Plus ça change. The more it changes, the more it stays the same. For the past 18 months, every day seems like groundhog day for the renewable energy industry in Australia, which has been at a standstill because of uncertainty about federal government policy.
The Abbott government, extraordinarily, protests that it is a supporter of renewables, and it is all the fault of the Labor Party that the industry is in such disarray. Time and again, Abbott and his ministers repeat utter nonsense about the renewable energy industry in radio and TV interviews, and at press conferences.
So we thought we would puncture some of these balloons. There are so many it is hard to know where to start. If you think we have omitted a good’un, please let us know, either through email or on the comments page.
So here we go:
Take your pick on the first one. All laid claim to the idea that the Coalition supported renewables.
“Look, we originated a renewable energy target. That was one of the policies of the Howard Government and yes we remain committed to a renewable energy target … we have no plans to change the renewable energy target. Tony Abbott, 29 September 2011
“We will be keeping the renewable energy target. We’ve made that commitment. We have no plans or proposals to change it… We have no plans or intention for change and we’ve offered bipartisan support to that.” Greg Hunt, speech, 27 February, 2013
“It has been interesting to note the claims being made about what the Coalition will or won’t do. All of it is simply conjecture. The Coalition supports the current system, including the 41,000 giga-watt hours target.” Simon Birmingham, Speech to the Clean Energy Week Conference, 24 July 2013.
Of course, all of that was utter nonsense. The clean energy industry and the financiers didn’t believe a word, which is why investment dried up as soon as it became clear that the Coalition would likely win power. And when they did, they made it clear that none of the quotes above were true, and they intended to wind back the target. In 2014, investment in clean energy in Australia slumped nearly 90 per cent.
Whopper 4. Then there was the promise not to cut the Australian Renewable Energy Agency.
“We are happy with its structure and happy with its personnel and we are not expecting to make any changes.” Industry minister Ian MacFarlane, Australian Financial Review, 14 June 2013.
That, too, was nonsense. The government tried and failed to abolish ARENA; to close it to new funding, and bring its operations back within a government department. It was blocked from doing that, but still managed to de-fund it to the tune of more than $800 million.
Whopper 5. “We want to double renewable energy production.”
This is the latest ploy by Greg Hunt to make it sound like his government is being constructive in negotiations on the RET.
There is currently about 16,000GWh of large-scale renewables in Australia, and the Abbott government proposes a 2020 target of 31,000GWh, which at least is more than what Hunt said in a press conference in November:
“What you see at the moment is that there are 16,000 gigawatt-hours of installed capacity. That’s likely to increase, at the very least, by 60 to 70 per cent under what’s being proposed by the Government.”
The only problem is that the current target stands at 41,000GWh, so making the new target 31,000GWh, the government is proposing to reduce the amount of new build from 26,000GWh to 15,000GWh. Not so much a doubling of production as a cut of 40 per cent.
Whopper 6. “We have already travelled two-thirds of the way so we would hope that they (Labor) will come the additional part.” Greg Hunt, ABC Radio, March, 2015
Again a reference to the 31,000GWh. Two thirds is only true if the starting point from the Abbott government for new build generation was zero, or from the 16,000Gwh already built. If your starting point is zero no build, then all the platitudes about supporting the RET are exposed for what they were – lies. Hunt gets to two thirds by arguing that 31,000GHw is about two thirds of the way from 16,000GWh to the current target of 41,000GWh.
Whopper 7. “The RET is broken” argument, validated only by the government’s attempts to break the RET.
“It’s simply not possible to build what is required between now and 2020. And if you don’t do that, you hit what is an effective carbon tax penalty of $93 a tonne.” Greg Hunt, Sky News, December, 2014.
This is a double whammy, two whoppers in one. The idea that the RET cannot be met, and that a penalty price would eventuate, is promoted only by the coal-fired generators, who don’t want more renewables to come into the system, because it means less coal will be burned.
First on the target and if it can be met. The Clean Energy Council, the renewable energy industry, General Electric, even the modellers for the Warburton review, found that the target could be met – if policy certainty was provided. The longer uncertainty remains, the harder it is to meet the target.
Whopper 8. Consumers will pay a penalty price.
This is based on the assumption that the RET cannot be met, and that retailers will simply decide to pay a fine – they call it a penalty price – of $92.50 for each megawatt of renewable energy they didn’t sign up to, and pass the price on to consumers.
Renewable energy developers say this is ridiculous, because at those prices, an awful lot of projects can be built, and there is currently more than enough in the pipeline, with development approval, to meet the target.
We can’t wait for a big retailer to tell its customers, which, if they were honest, would go something like this: ‘Well, we got a bunch of offers from wind farms and solar farm developers to build new projects, but we couldn’t be stuffed, and decided to send you the bill anyway.’
Hunt is now citing the Climate Change Authority to support his argument for a cut. The CCA, however, suggested only that the 2020 target be pushed out to 2022 and 2023 to take account of the policy uncertainty. It did not see any reason for the 41,000GWh target to be reduced. Indeed, it suggested a higher and longer-dated target be considered.
One final point on this: The RET is neither a tax nor referenced in any way to a price per tonne of carbon. If the target is met, the CCA says that the abatement cost of the RET will be about $26/tonne.
Whopper 9. “Well, this review, of course, was mandated by law that was set in place by the previous Government.” Greg Hunt, ABC Radio Brisbane, March, 2015 (and many other occasions).
Not quite. While the law says a review should be held every two years, the organisation with the statutory requirement to do this is the Climate Change Authority, an independent body at arm’s length to the government.
Instead, the Abbott government produced its own committee, headed by Dick Warburton, a man who does not accept climate science, and does not like renewable energy. He was joined by two others who had lobbied against the RET on behalf of fossil fuel interests.
Whopper 10. “If you listen to the extreme left, the people who have always argued for electricity to reduce poverty, now, they’re against the electricity.” Greg Hunt, interview with Andrew Bolt, Bolt Report, August, 2014.
Another line borrowed from the hymn-book of the coal lobby, which holds that coal is the only solution to “energy poverty”, the reference to the hundreds of millions without access to electricity in Asia and Africa.
This comment, made in remarks about the government’s support, and the left’s opposition, to the development of Galilee Basin, goes against the assessment of the countries involved. India is counting on distributed generation, mostly solar, as the most effective means to bring power to the masses. A similar assessment is being made in Africa, both by organsiations such as UNEP, and by energy developers themselves, such as Saudi Arabia’s ACWA Power.
Of course, there are many, many more whoppers where these came from.
The Abbott government’s contention that renewable energy pushes up the price of electricity – “renewable energy targets are also significantly driving up power prices right now”, Tony Abbott told 2GB’s Alan Jones in 2013. His government’s own review found that in the long term, renewable energy pushed prices down.
Its contention that the RET only ever aimed to achieve 20 per cent of demand. In fact, the original bill was for a minimum 20 per cent, and when the bill was finally approved by the Senate, with the support of the Coalition, it noted that it would be at least 22 per cent. So, while other countries look to lift their renewable energy ambition, the Coalition is now seeking to place an artificial cap on it.
That the aluminium industry will be broke because of RET: This has echoes of the Coalition’s carbon price scare campaign. The aluminium exemption has become a massive red herring, even if it has hooked in the Labor Party. The extra costs in the next year are said to be about $50 million. The aluminium industry, already largely protected, meanwhile, are enjoying both a surge in aluminium prices and a big fall in the value of the Australian dollar.
And, of course, there was Joe Hockey’s infamous remark that wind turbines are “utterly offensive”. This really goes to the heart of the Abbott government’s antipathy to renewables. They just don’t like wind farms. When Crikey.com did a survey of Coalition MPs last year, it found just one supporter of wind farms.
Typical are the comments made by the two Coalition MPs sitting on yet another Senate inquiry into wind farms – the entire committee is made up of anti-wind farm activists.
Coalition Senator Chris Back says wind turbines have adverse health impacts from as far as 10kms away. “Ewes and cows become very agitated and will leave their offspring in fits of panic if they are in the vicinity of operating turbines,” he said in a speech in 2012.
Coalition Senator Mike Cannavan, wrote in The Australian that Australia already has too much renewable energy, and “Australia’s renewable energy policies could simply be titled “Robin Hood visits Bizarro World” — they steal from the poor and give to the rich.” In another article for the Coalition’s newsletter he wrote: “Windmills have been around for centuries ….. and they are still not economically viable.”
Postscript: Hunt has since contacted RenewEconomy to complain about the characterisation of the Coalition’s pre-election promises. In particular, he said we should have included his comments where he made clear that there would be both a review of the RET, and that the Coalition supported a 20 per cent target.
“We support the Renewable Energy Target and we support the 20 per cent. We will obviously have a mandated review in 2014,” he said in June, 2013 (and on several other occasions).
Earlier in May, Hunt was asked three times to clarify his position on the RET, and whether that included support for the 41,000GWh target. To which he replied each time, “we are committed to the 20 per cent target, and have proposed no changes.”
As RE wrote at the time, the 20 per cent support undertaking did not clarify whether that meant 41,000GWh, or the abbreviated 26,000GWh (or real 20 per cent), that the Coalition finally produced. That is what added to the investment uncertainty.
As we said at the time, the intention of the government was not spelled out, Hunt was careful not to be drawn into a fixed gigawatt comment, knowing the internal politics of the Coalition, and the presence of those who wanted the RET unwound. The problem was that Abbott, and other members, did make undertaking for no changes.