ROSS GARNAUT Superpower: Australia’s low-carbon opportunity. Reviewed by Kurt Johnson
Respected economist Ross Garnaut shows how addressing climate change provides a golden opportunity for Australia.
Lockdown has had me researching books about climate change in Australia. Delving into the canon is a rollercoaster – readers can expect to experience despair, rage, disgust, sadness and boredom in rapid succession. Yet there are really only three types of climate change lit – first is the desperate plea for change, second is the grinding beige science proving we’re all doomed (followed by a desperate plea for change), while the third and thinnest category contains the plans to actually save the place. Thankfully, Ross Garnaut’s Superpower: Australia’s low-carbon opportunity (2019) is destined to bolster this final category.
For those who do not know, Garnaut, a professor of economics at the University of Melbourne, has been at the forefront of developing economic policy with regard to climate change at a federal level for well over a decade. The two Garnaut Climate Change Reviews commissioned by Rudd, the first delivered in 2008, the second in 2011, provided, for all the criticism they received, the most comprehensive blueprint of how Australia can tackle the climate question. A blueprint yet to be realised.
Aside from climate change in Australia, a perusal of the 31 pages of the long version of Garnaut’s CV reveals a catalogue of published pieces spanning Asian market economics to Marxism in PNG. Which is to say that Garnaut knows his subjects very very well. Such trained focus and technical depth has enabled him to write Superpower – a brilliant vision arguing that Australia’s obligations in the global effort to save the planet from climate change are not a yoke that will slowly suffocate our economy but actually a golden opportunity we’d be mad to miss.
His basic thesis is that Australia is alone among developed countries in our potential to generate vast supplies of renewable power. As far as premises go this is not a new one. Since the invention of the photovoltaic cell commentators have mourned our preference to pollute the skies instead of harnessing sunlight from them. What is fresh is Garnaut’s ability to capture the current state of the (pre-COVID) global economy, and project from it a world in which the odds are increasingly stacked in Australia’s favour – but only if we pursue renewable energy on the double.
Besides our natural advantage in renewables, Garnaut explains a second principle of the new world order likely to work to Australia’s favour: it is quite expensive and inefficient to export renewable energy. The two most conventional methods are sending electricity via direct current submarine cables, and liquifying hydrogen. The former, such as that being attempted in Mike Cannon-Brookes’ immense Asian Renewable Hub, is economically viable only through the project’s sheer scale. The latter liquid hydrogen option involves significant energy loss in the process of liquefaction and shipping overseas. As the world moves towards renewables, industrial potential will become linked to the capability to generate electricity – and this puts Australia at an advantage, competing with most countries relying on expensive imports.
Another axiom: vast amounts of power are required to process raw minerals. Our economy today is based on shipping commodities – often including the coal required to process them at their destination. This model has served us well through the turn of the century but is of fast-diminishing relevance as we progress into the twenty-first. When the world moves to renewables and the cost of importing electricity goes up, it will certainly pay to process ore ourselves as close to the sites of mining and electricity generation as possible. Again Australia has the natural advantage of the raw materials and renewable power potential that other developed countries can only dream of. If we play our cards right it will eventually be far cheaper to do the work of processing ourselves. According to Garnaut, an immense industry could sprout, an industry that could provide jobs that would dwarf the current fossil fuel heavy energy sector.
This is not just an advantage for us. If we become a global centre for ore processing, it would dramatically reduce industrial emissions worldwide:
If we seize this opportunity, Australia will be the locus of a historic expansion of internationally oriented energy-intensive industry.
Garnaut is not satisfied with stopping there: he’s also done the maths to calculate Australia’s capacity for carbon farming – sequestering carbon from the atmosphere and banking it into long-term storage, with a view of selling the carbon credits to countries wanting to offset their emissions. This could allow us to return to the good graces of Europe, a continent increasingly requiring its trading partners to be committed to reducing greenhouse gasses, and so presenting us with further opportunities to trade and grow rich.
What is compelling about Superpower is certainly not the writing. It is only in the introduction and conclusion that Garnaut allows passion to enter his text. The rest is a fortress of fluent Canberran encircled by an outer wall of economic jargon. It resists easy parsing:
There is confusion in the economics literature over the appropriate discount rate – including in the otherwise sound pioneering work of Nordhaus… The way in which we value income and utility in the future relative to the present comes into decisions on the costs and benefits of climate change mitigation in several different ways, requiring the use of different discount rates.
This reviewer will have to take your word on that, Professor.
Thankfully many of the complex ideas are aided by graphs, which really do help comprehension for the rookie economist. And for the most part this jargon is OK. It points to the cold reasoning his argument relies on: it is not just based on a hope that all this stuff might happen, but on a belief that here is an opportunity to be logically derived from the fundamental characteristics of the present.
Garnuat cannot be accused of crying wolf either. He is not a climate zealot demanding change at any cost. His 2008 review was widely criticised for not being ambitious enough. Back then, and again in 2011, Garnaut failed to see the same opportunities for Australia he does now. The state of play was different. For one, few foresaw the rapidity with which renewable technology was becoming cheaper. Yet Garnaut has dodged the all-too-common trap of climate change writing – cobbling together a flimsy case based on the hope that it can be so. Instead, he only identifies the opportunities he uncovers through sober analysis.
It’s not looking good that Garnaut’s ideas will be heeded. Morrison’s Gas Led Recovery promises to be another in a long line of missed chances to tackle climate change. In light of Superpower, this particular miss is the most galling not just because it chooses to sacrifice much more later for a little now, but because the economic case and the moral case have finally aligned. To discount Superpower is not just reprehensible but confirms that our leaders are driven by ideology, political division and the fossil fuel lobby far more than by the good economic sense they claim.
In the future we’ll look back at Superpower and be called to account for not acting on what we knew at the time.
Ross Garnaut Superpower: Australia’s low-carbon opportunity Black Inc. 2019 PB 224pp $29.99
Kurt Johnson is a journalist and author of The Red Wake: A hybrid of travel, history and journalism, Random House, 2016.
You can buy Superpower from Abbey’s at a 10% discount by quoting the promotion code NEWTOWNREVIEW here or you can buy it from Booktopia here.
To see if it is available from Newtown Library, click here.
