Australia’s Greenhouse Gas Emissions: Why Our Exports Are Contributing to Double the Domestic Impact

Australia ranks as the fourth largest exporter of fossil fuel emissions. The United States carries a significant responsibility for helping poorer nations deal with climate damage. A global shift from one energy source to another has never truly happened.

Countries that export fossil fuels also export their emissions, but the reporting gets tricky. The United Nations tracks greenhouse gas emissions based on where they are released, not where the fuels come from. So, even if a country exports coal or oil, the emissions are counted based on where that fuel is burned.

Under the Paris Agreement, countries pledged to cut their greenhouse gas emissions. However, they only report emissions that occur within their borders, ignoring the ones linked to exported fossil fuels.

The graph below shows the top 10 countries responsible for exporting emissions in 2022. Together, these nations account for 60% of global exported emissions, with the top six contributing 50%. The US and Russia are neck-and-neck, with Australia just behind.

Oil is the biggest contributor to exported emissions, with Saudi Arabia, the US, and Russia leading the way. This aligns with their overall emissions rankings.

For coal, the top 10 nations are responsible for nearly all exported emissions, with Indonesia and Australia alone accounting for about two-thirds. Surprisingly, the amount of emissions tied to gas exports is relatively low.

The next chart reveals how the emissions of the top eight countries stack up. Nations like Saudi Arabia, Australia, Canada, and Norway export significantly more emissions than they generate domestically. In contrast, the US’s exported emissions are just a fraction of its massive domestic emissions.

If these countries are serious about combating climate change, they need to address both domestic and exported emissions. Unfortunately, reducing exported emissions often takes a backseat to financial interests. As long as wealthier nations continue to export fossil fuels, global emission reduction goals remain out of reach.

Currently, fossil fuel companies benefit from a lack of accountability under the Paris Agreement. They continue to produce and sell fossil fuels, racking up profits while contributing to pollution.

At the 2023 COP meeting, countries committed to “transition away” from fossil fuels. However, this vague promise lacked concrete goals, timelines, and accountability. It was an improvement over past efforts but still insufficient. Following this meeting, the next COP showed little enthusiasm for meaningful change, partly due to the strong presence of fossil fuel industry representatives.

The question remains: which countries should pay for repairing climate damage?

At the previous COP, countries agreed to raise US$300 billion annually by 2035 for the New Collective Quantified Goal (NCQG), aimed at supporting poorer nations impacted by climate change.

While this is an improvement over the previously agreed US$100 billion, it’s still grossly inadequate.

The next challenge is determining which countries should contribute to this fund and how much each should pay. The World Resources Institute provides a climate finance calculator to assist in this complex discussion. It assesses contributions based on a country’s historical emissions and current wealth.

The calculator consistently shows the US as the primary contributor, given its extensive historical emissions and wealth. For example, in one scenario, the US alone accounts for 20% of the financial responsibility, while Australia is at 2.35%. Most other nations have minimal shares.

While the specific numbers can vary, a clear pattern emerges: around 100 low-income nations should not have to contribute, especially since they often suffer the most from climate impacts. Conversely, some countries that have gained wealth and emissions since the early 1990s, like China and India, should consider taking on some responsibility.

Ultimately, 20-30 nations should bear the bulk of the US$300 billion, and this funding should primarily come from grants, not loans, to avoid increasing debt for vulnerable nations.

When we look at energy transitions throughout history, there’s a common theme. Despite the emergence of new fuels since 1800, we’ve never fully replaced an old fuel. New energy sources supplement rather than replace existing ones. Even traditional biomass usage has risen since then.

Adam Tooze argues that the idea of a smooth global energy transition is overly optimistic. The evidence suggests that if a transition occurs, it will require radical changes.