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Wind energy biggest loser as Abbott sweeps to power

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Tony Abbott was swept to power on Saturday and declared the country to be under new management and “open for business.” If it is true for any industries, it is certainly not the case for large-scale renewables.

The wind energy sector is probably the biggest and most immediate loser from this election result. It has been at a virtual standstill for months because utilities who write contracts, and the bankers who finance the projects, were mindful of a likely Coalition win, and yet another review of the large-scale renewable energy target (LRET)

That review will now take place, but will unlikely to be completed until the end of 2014, and the findings may not be known until early 2015. The Coalition certainly appears in no hurry, and unless the renewables industry can find a compromise, it will have to wait for the result. To make matters worse, the review may not be completed by the Climate Change Authority – which last year rejected the complaints of incumbent fossil fuel generators and the conservative state governments – because the Coalition now has the numbers to dump the CCA.

The election has delivered a hung parliament of a different sort, and a number of new, strongly anti-wind members to the Coalition. These include Angus Taylor in Hume and Peter Hendy in the neighbouring seat of Monaro. Taylor is the author of an ill-informed document on wind energy, and Hendy was an advisor to Brendan Nelson when he made his fateful change of position on climate policies, and is also a former CEO of the anti-carbon price, anti-renewables Australian Chamber of Commerce and Industry.

Worse, the Senate looks potentially hostile to wind energy, now that Labor and the Greens appear to have lost their ability to block changes after June 30. The role of avowed anti-wind senators such as John Madigan, and Nick Xenophon (who nearly managed to clone himself in Saturday’s result), presents a formidable problem for the wind industry.

Zed Seselja, who may win an ACT Senate seat for the Coalition, is another anti-renewable warrior, and the opinions on wind and renewables from the remaining cast of the Senate circus is not clear. Clive Palmer could have two Senators – Glenn (the brick with eyes) Lazarus and Jacqui Lambie. While a noisy maverick, Palmer’s principal interests are coal and dinosaurs.

Family First Senator-elect Bob Day is a former member of the highly conservative HR Nicholls Society, so that is not promising. The views of the motoring, sporting, and shooting groups who may win seats is not known, possibly even by them. Madigan didn’t get elected on an anti-wind farm ticket either, but his acquired hostility may be his lasting legacy.

A further complication for the wind industry is the Coalition’s determination to hold yet another review of wind farm health impacts and its proposal to introduced “real time” wind farm monitoring, which the industry says would be expensive and useless.

Solar to go local

Wind farms are most affected by the RET review because large scale solar PV plants are unlikely to be able to compete on costs just yet. The plants that are being built are relying on other mechanisms such as Solar Flagships, or the three smaller plants being built under the ACT auction process.

However, one sector that may be active in the next 18 months will be smaller, distributed scale solar PV projects in the 2MW to 10MW range – like those proposed by Soleir solar project in Dubbo and the Sunshine Coast council facility in Queensland. That’s because there are lower capital requirements and risk, different funding mechanisms can be obtained, and the projects may not have to compete in the wholesale market.

In fact, there is no doubt that the biggest investment in renewable energy over the coming 18 months will come from households and business owners, who have been the biggest investors in recent years and will continue to install rooftop solar PV to generate their own electricity, and reduce their bills.

The wildcard here is the role of the state governments, particularly in NSW, Queensland and Western Australia, which are hostile to renewable energy and also have assets – generators and network operators – that they want to sell.

Miners take centre stage

The Coalition’s vow that it is open for business – and its promise to cut green tape – seems pitched almost entirely to the mining industry. Australia’s richest person, Gina Rinehart, made an appearance at the celebration party of Barnaby Joyce, now in the lower house, and one day likely to be Australia’s deputy prime minister and acting prime minister.

The Australian Financial Review on Monday declared Rinehart to be “our favourite miner.” No, really. Clive Palmer has a massive self-interest to promote his Galilee Basin coal interests which adjoin Rinehart’s – environmental approvals for infrastructure such as the port at Abbott Point will be decided by Greg Hunt – but that will be unlikely to restrict Palmer’s comments. One wonders just what he will say under parliamentary privilege.

Carbon price around for another year

The carbon price will last at least until the end of the financial year, thanks to Labor’s stiffened resolve, and may last longer still, depending on what, if anything, the new government can propose in its place.

The disintegration of Labor’s Senate representation means that Labor and The Greens (despite the latter’s extra seat or two) no longer have the numbers to stop the repeal of the carbon price after July 1 next year, when the new Senators take their seats.

However, the better than expected performance by Labor, and comments by likely leaders Bill Shorten and Anthony Albanese suggest that Labor will defend the carbon price, at least until June 30.  That will take the repeal into a time frame where China is accelerating its carbon price mechanisms, the final IPCC reports have been released, and other countries are moving to act. And maybe, just maybe, the science might be clearer – even to Abbott.

Abbott will have to think carefully about risking a double dissolution –  it could just make the influence of the minority parties in the Senate even greater.

Australia’s international credibility

On the international stage, Australia now risks following in the footsteps of Canada – two countries of nearly unparalleled wealth who have sought to frustrate international agreement so that they can dig up their massive reserves of fossil fuels.

The reception of the Australian delegation at this year’s climate talks in Poland could be quite interesting. Actually, it will probably go down quite well with the Poles themselves, who have succeeded in blocking most of the EU policies on carbon pricing and renewables.

The fracturing of centralised power

The traditional parties are losing their centralized control of domestic politics, in much the same way as the primacy of the base-load generators is being challenged in the electricity market. The vote for the mainstream parties has fallen from around 80 per cent in 2010 to just less than 75 per cent in 2013, tracking a similar fall in the use of coal-fired generators. Is there a link? Probably not.

But it is fascinating to see the influence of minor parties in some states – the huge voted for the Palmer United Party in Queensland and Tasmania, for the Greens in Victoria, the Liberal Democrats in NSW, and for Xenophon in South Australia, where he outpolled Labor in the Senate and nearly pipped the Coalition.

Abbott had promised stable government, but the Senate could turn out to be a circus. Abbott may find the variability of views and positions in the Senate as difficult to deal with as some of his colleagues, and the incumbent generators, have in getting their minds and their systems around variable renewables.

A change in mood

In 2010, the parties with the biggest increase in votes in the federal poll were the Greens, the Sex Party and the Shooters and Fishers. This time, the parties with the biggest increase were the Coalition, the Palmer United Party and the Xenophon ticket.

Clearly, the mood has turned. Three years ago Australians voted to save the planet, make love and then shoot the lights out. Now they want to axe the tax, trash the turbines, did up coal – and then go down with Palmer’s remake of the Titanic.

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  • barrie harrop

    Giles, its not all that grim,expecting Abbott to realize the benefits in a low carbon future,now he has leadership of Australia,so chin up.

    • RobS

      Do you have any evidence for your theory that he will suddenly have an epiphany and change 30 years worth of political and personal beliefs and 2 years worth of campaign promises and ideological statements? The rest of us prefer rather a little more than rosy smoke blowing theories considering what’s at stake.

  • Rob

    Sad days for wind. A double dissolution is likely as I don’t think Abbott has the negotiating skills to manage the menagerie of senators and their disparate interests.

    Lib-Dems in NSW was a donkey vote (for group A) coupled with name confusion. 3.5% swing to coalition in lower house but 4.5% swing against coalition in NSW senate means an 8% voting error and this matches the 8.9% Liberal Democrat vote.

    So its a fair bet the true Lib-Dem vote is around 0.9%. People saw “Liberal” in group A in the first box and stopped looking and didn’t release Lib-Dems weren’t the coalition and didn’t bother looking to find the actual coalition in Group Y. The Lib-Dem senator elect has already called himself the senator for donkeys.

    So that vote isn’t a reflection of voter intent, instead its a reflection of a broken electoral system. I don’t see why we can have 20 different versions of the senate ballot paper to eliminate the donkey vote concentration into any one group. They could be distributed to different booths to make the counting easy. Modern printing techniques makes this straighforward. We also need above the line preferential voting in the senate to take the power away from the backroom deals on preferences. Say selecting 1 to 6 as a minimum to make the vote formal. Eliminate the single number choices so we don’t get parties winning a seat from (Sport Party in WA) 0.2% of the vote.

    • RobS

      Unless Abbott keeps his nose very clean for the next few months I dont think a double dissolution will result in a much better outcome for him, The sheer number of minor parties would still likely result in a fractured senate requiring significant manoeuvering to get anything done. If on the other hand he has some gaffs or is perceived to be changing any election promises, or succumbs to his famous gaffe prone nature then the result could be even less favorable.

      • Rob

        I agree with you, and also doubt he’ll get a better outcome, but in the end it’s not what we think, it’s what he thinks that will determine his decision. If he gets a repeat of the election just gone there will be 2 fewer Green and 1 fewer Labor senators. So I reckon he might just be mad enough to hope for a repeat and go for it. He will want to create a legacy and that means getting passage of his agenda and a prospect of 3 fewer opponents will be inviting. These micro parties will work out that this is their one best chance to negotiate an outcome because they won’t get back in and so I reckon at least some of them will go for it and if so that means a headache for Abbott if he doesn’t clear them out.

        • RobS

          We just have to hope for some early gaffes to make a double dissolution less attractive to him and maybe also put some potential allies off side.

  • Coaltopia

    I’m guessing you mean the ACCI is pro-cabon? (or anti-climate?).

    And yes, it’s very likely Poland is happy to have another coalpromized nation back in the pits.

  • Keith

    Barrie, the problem is that in the last week of the campaign Abbott crystallised his climate denial in an interview with Michelle Grattan. The logic of this is that it is a waste worrying about fossil fuels and moving to renewable energy. Being big on consistency leaves him little room to move. The pronouncements about messing with wind power are hard to change unless he starts being inconsistent.

    The best hope is that the curious senate composition will yet mean that the climate excesses and anti-renewable energy position might still be blocked. Admittedly it is hard to work out who could play that role, but there are a few unknowns in the list.

    Or maybe when the coalition starts looking for jobs, they will realise that they are there for the growing in the renewables area. I certainly wouldn’t bet that, notwithstanding enthusiastic egging on by the coalition, big coal developments will be a viable investment proposition. Why would a capital provider risk having stranded assets?

    • barrie harrop

      Well Keith ,i do not expect any more dirty coal fired energy plants to be built and yes the jobs growth and new industry aspects will come home to roost anytime soon.
      Expecting trade off in the Senate too.

      • RobS

        I agreed with you wholeheartedly until reading Abbott’s policy on energy released less than 48 hours before the election. It did not contain the words solar or renewable ONCE. and contained a nearly two page section on increasing the profitability of coal generation again. It seems Abbott’s push back to the energy of the 20th century might be harder than most expected. Whether it pays off and then if so whether any new additions just end up as white elephant stranded investments in a few years remains to be seen but for the first time in a while I can actually foresee a new coal plant in Australia based on Abbott’s election policies.

  • George Papadopoulos

    Giles, I note your comment that “A further complication for the wind industry is the Coalition’s determination to hold yet another review of wind farm health impacts and its proposal to introduced “real time” wind farm monitoring, which the industry says would be expensive and useless.” Why do you think the wind industry feels so? Could it have to do with loosing RECs and going bankrupt, should they be found to be non-complaint with existing noise guidelines?
    Also the Clean Energy regulator requires developers to simply fill a form and tick a box that they are “compliant”. If gossip has it correct, an acoustician (wind industry favourite) connected with the Waubra, Waterloo and Hepburn developments recently commented that “the lack of true accountability is something to laugh about”. Certainly I don’t laugh when like last night it was sonic/vibrational hell out my way 35km from the Gunning Wind Farm. It leaves me wondering about how people cope at closer range.
    Why not a bit of accountability? After all, isn’t noise nuisance the chief contentious issue with wind turbines that needs to be resolved?

    • Giles

      I know I am going to regret asking this question, but 35kms?

      • George Papadopoulos

        Giles, I hope you weren’t going to regret answering my on accountability instead…
        Clearly the wind industry has something to fear doesn’t it? And having fun at my claims isn’t going to help its cause either, especially when I am not the only to have this problem.

      • MikeH

        George has bionic ears. But they must be on the wane. Previously he has claimed that he can hear wind farms from 100Kms away.

        Here are some of George’s other interests.

        http://geovital.com.au/geovital_george_papadopoulos_nsw.html

        • Warwick

          No Mike, he just needs to turn down the volume when listening to ACDC ..the lyrics are always hard to understand. It’s “Highway to Hell” not “..sonic/vibrational hell out my way 35km from the Gunning Wind Farm”…

        • Warwick

          No Mike, he just needs to turn down the volume when listening to ACDC ..the lyrics are always hard to understand. It’s “Highway to Hell” not “..sonic/vibrational hell out my way 35km from the Gunning Wind Farm”…

          • George Papadopoulos

            Warwick, wish you were out here tonight. I would have liked to see the look on your face and see if you had an explanation about what is causing this rumbling noise. Maybe some romantic eco-fascist bonking at a wind turbine tower?
            But enjoy your cheap laugh, while it lasts…

          • Warwick

            I’m sorry but your invite is kind of creepy, so I’ll pass…I’d rather not look into your face, listening to Phil Collins’ “In the air tonight” and having you tell me you’re experiencing rumbling noises from people copulating 35 kms away…

          • George Papadopoulos

            Yes, Warwick, its what you call determined people making lots of motion and noise, who love their wind turbines so much they will turn the world upside, but they will not entertain the slightest doubt that wind turbines, 40 foot ball field spans, and hundred of tonnes of material, whizzing around at 240km/h can actually be heard 35km away…

          • Warwick

            No, I don’t believe you. I have a basic understanding of science and how sound energy attenuates under the inverse square law. Your claims are fallacious, end of story…

          • George Papadopoulos

            Yes, a “basic” understanding of science – not a good understanding about wind turbines and their cylindrical project of noise. The inverse square law assume a singular source of noise – not a horizon filled with noise emitting devices…
            Maybe you need to improve your “basic” knowledge.

          • Warwick

            Ok, so now it’s “Tubular Bells”. Have you written to Qantas telling them that their “hundreds of tonnes” of planes travelling at 900 kmh that are 35km away are causing “rumbling noises”…or to Railcorp or the RTA for the thousands of cars emanating noise within 35km?

            If you actually wish to look at the science..

            http://ramblingsdc.net/wtnoise.html

            If anyone wants to examine George’s understanding of science…here’s a great start:
            http://scepticsbook.com/2010/01/25/zap-there-goes-your-hard-earned-money/

          • George Papadopoulos

            Warwick, did you get the point of my previous comment?
            But to answer your avoidance of my point. I don’t see more than one plane flying overhead every ten minutes – mainly daylight hours, I don’t have trains rumbling away for hours in the late evening, and traffic 14km away from the Hume Hwy is scantily audible. BUT THE WIND TURBINES CAUSE ME GREAT GRIEF, PARTICULARLY DURING SLEEPING HOURS!
            I’m sorry but your lack of understanding is profane!

        • George Papadopoulos

          Keep laughing and mocking. Was it not the wind industry’s favourite, David Colby, who said on ABC radio that infrasound travels huge distances – around the globe?

    • Nina

      I never understand this view.. Would you prefer to live next door to a coal-fired power plant? With not only noise, but lights and horrendous pollution?
      The only reason the wind industry has something to fear is because, out of anything, it WILL get cut, but the coal industry won’t! There’s not as much money in wind, and probably a highly contentious matter anyway under a prime minister who doesn’t believe in climate change.

      • George Papadopoulos

        Nina, I am sorry but no one has offered me to live next to a coal plant.
        There are appropriate places for coal plants and that is away from populated. Just that to close one coal you will need 6000 wind turbines all over the countryside, with plenty of back-up from gas plants/diesel generators.
        Clearly my options are to buy a property away from a coal plant, or learn to live amongst a rural forest of wind turbines, everywhere – anywhere.
        May I ask: Do you live next to a coal plant or 35km away from rumbling wind turbines?

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