Halting the terminal decline in manufacturing could be as simple as the government doing nothing – not watering down the Renewable Energy Target, not abolishing the Clean Energy Finance Corporation and not stopping investment in manufacturing.
Australian workers are resilient and skilled. Most will rebound from the mass redundancies, eventually, just as they did in Newcastle after the closure of BHP’s steelworks. But the loss of jobs and industries hurts workers, families will be broken and communities decimated.
Australia could still be a country that, in the words of Kevin Rudd, “makes things”. But the Federal Government’s determination to ‘axe the tax’ will strip funding from manufacturing and clean energy at the time it is most needed.
John Howard saw the need to rebalance the energy market away from big gas and coal towards clean energy, to harness the power of the sun, wind and water, when he established the Renewable Energy Target.
The RET has stimulated $18 billion in investment and industry body the Clean Energy Council estimates a further $18.5 billion in investment will flow if the target remains unchanged.
A strong renewable energy sector means jobs, like the much needed work for metalworkers in Launceston who manufactured towers for the 168-megawatt Musselroe renewable energy plant.
In Adelaide leading solar panel manufacturer Tindo Solar estimates investment of $20 million will create 600 new jobs by 2016.
Research conducted by the Clean Energy Council estimates that for every megawatt of energy generation Australia installs, nearly three jobs are created in directly and indirectly related industries.
A bill to abolish the Clean Energy Finance Corporation was passed in the House of Representatives, where the Government holds the majority, but rejected in the Senate. The CEFC’s reprieve may be short lived if new minor party and independent Senators support the Government.
The CEFC, funded with revenue from the carbon tax, is making a profit by investing in clean energy projects that create jobs and cut pollution. The work of the CEFC is multiplied by direct co-investments in our most intensive food, smelting and manufacturing industries, again with revenue from the carbon tax.
Australia’s long history of manufacturing, the skill of our workers and the reliable regulatory environment mean renewables will engage local manufacturers, given the chance.
But that chance evaporates if the Government succeeds in scrapping the CEFC, RET and carbon price. If the government is serious about innovation and creating long-term, stable, 21st century jobs, it must support these mechanisms and allow clean energy to revive Australian manufacturing.
Dugald Murray is the Australian Conservation Foundation’s senior economist