Anthony Albanese’s decision to sign Australia up to the G7-backed Climate Club has been welcomed by a leading economist as a possible "game-changer".
Unlike the annual international COP conferences that insiders have characterised as too slow-moving to prevent the worst effects of the climate crisis, the Climate Club will likely supercharge a number of emerging green industries.
According to Nicki Hutley, an economist with the Climate Council, this could include cooperation between other nations and Australia to promote growth in green hydrogen, steel and cement. “In Australia, we’re starting to make breakthroughs, but we’re still a significant distance away. But if you suddenly put multiple advanced economies and their researchers and money together, you're gonna get a faster outcome.”
When will Australia start to benefit?
The reason Ms Hutley believes the cooperation is “potentially a game changer” is because the sharing of ideas will see the economies of both members and emerging nations benefiting both environmentally and economically. “It has the potential to do great good,” she said.
When it comes to a timeline on when Australia will start benefiting financially from the agreement, Ms Hutley is optimistic it could be soon. “Will it be next year? No. Could it be in five years? Maybe. Will it be by 2030? I certainly hope so,” she said.
Who else is in the Climate Club?
The club was first proposed by US Nobel Prize-winning economist William Nordhaus. It begins with nations voluntarily agreeing to a strong emissions reduction target, and then they compel their trading partners to do the same.
Its members include Germany, Indonesia, Singapore, Argentina, Chile, Denmark, Colombia, Luxembourg, the Netherlands, Switzerland and Uruguay.
Australia’s commitment was welcomed by Germany’s chancellor Olaf Scholz after he met with Mr Albanese in Berlin. “I am delighted that Australia has announced it will to join the Climate Club. Anthony, thank you so much for being here today,” he said.
Mr Albanese said Australia is aiming to become a renewable energy superpower and this will involve working with countries like Germany on future industries. “No challenge is of course more pressing than that posed by climate change. Australia and Germany are now united in our deep commitment to tackling climate change,” he said.
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