Transcript Economic risk of change

Climate change in Western Australia
WALIS Forum 2008
13 March 2008
Dr Ray Wills
CEO, WA Sustainable Energy Association
Principal, Future Smart Strategies
School of Earth and Geographical Sciences,
The University of Western Australia
Sustainability in a changing climate for the
community - and business.
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McDonald's Corp. is blogging on the environment.
Starbucks Corp. has a green-themed online game.
Hilton Hotels Corp. linked manager pay to green outcomes.
All corporates have worked for years or even decades on proenvironment strategies and corporate social responsibility, and
growing awareness of global warming among consumers is
accelerating change.
Businesses in green buildings report improved productivity, better
staff retention, fewer sick days, millions of dollars in energy
savings and a reduced environmental footprint.
Some companies that "go green” have seen a 25% increase in
trade with eco-shoppers and eco-traders, with a trend for green
businesses to only deal with other green businesses.
First - some greenhouse science…
Greenhouse and global warming
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Greenhouse theory
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Anthropogenic global warming theory late 1960’s
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Basis first proposed by in 1824
Greenhouse = earth’s “blanket” average temperature about 15°C; otherwise would be -18°C
UN and IMO lead debate late 1979
Intergovernmental Panel on Climate Change formed 1988
Rio 1992, Kyoto 1997 …
Warming of climate is now unequivocal – global
increases in air and ocean temperatures, melting of
snow and ice, and rising sea level.
The enhanced greenhouse effect is not hypothesis empirically and theoretically well-established.
Instrumental record - temperature
Evidence of global warming
artwork
"Hot with a chance of a late
storm"
by The Glue Society.
About WA
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WA perhaps first Western economy with recognised
measurable economic impact through climate change.
About WA
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Annual inflow to Perth dams dropped from 338 GL to 114 GL
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Source: Water Corporation 2007.
About WA
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WA perhaps first Western economy with recognised
measurable economic impact through climate change.
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WA SW had 20% decline in rainfall in the last 30 years effects on runoff more serious with 50% drop in steam flow
to reservoirs
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Further 20% reduction predicted, and this may have
already started at the end of the 1990s.
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Value of lost income in water sales from dams is estimated
at $1 billion in WA through water restrictions and additions
to infrastructure (WaterCorp) - and almost another billion
with Desal II.
About WA
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A warming of 1.0°C is sufficient to move climate belts about
150 km south. A regional temperature change of 2 °C likely
to have a serious impact on most life forms, and on most
ecosystems and agricultural areas.
Changes by 2040
About WA
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Climate change is arguably the most important key
threatening process to all biota.
Biota in narrow climatic bands are likely to suffer
changes in the patterns of distribution and abundance
of a range of species.
Impacts both direct - climate affecting plant species
establishment and persistence, and indirect - climate
impacting bushfire regimes or increased summer
rainfall increasing the spread of dieback.
Rise of 2ºC results in loss of 66% of Dryandra species,
41% of Australian eucalyptus species (including many
WA species), and 100% of Acacia species.
Similar studies for fauna - all frog and mammal species
About WA
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With global warming and
drying of the south coast in
WA, areas with temperature
increases > 2° C combined
with a decline in rainfall
consistently below 400 mm
will lead to the loss of many
species of Proteaceae in
WA's SW.
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It is likely the iconic Banksia
and Dryandra will die out.
So too will the animals that
live on them.
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About WA
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Climate is key determinant of agriculture - changes
in climate will impact on crops and livestock.
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Rising temperatures will cause a shift in budburst,
shorter growing seasons, earlier harvest dates,
lower crop quality, changes in soil temperatures.
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Wheat growing areas in SW WA seriously impacted
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Northern wheatbelt likely to disappear, south reduced.
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Wipes out most of an industry worth more than $2 billion.
Climate is a key influence in grape selection.
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Shifting rainfall patterns and drier conditions will change the way
vineyards operate and reduce the wine crop.
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WA produces around 5% of all Australian wine, about 25% of wine in
super-premium and ultra-premium categories.
Sea level changes
Mandurah
at 1m sea
level rise
Courtesy of WA Sustainable Energy Association
Sea level changes
Mandurah
at 7m sea
level rise
Courtesy of WA Sustainable Energy Association
Sea level changes
About WA
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The Indian Ocean has warmed an average 0.6°C since
1960 - the largest warming occurred off Northwest WA.
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Bleaching of coral from higher ocean temperatures will kill
parts of the Ningaloo Reef just as the Great Barrier Reef.
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Acidification of oceans through
carbonation will impact on
fisheries.
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Impacts will be greater for some
regions and ecosystems, and will
be most severe for coral reefs
and the Southern Ocean.
Global changes
http://www.igbp.kva.se//uploads/ESO_IGBP4.pdf
Abrupt climate change
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Abrupt climate change is inherently unpredictable.
For this reason climate adaptation is as important
as climate mitigation of greenhouse gases.
Knowledge that abrupt climate change and natural
disasters have wrenched past societies into
disarray makes the case to build resilient societies
more urgent.
Responding to climate change
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The threat of dangerous climate change underscores
the need to build a sustainable economy.
An effective response will change the way we use
energy and in so doing, future proof our economy.
Action by government, business and the community
must put in place measures that
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reduce unnecessary use;
promote energy efficiency across life cycles;
reduce our reliance on increasingly expensive traditional
fuels; and
promote the production of energy through renewable
generation.
Economic risk of change
Climate
Risk
Sector Level
Political /
Regulatory
Physical Risk
Supply Chain
Company Level
Staff
Litigation
Reputation /
Brand
Products /
Technology
Business Advantage On A Warming Planet - Jonathan Lash
Litigation
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Negligence is common law – if you have knowledge
that something is at risk and fail to act, you are
negligent.
Australian Securities Exchange (ASX) updated
guidelines state companies are required to disclose
whether they have policies to manage risks that might
include environmental and sustainability issues.
More than any other issue, global warming is blurring
the lines between corporate fiduciary duties,
profitability and corporate social responsibility.
Energy - and networks
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Fossil fuel prices will continue to push up inflation, but
renewable energy will continue to shine on us, to wash
up on our shores, and to blow past us without
additional cost.
Australia is the Middle East of renewable energy and
we are failing to harvest the energy bonanza for the
benefit of the Australian economy and especially for
Australia’s export industries.
We need to plan the networks, strategically place the
infrastructure.
Inflation
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A sustainable way to fight inflation is deliver energy
efficiency in all things that result in long term energy
savings and
reduce
inflationary
pressures that
would otherwise
impact on
the CPI
Send in the paradigms
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We need to stop growth in emissions, and then reduce.
Some big experiments in socialism failed because they
failed to take account of the market.
Capitalism will fail if it ignores the ecological
consequences of our use of the environment.
A lesson from history is that we don’t learn from history
(we need to change this!)
Winston Churchill:
 History tells us that we will choose the right path –
once we have explored all the wrong ones.
 It's not enough that we do our best; sometimes we
have to do what's required.
WA SEA –
WA’s peak body for sustainable energy
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WA SEA works on behalf of members to ensure
that the State and Federal Governments support
the development and adoption of sustainable
energy technologies and services that minimise the
use of energy through sustainable energy practices
and maximise the use of energy from sustainable
sources.
Our members are the business part of the solution
to climate change. Join us…
The inconvenient truth - time has run out
for solutions that are simply convenient.
Dr Ray Wills
WA Sustainable Energy Association
[email protected]
Future Smart Strategies
[email protected]
School of Earth and Geographical Sciences,
The University of Western Australia
[email protected]