Apparently, having more than 60 per cent of Australia’s electricity generated from dirty and expensive coal-fired power stations in 2030 is not good enough for Coalition back-benchers, and some Cabinet members. So, the Coalition is promising more, if the mainstream media is to be believed.
Reports in the Daily Telegraph and the Australian Financial Review on Monday said that the Turnbull government was committing to “underwrite” multi billion dollar investments to build new coal-fired generators as way of getting the controversial National Energy Guarantee past Coalition back-benchers.
If there is a clear signal that the energy wars are as intense as ever, then this is it. Quite how the government proposes to have a new coal generator built is anyone’s guess, but the favoured mechanism is the “reverse auction” for new “firm” investment proposed by the Australian Competition and Consumer Commission chair Rod Sims last month.
Sims’ proposal for underwriting firm generation was seen in some quarters as highlighting the inadequacy of the NEG, which according to its own modelling will not result in any new investment in energy generation over the whole decade out to 2030.
How the dice can be loaded to enable coal-fired generators over the combination of renewables and storage remains to be seen. The Australian Energy Market Operator believes that even loading solar up with storage on a 1:1 basis will still beat new coal, but rules presumably can be gamed.
The reports – which enthusiastically proclaimed that “new coal fired power station would lower energy prices for Aussie families” – suggested that Sims will meet with Coalition MPs before energy minister Josh Frydenberg talks further with the Coalition back-bench energy committee this evening.
One way the Coalition could get a new coal-fired power generator is to offer the sort of guarantees and promises that state governments like to give out to the builders of toll roads and similar infrastructure.
The ruse here is for the toll road builder to produce ridiculously optimistic traffic figures and then get the state government to sign a contract promising them to “make good” or bail them out should the fantasy projections not be met.
Given the Energy Security Board’s modelling for the NEG, such fantasy projections cannot be ruled out, and any builder of a new coal-fired generator will rely heavily on a government bail-out as a backstop for what must be the inevitable cut in emissions in the coming decades.
Conservative commentators in the Murdoch media are openly calling for the government to abandon its emissions reduction targets, pathetically weak as they are, and to follow the Trump administration out of the Paris climate deal.
Coalition politicians such as Barnaby Joyce, Tony Abbott, Craig Kelly and George Christensen are saying much the same thing. And while many reject this as the mutterings of a small minority, the results of the recent “super Saturday” by-elections are putting Coalition MPs into “survival mode”.
And it seems that many are prepared to run on the fight of coal vs renewables, counting on ample support in the News Corp media empire, much of talk-back radio, and the indifference of Fairfax and the ABC.
The push for new coal-fired generators – the details of which are expected to be delivered to the Coalition party room meeting on Tuesday – comes after the Minerals Council of Australia funded Christensen on a trip to Japan to look at new coal-fired generators there.
The Minerals Council is no stranger to the Coalition. Its former policy point man is now climate advisor to prime minister Malcolm (I will never lead a party that doesn’t take climate change seriously) Turnbull. Greg Hunt’s former advisor when he was environment minister is now at the MCA.
Laughingly, the Coalition is trying to spruik its energy auction and underwriting scheme as “technology neutral”, but in a world that needs to reduce emissions, rather than increase them, there is no such thing as technology neutrality.
Little wonder that both the Victoria and the Queensland state governments are talking of the Coalition “climate crazies”.
“The (NEG) target must be able to increase as technology changes, without becoming hostage to extremists and climate change denialists in the Federal Coalition party room and in the Commonwealth Parliament,” Queensland’s acting energy minister Cameron Dick said in a statement on the weekend.
Labor’s Mark Butler thinks it’s all part of the ruse to get the NEG past the backbench, in much the same way the the NEG was designed principally to disguise the fact that abatement has a price, and to pretend that it could stop the renewable energy industry in its tracks.
“Malcolm Turnbull’s latest attempt to appease the anti-renewable ideologues in his party room misrepresents an ACCC recommendation to support new generators, by using it as a coal fund,” Butler said in a statement.
“This is a clear attempt by Malcolm Turnbull to mislead his backbench and sneak the National Energy Guarantee through the Coalition party room. The ACCC recommendation is not about supporting new coal power, it is about supporting hybrid renewable, storage and gas projects.”
He noted that Sims had made it clear his proposals had originally not been about baseload power and not targeted at coal, and ESB chair Kerry Schott had said “there would be absolutely no way that anybody would be financing a new coal-fired generation plant.”
The energy industry has said much the same thing. “If the Prime Minister wants to deliver a ‘new coal fund’ to his party room, he should not be using the ACCC as cover for such a misguided, wasteful and irresponsible policy,” Butler said.