Can Clive Palmer be trusted to protect renewable energy target? | RenewEconomy

Can Clive Palmer be trusted to protect renewable energy target?

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Clive Palmer, who has helped Abbott government dump the carbon price and has now reversed his opposition to Direct Action, may now allow changes to the RET. He also says Australian coal is good for emissions reductions.

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Clive Palmer, who has helped Abbott government dump the carbon price and has now reversed his opposition to Direct Action, may now allow changes to the RET. He also says Australian coal is good for emissions reductions.

The chances of the current renewable energy target (RET) remaining intact may have taken a dramatic dive after Clive Palmer, the coal baron with a crucial voting block in the Senate, appeared to flag changes that could support the Coalition’s stance on the RET.

Just hours after Palmer had backflipped on a promise made in June and signaled he would, after all, support the Abbott government’s Direct Action policy, Palmer said that hydro-electric generators built decades ago should be included as part of the current renewable energy target.

The importance of this comment is that it effectively endorses the Coalition’s argument that the RET should be reduced from its current level of 41,000GWh to around 26,000GWh, which would slash the amount of new generation to be built by two-thirds, and destroy the renewable energy industry in the process.

Palmer was at pains to say that the Palmer United Party supported the 41,000GWh target. “Well, for the third time, Tony, yes, we do,” he told Tony Jones when quizzed on the ABC’s Lateline program last night.

But Palmer also told Jones that he wanted to fix an “anomaly” that meant that old hydro schemes were not included in the current target. (Because the hydro schemes were pre-existing, it was decided they did not need the subsidy, although the 15,000GWh they represent is added to the 41,000GWh current target, and the small scale solar scheme to reach the so-called minimum 20 per cent).

“So we think – same with the Snowy Mountain Scheme – if you’ve got hydroelectricity, it’s clean energy, it’s something that shouldn’t be categorised the same as you would a coal-fired power station, for example. But on the current legislation, that’s how they deal with it. That’s an anomaly which is not in the country’s interest and we think it should be rectified.”

snowy hydro

It’s a dangerous comment for the renewables industry, because by including the 15,000GWh of pre-built hydro in the current scheme, Palmer is effectively arriving at the same number that the Abbott government wants to prosecute – 26,000GWh.

And in the current policy environment, where hikes in fuel excise are described not as a tax hike but as “revised implementation arrangements”, a 41,000GWh target (and a 20 per cent target for that matter) can mean whatever you want it to mean.

Industry Minister Ian Macfarlane’s office has been telling callers that he supports a 51,000GWh target. That is 15,000GWh of mostly pre-built hydro generation, 10GWh of rooftop solar, and 26,000GWh of large-scale renewables under the current target. And it just so happens that turns out to be 20 per cent of what he says are the new demand estimates for 2020.

Palmer’s proposal of counting hydro in the new RET amounts to the same result, and it deals him back into negotiations. Given his propensity for showmanship and pirouettes, it would not surprise that he would come to an accommodation.

It is a proposal that would horrify the renewables scheme, because it would be a handout for assets that were built decades ago. As it is, some hydro generators have been accused of rorting the scheme because if they generate above a “baseline” (around 15,000GWh) over a certain period, they get the added benefit of renewable energy certificates. But if they produce less in another period, they don’t have to hand them back.

The state governments might support this idea because it would boost the value of the hydro assets they are trying to sell. Palmer might also get the support of Nick Xenophon, who not only says he does not like wind, but is agreeing to wave through Direct Action on the basis that the government will support penalties for businesses that increase their emissions, although the Abbott government has said it has no intention of doing any such thing. And the Abbott government will do anything it can to dial down renewables.

Indeed, Wednesday was an extraordinary day of politics; there were so many back-flips it looked like a training session for Circus Oz. And “Circus Oz” is a fairly apt description of Australia’s clean energy and climate policy environment. The end result is a victory for the Abbott government and environment minister Greg Hunt, but not a victory for the environment or climate policy. But still the mainstream media watched and clapped like an impressionable infant.

“Thanks to Clive Palmer, emissions trading isn’t dead,” golly-goshed the Fairfax economics editor. Absolute bollocks. In return for his own backflip, Palmer obtained Hunt’s vow not to abolish the Climate Change Authority (well, Hunt couldn’t abolish it anyway without Palmer’s support), and to commission the CCA to look into the benefit of emissions trading scheme and future emissions reduction targets (something they have already done).

To top that off, Hunt made it clear that the Abbott government has no intention of taking any notice of the CCA report that Palmer has commissioned.

And don’t doubt Hunt on that one: he completely ignored the CCA’s groundbreaking Targets and Progress Review which recommended that Australia lift its 2020 target to a 19 per cent reduction from a 5 per cent reduction, suggested Australia needed to cut emissions by 40-60 per cent by 2030, and made absolutely clear that the best means to achieve that was through a market mechanism. i.e. a carbon price and a bunch of other mechanisms such as an energy efficiency scheme and emissions standards that the fossil fuel lobby implacably opposes.

The Abbott government, of course, has no intention of doing any of that. The Direct Action’s Emissions Reduction Fund is not even calibrated to meet the 5 per cent target, and Abbott has made it clear that there will be no new funds, even though various studies say it will fall short of the target by between $4 and $20 billion. And there will be no carbon price under a government that Abbott leads.

The irony is, however, that Abbott and his team know that if Australia was ever to implement a policy that matched the country’s commitment to cap global warming at 2°C, then it would have no choice but to introduce a carbon price. All the studies, including from the Howard government era, point to that. Abbott even favoured it himself before discovering that sloganeering was a cheap and effective political trick.

One thing that this process has shown is that Palmer has an extraordinary ability to conjure up press conferences with intelligent and highly principled people and make them look faintly ridiculous, and embarrassed.

He did it back in June when he shared the stage with Al Gore, who had the look of a man trying to remember which advisor it was that advised him to appear on the stage with a coal baron pulling apart one of the most advanced and respected carbon pricing scheme in the world.

fraser bernie
Image courtesy of The Guardian

He did it again this week sharing a podium with a slightly bemused Bernie Fraser, the former Reserve Bank governor who interrupted a pleasant retirement in the Southern Highlands to head up the Climate Change Authority.

The difference between Gore and Fraser is that the latter probably had no choice but to attend the media event.

Palmer said in June that Direct Action was a waste of money and was “hopeless” and “dead” because it would be too expensive with little environmental outcome. Now he has voted for it. He vowed to save the Australian Renewable Energy Agency, but then voted to help the Abbott government strip it of more than one-quarter of its funds.

So, the next media event will probably be an agreement to wave through changes to the RET, meaning that both the Greens (who want no changes) and Labor (who are tempted by a compromise) will be sidelined.

Palmer clearly cares only about coal, and his project in the Galilee Basin. He argued on Wednesday that Australian coal was “good for the climate” – he based this notion on his claim that it resulted in 35 per cent fewer emissions than Indonesian coal.

But this is debatable. The best Indonesian coal has the same emissions as the best Australian coal; what’s more, they are considerably lower in ash and sulphur, the nasty emissions that are making the air in Chinese cities toxic and unbreathable, and causing the Chinese government to look for alternatives.

And then there is the small matter of price; China does not want to pay the sort of money required to make the Galilee Basin deposits economic. And it may not need to, China could cease to become an importer of coal later this decade.

Palmer’s grip on renewables policy and technology is also tenuous at best. His much-admired defence of the RET had a use-by date of 2016, and that is not enough to provide certainty to attract investment and keep international money in Australia. And much of the running appears to be made by the inimitable Jacquie Lambie, whose main interest is protecting a range of old and heavily supported industries such as old smelters that are not, to borrow one of her phrases, particularly “well hung”. Tasmania’s future lies in clean-tech, and its representatives need to know that.

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  1. Rob G 6 years ago

    Clive Palmer is splitting hairs. Hydro power is clean, but is not renewable. He’s starting to cave, I wonder what sweeteners he’s had from Abbott? TimTams maybe!?

    • Pied 6 years ago

      why is hydro power not renewable?

      • Rob G 6 years ago

        Because there isn’t an endless supply of water. No rain = no power. Water is not renewable as once it is gone it’s gone for good – like petrol. The sun is always there, as is the wind.

        • Lobes 6 years ago

          Rainfall into dam catchments is absolutely renewable, not to mention pumped storage is also. The petrol analogy is also poor. If you were to say electrolysing water into Hydrogen to power fuel cells is not renewable you may have a point but hydro is renewable because like the wind and the sun the rain is also always there..

          • Alistair Spong 6 years ago

            Actually it’s not always there . A quick look at the reducing rainfall across Southern Australia over the last 25 years proves the point

          • Ben 6 years ago

            Pumped storage with no energy input would be a (impossible) perpetual energy machine. And I think you’ll find that once the electrolysed hydrogen is burnt, it reforms water. So wrong on both counts.

          • Lobes 6 years ago

            I think you need to go back and re-read the laws of thermodynamics. Fuel cells are not 100% efficient. No system is.

            Pumped storage is renewable if you use a closed system based on wind/solar/etc that doesnt expel the water.

            As for rainfall the atmospheric cycle continues I dont think you can predict when and where or if it will suddenly stop.

          • Rob G 6 years ago

            Renewable energy doesn’t run out, dams do. Rainfall is not dependable, droughts happen. Just take a look at Brazil’s dropping hydro caused by drought.

            As for pumping, the energy needed to pump water back up into the dam needs as much energy as it makes coming out of it. Simple laws of physics. Net gain = 0. However, if you use surplus power from wind/solar to pump water back into the dam this can become a type of energy storage. This is a great way to store energy, but still doesn’t make hydro a renewable energy source.

        • John P 6 years ago

          Hydro is renewable because the energy is not in the water but in the gravitational field. The water just effects the transfer.

          • Rob G 6 years ago

            I’ll grant you that gravity in itself is renewable – it’s always there. An example being ocean wave power which is a 100% renewable use of gravity. But Hydro power needs (non-renewable) water to take advantage of the gravity. You cannot ignore the finite supply of water as part of Hydro power, it’s hand in glove with gravity. If sunlight could runout and taking its heat with solar made our sun cooler then it would not be renewable.

            Fresh water (not salt) is relatively scarce in world terms and not a sustainable never-ending source. Wind (kinetic) is abundant and cannot be used up. Sunlight (heat/light) also is endless and cannot be used up. Geothermal (heat) is endless and cannot be used up. Wave (gravity) is also endless and cannot be used up. Renewables are energies than cannot be exhausted, and that counts the whole package.

            By the way, this is a great debating point as Hydro does sit in that grey zone for many people. And it goes further as debate can also argue that it is not clean energy – is the destruction of large amounts of land and altering natures path a fair trade off for ‘clean’ energy… I’m not yet settled on that one.

          • John P 6 years ago

            Yes, water is necessary to convert the potential energy of the field as I know from personal knowledge.
            During the last drought I decommissioned my own hydro power plant due to lack of water.
            The turbine was a high volume, low revs design and I’m now wondering if it may be reconfigured as a vertical axis wind type. The trouble here is that vertical axis rotors have a limitation due to angular momentum factors.
            I think it is worth looking into though.

          • Rob G 6 years ago

            Sounds interesting. I think there is a big future for combinations of wind with Hydro – or even new energy on top of older setups. If you have existing generators why not explore other configurations, makes a lot of sense.

          • disqus_3PLIicDhUu 6 years ago

            The part that is totally not renewable, is when part of the Snowy Hydro scheme, pumps up GWh from off peak, fossil fuel, to come back down again as ‘renewable

  2. Zvyozdochka 6 years ago

    The only remaining question about Palmer is whether his behaviour is calculated baffooning or is an LNP ‘useful idiot’. I haven’t worked it out.

  3. john 6 years ago

    the problem is none of them believe this

  4. Beat Odermatt 6 years ago

    The good news are that all Luddites in the end will lose. Industry Minister Ian Macfarlane may be the oldest of all Luddite and he will make sure that Labor will win the next election. He does not know or care that over 90% of LNP voters are actually care more for the environment than a few coal mines. It is easier to stay dry swimming than guessing what Clive Palmer will do.

  5. Chris Fraser 6 years ago

    I’m glad that CCA, CEFC and ARENA are for now not being repealed. It leaves a bit of infrastructure in place. We can only hope that the staffs do not get stacked with crones, cynics and acolytes. This study that CCA has to do … that sounds a bit eye-rolling to me. CCA established a need for an international ETS scheme under Gillard already. We don’t even need to wait another 18 months to be told the same thing.

    • Chris M 6 years ago

      Is that the case with ARENA as rather hard to discern from mainstream media (sorry Giles).

  6. Pedro 6 years ago

    Clive Palmer is all about Clive Palmer. The only thing you can trust him on is to serve his own self interest. And a significant number of total fools voted for him.

  7. Jason 6 years ago

    off grid here we come- these morons have no idea the rage that is building and as soon as it is remotely feasible KA-BOOM! you will see huge chunks of Australia just vanish from the grid… these parasites deserve nothing other than to be pillared on the nearest post and let the ants have them…

    • john 6 years ago

      Actually that is so going to happen very shortly check out energystoragenews there is so much going on it is not funny.

      Companies have seen the light and flow batteries look like they will be very much in demand ok link

      • Jason 6 years ago

        I did, it is amazing the churn just under the surface… let’s see what happens when this takes off

  8. fehowarth 6 years ago

    What Hunt is saying, no way are they going to listen to experts. Do not care what the facts are, will continue with DA. Still, with a little but of luck there will be a report, and an election coming up. ovt will not listen but voter may.

  9. WR 6 years ago

    People who don’t know his background have misunderstood Palmer’s motives. He’s basically a dealmaker. He’s someone who likes to bargain, bluff, bluster, delay and negotiate until he has made a deal that he believes makes him look good or makes him money. That’s just the type of person he is. You should expect to see more of this type of thing from him in the future.

  10. shinytop 6 years ago

    This seems vaguely familiar to me, didn’t we hear this type of spin around Sept 2013, can’t seem to make up their minds about what they really mean. Such a bunch of lying [email protected]@#?/ds, selling this beautiful country, its people and reputation down the drain.

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