Fossil fuel climate claims

Why is it so hard to have a rational debate about energy use and climate change?” was the plaintive cry of Whitehaven Coal’s CEO Paul Flynn in The Australian this week. Well, one reason might be that his industry along with the oil sector has spent decades obfuscating the issue. What’s more remarkable is that in 2021 Flynn still sees merit in running a slightly updated version of the same interference.

The coal 21 argument put forward has the usual canard that we can’t just stop using fossil fuels tomorrow, which pretty much everyone gets (except a handful of green extremists). There’s the standard nonsense that Australian coal is “low emissions”. No coal is low emissions on any meaningful scale, but some coal may be higher emissions than others.

The picture Flynn paints of his coal output somehow saving young girls in rural India from having to go fetch buckets of water all day would be laughable if it wasn’t so desperately cynical. The reality is that rural Indians who lack electricity do so because they can’t afford it, regardless of how it is produced. That’s not going to be solved by kind-hearted Australian coal barons selling their coal to India (presumably at market price).

Major developing nations like India and China already have a good deal of baseload power, whether coal, hydro or even nuclear. So new capacity to meet rising demand doesn’t have to be more of the same. Their grids could likely accommodate renewables for new capacity for several years at least, and the new energy sources would on average be cheaper. This is a very different dynamic from mature economies like Australia, where new renewables are mostly displacing output from existing plant, and renewable penetration is reaching levels where we need to spend a lot of money on other infrastructure such as new transmission, batteries and synchronous condensers to keep the system secure.

Elsewhere in the media, APPEA chief Andrew McConville was running similar lines on behalf of his members, Australia’s oil and gas producers. Glossing over oil, he focussed on the supposed benefit of LNG. McConville has an easier story to tell, since gas could plausibly be displacing higher emission fossil fuels in the Asian markets our LNG tankers are destined for. Although, that may depend on how much leakage is happening at the wellhead. He also namechecked hydrogen as the oil and gas sector’s natural future. Intriguingly he seems to think that blue carbon, where emissions are produced but then captured and sequestrated is a better value bet than green hydrogen fuelled by renewables. This may be true, but it depends on a reliable, well-functioning and replicable capture and storage mechanism, which decades of demonstration projects have struggled to deliver. Australia’s flagship CCS project is the Gorgon project in WA, which has not lived up to expectations.

It’s curious that both articles resort to convoluted arguments about what they may or may not be displacing or replacing in the countries where their respective fuels are ultimately combusted. There is a simpler line of argument. Emissions reduction is predicted on countries periodically meeting and agreeing to make commitments through the UNFCCC framework. Early on in this process, the accounting convention was set that emissions from burning fossil fuels are the responsibility of the country where they are burned, not the country that extracted the fossil fuels. Both coal and gas in Australia are dominated by the export sector. It’s simply not our business what the buyers do with it or how well it fits in with those countries’ climate commitments. For sure it makes sense to keep an eye on this, because if Japan, Korea, China or India decide to reduce emissions faster, then those markets may shrink rapidly. But in the end, it’s up to them. Unilaterally refusing to export fossil fuels to them is like pushing on a piece of string, they will just buy from elsewhere. This is the straightforward riposte to climate activists who rail against the industry. Of course, that still leaves us responsible for our own fossil fuel consumption, but that is a different issue.