Targets on energy careful not to put limits on growth

ENERGY security and climate change have become two sides of the same coin. Energy security means two things: ensuring a reliable supply of energy at an affordable price.
Climate change may have long-term consequences on energy prices, but energy security can and does have an immediate impact on economies and governments.
Last week, the EU announced a new strategy to cut greenhouse gas emissions by 20 per cent by 2020, driven as much by the desire to protect European economies from increased global energy price and supply volatility as an extension of their aggressive, but as yet unsuccessful, greenhouse reduction strategy.
The EU hopes to kill two birds with one stone: start to make deep cuts in its greenhouse emissions while reducing its dependence on energy imports, in particular the increasingly unreliable supplies of gas and oil from Russia.
In Washington, the US Congress has been looking at the development of ethanol and other biofuels for the same reasons.
Yesterday it was the turn of the developing ASEAN nations, whose leaders realise their continued growth is at risk unless they can ensure access to cheap and reliable energy supplies.
They have pledged new but largely unspecified co-operation to both save energy and find new sources over which they have greater control.
As developing economies, they are entitled to feel removed from direct responsibility for addressing the risk of climate change, even if their growth will increasingly add to the problem. Asian countries will suck more than 60 per cent of global investment in energy infrastructure by 2030 to fuel their economic transformations.
For this reason, the agreement at Cebu has no emission targets or goals that may create their own threat to growth. They have agreed to invest more in alternative energy sources, including renewables, nuclear and the production of biofuels to counter the oil price shocks.
This is likely to alarm many environmentalists, who fear the scale of production required to achieve this geopolitical objective will only come through wholesale land clearing needed to produce the raw materials.
For the Howard Government, the Cebu declaration is a mixed blessing. Growing Asian economies are an important and growing market for Australia's energy exports of coal and gas, although their rate of growth and focus on oil suggests the threat to our terms of trade is likely to be low in the short run.
However vague the declaration may appear on paper, the Howard Government is certain to use it as an example of how the challenges of energy supply and greenhouse gases will be met by regional rather than global agreements.