Australia’s second-richest person, mining magnate Andrew “Twiggy” Forrest, is known to his admirers as a down-to-earth, straight-shooting businessman cut from the same cloth as self-made billionaires Jeff Bezos and Bill Gates.
And like his contemporaries in the United States, Forrest, the chairman of Fortescue Metals, the world’s fourth-largest iron ore producer, has taken on a leading role in the fight against climate change.
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Forrest is spending $114 billion Australian dollars ($81bn), including 3 billion Australian dollars ($2.13bn) of his own money, to build the world’s largest electrolyser, an apparatus that separates water into oxygen and hydrogen. Powered by wind and solar energy, it will produce an emissions-free energy source and promises to decarbonise Asia’s steel mills.
“Green electricity, green ammonia and green hydrogen can cover 100 percent of the world’s carbon emissions,” Forrest said during a talk at the National Press Club in Canberra in October.
Climate advocacy by billionaires such as Forrest has polarised environmental activists and commentators. While some welcome the super wealthy’s newfound focus on the climate, others question whether their actions can be seen as altruistic after they amassed fortunes, and continue to rake in billions, from heavily polluting industries.
Fortescue Metals emitted 2.2 million tonnes of carbon last year, according to Australia’s Clean Energy Regulator, not including 241 million tonnes emitted by the smelting of the company’s iron ore in China.
“With the exception of [Australia’s richest person and fellow mining magnate] Gina Rinehart, no Australian has ever caused more damage to the environment than Andrew Forrest,” an Australian Financial Review columnist said in a recent commentary.
Bezos brings a similarly mixed track record to the table. In 2020, he created a $10bn fund for climate change. But his company Amazon emitted more than 60 million tonnes of carbon that year – 15 percent more than in 2019 – whilst hauling in a record $386bn in revenue.
According to a report by Oxfam and the Stockholm Environment Institute, the world’s wealthiest 1 percent are responsible for 15 percent of carbon emissions – nearly twice as much as the world’s poorest 50 percent.
Similarly, just 1 percent of the world’s population is responsible for half the emissions caused by aviation, while almost 90 percent of people hardly ever fly, according to research by the Western Norway Research Institute.
Bill Gates, who last year published his book How to Avoid a Climate Disaster, has an annual carbon footprint of 7,493 tonnes, mostly from flying on private jets, according to an Indiana University study on the carbon footprints of billionaires. That is nearly 3,000 times more carbon than the average person in Fiji creates in a year and at least 11,350 times more than the average person in Laos.
“When it comes to climate change and carbon emissions, our research over the past 30 years shows the stark difference between the emissions caused by the super rich compared to poor individuals,” Stockholm Environment Institute scientist Emily Ghosh told Al Jazeera. “So even though they are mostly responsible, they are the ones deciding the solution.”
In many cases, billionaires’ proposed solutions involve expensive nascent technology like green hydrogen that, if successfully scaled, will create new monopolies that control consumption patterns for decades, Ghosh said.
“We need to stop looking at magical solutions,” she said. “That is what got us here in the first place and I’m worried that we will go down the same path where we are locked into one technology and not looking at a diversity of energy options.”
‘Conflict of interest’
Another potential conflict of interest concerning a billionaire climate-change fighter is taking shape in Australia in the lead-up to the federal election on May 21.
Simon Holmes a Court, son of the country’s first billionaire Robert Holmes a Court, is doling out millions of dollars through Climate 200, a private fund, to candidates who set the highest emissions targets in their electorates. As the founder of Decarb Ventures, an investment firm focused on renewable technology, Holmes a Court could stand to profit if his candidates win office.
“These billionaires who have huge investments in renewable industries will argue that there is nothing wrong with donating money to politicians. But I see a clear conflict of interest,” Daniel Lewkovitz, a candidate for the pro-free market Liberal Democrats whose opponent Allegra Spender received 60,000 Australian dollars from Climate 200, told Al Jazeera. “And if the only thing the independents cared about was reducing carbon emissions, they would all be in favour of nuclear energy as I am. Allegra Spender refuses to debate with me about nuclear energy.”
Spender was not immediately available for comment. Holmes a Court and Climate 200 did not respond to enquiries, while Forrest declined to comment on perceptions of his dual role as climate hero and polluter.
When asked by Australian television recently if his new mission to replace fossil fuels with green hydrogen was driven by shame, Forrest said he had “precisely no shame”.
“Now, if I did nothing about it when I knew I could, then I would have shame,” he said.
The Australasian Centre for Corporate Responsibility, a shareholder advocacy organisation, has described Forrest’s plan as a “bold and welcome commitment”, adding that his competitors BHP and Rio Tinto, the world’s second and third-largest iron-ore producers, “should be embarrassed by being outdone” by a smaller firm.
Australian Prime Minister Scott Morrison has been among the most high-profile advocates of free enterprise and innovation as a solution to the climate crisis, arguing for “can-do capitalism” over “don’t do governments”.
“Just as the animal spirits of enterprise have worked together with scientists and technologists to change the world in the past … I am more than convinced they hold the answer to solving the challenge of a decarbonised economy,” Morrison told a business event in November.
Nonetheless, Fortescue Metals will continue to pump millions of tonnes of carbon into the atmosphere for at least another eight years, according to the company’s 2030 carbon neutrality plan.
Rather than looking to billionaires to “wave their magic wands”, Ghosh at the Stockholm Environment Institute believes “solutions should come from the bottom as well as the top because one solution will not fit into every space”.
“We need to look at context-specific solutions and listen to the people who are living there, especially those already affected by climate change and those who have always lived sustainably,” she said.
Nevertheless, more and more billionaires are throwing their hats into the ring.
This week, Australia’s third-richest person, Mike Cannon-Brookes, co-founder of software giant Atlassian, bought an 11 percent stake in AGL Energy, the country’s largest corporate contributor to carbon emissions, in a bid to stop a proposed demerger that would see its coal plants operate until 2045.
Cannon-Brookes, who wants to transform AGL by pumping 20 billion Australian dollars into renewable energy and battery storage, has described his plan as the largest single decarbonisation project in the world.
“We are at a critical point in Australia’s energy transition and in AGL’s future,” the billionaire said in a statement.
Dario Kenner, author of Carbon Inequality. The Role of the Richest in Climate Change, said Cannon-Brookes’ methodology is flawed.
“The urgency of the climate crisis means there isn’t time to green one company, like AGL, at a time,” he told Al Jazeera. “Previous energy transitions have been heavily shaped by governments, and that’s what will need to happen again to reduce the economy-wide use of oil, gas and coal as fast as possible.”