Preliminary estimates from the International Energy Agency, released in March, suggest that energy-related emissions of CO2[1] were unchanged in 2014 compared to 2013. Countries experiencing notable drops in emissions included China, Britain, Germany and the EU as a whole, but not, of course, Australia[2]
This has happened before, but only in years of global recession, whereas the global growth rate in 2014 was around 3 per cent. Of course, there are plenty of special factors such as a good year for hydro in China. Still, after looking carefully at the numbers, I’ve come to the conclusion that this really does represent, if not the long-sought peak in emissions, at least the end of the link between rising living standards and CO2 emissions.
The most striking feature of 2014 in this context was the behavior of fossil fuel prices. Coal prices had already fallen a long way from their peak levels in the years around the GFC, and they kept on falling through the year, even as coal mines began to close and lots of projects were abandoned. Oil prices remained at historically high levels until the middle of the year but then joined the downward trend, which has continued into 2015. Natural gas is a more complex story, since there isn’t a global market, and I haven’t figured it out yet.
Still, it seems to me that the 2014 outcome is a consistent with a story in which most growth in demand for energy services will be met by a combination of renewables and energy efficiency, and in which coal continues to lose ground to gas. The lack of demand implies that fossil fuel prices are likely to stay permanently below the levels anticipated when most recent projects were initiated.
Behind all this, it seems as if the various piecemeal measures introduced with the aim of switching away from fossil fuels are working better than almost anyone expected, and with minimal economic cost. Hopefully, this will encourage world leaders to set more ambitious targets, consistent with stabilising the global climate at temperatures 2 degrees or less above pre-industrial levels.
fn1. This excludes, for example, the effects of land use change, on which the IEA doesn’t collect data
fn2. At least after the repeal of the carbon tax
John Quiggin 
This also suggests to me that measures that operate only at the margin are probably more effective and efficient than those that apply to all of the market, whether they be taxes or pseudo markets. I am suspicious of both such camps. Tony Abbott may have inadvertently got it right.
Are there any recent studies on the viability of the Carmicheal and Whitehaven mines that are in the pipeline in Australia, based on current and projected prices?
Surely these mines are no longer profitable. Still, if coal is “good for humanity” then we have a moral duty to dig it up and burn it.
@plaasmatron
My view is that the Galilee Basin mines, including Carmichael, are never going to happen. GVK already missed its payment to Hancock for the second half of the purchase price, and Adani hasn’t found any finance for its projects
http://www.asiaenergysecurity.com/newsdetail.aspx?pid=1948
On the other hand, Whitehaven is already shipping so it only has to cover extraction costs to keep going. Prices will have to fall a fair bit further before that happens
To recap, we have grown 3% on the same fossil fuel energy emissions. It could be any or all of;
(1) More “emission-efficient” fuels like gas.
(2) More use of renewable energy.
(3) More use of nuclear energy.
(4) More efficient production per unit energy use.
(5) Less energy wasted in non-production consumption.
Do the figures tell us in detail which effects as above are occurring?
@John Quiggin
John, the article you linked to refers to GVK missing the payment to Hancock. Aparrently Adani and Carmicheal are all systems go, albeit with significant headwinds.
http://businesstoday.intoday.in/story/gautam-adani-group-australian-coal-mine-investment-analysis/1/213956.html
@John Quiggin
John, the article you linked to refers to GVK missing the payment to Hancock. Aparrently Adani and Carmicheal are all systems go, albeit with significant headwinds.
(this time without the first part of the url)
businesstoday.intoday.in/story/gautam-adani-group-australian-coal-mine-investment-analysis/1/213956.html
@Ikonoclast
You leave out the likeliest factor: a structural shift away from energy-intensive manufactures. The weight of German, British, French anf Japanese GDP has been falling for a while. Chinese heavy industrial production has been growing slower than GDP, and the production of pig iron has flatlined. Some links here in a post of mine, anticipating JQ’s by a fortnight.
Cool.
The levelling out could be correct now we want a steady decline. Some of the IPCC’s high emissions scenarios like RCP 8.5 can now probably be ruled out. I suspect most countries will keep their big coal stations until they need replacing 20 years from now. For example Germany remains steadfastly fossil fuel dependent despite up to 26 bn euro a year in clean energy subsidies; see e.g.
http://en.wikipedia.org/wiki/Energy_in_Germany
Perhaps decarbonising is much harder than we think when fossil fuels remain abundant, cheap and largely un-carbon taxed.
The fact that so far we’ve just tinkered around the edges of carbon reduction makes me wonder how far we can go before it hurts. With say 50% less emissions (as opposed to 5-10%) we’ll probably have less personal mobility, more expensive food and lower real disposable incomes. So far no country has decarbonised both its electricity and transport systems. Achieving the emissions flatline is just the first step.
They write: “At this moment in history, it is paradoxical for universities to remain invested in fossil fuel companies. What does it mean for universities to seek to educate youth and produce leading research in order to better the future, while simultaneously investing in and profiting from the destruction of said future? This position is neither tenable nor ethical.”
http://www.theguardian.com/environment/2015/apr/07/top-academics-ask-worlds-universities-to-divest-from-fossil-fuels
Maybe its not lies damned lies and statistics. For the moment.
But how much is this to do with us being in that economic malaise known as austerity? Perhaps this plateau is absolute. Or its just a temporary step as India and the rest of China demand more stuff just like us and economic fashions change back to Keynesian growth and kick start global growth with a warm and fuzzy PR exterior (circular economy, green growth, pick your oxymoron).
Beyond that as has already been pointed out is the problem of really large reductions. Moderate reductions say 20% would probably be possible simply through efficiencies driven by cost of petrol e.g. trashing those pointless Tourak and Balmain tractors that are still the rage.
But any close examination of CO2 budgets shows you need far more change tantamount to a change in production systems. The latter is possible technologically. And we would all be better off with a degree of small is beautiful. But that would require a change in the economic paradigm as radical as Marxism but far more effective. Not to mention the opposition of the fossil fuel companies.
But I dont see it or even the seeds, my favorite wipping post being the Australian Greens joke economic policy….motherhood statements and a complete lack of collective evidence they even understand conventional economics let alone have an alternative.
Newtonian, there is an Australian state that went from almost 0% renewable electricity to getting 40% of it electricity from wind and solar inside a decade. And so far there has been no change in the economic paradigm. More the opposite really. The dominant paradigm has just gotten paradigmier. And I’ll mention the state went from almost 0% to 40% renewable electricity via policies and technologies that I am given to understand are supported by the Greens. Though I could be wrong about this, as I don’t pay much attention to politics. Maybe the Greens have actually been supporting coal mining and coal seam gas like the Coalition. It’s possible something like that escaped my attention.
It is intriguing that the falling price of coal does not seem to be accompanied by increased consumption.
The world is entering long term stagnation, sometimes called “secular stagnation”. This will bring CO2 emissions down but most likely in a “too little, too late” manner.
The real underlying causes of stagnation now are the Limits to Growth. Although, very poor macroeconomic policy and structural changes in global capitalism also have a lot to do with it. Of the developed world, the EU and Japan are now in permanent stagnation. The USA fends off stagnation for the moment. The New World is not as resource exhausted as the Old World and the US has more power (military) to get resources from the rest of the world.
China benefits for now from the shift of global manufacturing to China. But in many ways, China look to become resource exhausted well before Russia and North America. Collapse will happen on a regional basis: Middle East and North Africa first, then Pakistan, S.E. Asia, India, the rest of Africa, Europe, China, Sth America, and USA/Canada in about that order. Russia is the wild card. Resource reservess say it should collapse last but its authoritarian ineptitude and social issues suggest a much earlier collapse.
@Ikonoclast
Yes. But, also it is bringing down, or leveling, emissions for the wrong reason.
We were told that if we hit 10% renewables on the grid, it would destabilise it and we’d all be rooned; well, in South Australia we went way past that and nothing bad happened. Considering how often load shedding occurred prior to renewables popping up, and the inconvenience of the load shedding happening—I had it happen several times during my cooking for dinner—our current renewable energy sources are no inconvenience.
More recent developments in renewable energy, more efficient solar cells, for example, and micro cells as another, mean that significant numbers of households have little need for the grid, or at least a substantially reduced need for the grid.
There is a lot of inertia of the social kind, but once the barriers come down, the pace of change is rapid. Governments are enablers, or disablers; sadly, we have the latter at the federal level, for the time being.
With respect to the levelling off of CO2, until we see a few more years of it, or even a real decrease, I won’t be calling it a peak. Having skimmed the IEA report, I notice they say carbon dioxide, rather than CO2-e, which makes me wonder if they accounted for CH4 (methane) emissions, a much more significant greenhouse gas than CO2, molecule for molecule. Given the very recent boom in coal seam gas, fugitive CH4 emissions are important to consider as well now.
China claim to be reducing their use of coal because of the urban pollution; clearly this reduces CO2 emissions, all other things being equal. However, if they are still growing their economy, they must be getting energy from somewhere else, or have figured out how to be more efficient in using what they have. Since China’s economy isn’t easy to put a value on for a single short period (e.g. a year), I’m not confident yet that the so-called levelling off of CO2 is in spite of a growing economy. Hopefully it is.
Personally, I am confident it is possible to move to renewables on a mass scale, change how we do certain things—personal travel among them—to adapt to renewable energy sources in the same way we adapted to centralised energy production in the past, and to find further efficiencies in our use of a given unit of energy. Humans are versatile, when encouraged enough.
Ronald & Donald
I wonder if that unnamed Australian state has now found that at ~30% wind and solar (per official statistics) it needs to hold an inquiry into getting other forms of energy. One option is to connect more strongly to a neighbouring state that has the dirtiest energy of all. Yet another state with a historical 86% clean energy mix finds on account of reduced rainfall it will also need more of that dirty interstate energy in 2015.
@Hermit
If a proper emissions trading scheme were operational, coal fired power would be finding it tough to stay in the market. Thanks to the coal people writing the gov white paper, with nought mention of Anthropogenic Global Warming, climate change, call it what you will, our current mob has rolled over for a tummy tickle and a fist full of filthy lucre. Of course dirty coal is cheap power, and while it is cheap, people are going to want some of that; an ETS might just have made the difference, but it is unlikely we’ll get another run at it for at least half a generation. After going to an election on the simplistic mantra of axe the carbon tax, no major political party is going to risk bringing it back in as an election policy for the next election, whatever they think of the arguments on the issue. Only the Greens can risk it, and they aren’t a major party (yet).
I think carbon pricing is the way to go but it seems the public doesn’t. Opinion polls report 65% approval of the RET which according to ACIL Allen has a cost of CO2 avoided of $59 per tonne. When carbon tax was repealed the official price was $25.40. Call me cynical but I think part of the federal RET approval is the desire to preserve state based solar feed-in tariffs most of which seem set to revert to low levels (say 5c/kwh) around 2019.
They say a camel is a horse designed by a committee so I wonder if our pollies can actually implement an ETS that isn’t riddled with giveaways. Case in point Sen. Lambie wants smelters to not have to pay the relatively minor renewable energy certificate component of their electricity bill. What about Aussie Mums and Dads? Her former mentor thinks high emitting nickel refineries should pay the same carbon tax arrears as low emitting refineries. I think the public will have to lead and politicians follow.
Does that fit with a global growth rate of 3%? This sounds a little religious to me. I’d like a more proximate explanation. It seems to me that it is more likely that everyone, or really enough people to make a difference, have realized that the gig is up for fossil fuels and looking for efficiencies and alternatives. There are some good reasons to think that the linkage between fossil fuel use and growth is not that robust and this is what we are seeing.
@Jim Birch
You have not provided any source for your 3%?
It appears to me that capitalist funds seek higher returns than this?
From 1960 to 1973 Average annual growth was higher at least for;
4% Africa
4% South Asia
5% Latin America
5% France
4% Germany
9% Japan
3% UK
4% USA
[United Nations Human development Report 1993 table 3.1]
World GDP growth has been trending down since 1974. See:
http://www.ggdc.net/maddison/historical_statistics/horizontal-file_03-2007.xls
And as a result we have gone through Thatcherism, Reganism, and Keatingesque frantic efforts to prop up their system.
The current result is 200 trillion of debt and climbing.
There may or may not be limits to growth – but there are limits to capitalism.
@Jim Birch
How long can the global economy keep growing on a finite planet? That is the key question. What is your guess?
(1) Forever?
(2) Until the sun dies?
(3) 1 billion years?
(4) 1 million years?
(5) 1,000 years?
(6) 100 years?
(7) 50 years?
(8) 20 years?
(9) 10 years?
The scientists in several disciplines are predicting on average about 10 more years. I listen to scientists a heck of a lot more than I listen to economists. Scientists have a far better predictive record.
I think regional Limits to Growth are occuring right now. It might take another decade or two for the phenomenon to go global.
@Ikonoclast
Just remembered there was this topic discussion relevant to climate change.
Along these lines you might want to look at this article. Its excellent.
http://www.theguardian.com/news/2015/apr/08/can-world-economy-survive-without-fossil-fuels
Cheers
Thanks for the response Ronald. I’m well aware of South Australia’s efforts which are a great start. And please dont mistake my comments as trying to trash PV and related efforts. My problem is that I’m a ‘fine’ details person and regretably what I’m seeing still doesnt add up – its still too little too late given a free market economy. I could rant on for hours but I’ll confine myself to 4 bits of evidence as to why by implication (some of ) the Greens greatly disappoint me. I simply dont see them taking seriously the range of issues beyond motherhood policies not rooted in reality as evidenced for example by their lack of economic policy.
– Firstly there are the contradictory forces beautifully summarized by Larry Elliot of the Guardian (see link just above).
– Secondly there is the problem EROEI Energy Return of Energy Input. The present economic paradigm which was heavily subsidised renewables has worked well on the margins to show what is possible. But the more you go for solar or wind without subsidy the more it will cost and cut into resources that might be used for poverty alleviation etc. I think its affordable with a change in lifestyle and economics but only with that. To appreciate the problem have a look at this article which I’ve posted before : Murphy D.J. (2014) The implications of the declining energy return on investment of oil production. Philosophical Transactions of the Royal Society A: Mathematical, Physical and Engineering Sciences 372. DOI: 10.1098/rsta.2013.0126. It seems to presage a very economic structures.
– Third while renewables are fine for standing energy, transport poses a lot bigger and I suspect costly challenge. The technologies are advancing but the biofuel disasters (e.g. taking food crop land to fuel SUVs) illustrate how the devil is in the detail. Most fundamentally the energy density and convenience of carbon fuels is and probably will remain very hard to replace given a car dominated transport. Its easy to say the market will change things but the physics and chemistry continue to be against it.
– Fourth, a large chunk of the Greens are in denial that population is part of the problem. Its this being wedded to ideology first and reality second which grates on me. We are already at what 1.6 earths in the way of impact. And to bring the 9 billion people to that level might take 4 to 6 earths which is plainly not possible without serious changes in economics and social structures. I say without reservation all people have a right to equity when it comes to their access to resources. But the numbers say this is not possible without massive redistribution which implies a very different economic system especially here in Oz.
I’m not real sure that a large chunk of the Greens are in denial that population is part of the problem. The people I have had cause to rub shoulders with who are in the greens target group certainly do think population, and population growth, are substantial issues. Nearly every environmental issue is compounded by scale, scale which is a function of human population. If we had only a hundred million people on the planet, it would be possible to at least contemplate a relatively stable coexistence with the rest of the ecosystem. Seven billion people, of whom two billion participate in a very capital intensive, conspicuous consumption society, is two or even three orders of magnitude more destructive than the hundred million I chose for an example. It is hard to miss population’s consequences.
So I suspect very few green-thinking people would feel population is not a deleterious factor.
Transport is an issue, no doubt, but then I am impressed with the bike culture resurgence in my city of Adelaide; in the CBD, most days of the year, it is no big deal to scoot along on a bike. Even the inner suburbs are quite accessible. If people didn’t feel so compelled to own a car, at least in the inner suburbs, the road space and road upkeep would change dramatically. Perhaps we need to think of how we can transform our urban environments so as to minimise the need or desire for car-like vehicles? Heck, we even have rickshaws here now.
The 3D printing concept, or additive printing as it is more commonly called, is demonstration of how a change in method of production has been almost revolutionary, in that made-for-single-instance objects, quite sophisticated objects, can be manufactured on the spot. The team going around the US getting children to design their own customised prosthetic limbs is an illustrative instance of how a shift in thinking opens the way to a whole new world of possibility. Instead of one or two very expensive prosthetic parts, an individual may have several cheap parts, each optimised for a specific function—eating vs writing/grasping, for instance. Well, the same kind of shift in thinking just might be required when we look at transport in a non-fossil fuel world.
Meanwhile, back in la-la-land, the Abbottian government has a white paper which can’t even bother to deny AGW, it simply ignores its existence completely.
This is probably for Megan, but why won’t the ALP stand up for something? They keep trying to negotiate and offering deals on the RET, but the more they do that, the more the Coalition will ask for
http://www.theguardian.com/australia-news/2015/apr/08/labor-offers-lower-renewable-energy-target-to-break-deadlock-with-coalition
Stuff em. Go for a real target and let the coalition negotiate. Not as if they’re ever going to get their proposals through the senate, so why conciliate?
@Donald Oats
On population, here’s something I prepared earlier http://fairgreenplanet.blogspot.com.au/2014/10/plea-for-clearer-thinking-on-population.html
Please people, stop over simplifying this issue. Most high emitting countries already have low birth rates. The goals should be:
– Reduce emissions rates in wealthy high emitting countries (first priority, if you can do the maths, which I sometimes wonder about)
– Improve the living standard (using renewables not coal) in poor countries and improve the status of women. That will bring the birth rate down.
What would be the short term consequences, especially downstream consequences, like between now and this time next year, if the opposition (including cross-bench) simply refused to pass any changes to the RET legislation? Perhaps the ALP should just say it is in opposition, it isn’t its problem if the government can’t get a bill through.
@Val
I’ll give it a go.
Because, to “stand up” for something you first have to “stand” for something. The ALP doesn’t stand for anything except the 1% fascist dominant paradigm status-quo business-as-usual credo of their US masters.
In Australia we have a 2 right wing dominated political duopoly. As Tony Windsor says, instead of a choice between any kinds of differing political philosophy we have a choice between two management teams. Both of which are far right neo-liberal, neo-conservative free-market fundamentalists.
This may sound counter-intuitive, but I blame the supposed “moderates” or “progressives” across the ALP/LNP duopoly divide for everything that is hateful and damaging about our country.
As an example: “Labor 4 Refugees”. These people have unconditionally supported a party that has put children and refugees into potentially permanent torture camps. In my mind, those people are more to blame (for continually advocating blind support for the ALP) than the cold-blooded ‘whatever it takes’ crew who so cunningly exploit their blind support.
It’s very simple. If they really oppose the policy then they must oppose the party. But they can’t, because they are weak and hopeless vassals, serfs or toadies of a cult.
@Donald Oats
That would be nice!
And then we could all have a pony. (/sarc)
This “ALP” you speak of, that would be the one that just waved through the mass-date-retention laws? The one that the LNP votes through legislation WITH more often than AGAINST?
When I get my pony can I have a small white kitten as well?
I am reasonably confident that emissions have peaked or failing that will peak in the next year or two. The reasons why I am optimistic are:
China’s coal use declined last year and may decline this year or at least hold steady. The nation is rapidly increasing its renewable capacity which now is staring to offset coal generation rather than merely feed growing demand. China now produces about three quarters as much electricty per capita as the developed nation of Italy. They have considerable room for household energy consumption to increase but this will only happen slowly and new appliances Chinese citizens buy will be small, modern, and highly efficient. Emissions from Chinese construction will fall as China shifts to maintaining their current infrastructure instead of building new infrastructure. Basically they have enough, or nearly enough, modern buildings, roads, transmission capacity, and mechanised farm infrastructure. Coal use for heating, cooking, and industrialised processing has been reduced and will be reduced further. Their massive pollution problems will mean pressure will continue for reduced coal burning. China’s modest nuclear program also helps, though is being phased out thanks to cheaper alternatives. China will not take advantage of lower oil prices to increase oil consumption as to do so will immediately push oil prices back above $100 a barrel as it is one of two elephants in the global room. If it wants to continue to enjoy cheaper oil prices it knows it has to restrict its consumption, and if possible export electric buses and other oil conserving items overseas. (China’s BYD dominates electric bus sales.) Currently there is a steel glut where China is producing steel for less than it costs to produce even at today’s low prices. (We know this because we sell them both the iron ore and coke.) The end result is world steel production will fall, further reducing emissions.
New coal power plant starts have plunged worldwide. This is because new renewables are now cheaper than coal in most areas, even in places that have little in the way of restrictions on pollution. And even where new renewables may not clearly be cheaper there is concern about future carbon pricing or coal taxes and declining renewable costs and the future price of electricity as wind and solar push it down.
India plans to increase its domestic coal production but hasn’t had much luck straightening out its coal sector in the past, so they may not have much success this time round, particularly now that renewables are competitive with coal and Indian cities often have worse air pollution than Chinese ones. India is rapidly expanding its wind and solar capacity. They have a long way to go to catch up with China, but with the cost of renewables falling and their currently mild coal tax recently doubled, the rate of renewable growth is only going to accelerate. For the large portion of the Indian population who live off grid, solar will become their main source of energy and this will slow the expansion of their currently coal dominated grid.
Emissions in developed countries will continue to decline, despite Austalia’s recent carbon fart caused by a fart in Canberra. Australia will never build another coal plant and neither will other developed countries except maybe for a few already under construction or where where the local coal industry manages to cash in on its remaining influence before it completely evaporates. While nuclear power shows that uncompetive generating capacity can hang around for a long time, coal will not receive the support nuclear did.
Every developed country except one or two small ones ruled by mad men have car fuel efficiency standards and are sticking to them despite the fall in oil price. We are unlikely to see a resurgence in oil use and if we do oil prices will shoot up and fix that problem. Electric cars are not yet as cheap as petrol and diesel vehicles if fuel taxes are ignored, but they are approaching that point and their uptake will continue to increase. The oil producing country of Norway is leading the world in this with a quarter of new car sales being electric.
So, the above reasons, I am optimistic that CO2 emissions have peaked. Whether or not we will reduce emissions from this point rapidly enough to prevent deaths in the millions, I don’t know.
Here’s a recent article on electric car sales in Norway: http://insideevs.com/norway-electric-car-sales-nearly-26-market-share-march/
Just to be clear, I include plug in hybrid cars as electric vehicles as they spend most of their time operating as electric vehicles, or at least the serial hybrids do. The plug in Prius is weak in this area as they are stuck in the word of parallel hybriding where they try to fit in a niche where it doesn’t make sense to just give up on parallel hybrid technology and go serial. They’re not doing a good job of it.
(Parallel hybrids power the wheels using the electric motor and petrol motor at the same time, although they might use only the electric motor at low speeds. Serial hybrids only use the petrol motor as a generator and only use the electric motor to send power to the wheels, which is a much simpler design. And rapidly becoming a cheaper design.)
@Ikonoclast
To answer your question, we need to dig out of the cupboard the old Soviet “material product” aggregates: physical stuff not services. Material product has already stopped growing in OECD countries. The worst that can happen is everybody else catching up, but there is no paradox of exponential growth. The service and rent components of GDP can grow without limit, as they are not constrained by matter. El Bulli charged €250 a meal before it closed. I’m not sure whether a world of free T-shirts and €1000 concert tickets makes sense, but it’s not ruled out by running out of resources.
@James Wimberley
I liked your post. As you say, the shift to services is crucial.
@James Wimberley
Without in any way endorsing Iconoclast’s claim about limits to growth, services also require resources to be produced. The €1000 concert needs electricity to power the amplifiers, accountants need computers, doctors need imaging equipment which (for all I know) might require rare materials, and so on.
Ikonoclast, you are dead wrong on limits to growth. Where to begin?
Well for a start, on resource depletion/environmental limits the economists have a FAR better predictive record than the physical scientists (Club of Rome anyone?). That’s precisely because they understand that prices change behaviour – and that rising prices for a depleting good forces relatively painless creation of substitutes (BTW that’s actually the reason why heavy taxes on ANYTHING causes far less damage to overall living standards than the small government people would have you believe).
It is also the reason why pricing carbon properly will, in the long run, reduce CO2 emissions markedly with minimal effect on said growth and living standards. The really, really frustrating thing with global warming is that, unlike some other environmental problems, it is eminently fixable – but won’t be fixed!. The reason it won’t be fixed is mainly the fault of those who believe any fix must radically reduce living standards.
Far and away the most influential and damaging of these people are the industry-sponsored denialists, who have obvious vested interests in claiming this. But people who believe capitalist consumption is ipso facto wicked and therefore we should reduce living standards in the name of avoiding climate change don’t help us arrive at that fix either, precisely because they will never persuade the mug punter in the street that their consumption is wicked.
As for piecemeal action being effective in reducing carbon emissions, yes – have enough of them and they will be. But they will certainly cost more in living standards than a more rational tax-based approach, and there are theoretical reasons (from political economy, not economics) to believe they may not be as politically sustainable in the long run.
I do wonder how many of the public truly understand anything about physics? Although they would deny it, they (people, business, government) are basically propounding that economic production can occur without real inputs (matter and energy). This is the endpoint of the argument that there are no limits to economic growth on earth and/or that we can “de-materialise” the economy somehow.
Human beings are made of matter. They need food and water which are made of matter too. They need shelter, infrastructure and industrial food production at global population levels anywhere in the billions. All this involves the use of matter and energy. You cannot ever de-materialise the economic basics. At some stage relatively soon material growth must stop. Footprint analysis has already demonstrated we are over-populated and in overshoot beyond sustainable levls. There are clearly not enough resources on a finite planet for indefinite growth or even to maintain current overshoot.
Qualitative growth (knowledge, science, technology, culture) appears somewhat different at first glance. It is indeed leveraged (more and better outputs for less inouts) but it is still not ultimately de-materialised in any way and there are also natural limits to all efficiency gains. Qualitiative growth also ultimately runs up against physical limits, particularly energetic limits in the battle against entropy but also material limits, electrical limits, quantum effect limits and so on. Qualitative growth will imply, indeed mandate, higer levels of complexity. How are higher levels of complexity created and also maintained against decay? Yep, by the input of energy. Energy limits will still apply.
I guess people keep their spirits up by denial. Good luck to them if they can delude themselves in this manner. It makes one happier for the moment. However, these delusions that we are not already at an emergency juncture are exacly what makes it hard to get any real changes. It is clear we are on target for damaging levels of climate change. It’s something like 95% certain. It’s clear species extinctions are de-stabilising our whole ecology. It’s clear the oceans are dying. It’s clear we have well exceeded a sustainable footprint. The science is in on all of this.
@derrida derider
How so?
We get unnatural rate of warming when CO2 atm. concentration is over 300 ppm.
How does pricing carbon either remove existing carbon? or prevent warming?.
At best it seems to me that carbon pricing only reduces the rate of increase.
A zero rate of increase of CO2, a levelling off, is not sufficient even if maintained 100 years.
I read a piece in the New Zealand Herald which contained the following:
Mindblowing.
Is this domestic services or services exports? I have my doubts about services exports. Except for education services Australia runs a services CAD deficit or close to. Services exports also have lower labour content.
Australian services – provided offshore to not necessarily produce much domestic benefit.
Australia has no real comparative advantage with services except being English speaking and in the same time-zone as Asia.
Service exports are very vulnerable to exchange rate variations.
While there are short-term possibilities, most developing nations will foster their own services. There is a period when developing countries will increase per capita GDP and will look to purchase services from the OECD. But this strategy has a use-by date.
I would imagine that future trade agreements will make it harder to retain the benefits of services exports in Australia.
Domestic services are a different matter.
The source was John’s original post.
@derrida derider
I’m reminded of the Golgafrincham “B Ark”. In particular the part about designating the leaf as a unit of currency and its consequences.
@derrida derider
they will never persuade the mug punter in the street that their consumption is wicked
That’s because with very few exceptions, such as child …graphy, consumption isn’t wicked. It’s just consumption. There’s a real whiff of the old Methodism amongst those who scold consumption for environmental reasons.
There seems to be this illusion that services don’t cost material resources and energy. Indeed, they do incur such costs albeit lower costs than heavy industrial manufacture or moving heavy freight (including masses of people whom we can also characterise en masse as heavy freight).
There is, as I said in a comment above, a base level of light to heavy manufacture, fabrication and industrial food production (mechanised farms) necessary to maintain a modern society and all its people and infrastructure. Yes, there are enlightened ways we could approach this and add quality services and save energy in other areas. There are also thermodynamic and other physical limits to these improvements. Nothing is infinitely improvable.
Modern gasoline engines have a maximum thermal efficiency of about 25% to 30% when used to power a car. Steam fossil fuel power stations operating at the critical point have efficiencies in the low 40% range. “Tesla, …quotes a 75% round-trip efficiency. Tesla and Leaf owners report slightly lower real-world charging numbers, with the charger and battery portions of the cycle on the order of 80% to 85%. If we use those numbers we get:-
0.90 (motor and drivetrain) x 0.95 (inverter) x 0.8 (battery and charger) = 68%.
This isn’t a huge difference, so we’ll split it and call it 70%.”- Energy Matters website.
Australia could remain self-sufficient and within its own ecological footprint for a long time if we develop a population policy. We could achieve enduring sustainability by capping our population at about 35 million to 40 million people.
Climate change will hit Australia very badly. Without these climate change effects our safe carrying capacity might have been larger than 40 million as an upper limit. The fact that Australia has some demographic space should not delude people into thinking that the globe also has demographic space. It does not. It is already in overshoot.
Footprint analysis is scientfically sound although it does have measurement error like any scientific measurement or measurement set.
“Ecological Footprint accounts do not say anything about what should be, or what any person or group of people should do. Rather, they provide an objective and reproducible answer to the question of how much of the planet’s regenerative capacity is occupied by human activities. No normative or opinion-based judgments or weighting factors enter into Ecological Footprint accounting methodology. For example, the equivalence factors that allow different land types (uses) to be aggregated in the common unit of global hectares are based on empirical measurements of productivity.” – Footprint Network.
Common criticisms of Footprint analysis are answered here.
http://www.footprintnetwork.org/en/index.php/GFN/page/responses_to_published_criticisms/
People who deny the science of LTG and Footprint Analysis (the basic science founded on the notions of a finite earth and material, energetic and in particular, thermodynamic limits are comple Science Denialists (Reality Denialists) pure and simple and engaged in faith-based reasoning. Economics (as bourgeois economics) has become their faith. It’s a faith not a social science and certainly not a hard science.
“The economy” is defined by production not by resource use. Over time resource use must become sustainable at some point, hopefully before the planet is totally trashed, but production and resources are not linked in a rigid linear way. Recycling of materials can potentially occur (almost) forever with each iteration producing a more valuable product. Services can grow indefinitely with level or decreasing raw material requirements.
What I was getting at is that very few people wake up in the morning and and say “I won’t do X because of limits to growth,” even if there are rock solid limits to growth at play. There’s got to be a proximate reason, like, it’s too expensive, it’s illegal, it’s not available, we’ve run out, etc. If the cost of coal is dropping but use is decreasing then this doesn’t seem an obvious case of limits to growth. Kinda the reverse. So, maybe something else is happening. A shift in norms, perhaps? We might not have a universal carbon tax but anyone with a functioning brain can see a real threat of one coming into effect fairly soon and this itself changes planning and thinking. Also, it is possible that some decisions might be being made by people actually be interesting in protecting the environment.
@derrida derider
I think you’re wrong about the Club of Rome predictions, dd. My recollection is that they predicted we would start running out of stuff between about now and 2030. We’re starting to see evidence of that.
As Sandwichman notes http://econospeak.blogspot.com.au/ it’s important not to confuse a flow (global CO2 emissions) with a stock (level of CO2 in the atmosphere). It’s the latter that counts, as the level of CO2 is the driver of heat retention. To reduce the stock to a level that does not lead to temperatures increasing for a decades (there are long lags in earth systems adjustment), we need to cut emissions by at least half.
With my Quiggin optimist hat on, I can acknowledge that zero growth in one year is better than an increase, but it remains a steep uphill battle.
Back in 2008, I took a look at what Club of Rome actually said. My bottom line is that their central case had resource constraints biting sharply by 2000.
https://johnquiggin.com/2008/05/08/looking-back-at-the-club-of-rome/
A look at a Google-Farm demonstrates that service provision is a big consumer of energy; however, much of that energy can be extracted via renewable energy methods, as it isn’t tied to transportation of product. The benefit of providing an e-book compared to the physical book is the obvious one that the e-book doesn’t require the use of paper products, transportation, etc. That doesn’t mean it is entirely immaterial in resource use, but it is surely better than the material product.
As for the Club of Rome, I saw a copy of it when I was at uni in the early 80’s, and my understanding of the objectives behind their work was that they were trying to model the effects, not necessarily trying to make a definite prediction. In other words, they were examining the mechanisms by which limits to growth present themselves. Given the boundless energy with which we humans can innovate, making a specific prediction some 30 to 40 years down the track, pre-dating cheap and abundant computing horse-power with which to run simulations, crunch numbers, is a pretty risky proposition. Perhaps no different to the recent well-known business economists’ predictions that the RBA would lower interest rates in April…Anyway, I’m sure there were reasonable academic criticisms of their work, but the popular media’s representation (and the publisher’s “push piece” on the jacket’s flap) really went walkabout.
To me, although my recollection of the book is now quite hazy, I think the take home message of limits to growth was that there can be large overshoots, time passes, passes, and then the (by now inevitable) crunch comes with a loud bang. That isn’t a guarantee, just a potential behaviour of the system worth making an effort to avoid.
Newtonian, could you explain the problem you see with Energy Return Over Energy Input for renewables to me, using simple sentences so I will understand? I don’t see the problem. Energy has to be put in to build any generating capacity and if it uses fuel it takes energy to get it to the generating capacity. New renewables are now beating fossil fuel generating capacity on this measure, particularly where coal or liquified natural gas has to be transported long distances.