Issue: 533
Sent: 22-11-2013 09:23:03
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China Leaders Make Growth the PriorityThe Essential SMSF Guide 2012-13Government Climate Policies Lag Consumer RealityEmail Marketing For Planners
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Government Climate Policies Lag Consumer Reality

Click here to buy - A How To Book of SMSF's by Tony Negline
Mark Edwards

Whilst international attempts to agree on climate change policy and emissions targets proceed at a glacial pace, it appears that market forces and the combined efforts of the world's population are making changes to emissions without a regulatory framework.

Each year, the Netherlands Environmental Assessment Agency and the European Commission's Joint Research Centre (JRC) produce an annual report on CO2 emissions and global trends. Their latest report analyses data up to the end of 2012. For the last 10 years, emissions have increased at an annual rate of 2.9%. However, in 2012 the report found that whilst the total level of CO2 emissions reached a new record of 34.5 billion tonnes in 2012, the increase in emissions was only 1.1%.

CO2 emissions growth has largely moved in lockstep with global GDP. The only recent year in which emissions dipped was 2008 as a result of the GFC. As a result of this, governments have been reluctant to curb emissions for fear that emissions reduction will lead to GDP reduction.

The CO2 emissions growth rate from 2012 shows that is not the case. Whilst global GDP for 2012 was about 3.5%, emissions growth was less than half of that at 1.1%.

A contributor to this result was the US switching from coal to cheap natural gas from fracking. This was driven by cost reduction rather than emissions reduction, however, that really is the point to make here. Much of the work in reducing emissions at an indivual or corporate level involves cost reduction.

The bulk of CO2 emissions come largely from burning coal. Coal is largely used for producing electricity. So anything that uses less power reduces your power bill (or your company's power bill) and leads to a reduction in CO2 emissions. For example, when you install more efficient lighting, you save money and reduce emissions.

The same applies to waste in general. Food, packaging and consumables all require energy to produce. If you waste less of them you need to produce less in the first place saving both money and emissions.

For example, cooking enough for your family to eat without leaving leftovers that end up in the bin reduces your grocery bill. This eventually reduces the amount of food needed to leave the farm gate which reduces the emissions required on the farm and in transport.

The issue of global warming somtimes seems so vast that there is nothing an individual can do. This thinking is quite wrong. All of the small changes by individuals and companies have added up to a significant global change in emissions growth in 2012.

The green/labour spin on emissions reduction is that it is a necessary cost that we should bear. The liberal spin is that it is an unnecessary cost that we should not bear. What the market is discovering is that it is not necessarily a cost at all.

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