Environmental Sustainability Objectives
Expert reviewed • 22 November 2024 • 11 minute read
What is Environmental Sustainability?
Environmental sustainability has become an increasingly important objective of economic policy, particularly in the face of climate change and resource depletion. It aims to meet the needs of the present without compromising the ability of future generations to meet their own needs. This involves managing resources responsibly, reducing pollution, and mitigating climate change. Before reading this chapter, it is best to look at the module on Environmental Sustainability, to have a better understanding of the concepts presented below.
What is the Importance of Environmental Sustainability?
Achieving environmental sustainability in the economy is important for several reasons, including:
- Environmental sustainability helps maintain the availability of natural resources essential which ensures long-term economic viability. Sustainable management of resources such as water, soil, and minerals guarantees that future generations can continue to meet their economic needs without depleting these resources. This long-term perspective supports continuous economic growth and stability.
- Reducing pollution and environmental degradation directly impacts public health by minimising health risks such as respiratory diseases, cardiovascular conditions, and other pollution-related illnesses. Cleaner air, water, and soil contribute to a healthier population, which in turn reduces healthcare costs and enhances productivity.
- Addressing environmental sustainability helps mitigate the economic risks posed by climate change. By reducing greenhouse gas emissions and implementing adaptation strategies, economies can prevent severe climate impacts such as extreme weather events, rising sea levels, and disrupted agricultural productivity.
- Aligning with global efforts like the Paris Agreement, Australia demonstrates a commitment to international environmental goals. Participating in global sustainability initiatives can lead to economic benefits such as access to green technologies, investment opportunities, and trade advantages with countries prioritising sustainable practices.
What are the Challenges in Achieving Environmental Sustainability?
Several factors pose challenges to achieving environmental sustainability:
- Balancing short-term economic gains with long-term environmental costs is a significant challenge. For example, Australia's mining sector, which contributed 10.4% to GDP in 2020-21, is a major driver of economic growth but also a significant source of greenhouse gas emissions. This sector's activities, while economically beneficial, pose substantial environmental risks, highlighting the tension between fostering economic growth and protecting the environment. This is a significant issue in Australia, which has a narrow export base, comprised mostly of mining-based services and commodities.
- Advancing and adopting cost-effective green technologies is crucial for environmental sustainability. Despite significant progress in renewable energy, issues such as intermittency - where energy production is not continuous due to factors like weather conditions - remain problematic. For instance, while renewable energy sources are becoming more prevalent, their reliability and storage capabilities need further improvement to ensure a stable energy supply.
- Concerns about maintaining a competitive edge in carbon-intensive industries complicate sustainability efforts. Australia's aluminium industry, which generated $4.5 billion in exports in 2021, faces competitive pressures from carbon pricing policies. Such industries are critical to the economy but also contribute significantly to carbon emissions.
- Shifting consumer behaviour towards sustainable alternatives is essential but challenging. A 2022 study revealed that only 7% of Australians consistently make sustainable purchasing decisions. Changing consumption patterns requires not only increased awareness but also accessible and affordable sustainable options.
What Policies are Used to Promote Environmental Sustainability?
Australian policymakers employ various strategies to achieve environmental sustainability:
Carbon Pricing Mechanisms
Carbon pricing mechanisms such as the Emissions Reduction Fund (ERF) incentivise businesses to reduce emissions through projects that earn carbon credits. Additionally, the Safeguard Mechanism sets baselines for large emitters and ensures that emissions reductions are maintained. The implementation of these mechanisms in Australia has been seen as successful, as in 2023, carbon credits traded at an average of $30 per tonne. This reflects the value placed on reducing emissions and promoting sustainable practices.
Renewable Energy Targets
Australian policymakers also implement renewable energy targets such as the Large-scale Renewable Energy Target (LRET). This target aimed to generate 33,000 GWh of renewable energy by 2020, a target that was successfully achieved. Additionally, individual state ambitions are highly beneficial to achieving environmental sustainability in Australia's individual economy. For example, states like Victoria have set even more ambitious targets, such as aiming for 95% renewable electricity by 2035. These state-level initiatives complement national efforts and drive substantial investment in renewable energy infrastructure.
As a result of setting these targets, energy industries have slowly moved to generating energy from renewable sources such as solar power. The graph below demonstrates this slow increase over the last decade.
Energy Efficiency Standards
Updates to the National Construction Code include stricter energy efficiency requirements for new buildings, ensuring that they consume less energy and reduce greenhouse gas emissions. Additionally, appliance energy rating labels help consumers make informed choices about the energy efficiency of household appliances, encouraging the purchase of products that use less energy and lower overall emissions.
Conservation Policies
Biodiversity conservation strategies aim to protect Australia's diverse ecosystems and species through measures such as habitat restoration, protection of endangered species, and sustainable land management practices. Additionally, marine protected areas, covering 3.3 million square kilometres, are designated to conserve marine biodiversity, protect critical habitats, and sustain fish populations. These conservation policies as a whole, contribute to overall ecological health and resilience.