CANBERRA -- Economic modelling, released late on Friday, has revealed the Australian economy would not be greatly harmed if it went down the path of stronger-than-announced greenhouse gas emission targets.
The Government has unveiled, without any fanfare, modelling it commissioned by former Reserve Bank member and climate economist Professor Warwick McKibbin.
It is designed to be in support of the recently announced 26-28 percent emissions reduction target for 2030 (based on 2005 emissions) that the Government will take to November’s Paris climate conference.
The Minister in charge of the Australian delegation to Paris, Foreign Minister Julie Bishop, told The Huffington Post Australia the official target is non-negotiable, credible and responsible.
Just prior to announcing the target, Tony Abbott attacked a tougher emissions modelling of 44 percent done in 2013 by the now defunct Climate Change Authority, claiming it contained, “massive and unmanageable costs, massive increases in power prices, massive increase in the hit on families’ cost of living".
But that hasn’t been found in the McKibbin report, which has been prepared in consultation with the Department of Foreign Affairs and Trade (DFAT).
Overall, report declares “the Australian economy is expected to grow strongly to 2030 regardless of whether Australia adopts a post-2020 target".
Professor McKibbin has compared four vastly different long-term emission reduction targets and compares them to a “business as usual” model.
For the tougher cut of 45 percent by 2030, the report says the hit to gross domestic product (GDP) would be less than one percent, at just 0.7 percent.
A target of 26 percent by 2030 would reduce GDP by 0.2 to 0.3 per cent, according to the McKibbin report.
The Abbott Government’s modelling notes that a post-2020 target will have a “slightly higher impact on Australia’s economy than most other developed economies”, but it says Australia is expected to grow faster than Japan, the EU and Canada.