You’d think they’d be grateful: Malcolm Turnbull and Josh Frydenberg have gone to all the effort of designing a climate and energy policy that does nothing, and Tony Abbott and allies are still complaining that it does too much.
2018 is starting to feel a lot like 2009 all over again. That’s not a prediction for a party coup d’etat against Turnbull, but it does look like being a re-run of having an already hopelessly compromised policy scrapped at the last-minute by the acts of the right wing.
Abbott this week was in the party room, and on the air at 2GB, threatening to “cross the floor” because the proposed National Energy Guarantee would not result in the construction of a new coal-fired generator.
Here’s Abbott (above) walking out of the House of Representatives on Tuesday carrying a dossier marked the “Coal era is not over”, probably put together by the Monash Forum. Perhaps the one underneath is his membership to the Flat Earth Society.
Abbott demanded the Coalition back-track on the NEG, arguing it would never work if it did not include a new coal-fired power generator.
Why is this a problem?
Because, as David Leitch, the most sober of energy analysts, wrote this week:
“The NEG does nothing: It won’t lower prices, it won’t reduce the large gentailer influence, it won’t bring about the new investment required … it has no commitment to change. In short, it’s fraud as far as policy goes, or at best, a fix.”
And clearly a political fix, designed to placate an Abbott that refuses to be placated.
State and federal Labor might have been ready to play along were the policy to fit the category of “doing no harm”, but analysis from the likes of Leitch, Tristan Edis, Bruce Mountain, Dylan McConnell, Andrew Stock and many others suggest that’s exactly what it may do.
The ESB had addressed some of the initial concerns about the NEG in its second version, promising changes to avoid a further concentration of power among big retailers. But the latest version has opened up a potential hornet’s nest of issues.
Most, if not all, can be addressed, but the spirit of compromise is not alive in Canberra, given the push by Abbott, and certainly not on the most important element of the policy, the emissions reduction target.
Abbott says cutting emissions in the electricity sector by 26 per cent is too much, even though most will be met by the mechanism he tried to kill, the renewable energy target.
He was the prime minister that approved the national target of a 26-28 per cent reduction. Trump-like, he is now blaming his advisors for pulling the wool over his eyes, and the country remains without an economy-wide policy.
But the true colours of the party and its policy direction come from the one-third of National Party MPs who the AFR’s Phil Coorey wrote this week are backing Abbott, and threatening to oppose the NEG. Why cut emissions at all, they argue.
Let’s remember that the whole premise of the NEG was the pretence of bi-partisan support, particularly in the Coalition party room.
But while there is such a wide gap between the two major parties on emissions targets and renewables, and indeed climate science, there is and can be no bi-partisanship.
Even those within the Coalition who support the NEG do so only on the assumption that it will – as the ESB modelling suggests – stop renewables in their tracks.
“If this policy is not bedded down before the election we will get a Labor policy with a 50 per cent target (and) you cannot have reliability with this percentage of renewables,” National MP Mark Coultan told Fairfax.
The attachment of the Coalition to coal is bizarre and ill-founded. But it’s based on the fodder prepared for them by the Minerals Council of Australia, the Institute of Public Affairs, various astro-turfing groups, and the Murdoch Media.
The attacks on wind and solar are relentless.
The Australian was at it again this week with its own editorial and a contribution from economist Judith Sloan, topped by an “investigative” report from environment editor Graham Lloyd, which promoted “cheap” new coal generators, even nuclear.
The full-page article gives prominence to this graph, below, purporting to show the cost of various technologies, prepared by Solstice Services, a consultancy run by a trio of former employees of the Tarong coal generator in Queensland. And they haven’t changed their stripes.
A new coal HELE plant (the acronym stands for high efficiency, low emissions, but might more accurately be high emissions, low efficiency) is claimed to be the cheapest form of new energy, even cheaper than wind and solar, and even before you add storage.
The chart places the cost of solar and wind – the cost of solar and storage is put at up to eight times its actual cost. It’s breathtakingly misleading, and completely contrary to what anyone in the energy industry will tell you.
The problem is that the majority of Coalition MPs – and many conservatives and Murdoch readers – believe this sort of nonsense, because that’s all they are fed.
It’s hard to find much reference in The Australian to the list of industries which are turning to wind and solar, because it is cheaper – and with storage and “firming contracts” – still significantly lower than what they are charged by the fossil fuel incumbents.
Sanjeev Gutpa is to power his Whyalla steelworks with around 1GW of solar and storage, and has already written contracts to supply five other big industrial users in South Australia, primarily via a new 220MW solar farm he will built near Port Augusta.
He has already signed a contract for the Numurkah solar farm to power his steelworks in Laverton, has signed contracts with two new solar farms for other industrial users in Queensland and Victoria, and plans to build up to 10GW of solar to restore Australia’s manufacturing base.
Others to source wind and solar for all or part of their electricity needs include Sun Metals zinc refinery, brewer CUB, packaging giant Orora, Telstra, Mars Australia, CC Amatil, Nectar Farms, Sundrop Farms and dozens of smaller businesses. These developments rate barely a mention in the Murdoch media.
Still, the nonsense is not exclusive to the Coalition right wing. The Electrical Trades Union on Thursday issued a press release slamming the decision by the Northern Australia Infrastructure Facility to award $516 million to the world-leading Kidston solar and pumped hydro project.
“This is a sneaky, underhand way of privatising ours (sic) state assets through backdoor deals with private companies in direct contravention of the state government and state LNP’s supposed anti-privatisation policy positions,” the union said.
It’s not clear how the ETU imagines that all the wind and solar farms planned for the state under the Labor government’s 50 per cent renewable energy target will be built, if it were not for private money.
Already, 23 separate projects have been completed or under construction, and there is another 30GW in the pipeline. Now, it may be that the ETU has a very legitimate gripe about the sourcing of labour for those projects by EPC contractors, but that is a different matter.
But let’s get back to the NEG. The final details are being rushed together over the next five weeks – the technical aspects by the ESB, and the emissions targets and broader policy issues by the Coalition government.
The ACT energy minister Shane Rattenbury, a Green, fears that the agitations of Abbott and a big rump of the Coalition back bench means Frydenberg will have no room for compromise at the COAG energy minister meeting in early August.
That, he says, risks the whole thing being junked. Even if the ESB is able to iron out the technical issues from the emissions and reliability obligations, the Labor states need Frydenberg to cede ground on policy.
Frydenberg clearly won’t change the Coalition’s low ball targets, but the minimum they need is manoeuvrability to adjust those targets, control the amount of offsets, and address “additionality” – meaning that the efforts of individual states, and corporate buyers and households, are recognised.
If not, it will be back to 2009 when the CPRS, itself a compromised policy after trying to appease the conservatives, was rejected by the far right, and voted down when Labor refused to negotiate with the Greens.
And would the dumping of the NEG be so bad? It’s yet to be seen that not having the NEG will be any great loss.
And here’s another irony. Abbott, who thinks that climate science is crap, managed to halt the renewables roll-out for three years when prime minister.
Turnbull, who promised never to lead a party that didn’t take climate change seriously, is now attempting to impose an effective 10-year moratorium on those same technologies.
Note: The ESB last week released the draft of their detailed policy documents after 5pm on Friday, which as we noted then is the time traditionally used by institutions to take out their dirty washing.
The release of a further 10 detailed policy papers was flagged for this week. The latest word as we finalised our newsletter at 3pm was that: “it will be released later Friday afternoon.” More dirty washing. Not a good look.
Giles Parkinson is founder and editor of RenewEconomy.com.au, and is also the founder of OneStepOffTheGrid.com.au and founder/editor of www.TheDriven.io. Giles has been a journalist for 35 years and is a former business and deputy editor of the Australian Financial Review.