Election diary: Joyce pledges $1.5 bn on gas, as modelling reveals why that’s a bad idea

Barnaby Joyce wants $1.5 billion to send more gas offshore

Deputy prime minister Barnaby Joyce has made his first major promise of the election campaign – a commitment to fund the construction of a $1.5 billion gas export terminal in Darwin.

Joyce made the announcement from Darwin on Tuesday, with the funding commitment including $300 million for LNG ad hydrogen production, along with more funding for carbon capture and storage infrastructure.

The Morrison government has talked up its plans to expand Australia’s gas production as being necessary to avoiding potential supply shortfalls in Australia’s gas markets.

However, gas company Santos, which is developing a number of major gas projects in the Northern Territory, has conceded that those investments were dependent on the ability to sell more gas internationally.

Government modelling points to ballooning debt costs due to climate failures

The new commitment to fossil fuels came as it was revealed that modelling produced by the Morrison government suggests that the cost of servicing Australia’s surging public debt could be worsened by its failure to act on climate change.

A report published last year as part of the government’s ‘long term emissions reduction plan’ – with input from consultancy McKinsey and the federal Treasury – found that Australian governments could be charged a premium on interest rates for debt – as much as 300-basis points – if Australia is seen to be out of step with the rest of the world on climate action.

With Australia’s public debt tipping over $1 trillion for the first time – a doubling of interest rates, or more could cost Australia tens of billions in added interest payments.

It could create a major headache for future governments, and political leaders set to battle it out in an election campaign fought over economic management, and climate change if they get around to it.

CEC wants renewables front and centre

The Clean Energy Council put its case for renewables to be front and centre of the election debate, saying the economic and environmental potential was enormous.

But, CEO Kane Thornton conceded: “Energy policy probably isn’t front of mind for a lot of voters come election time. However, global events probably suggest that this Federal Election should be different.”

In the end, it’s likely to be the focus of the Greens and the so-called “climate independents”, but right now they are struggling to get air time over the mainstream media’s focus on the major parties.

Despite offering highest ever price for carbon offsets, Regulator struggles to attract new projects

Despite offering projects its highest ever price for carbon offsets, the Clean Energy Regulator has netted only a modest volume of new contracts under the Emissions Reduction Fund.

Releasing the results of the 14th auction under the fund, the Regulator said that it would pay an average price of $17.35 per tonne, for 7.6 million Australian Carbon Credit Units.

The Regulator has struggled to attract much interest from new emissions abatement projects – despite the Emissions Reduction Fund being the flagship climate policy of the Morrison government.

The scheme has also come under significant criticism of late, with questions raised around whether it actually achieves the emissions reductions claimed.

Without vehicle emissions standards, most Australian cars fail even ‘voluntary’ standards

An often overlooked aspect of Australia’s emissions reduction policy is the potential to cut transport emissions through the introduction of vehicle emissions standards.

New data from the Federal Chamber of Automotive Industries (FCAI) shows that most petrol vehicles sold in Australia fail to meet even voluntary standards introduced by the industry.

Though industry-wide figures released in late March showed a slight reduction in CO2 emissions (146.5gm CO2/km, down slightly from the 2021 target of 150gm CO2/km,) most of the 39 brands included in the passenger car segment missed their own stipulated targets.

Until political parties embrace the idea of compulsory standards, Australians will be left driving more polluting and more costly inefficient vehicles.