Net zero, avoided emissions and Hector the sentient lump of coal
There are a lot of empty maxims in the communications and climate advocacy space, but the truly solid one is that repetition is key.
So, let’s say it again: the engine of climate change is the rapid accumulation of greenhouse gases inside the finite bucket that is the Earth’s atmosphere and oceans. The only way out: putting a hard stop to our species leaking this substance into the skies, and eventually, figure out how to undo the damage already done.
My previous post, about Shell’s climate plans, dug into how what seems to us like strong climate ambition can actually badly breach this principle. Promises to offset emissions, ‘carbon intensity’ targets that allow plenty of wiggle room to increase total emissions — it’s a lot.
“Net zero by 2050” has become a rough shorthand for “probably enough”, in terms of climate action. But if flattens a variety of important numbers and, increasingly, it’s losing much of its meaning as a short way of indicating climate ambition — thanks to continuing efforts to co-opt good faith assumptions towards nefarious, emissions-increasing ends.
Things just got worse, with a major player on the global climate stage adding a new layer of confusion to a term that’s already buckling under pressure.
It all ties back to a sentient lump of Australian coal with wide eyes and a tortured, immortal soul.
The math of avoided emissions
A common argument used by the fossil gas industry around the world is that because burning gas is (in their eyes) cleaner than burning coal, that counts as “emissions reductions”.
Putting aside the questionable nature of that claim (digging up and transporting gas releases methane, as well as other GHGs, often discounted from this calculation), burning gas still worsens climate change, even though emissions would be higher if coal were burned instead:
The principle is relatively straightforward: the laws of physics that govern the response of the Earth system to these substances don’t pause determinism and check to see what worse outcomes there could have been. There isn’t some molecular committee that receives carbon dioxide molecules, notes that there could have been more if coal had been burned instead of gas, and applies a ‘thanks for trying!’ discount on planetary warming.
It isn’t about what might have been — it is about what happened.
On February 10 this year, Mark Carney, the Vice Chair at global asset management firm Brookfield and a former Bank of England Governor serving as a major advisor on the COP26 summit, said this, of his company:
“Brookfield is in a position today where we are net zero. That’s not just net zero in our operations, the buildings we have and when we take flights again and the hotels and the paper etc, but across the $575bn asset portfolio. And the reason we’re net zero is we have this enormous renewables business we’ve built up, and all the avoided emissions that come with that”
It’s worth noting that Brookfield do indeed own a decent capacity of renewable energy. In 2019, they generated 57 terawatt hours of zero carbon energy, slightly more than all zero carbon sources on Australia’s National Electricity Market. They claim this generation displaces 27 megatonnes of CO2–e. It’s a little difficult to find the justification for this, but it sounds plausible (Australia’s RET scheme avoided around 30 in 2019). Nothing to sneeze at.
However, Brookfield do, as a company have their own emissions footprint. Their latest annual report puts the numbers like this:
The “avoided emissions” theme about renewables dominates their report. “We measure our GHG emissions with a focus on reporting avoided emissions, meaning GHG emissions that would have been produced had our electricity been sourced from non-renewable fossil fuels”, they write.
But the greenhouse gas molecules that leave the jet engines of those planes remain blissfully unaware of the vast quantities of renewable energy being operated by the parent company of the human beings inside the flying aluminium tube. Those molecules impact the climate just the same, no matter how many hydro plants and solar panels exist elsewhere.
If some equivalent number of those molecules were captured, either by nature or technology, and stored away as permanently as they were when they were fossil fuels, that would be getting close to a “net” effect. “Avoided emissions” are very good — they’re exactly what we need more of. But they cannot be considered as “cancelling out” other emissions.
All activities that release greenhouse gases must mostly come to a complete halt, or in some rare exceptions, be neutralised by re-capturing released carbon. That’s the end of the story — there is no wiggle room here, because the laws of physics don’t care about our framing.
Brookfield have actually been making this claim for some time. In their Q4 2019 letter to shareholders, they wrote:
“The sheer scale of our renewables business and its avoided emissions eclipse our estimates of emissions across all our other businesses. On this basis, we believe Brookfield’s overall carbon profile today is very low, if not neutral or possibly even negative”
They repeated this in their 2020 Q4 letter, too. It wasn’t an ‘off the cuff’ remark’ — this has been part of the company’s messaging for years.
Carney later “walked back” the statement — sort of.
In the statement above, Carney hints at “managing” investments to be consistent with a net zero economy. He mentions it in his original Bloomberg talk, too:
“Just because we’re net zero doesn’t mean everything is green. We have assets that span the spectrum, and we have a commitment that we will manage those assets and work to decarbonise those assets over time, very transparently, and provide the information that the market needs in order to judge that. It’s climate change, so all have to work to take carbon out”.
What he’s talking about here is Brookfield’s core climate harm, and it doesn’t have much to do with flights, or renewables. It has everything to do with a lump of Australian coal.
Hector, the lump of coal
If you’re wondering why climate seems to keep getting worse, its because the people who cause the problem keep trying to expand, and often they succeed faster than efforts to counter. One clear example is a major piece of coal infrastructure that never seems to make a mention in Brookfield’s sustainability repots.
Brookfield owns a 49% stake in Queensland’s Dalrymple Bay Coal Terminal (DBCT). Ulf Erlandsson from the Anthropocene Fixed Income Institute (AFII) points out that Brookfield has launched a “USD7.5bn Global Transition Fund (‘net-zero’) fund” at literally the same time that DBCT has announced plans to expand the amount of coal that it sends around the world 15 megatonnes per annum. That project is known as “8X”.
“The exploitation of all of [Dalrymple Bay Coal Terminal] could lead to 300Mt per year in emissions and 3GT over ten years”, write AFII. That is, of course, 11 times the amount of emissions “avoided” by Brookfield’s renewable energy assets. It’s more than half of Australia’s entire annual domestic emissions, flowing through this single coal port, and due to be unleashed into the skies and oceans when the product is used.
This could get even worse — there’s a “9X” project in the works, too, which would add double the increase in capacity, up to 136 megatonnes of coal passing through the facility, each year.
DBCT doesn’t dig up coal, or burn it. But it accelerates it — enabling its transport around the world, and contributing to its fate, which is to be burned and cause climate change.
Brookfield tried to sell off DBCT last year, and ended up owning almost half of it, due to a tepid reaction. “The coal export risks out there were just a bit too high for us,” Hugh Dive, chief investment officer at Atlas Funds Management, told Reuters. As the world pays more and more attention to the consequences of fossil fuel infrastructure, things change.
Scrutiny has an impact. We know this because this is the same DBCT that created a huge, wide-eyed, bespectacled (is it short-sighted?) coal goblin that created haunting educational videos for locals schools.
His name was Hector.
After he was discovered, he went viral — in the bad way. And now there isn’t a trace of him on the DBCT website, and his Youtube and Facebook presence has been scrubbed. Hector’s Fun Zone only exists on internet archives. It turns out the optics of an anthropomorphised lump of coal are not great, and that public scrutiny actually leads to changes.
DBCT isn’t Brookfield’s only investment. Greenpeace’s Unearthed site lists quite a few others, here:
- The Natural Gas Pipeline Company of America
- The Inter Pipeline in Canada
- The Abu Dhabi Natural Gas Infrastructure
- The East West Pipeline in India
Brookfield does not seem to invest in digging up fossil fuels, or burning them — but it is heavily invested in the metal blood vessels that transport fossil fuels around the world. That counts as a climate impact, but is essentially invisible in their climate reporting (scope 3 emissions only seem to look at flights, and nothing else). “Within the envelope of net-zero carbon, we will continue to own and operate certain essential infrastructure assets globally that transport fuel”, Brookfield told Unearthed. “We believe the operating experience we have gained in transitioning from carbon-intensive to net-zero carbon ourselves will make us better owners of many of these assets”, Brookfield said in their most recent shareholder letter.
Building renewable energy, electrifying things and pushing fossil fuels out of grids, homes, industry and transport is very, very good. There is a hard number of emissions that would’ve occurred, had that not happened, and the people behind those renewable energy projects deserves credit for doing so.
However, being a major stakeholder in a project to create the world’s largest coal export terminal isn’t cancelled out by more solar panels and wind turbines. We won’t really be avoiding emissions until every step of the process of worsening climate change begins to contract, rather than expand.
That means recognising when the terminology used to describe good climate action is being abused to defend bad decisions.
