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The Australian National University

Case Studies

Case Study 1: Australia’s climate change policies: implications for the electricity sector

A study of the impact of climate change policies in Australia on the electricity sector.  The electricity sector has a critical role in assisting Australia to transition to a low carbon economy, and has become the central focus of Australia’s carbon reduction policies under the National Climate Change Strategy.  The electricity sector, however, operates within a larger, more complex climate-energy-water system that encompasses the water sector, the agriculture sector, Earth systems, and the policy-making arena. Changes to any part of that system will effect change elsewhere, and these processes may take place at different spatial and temporal timescales.

The aim of this case study, therefore, is to determine the impact of proposed climate change policies, particularly the carbon pollution reduction scheme and the underpinning emissions trading scheme, on the electricity sector. There is a particular focus on changes in the amount of water needed for electricity generation—the predicted drying of the SE of the Australian continent could pose problems for water-dependant electricity conversion technologies.. 

The project comprises the following activities:

  • Development of a system dynamics model that captures the key political, technological, and environmental dynamics within the climate-energy-water system
  • Design and assessment of a series of scenarios that represent current policy trends, and alternative pathways to determine the potential conflicts and synergies under each scenario, using the climate-energy-water systems model.
  • Stakeholder consultation to evaluate the model design and scenario assumptions, as well as outputs from the model
  • Development of an advisory tool for stakeholders to assess the implications of changes in the climate-energy-water system
  • Formulation of recommendations that would assist in appropriately integrating policies and decisions within the climate-energy-water system.


Case Study 2: Policy Inertia in the CEW System

The aim of this project is to develop ways to help policy makers understand better the need to match:

  1. the time-scale for integrative research and policy development in the Australian climate-energy-water (CEW) system, with
  2. the time available for effective climate change mitigation and adaptation.

This endeavour is given urgency by the likelihood that atmospheric greenhouse-gas concentrations are approaching (or may have already passed) thresholds beyond which positive feedback processes in the climate system will lock-in.

The proposed approach involves two strands:

  • An historical study of the response of the global community to the demonstration, in the mid-1980s, that chlorofluorocarbon (CFC) emissions were affecting the ozone layer. The CFC case closely parallels the current CO2 situation, but pre-dates and is technically simpler than the CO2 case. It did, however, play out in an international political system that had much of the complexity of the present situation. For these reasons, a CFC case study promises to provide significant insights into the causes of delays in efforts to develop integrated CEW policies.
  • The development of simple stock-and-flow (SF) models that illustrate the ‘basic physics’ of the Australian CEW system, with an emphasis on the inescapable delays and inertia. These models will be as simple as possible, consistent with an ability to capture the essential behaviour of the CEW system. They will encompass a relatively small number of state variables (stocks) and will use the best current estimates for the rates of the dominant state-change processes (flows). They will be used to demonstrate the time-scales characteristic of change and recovery in the climate system, and the potential effects of mismatches between these environmental time scales and the likely timescales for policy-making and action in the energy and water sectors. John Sterman and his co-workers have demonstrated the need for such models. Their research has shown that many people, including those with a high level of technical education, do not understand the behaviour of even simple SF systems.

An understanding of relative time-scales is crucial for policy makers. Thus, an effort will be made to illustrate the role of the [Tp,Ta]-ratio in determining policy success or failure. Here Tp represents the characteristic time for policy development and implementation, and Ta represents the time available for effective action. In general, it will be assumed that Tp refers primarily to human responses, while Ta reflects mainly environmental responses.

In the Australian CEW system, both Tp and Ta involve a chain of information delays and material delays. Delays are pervasive in complex systems and play a fundamental role in their behaviour.

They provide environmental and social systems with the equivalent of physical inertia. They cause much of the counterintuitive behaviour that makes such systems difficult to understand and manage. In addition, because of their central dynamical role, delays are key leverage points for change—an increase or decrease in a critical delay can have a profound effect on system behaviour. A study of delays and relative time scales in the CEW system therefore provides a highly practical approach to integrative research and policy development in the energy and water sectors.

The historical study and dynamical models developed in this project will provide the basis for policy scenario development and a series of publications and workshops focused around the concept of policy inertia. Policy inertia is a ‘powerful idea’—that is, it is relatively easy to understand, yet is an effective ‘tool to think with’ in a wide range of situations. As such it provides an easy-access pathway for education and training in complex-system policy design and management.


Case Study 3: Crops and Soils in the Australian Climate-Energy-Water System

This study is designed to analyse the climate change–energy-water interplay in the soil-crop-animal systems of Southeast Australia. The Garnaut report emphasised the importance of agriculture and land-use change in mitigating greenhouse emissions in Australia, and a recent CSIRO report has confirmed this potential for mitigation in Queensland rural areas. The present study is designed to help policy-makers and land-owners understand better the complex inter-relationships between greenhouse emissions, arable land use systems, water use and climate change through the following steps:

  • Develop influence diagrams that show the complex inter-relationships between climate and such factors as blue- and green-water use; fertilizer production and use; the competition between crops for biofuel production and crops for food, feed and fibre; pastures and animal production; and fossil fuel use. These diagrams will focus on the situation in Southeast Australia.
  • Undertake focused more quantitative analysis through stock-and-flow modelling of particular sub-systems. For example, land-use change and land management (tillage) options in mixed crop-pasture systems, focusing on impacts on greenhouse gas emissions (carbon dioxide, nitrous oxide and methane) and soil-carbon sequestration. The introduction to agriculture of an emissions trading scheme, currently scheduled for 2015, will affect the profitability of different land use options depending on the relative price of carbon. Study of this sub-system is therefore designed to provide new insights into how the new carbon economy will influence farmer decision-making as well as policy design. Other studies will analyse the effect of climate change on crop-pasture systems, paying particular attention to comparative water use in rain-fed and irrigated systems..


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