Carbon Pricing Information Forum With Greg Combet

(6.30pm 9 November 2011, Lower Sydney Town Hall)

Thank you, and hello, everyone. Welcome to our forum. I'd like firstly to acknowledge the Gadigal people of the Eora nation, the traditional custodians of this land and acknowledge the significant role the SMH plays in supporting our City Talks and in the case of tonight's City Conversation.

I also welcome our speakers:

  • Greg Combet, the Federal Minister for Climate Change and Energy Efficiency;
  • Tanya Plibersek, the Federal Member for Sydney and Federal Minister for Human Services & Social Inclusion;
  • Geoff Cousins, Telstra board member and author;
  • Andrew Petersen, CEO of Sustainable Business Australia; and
  • Ross Gittins, economics editor for the Sydney Morning Herald.

I am very pleased to welcome you tonight to this City Talk - part of a series of talks the City regularly hosts throughout the year to inform, and we hope to inspire Sydney citizens. A number of these talks have addressed the urgent challenge of global warming including a June City Talk with Ross Garnaut.

Tonight, we want to dispel the confusion and misinformation surrounding the Federal Government's policy on carbon-pricing. It is clear that vested interests, scaremongering, political ambition and outright miscommunication have clouded the debate.

Carbon pricing is one of a range of strategies that Australia needs to play its part to address global warming—an important, even essential, part of the solution.

An emissions trading scheme will help Australia meet carbon reduction targets in the most cost-effective way by giving polluters an incentive to pursue the lowest-cost abatement opportunities.

Despite reports to the contrary, this is not the first country to place a price on carbon. In fact New South Wales introduced Australia's first mandatory emissions trading scheme in 2003.

China has announced plans for an emissions trading scheme to be rolled out in six provinces by 2013, and for a national scheme by 2015. Many other countries have also introduced a price on carbon.

There are necessarily costs associated with reducing and preventing environmental impacts—but the cost of doing nothing far outweighs the cost of action.

The Federal Government's Climate Commission's review of the science of climate change recently concluded that climate change is real and is occurring at a rapid rate, and that two degrees is the maximum temperature change before our planet risks tipping into catastrophic climate change.

We are in the critical decade and the decisions we make from now until 2020 will determine the severity of climate change our children and grandchildren will experience.

While the 'Chicken Littles' rush around claiming the sky will fall due to carbon pricing, the facts are that revenue from the carbon price will flow into emission reduction projects, clean energy, job reallocation and compensation to industry and households.

It gives us an extraordinary opportunity to foster innovation, create new jobs and develop a more intelligent economy - one that does not rely on digging up finite resources and shipping them out.

In 2007, The City joined the C40 Cities Climate Leadership Group, a network of large cities globally engaged in practical local action to reduce the impact of climate change.

At the C40 biennial Summit in São Paulo earlier this year, President Bill Clinton said unequivocally that building a sustainable future is the only possible basis for a functioning economy.

Action to address climate change was, he said, "not only needed for the planet - it's also good economics".

He backed that up with the information that, in the United States, 870 jobs are created for each one billion dollars spent on a coal-fired power station. The number of jobs is even less for nuclear power stations because the plant is so expensive.

By contrast, one billion dollars invested in solar energy creates 1,900 jobs; one billion dollars invested in wind power creates 3,300 jobs; while one billion dollars invested in energy efficiency projects create 7,000 jobs.

The relativities are similar globally, though the benefits are likely to be even greater in developing countries where - of course - there is also the greatest need for jobs.

A recent NSW Treasury assessment—which the State Government hoped would demonstrate economic catastrophe due to a carbon price — in fact showed that Sydney would have more jobs and stronger growth at the end of the decade because of the emissions trading scheme.

I welcome the resolution at the recent Local Government Association of NSW Conference to support carbon pricing — a natural extension of the existing work on climate adaptation and mitigation.

Local government is at the coalface of the risks and impacts — including uncertainty in land-use planning, increased emergency storm and bushfire management, coastal erosion, reinforcement of stormwater and sewerage systems, and educating our communities.

Across New South Wales and Australia, local government is leading in much of the practical grass-roots work needed to reduce greenhouse gas emissions and to change existing activities to reduce vulnerability to the impacts of climate change.
Research released at the C40 Summit in São Paulo showed that governments of large cities globally are also routinely ahead of their regional and national governments on climate action.

The research into climate action in C40 cities found that mayors oversee 4,734 actions to address climate change, with 1465 more under consideration. And these cities have significantly improved the scale and speed of their climate action since the establishment of the C40 in 2005.

This is really important because cities are responsible for up to 75 to 80 per cent of greenhouse gas emissions, so we know that it is action in cities that provides greatest opportunity for deep cuts in emissions.

The City of Sydney believes that our efforts will be easier once the carbon-pricing scheme comes into effect next July. With the carbon price set and increases capped over three years, we have greater certainty and can assess our strategies and projects accordingly.

Sustainable Sydney 2030 aims to reduce greenhouse emissions by 70 per cent of 2006 levels over the next 19 years. This will be achieved partly through a trigeneration network producing low-carbon, locally provided electricity, initially powered by natural gas before transitioning to renewable gas from waste.

Trigeneration captures the waste heat produced from the electricity generation and uses it to heat and cool buildings. This system is almost three times as efficient as a coal-fired power station and this efficiency, together with the savings in distribution costs, means cheaper energy.

Although local trigeneration is not common in Australia, at least 10 of the C40 cities have extensive networks. New York has been powered by cogeneration for more than a century, and it's implementing new tri-generation systems, along with comprehensive energy efficiency retrofits for older buildings.

The economics of reducing carbon emissions will improve with the introduction of the carbon price.

The Transport sector is a contributor to greenhouse gas emissions and the City is working to provide lower carbon alternatives including car share, support for electric vehicles and establishing a cycling network as a real alternative for shorter trips.

We are building a 200 kilometre bicycle network and with 10 kilometres of separated cycleways already built, we are already beginning to see the benefits.

In the last year, we counted an average increase of 60 per cent in the number of cyclists at the morning peak and 48 per cent in the evenings. While the process has been difficult at times we are seeing a new cycling culture develop in the city.

However to maximise the benefits, we need a regional network beyond the city boundaries - one that will connect with major inner residential and retail areas and educational institutions.

In 2010, together with neighbouring councils and the former NSW Department of Environment and Climate Change, we commissioned an independent cost-benefit analysis for a bike network spanning 15 council areas, and sought Federal funding.

Our work shows that just $179 million would create a 284 km network covering 164 suburbs and a population of 1.2 million people—and increasing cycling by 66 per cent by 2016. That's a big reduction in emissions, congestion and health costs!

The independent study found the network would generate $4 benefit back to the community for every one dollar spent. Motorways only return $2.

While we are funding our city network for $76 million, other council's don't have the same resources and they really need that infrastructure and Federal funding.

The City also has a range of sustainability programs in place for both residents and businesses to help reduce energy consumption and energy bills. The programs will also help reduce the costs associated with carbon pricing.

These programs include Smart Business Live Green, which helps small business with strategies to reduce energy, water and waste.

Office tenants are catered for with the CitySwitch Green Office program to help reduce energy consumption, and the Better Buildings Partnership was formed in July this year, working with the owners of 60 per cent of our commercial office space to achieve our 2030 goals.

These are hard-headed business leaders who recognised the commercial advantage of reducing their carbon emissions, and some already operate stand-alone local energy systems for their buildings.

For residents, there is the Green Apartment Buildings program, helping owners and body corporates to reduce the environmental footprint of their buildings; our Green Village Workshop Series helps individual households reduce their footprint while the SAVE program focuses on improving environmental and social sustainability for social housing residents.

The City of Sydney became Australia's first carbon-neutral local government in 2007, through buying green power and carbon offsets.

Since then, we've completed 18 solar projects, reducing emissions by 180 tonnes, and we've established a $10 million renewable energy fund—and we are currently assessing a tender for this work.

Building retrofits have reduced emissions by 17 per cent across our property portfolio since 2006 and we recently signed up to complete a full portfolio refit which will reduce energy use by an additional 23 per cent and carbon emissions by 20 per cent.

Our 18 month trial has demonstrated low-energy LED street lights can reduce energy use by half, and we are now in the final stages of assessing a tender to install LEDs on all 8000 of our street lights.
We are also exceeding our targets for diverting domestic waste from landfill, and expect to achieve a 68 per cent resource recovery this year. Landfill, the traditional method of dealing with our garbage, is a source of methane, a potent greenhouse gas. We are working on technologies to convert our residual waste to renewable gas to power our trigeneration network.

It is astonishing that the sceptics demand that we persist with business as usual, in the face of all the evidence that we must and can change.

Climate change is real and all of us will have to live differently in the future.

We all know that change is difficult. Most people are innately conservative and do not want change.

We need political leadership on this most important issue about creating a future for our children and grandchildren.

The passage of the carbon pricing legislation in the senate yesterday was an enormous relief and a cause for great celebration—and I commend Government, independent and Greens members who acted responsibly and courageously—and voted for our future.

Thank you.