The Political Economy of Carbon Pricing in Australia: Contestation, the State and Governance Failure
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The political economy of carbon pricing in Australia: Contestation, the state and governance failure Rebecca Pearse A thesis in fulfilment of the requirements for the degree of Doctor of Philosophy School of Social Sciences Faculty of Arts and Social Sciences October 2015 ORIGINALITY STATEMENT ‘I hereby declare that this submission is my own work and to the best of my knowledge it contains no materials previously published or written by another person, or substantial proportions of material which have been accepted for the award of any other degree or diploma at UNSW or any other educational institution, except where due acknowledgement is made in the thesis. Any contribution made to the research by others, with whom I have worked at UNSW or elsewhere, is explicitly acknowledged in the thesis. I also declare that the intellectual content of this thesis is the product of my own work, except to the extent that assistance from others in the project's design and conception or in style, presentation and linguistic expression is acknowledged.’ Signed Date 22 / 10 / 2015 Abstract This thesis examines the rise and fall of an emissions trading scheme in Australia between 2007 and 2014. It offers a novel analysis of the Australian climate policy debate. The thesis develops a heterodox political economy of carbon pricing that draws out the links between polyvalent social struggle over climate change and the process of instituting marketised climate policy. In contrast to existing depictions of the struggle over carbon pricing as a neat division between forces for and against carbon commodification, the thesis argues that there is a more complex dynamic at play and explores the contradictions of carbon pricing in theoretical and empirical detail. The prospects of legitimate and effective carbon pricing cannot be asserted in principle; rather they must be examined empirically. The thesis provides evidence of the interconnections between political contestation and the brief institution of a carbon market. It details carbon pricing policy and legislation, parliamentary debates, and contests in the media and civil society. The case of carbon pricing in Australia illustrates that the approach to marketised climate policy adopted does not deal with, and in fact has exacerbated some pre-existing issues of governance failure in energy and land sectors. The thesis demonstrates that governance failure provides a more compelling explanation for the outcomes observed than approaches that conceptualise the political economy of carbon pricing in terms of state failure or market failure. The normative implications of the political struggles in Australia are explored. Contestation over carbon pricing reforms has posed a political challenge to marketised climate governance in Australia. Conservative and industry opposition is a key part to the political failures of carbon pricing, but so is the broader lack of authority of social democratic political parties, experts and environmental organisations on this issue. A popular agenda for carbon pricing is now very far off, if not impossible. However, new strategic directions within environmentalism indicate that ‘energy politics’ is emerging as a more fruitful political arena than carbon pricing politics. i Acknowledgements I owe particular thanks to Marc Williams who has been an immensely supportive supervisor and lecturer before that. Marc has provided invaluable feedback and guidance. I’m indebted to his capacity to help dig out an argument when it’s buried. Stuart Rosewarne from the University of Sydney has been hugely helpful and encouraging. He generously gave up his time to read draft papers and chapters along the way and I have been inspired by his scholarship. I am also grateful to Liz Thurbon my co-supervisor and to the thesis examiners for thoughtful feedback. James Goodman, Raewyn Connell, and Linda Connor have all been great to work with and learn from. On different projects they have all taught me a lot about how to approach academic work and how to think. I owe a special thanks to Linda for listening to my climate policy ramblings on the car drives North West. I have been privileged to share parts of my intellectual journey with other students at UNSW. Michelle Jamieson, Ashley Barnwell, Florence Chiew, Patricia Morgan, Zoe Baker, Anisha Gautam, Ele Jansen, Emily Auton, and Yvette Selim have all been wonderful companions. Very special thanks to Ashley for the fruit box chats and to Michelle for telling me to finish. Thanks also to the people who participated in interviews for this project. We had sober reflections on the challenge of climate change in those discussions and I am grateful to have benefited from their wisdom. Thanks also to Julia Dehm, Ellen Roberts and Bronislava Lee for their friendship and their insights into climate politics of all kinds. Big thanks to Dayna Williams and Lance Pearse for being awesome. Biggest thanks to Tim and Jim Hitchcock for constant gentle reminders that relaxed is the best way to be. They are my heroes. ii Published material Some of the material in this thesis is drawn from peer-reviewed journal articles published during my candidacy. Chapter 6 draws from peer-reviewed publications on land offsets and Australia climate policy. Pearse, R. (2013), ‘Back to the land? Legitimation, carbon offsets and Australia’s emissions trading scheme’, Global Change, Peace and Security, 25(1): 43-60. Pearse, R. (2012), ‘Mapping REDD in the Asia-Pacific: Marketisation, governance and contention’, Ephemera: Theory and Politics of Organisation, 11: 181-285. Chapter 3 uses text from a peer-reviewed paper reporting on the Australian emissions trading legislation. Pearse, R. (2014a), ‘Carbon trading for climate justice?’, Asia Pacific Environmental Law Journal, 17 (November): 111-130. Chapter 1 uses a small of amount of text from a review article written with Steffen Böhm. Pearse, R. & Böhm. S. (2015), ‘Ten reasons why carbon markets will not bring about radical emissions reduction’, Carbon Management, 5(4): 325-337. Chapter 7 uses a small amount of material from a co-authored book I wrote with Stuart Rosewarne and James Goodman. Rosewarne, S., Goodman, J. & Pearse, R. (2014), Climate Action Upsurge: An Ethnography of Climate Movement Politics, London: Routledge. There are other publications I have written on climate and environmental politics during my candidature. There is no text taken from these works in this thesis, but they have been part of my learning process. Pearse, R. (2010b), ‘Making a market? Contestation and climate change’, Journal of Australian Political Economy, 66: 166-198. Pearse, R., Goodman, J. & Rosewarne, S. (2010), ‘Researching direct action against carbon emissions: A digital ethnography of climate agency’, Cosmopolitan Civil Societies Journal, 2(3):76-103. Pearse, R. (2014b), ‘Review essay: Climate capitalism and its discontents’, Global Environmental Politics, 14(1): 130-135. Connell, R. & Pearse, R. (2015), Gender: In World Perspective, 3rd edition, London: Polity. [co-authored revision of Raewyn Connell’s textbook, including new chapter titled ‘Gender and environmental change’] iii Contents I Introduction ............................................................................................................... 1 II Theorising carbon pricing ...................................................................................... 19 1 Carbon pricing and political contestation ............................................................... 21 2 The political economy of carbon pricing ................................................................ 61 III The state and governance failure ............................................................................ 83 3 Historical dimensions of Australian climate policy ................................................ 85 4 Failure of the CPRS .............................................................................................. 111 5 The rise and fall of a carbon price ......................................................................... 133 6 Case studies of governance failure ........................................................................ 149 IV Contestation and competing imaginaries ............................................................. 173 7 Populism and the techno-market imaginary .......................................................... 175 8 Fossil fuelled future? ............................................................................................. 189 V Conclusion ............................................................................................................ 211 Appendix A ................................................................................................................... 216 Appendix B ................................................................................................................... 219 References ..................................................................................................................... 221 v Acronyms AAU Assigned Amount Units ACA Australian Coal Association ACF Australian Conservation Foundation ACCI Australian Chamber of Commerce and Industry ACOSS Australian Council of Social Services ACTU Australian Council of Trade Unions AFGC Australian Food and Grocery Council AGO Australian Greenhouse Office AIGN Australian Industry Greenhouse Network Ai Group Australian Industry Group ALP Australian Labor Party ANT Actor Network Theory APPEA Australian Petroleum Production and Exploration