Atonement for Environmental Sins: A Market-Based Solution for ASEAN-Australia Carbon Problem

AAYLF delegate from Malaysia Paul Lim Pau Hua explores the implications for climate change for ASEAN countries and calls for urgent regional cooperation on environmental issues.

 

In December of 2015, a total of 195 countries converged unanimously to sign the Paris Agreement, ASEAN member states also pledged their commitment to reducing emissions by 2030 under this agreement. It was hailed worldwide as a historic achievement. Nonetheless, the impacts of climate change on our planet are now being felt acutely across the globe. Not forgetting the fires that raged through forests in Indonesia during this past August, shrouding ASEAN cities as far as Kuala Lumpur and Singapore [1] in a cloud of thick smog. 

ASEAN Reality: Opportunity to Mitigate Carbon Emissions 

ASEAN is expected to become the world’s fourth-largest economy by 2030 [2]. However, ASEAN countries also face the challenge of how to reduce their carbon emissions as per their promises under the Paris Agreement amidst economic expansion. Currently, there is no mechanism to force a country to achieve the emission-reducing goal to a certain level. Meaning that countries are free to choose the stringency of their emission mitigation targets. 

Given the rapid development of ASEAN economies, carbon offset is an apt solution permitted by Article 6 of the Paris Agreement [3] to mitigate carbon emissions, while not hampering the economic activities. Carbon offset allows individuals and companies to invest in environmental projects in order to balance out their carbon footprints. The projects include reforestation, investing in renewable energy, reducing emissions through energy efficiency, and more efficient agricultural processes. Offset projects have the potential to deliver a range of positive outcomes in terms of environmental, social and economic benefits such as job creation in addition to emission reductions. 

Moreover, carbon credits can be earned by the organization by reducing their emissions below the forecast. It is a certificate that provides the holder of the credit the right to emit one tonne of carbon emission and serves as a tradeable permit in the carbon trading market where carbon is priced. The revenues generated from the carbon trading process can be reinvested and foster sustainable green development projects.

Nonetheless, such mechanisms can pose a risk to the environmental integrity of climate actions, especially if issues surrounding additionality, permanence, leakage, quantification and verification are not adequately addressed. Therefore, well-designed programs may be one way out of the conundrum of needing to achieve steep global emission reductions while at the same time supporting ASEAN development.

ASEAN-Australia Acting on Carbon 

The ASEAN-Australia Strategic Partnership plan of action has stated a commitment to promote regional cooperation on environmental issues. 

In fact, Australia has developed a carbon offset system with a relatively perfect mechanism. So, connecting Australia’s best practices can assist ASEAN to avoid pitfalls. Australia’s National Carbon Offset Standard is a very rigorous and transparent framework that is based on relevant international standards to mitigate emissions. The NCOS was well-drafted with five comprehensive categories [4] to reflect the standard of measurements for different groups. Hence, at a government-to-government level, special policy frameworks designed with guidance from Australia’s Department of the Environment and Energy are recommended to assist ASEAN governments on establishing carbon offset standards. Systematic public policy is a cornerstone for ASEAN governments to provide direction and spur societal adaptation to the practice of carbon offset. 

On the other hand, ASEAN e-commerce is experiencing explosive growth. Nevertheless, packaging waste is fast piling up adjacent to soaring sales, contributing to carbon emissions. Great business leaders have a greater responsibility to act aggressively on tricky problems. Inspiration has been exemplified by the Australian Airline Qantas, who has piloted the emissions offset initiative for their flights.[5] So, it will be exhilarating if e-commerce giants like Tokopedia take the lead in investing in ASEAN’s low-carbon-economy by offsetting its shipping carbon emissions. If this happens, it would signify that every purchase on Tokopedia can make a positive impact for the betterment of ASEAN. It will certainly give the consumers an impression of what responsable e-commerce looks like. 

Time is ticking! ASEAN must dramatically transform how it values the climate in the economic system to realise their promises. 

References

  1. The haze is making a comeback in August, and some Malaysian regions are already affected. https://www.businessinsider.my/the-haze-is-making-a-comeback-in-august-and-some-malaysian-regions-are-already-affected/
  2. ASEAN To Become World’s Fourth Largest Economy By 2030: Singapore Pm Lee https://sbr.com.sg/economy/asia/asean-become-worlds-fourth-largest-economy-2030-singapore-pm-lee 
  3. Article 6 of the Paris Agreement introduces a policy foundation for market-based mechanism in dealing with emissions mitigation, such as carbon pricing. 
  4. Five categories of NCOS: Organisations, Events, Precincts, Buildings, Products Services 
  5. Qantas Says It Will Slash Carbon Emissions to Zero By 2050 https://www.news.com.au/travel/travel-advice/flights/qantas-to-slash-carbon-emissions-to-zero-by-2050/news-story/47c671d590545476d832c4dddba2721b