Tell carbon workers the truth about their jobs - Grattan Institute

Australia’s bipartisan commitment to a net-zero emissions economy in less than 30 years requires a socio-economic transition of almost unprecedented scale. Yet, our political leaders have so far been unwilling or unable to give the Australian people the full story covering both the challenges and the opportunities that lie ahead.

Australia has close to 100,000 “carbon workers”, people whose jobs are directly in or tied to emissions-intensive activities such as coal mining, steel making, aluminium smelting, and coal-fired power generation. About half of these carbon workers are concentrated in a small number of regional areas where indirect jobs will also be affected by the transition.

Despite claims to the contrary, the future of much of Australia’s carbon-intensive industries, particularly coal mining, will be determined primarily in Beijing and New Delhi, not in Canberra.

Carbon workers deserve honesty about the limited ability of Australian governments to protect their jobs. The federal government’s current approach – modest domestic emissions-reduction targets – will not in effect protect jobs in the face of global climate action. Nor does it help capture the economic opportunities Australia might have in a decarbonised world. The current approach, therefore, ultimately works against Australia’s national interest.

Domestically, coal-fired power generation is under similar threat because of our bipartisan commitment to net zero and the growth in renewables. The latter is mostly driven by support from state governments, since the federal government’s renewable target is no longer driving growth.

This is an uncomfortable reality for politicians. The Coalition raises alarm bells when the owners of these plants reduce their expectations of remaining plant life. And Coalition MPs warn of implausibly big job losses if possible future coal mines were not to proceed. Yet, the federal government’s own projections show clearly that more early coal closures are expected this decade.

Labor has a more aggressive 2030 emissions reduction objective (43 per cent below 2005 by 2030) than the Coalition’s projection (35 per cent), yet Labor has argued that early closures will be driven by the market rather than by their policies.

The position with natural gas is no better. The Coalition continues to argue strongly for a gas-led recovery, and the Queensland Labor government talks up the challenge of unlocking new sources of gas supply. Neither position is consistent with the International Energy Agency’s assessment that, under a net-zero emissions scenario, global trade in LNG falls by 60 per cent between 2020 and 2050.

The positions of Australian governments on this issue are at least wishful thinking or at worst cynical politics. They tend to want to have it both ways: they love to talk up the big positive side of the story while trying to ignore the negative side. Yet, whoever is in government cannot deliver their emissions reduction targets without an impact on emissions-intensive industries and workers.

On the ground and in the regions, workers and communities are far more realistic. They are not looking to government for empty promises that their existing jobs are secure. But they do want two things. The first is evidence that governments recognise and understand the changes happening around them. The second is for governments not to tell them what their future will look like, but to work with them and the business communities to identify the best opportunities in a low-emissions world and plan how they can be delivered.

And the best time to be planning for a different future is while the existing jobs and the businesses are still robust.

Both sides like to talk up the benefit of jobs from the opportunities from hydrogen and related exports and manufacturing. But both sides fail to work directly with regional Australia on what these jobs could be. While there may be some common areas across several regions, such as large-scale renewable energy generation, opportunities such as green steel or aluminium and critical minerals extraction and processing using low-emission technologies will be locally specific.

Acting on climate change is hard. It is particularly hard for Australia, as a major exporter of fossil fuels with high domestic reliance on fossil fuels. But, despite this, global climate action is in Australia’s national interest. This is easily missed in public debate because the losers from climate action are more visible than the winners, and the costs come sooner than the benefits.

Australia’s carbon workers seemed to reject the ambitious emissions reduction targets that Labor took to the 2019 federal election. Whether Labor has learned from that experience, or the Coalition can successfully reprise its negative campaign, the Australian people need an honest conversation – now.

Tony Wood

Energy and Climate Change Program Director
Tony has been Director of the Energy Program since 2011 after 14 years working at Origin Energy in senior executive roles. From 2009 to 2014 he was also Program Director of Clean Energy Projects at the Clinton Foundation, advising governments in the Asia-Pacific region on effective deployment of large-scale, low-emission energy technologies.

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