Garnaut draft report

Portland wind farm in Victoria, Australia. Credit: Robin Sharrock
Portland wind farm in Victoria, Australia. Credit: Robin Sharrock

The Garnaut draft report on economic measures and actions to address climate changes was released on July 4, 2008.

The main points included in the Garnaut draft report are:

  • By 2050, unmitigated climate change on middle of the road outcomes would mean major declines in agricultural production across much of the country, including a 50 per cent reduction in irrigated agriculture in the Murray-Darling Basin.
  • By 2100, irrigated agriculture in the Murray Darling Basin would decline by 92 per cent.
  • Early economic modelling results of readily measurable unmitigated climate change for middle of the road outcomes on temperatures and decline in rainfall – indicate that climate change would wipe off around 4.8 per cent of Australia’s projected GDP, around 5.4 per cent of projected household consumption, and 7.8 per cent from real wages by 2100.
  • Professor Garnaut says: “Australia would be hurt more than other developed countries by unmitigated climate change, and we therefore have an interest in encouraging the strongest feasible global effort. We are running out of time for effective global action, and it is important that we play our full part in nurturing the remaining chance.”
  • Prof. Garnaut reiterates his support for an emissions trading scheme to cover as many sectors as practicable.
  • The Draft Report advocates the full auctioning of emissions permits and the return of all revenue to households and business.
  • The Report proposes that half the proceeds from the sale of all permits is allocated to households, around 30 per cent provided for structural adjustment needs for business (including any payments to TEEIIs), and the remaining 20 per cent allocated to research and development and the commercialisation of new technologies.
  • The Draft Report states that it would be in Australia’s interest to find out as soon as possible whether there can be a low-emissions future for coal, and to support rapid deployment of commercially promising technologies.
  • Professor Garnaut said that he supported the phase-out of the Mandatory Renewable Energy Target, once the unconstrained ETS was fully operational.


  • The Professor is strongly calling for auctioning of all permits under the scheme. This is excellent news which, if adopted, will avoid one of the largest problems of the EU scheme, when sectoral lobbying and deliberate gaming of the market led to horrible market distortions in the first years thanks to the decision to grandfather permits.
  • The immediate inclusion of all energy, industrial processes, fugitive emissions and transport, with forestry and waste being brought in as soon as practicable and agriculture dependent on appropriate measurement capability, is exactly what is required.
  • Support for complementary measures such as feed-in laws and MRETs to bring on line the renewable energy technologies that will power our future, as well as the rejection of nuclear power.
  • Professor Garnaut’s focus on equity, and supporting low income Australians well ahead of industry, is pleasing. Garnaut is strong on not compensating the coal industry for stranded assets.


Professor Garnaut’s much-awaited Draft Report has been criticised for being strong on the architecture but terribly weak on the big, over-riding issue of preventing runaway climate change.

Further criticisms include:

  • His policy prescriptions are completely out of step with his science.
  • He proposes an incrementalist approach with a slow start and even a step backwards on the 2050 emission reduction target.
  • His support for so called “[clean coal]” and his belief that geosequestration will be the saviour of the Hunter and Latrobe Valleys. If he truly understood the urgency of climate change, Professor Garnaut would not be punting on technology which is at least a decade from proving itself, if it ever can, and can never be a truly zero emissions energy source. But, like the politicians, he seems incapable of envisioning Australia beyond coal.
  • Structural adjustment packages, if used to prop up coal jobs, they will surely kill the valleys in the end. If, however, structural adjustment is used to support a green collar revolution, through the restoration of a domestic manufacturing sector and a huge expansion in retraining and re-skilling the workforce, those who are foreshadowing doom and gloom for the Hunter and Latrobe will be proven wrong. Opportunities abound provided the structural adjustment is for the new economy and not trying to shore up coal.
  • Professor Garnaut is in denial about Australia’s domestic forestry industry and its greenhouse emissions. It is vitally important that, in addition to protecting PNG’s and Indonesia’s forests, we stop destroying Australia’s own magnificent and biodiverse forest carbon stores.
  • Garnaut’s biggest problem, however, and the one which may condemn by association all the good material in this draft report, is his support for a slow start to the regime, with a carbon price cap ensuring we don’t try to beat our pitiful Kyoto target, and a significant step backwards on the Labor government’s 60% by 2050 emission reduction target, which he now sees as acceptable in the current global context.
  • From a man who has come so far on climate science since last November, this delay and weakening of the target is deeply disappointing. It seems that, for all his work becoming a climate change guru, Professor Garnaut is still a conservative economist. We need more than a conservative economist and bureaucrat PM to tackle this challenge.

See also

External links

  • Garnaut climate change review – reports can be downloaded from this site
  • Cut taxes to soften climate pain: Garnaut report, The Australian, July 4, 2008
  • Garnaut can’t see the forest for the trees, GreensBlog – the official blog of the Australian Greens Senators
  • Garnaut report resources, Australian Conservation Foundation