This chapter synthesises insights from the Deep Decarbonisation Pathways Project (DDPP), which provided detailed analysis of how 16 countries representing three-quarters of global emissions can transition to very low-carbon economies. The four ‘pillars’ of decarbonisation are identified as: achieving low or zero-carbon electricity supply; electrification and fuel switching in transport, industry and housing; ambitious energy efficiency improvements; and reducing non-energy emissions. The chapter focuses on decarbonisation scenarios for Australia. It shows that electricity supply can be readily decarbonised and greatly expanded to cater for electrification of transport, industry and buildings. There would be remaining emissions principally from industry and agriculture, these could be fully compensated through land-based carbon sequestration. The analysis shows that such decarbonisation would be consistent with continued growth in GDP and trade, and would require very little change in economic structure of Australia’s economy. Australia is rich in renewable energy potential, which could re-enable new industries such as energy-intensive manufacturing for export

Indonesia's environment matters not only to the quality of life of its people, but also to its neighbours and the world. Indonesia is among the world's largest emitters of carbon dioxide, but it has good opportunities to reduce those emissions to the benefit of future generations everywhere. Better management of the environment could also have more tangible benefits, such as saving Indonesia's neighbours from haze pollution, reducing flooding, increasing agricultural productivity and protecting Indonesia's globally important reservoirs of biological diversity.

There is a fundamental tension between the environment and development in Indonesia (Resosudarmo and Jotzo 2009). The country is exceptionally well endowed with natural resources, the exploitation of which accounts for a large share of economic activity. Conversion of natural forests to oil palm plantations brings jobs and infrastructure to backward areas. It also creates large profits for industry as well as substantial tax revenues. So does mining for minerals and coal, and the extraction of oil and gas. Meanwhile, growth in service and manufacturing industries together with rising household incomes mean ever-increasing demand for electricity and other forms of energy.

Managing the environmental effects of economic development is a challenge for all countries. Sustainability entered mainstream global strategic thinking with the 1992 Rio Earth Summit and today finds its expression in the ambition for ‘green growth’. Climate change is the emblematic issue in the quest for green growth, as rapid global economic growth using the conventional, greenhouse gas-intensive model could result in dangerous changes to the world's climate. The issue is not to slow development and economic growth but to achieve such growth in a manner that puts less stress on the environment.

Indonesia could play an important role in the global effort to put economies on a more environmentally sustainable footing. On climate change in particular, Indonesia might be able to take a leadership role among developing countries, because of its potential to change its trajectory in deforestation and energy supply, and because of its strategic position as a large, fast-growing developing country that tends to look for a middle way in international affairs.

Introduction

Adaptation to climate change has become a strategic negotiation issue only recently, although the UNFCCC has referred to it in Article 2 and Article 4. The difficulty of implementing national and international mitigation policies and the increasing awareness of climate inertia eventually put adaptation under the spotlight of science and policy. The EU released a Green Paper on Adaptation (European Commission 2007b) and many EU countries have prepared and started to implement national adaptation plans. The Bali action plan adopted at the December 2007 conference has identified the need for enhanced adaptation action by the Parties of the Convention, and adaptation is among the five key building blocks for a strengthened response to climate change. COP 13 has established the Adaptation Fund Board with the role of managing the Adaptation Fund, established at COP 7. COP 14, held in Poznán in 2008, also made some progress on a number of important issues concerning adaptation.

The ultimate question that interests policy makers is how to reduce the climate change vulnerability of socioeconomic systems in the most cost-effective way. This objective can be achieved with both mitigation and adaptation. It also requires, on the one hand, a thorough knowledge of the size and the regional distribution of damages and, on the other hand a precise assessment of the cost-effectiveness of alternative policies.

Given its local- and project-specific nature, a cost-benefit analysis (CBA) of adaptation strategies has been treated from a micro-perspective.

Eastern Indonesia has for a long time epitomized the problems of development in Indonesia, with the region having lower incomes, higher poverty and worse social indicators than most other regions in Indonesia. The challenge is to achieve economic development. But much economic development relies on more intensive use of resources, which places great pressure on the environment. In some parts of the region this could undermine the future sustainability of the economy. In others it threatens unique environmental systems that are of significance not just for Indo nesia but for the world.

This book brings together contributions from leading experts on eastern Indonesia. It provides comprehensive information on current economic, social, political and environmental developments in the region. The goal is to provide a framework for balancing environmental and social concerns against the need to promote economic development, particularly in areas where poverty is prevalent. Understanding the interactions, trade-offs and synergies between development and environment is a prerequisite for better policies to benefit both the people of eastern Indonesia and the environment.

The existing literature on eastern Indonesia—especially research on the nexus between resources, environment and development—is sparse. Earlier publications of note include Barlow and Hardjono (1995) and Pannell and von Benda-Beckmann (1998). The present book has its origins in a symposium held at the Australian National University in 2006, which brought together some of the leading researchers on eastern Indonesia.

BACKGROUND

Indonesia is the world's largest archipelagic state and one of the most spatially diverse nations on earth in terms of resource endowments, population settlements, locations of economic activity, ecology and ethnicity (Tomascik et al. 1997; Hill, Resosudarmo and Vidyattama 2008). Stretching across 8 million square kilometres of land and sea between the Indian and Pacific oceans, it links the continents of Asia and Australia (Map 1.1). Indonesia's 17,000 islands have a land area of close to 2 million square kilometres.

Recent scientific findings show that climate change is already taking place and that there is the risk of severe impacts if emissions of greenhouse gases are not cut back (IPCC 2007). Climate change is no longer seen as ‘just’ an environmental problem, but as a threat to economic development and prosperity (Stern 2006; Garnaut 2008). This perspective has greatly elevated the issue among policy makers the world over. In Indonesia, climate change rose high on the public and policy agenda with the UN climate conference held in Bali in December 2007.

Indonesia faces a variety of impacts from climate change, from sealevel rise to a changing hydrological cycle and attendant droughts and floods, to greater stresses on public health. These will require attention and corrective action if development is to be safeguarded in the face of changes in the natural world. Indonesia itself is a significant emitter of greenhouse gases, especially connected to deforestation. Reducing these emissions creates its own challenges, but also brings opportunities.

This chapter summarizes the expected climate change impacts for Indonesia, and eastern Indonesia in particular. It discusses the main sources of emissions and options to reduce or avoid them. Climate change research on Indonesia is limited, and is especially patchy for eastern Indonesia. Nevertheless, enough information is available for us to sketch some options for climate change policies that would support development in eastern Indonesia.

CLIMATE CHANGE AND DEVELOPMENT: THE GLOBAL ISSUES

Causes and Impacts

Human-induced climate change occurs because of a build-up of greenhouse gases in the atmosphere, trapping the energy from the sun to a greater degree than previously. The main greenhouse gas from human activity is carbon dioxide, which is released in the combustion of fossil fuels (especially coal, oil and gas) and in the conversion of forests to other uses. Other greenhouse gases include methane, from sources such as agriculture and waste dumps, and nitrous oxide from agriculture and some industrial processes.