Five things the Business Council can do if it really ‘supports action on climate’

As Australia swelters through one of the most extreme heatwaves on record, the CEO of the Business Council of Australia (BCA), Jennifer Westacott, has come out to defend the council’s position on climate change. This is a regrettable decision.

Westacott claims that it’s “pointless” raising emissions targets “with no road to get there”. She claims that the BCA “supports action on climate” because it supports the Coalition’s inadequate 26-28% emissions reduction target. But the reality is there is a big difference between lowering emissions a little bit (shuffling deck chairs on the Titanic) and delivering meaningful solutions on climate (turning the course of the ship early enough and fast enough to avoid a deadly disaster).

Scientists and climate experts agree: the Federal ALP’s 45% emissions reduction target by 2030 is the absolute least Australia must do in order to do its fair share in the global effort needed to avoid dangerous climate change.  

For too long the BCA has been part of the problem on climate. If the BCA actually wants, as it claims, a “workable plan for Australia”, here are five things the council and its members can do to show it is ready to help steer this ship away from climate catastrophe.

1. Acknowledge that business has been part of the problem

A constructive and honest conversation must start by acknowledging the role of business in creating the current uncertainty around climate and energy. Companies are increasingly coming out to lament the lack of policy certainty about climate and energy policies, but how many businesses supported Tony Abbott’s “Axe the Tax” campaign?

Yes, the BCA (representing more than 100 Australian businesses) has recently been on the record calling for policy certainty. But it was also one of the most vocal organisations calling for an end to the carbon price. Similar situations occurred with both the renewable energy target (RET) and the carbon pollution reduction scheme.

While Westacott claims that “re-treading old political battles isn’t an action plan for the future”, if the BCA wants to be credible on climate it needs to own that its past positions have been a key contributing factor to the current political situation.

2. Stop calling for bipartisan support

From the Energy Council to the Investor Group on Climate Change, business associations continue to call for bipartisan support on climate and energy policy. Doing so is either a tacit validation of regressive views held by the so-called Monash Forum, or it is political naivety from organisations that should know better.

Bipartisan support for action on climate is not a realistic option in Australia as long as climate deniers such as Tony Abbott, Craig Kelly and others have the ability to topple prime ministers.

Unless these groups are actively working to remove these climate blockers from parliament, they need to resign themselves to the fact that any real action on climate (which includes decarbonising our electricity sector) won’t come with bipartisan support any time soon and they should stop calling for it.

Doing so only makes the job of securing energy and climate policy harder.

3. Stop lobbying against climate and clean energy policies (publicly or privately)

Woodside recently called for a carbon price; this is despite the fact that the company lobbied for free permits when there actually was a carbon price. Businesses of all stripes lobbied Tony Abbott to scrap the Energy Efficiency Opportunity (EEO) Act in 2014. This legislation — which required Australia’s largest energy users to undertake an energy efficiency assessment and report on any measures with a less than four-year payback — was the essence of good, effective, light touch regulation. It was the only legislation that required company boards to proactively manage their energy risk, and it worked. Between 2016 and 2011, the EEO saved businesses $808 million of a potential $1.2 billion in savings identified.

Yet even that was too arduous for Australian businesses. It was scrapped in 2014.

These scrapped policies are important elements of a plan to act on climate in Australia. Will BCA and its members, after a long history of obstructing these policies, now call for their reintroduction?

4. Join the RE100

Some businesses, like the Tomago aluminium smelter, call the ALP’s plans ambitious. However the plans are nothing when compared to the clean energy plans of many businesses.

At the end of 2018 the Commonwealth Bank of Australia joined 75 other companies including Mars, drinks manufacturer CUB and Google as part of a global business renewables lobby called the RE100. CBA also joined the ranks of more than 30 organisations that have signed corporate renewable power purchase agreements. At the same time, more businesses installed solar in 2018 than ever before.

Businesses that are serious about acting on climate should join the charge, and the BCA should encourage its members to join.

5. Get serious about energy productivity

In addition to jumping on the renewable energy bandwagon, businesses also need to get serious about energy efficiency.

Australian companies are woeful compared to their international competitors when it comes to energy productivity. The latest American Council for an Energy-Efficient Economy (ACEEE) international energy efficiency scorecard shows Australia is the worst performing major developed country in the world; we are lagging behind developing nations such as India, Indonesia, and China. Australia scored particularly poorly in industrial energy efficiency (22nd out of 25), meaning that industry is paying more than it should to meet its energy needs.  

Improvements on this front could deliver big benefits. A recent study by ClimateWorks Australia, revealed that some Australian firms could see annual profits grow by between 2.2 and 13.8% by increasing energy efficiency.

In the end Australian businesses can either accept the climate science or end up on the wrong side of history. If they do accept the science, they need to acknowledge that we are accelerating closer to the proverbial iceberg thanks to a decade of inaction — and that we need to turn this ship around sharply and quickly.

Nicky Ison is a research associate at the University of Technology Sydney, co-founder of the Community Power Agency and author of the Repower Australia Plan.