Australia can achieve a 60 per cent reduction in greenhouse emissions by 2030 20 years earlier than the target set by the Rudd Government chiefly through energy-efficient buildings and appliances, a new report says.
Global business consultants McKinsey & Co claim deep cuts to Australia's emissions are achievable and affordable, with an estimated gross cost to the economy of $2.9billion, or an average of $290 a household.
But it warns the scale of changes required is substantial and the Rudd Government must urgently set "aggressive but realistic" emission reduction targets to avoid dangerous climate change.
In an analysis issued today which charts Australia's cost curve for carbon reduction, the company recommends the Rudd Government take three key steps to cut emissions set an aggressive reduction target for 2020, accelerate policy implementation, and proactively support global programs to achieve greenhouse cuts.
"Australia's recent ratification of the Kyoto Protocol forms a binding commitment to stabilise greenhouse-gas emissions at 108 per cent of 1990 levels by 2012. Failure to do so will have real consequences in the upcoming commitment periods, and current projections indicate that Australia will need to strengthen its efforts to meet this target," the report says.
It claims by 2030, a total of 60 megatonnes of carbon cuts an 11 per cent overall reduction can be found in the building sector, "and many can be implemented today". These include improved commercial air handling, air-conditioning, water-heating systems, changes to lighting systems and energy-efficient stand-by features.
Other quickly implemented measures include refrigeration efficiency, more fuel-efficient cars, improved tillage and fertilisation for farms, electric motor-drive systems, replanting of native vegetation on marginal crop and grazing land, capture of methane leakage from mines and geothermal baseload power generation.
The report excludes nuclear power from the cost curve "because it appears highly unlikely that regulatory approval would be granted to build such a facility by 2020".
The McKinsey cost curve analysis does not include solar thermal power, which CSIRO claims is capable of meeting Australia's total electricity demand from a 35sqkm area with high levels of sunlight and low cloud cover.
Within the power sector, significant emission cuts can be achieved through carbon capture and storage for coal and gas, onshore wind and geothermal power generation.
The report estimates just under 8 per cent of Australian energy could be produced by geothermal power by 2030. "A significant reduction in Australia's greenhouse-gas emissions is achievable 30 per cent below 1990 levels by 2020 and 60 per cent by 2030 without major technological breakthroughs or lifestyle changes," the report says.
The Rudd Government has committed to a target of cutting emissions by 60 per cent by 2050 but has resisted setting a 2020 reduction goal until it receives a report later this year from Australian National University economist Professor Ross Garnaut.
ANU Climate Law Institute director Andrew Macintosh said the McKinsey analysis showed deep cuts to Australia's greenhouse emissions were "absolutely achievable" without adverse economic impacts.
"All the Government needs to do is get on with it and put these cuts into practice," he said.
Greens climate change spokeswoman Senator Christine Milne said the McKinsey greenhouse abatement cost curve "should end the defeatist claim that serious emissions reductions will ruin the economy".
"McKinsey makes it clear that large emissions reductions can be achieved for very little cost, including a great array of abatement options that save money," Senator Milne said. "Perhaps more importantly, they set this cost against the far larger economic growth, showing how small a sacrifice we need to make.
"The report puts a cost of $290 per household by 2020, over which time household income will be $20,000 higher.
"With such low cost, surely we can afford even deeper cuts, giving us an even better chance of avoiding catastrophic climate chance.
"Indeed, it would be utterly irresponsible not to reach out for them."