the White House is likely to see Australia increasingly isolated as the world heads to net zero emissions, with quite fundamental implications for our economy. Let’s have a look at what has happened in the last two months.In September, the European Union proposed increasing its 2030 target from 40% to at least 55% reduction below 1990 levels in order to meet the net zero by 2050 target it adopted in 2019. Critically, the EU has made climate action one of its three main Covid-19 response priorities, so that at least 30% of its multi-annual budget and recovery fund is to be spent on achieving its increased 2030 emission reduction targets and its climate neutrality goal for 2050. These new goals for the EU27 would bring its domestic emissions very close to a 1.5°C Paris compatible level for the period to 2050. The UK has similar goals and ambitions to the EU27.Shortly afterwards, President Xi Jinping announced that China would “aim to achieve carbon neutrality before 2060”, the first time China has acknowledged the need to reach anything close to zero CO2 emissions by mid-century. If it covers all greenhouse gas emissions it would also be very close to what is needed by mid-century to be in line with the Paris agreement’s long-term goal. If this goal covers CO2 only, then China would need to achieve carbon neutrality around 2050 for this to be compatible with the Paris agreement.With China responsible for about a quarter of the world’s emissions, a move to net zero by mid-century has very significant implications for global temperature, lowering the Climate Action Tracker’s end of century projections by 0.2-0.3oC towards 2.4-2.5oC, compared with the previous 2.7oC projection.In October, both Japan and South Korea also announced net zero GHG goals for 2050. Japan’s prime minister, Yoshihide Suga, announced Japan would aim for net zero greenhouse gas emissions by 2050 with several specific measures, including a fundamental revision of its policy on coal-fired power plants. In an important change to Japan’s narrative, Suga emphasised the benefits to economic growth from the net zero commitment, whereas he’d previously characterised it as a cost.Getting to net zero essentially means the phasing out of coal, gas and oilThis was followed two days later by the South Korean president, Moon Jae-in, announcing his commitment to achieving carbon neutrality by 2050, replacing coal power generation with renewable energy to create new markets, industries and jobs.Taken together, these four countries account for about 40% of global GHG emissions. There is also a large number of smaller countries with comparable net zero emissions commitments that would bring the total global coverage to about 48% of global emissions.What’s notable about all of these announcements is that they were made in the absence of any commitment by the United States and before any US presidential election outcome. China’s announcement in particular seems to reflect a geopolitical judgement by the Chinese government that they intend to move forward with ambitious climate goals even without the US.Arguably, these moves by this set of countries on their own will generate a major global move towards increased ambition and towards net zero by 2050.So where does this leave Australia? These net zero by mid-century moves by its major export markets create huge challenges.In 2019 China, South Korea and Japan accounted for 72% by value of Australia’s exports of LNG and coal: 88% of Australia’s LNG exports; 75% of thermal coal exports; and 51% of metallurgical coal exports. It is notable that none of these countries have focused on natural gas and all have mentioned renewable energy and other technologies, and all recognise that early action on coal is needed.The election of Joe Biden could trip this already major momentum into a landslide towards higher climate ambition. His election means the US will re-enter the Paris agreement, reverse the Trump administration’s rollbacks and make a significant contribution to closing the Paris agreement’s ambition gap with a new 2030 target. If he took the initiative to reboot US action in line with his plan to reach net zero emissions by 2050, Biden could reduce US emissions substantially by 2030.If he is able to fully implement his proposed Energy and Climate Package, and continues to be supported by the existing strong sub-national action in the US, the US could significantly reduce its 2030 emissions, reducing the gap between where it is headed now and a Paris agreement-compatible emission range for that year.Even in the case of delays and challenges to federal action, the efforts of state and local actors, such as the We Are Still In campaign, are expected to continue. A recent study estimated that enhanced action by subnational actors in the US could reduce emissions by 37% below 2005 levels by 2030. Biden as US president may not have control of the Senate (although the vote count on this result is far from over – and may not be resolved until January), but there are workarounds.Biden also has a net zero 2050 goal, which will place the US close to a Paris agreement-compatible emissions pathway. This would further lower the 2100 projected warming by about 0.1°C, and further if America undertook negative emissions action of scale beyond 2050. So the EU, China, Japan, South Korea and the US – about two thirds of the global economy, about half the world’s emissions and close to 75% of our fossil fuel export markets –will have net zero goals for 2050 or shortly afterwards. This is a massive shift.Let there be no misunderstanding about what this means. Getting to net zero essentially means the phasing out of coal, gas and oil, with markets more or less halved by 2030. This is a seismic shift for Australia and it means that it’s very likely that demand for our coal and gas will drop at least as fast as it has risen in the past few decades.It would hardly be a strategy for Australia to follow Poland’s lead and simply start to stockpile coal in warehouses. Diplomatically, Australia will find itself increasingly isolated, even in its own region and in particular with its close Pacific Island neighbours, not to mention the two superpowers, China and the US.Australia needs a forward-looking strategy aimed at taking advantage of its massive natural advantages in renewable energy and the resources essential for the low and zero carbon transition, and one that provides for a just transition for the communities and workforces affected by the rapid reduction in the markets that they have hitherto dependent upon.There is no time to be lost dithering, denying and obfuscating.• Bill Hare, a physicist and climate scientist, is the managing director of Climate Analytics More