Tony Abbott in denial about Australia's energy future | RenewEconomy

Tony Abbott in denial about Australia’s energy future

Print Friendly, PDF & Email

Q&A highlighted why Abbott has got it wrong on energy. An ideology that promotes coal, nuclear and centralised systems, over solar, wind and mini-grids is likely to be an expensive boondoggle. And new reports suggest the pace of change will be even quicker than thought.

share
Print Friendly, PDF & Email

There was a brief exchange on the ABC TV’s Q&A program on Monday night that neatly summed up all that is wrong with Australia’s energy policy.

Grahame Morris – a former chief of staff to Coalition prime minister John Howard, and a corporate lobbyist who is influential in the government of Tony Abbott – had, in the words of host Tony Jones, steam coming out of his ears at the idea that wind and solar could offer a future energy solution.

morrisFlapping his arms about and pointing his finger, Morris exclaimed: “Look, not everyone wants a bloody big windmill in their backyard … nuclear power is clean … one of the problems with the third world with poverty is that they don’t have electricity. We have coal and we have uranium that can provide energy sources for those people. You are talking about poverty  … that is the answer.”

Morris also scoffed at the idea of climate change and, with that, pretty much summed up the policy position of the Abbott government, its principal advisors, and the conservative think tanks that influence and applaud it.

It is a discourse – the belief in the primacy of centralised generation, be it coal or nuclear – that is guiding the Abbott government’s climate, energy and industrial policy. Disconcertingly, it is a view that spreads to the Labor Party, too, judging by the response of Labor’s Joel Fitzgibbon, from the Hunter Valley.

It’s also parroting the key marketing point of Big Coal: one that ridicules or downplays climate science, talks down the need to act, and places its faith in ageing technologies. The push against wind farms is a symptom of the view that nothing can or should change, and green policy can’t be allowed to be right about anything.

But it is plain wrong, and dangerously so. Later today, the global analyst firm Bloomberg New Energy Finance will release a new study and forecasts that are stunning in the speed and scale, and the flow of investment trillions, towards a new global energy system.

The BNEF report – see details on it here – predicts that households and business will account for more than half of Australia’s demand by 2040, and is the latest, and most comprehensive, of a series of reports that highlight the rapidly shifting sands of the global energy market, and the move from centralised generation to a decentralised future.

This has been canvassed by the likes of the CSIRO, the International Energy Agency, the biggest utilites, and global investment banks.

UBS last month came up with a report stating that a scenario where 50 per cent of all electricity generation was provided by solar by 2050 could not be ruled out. Much of this would be behind the meter, on the rooftops of homes and businesses.

Morgan Stanley has predicted 2.4 million homes in Australia will have battery storage. Even the owner of the Hazelwood coal-fired generator, one of Australia’s biggest and certainly its dirtiest coal plant, says half of all electricity consumption will be localised, rather than centralised within a few decades.

Remarkably, the Australian Energy Market Operator says that within 10 years, rooftop solar in South Australia will meet 100 per cent of demand on some days in the state. That leaves no room for baseload, centralised generation.

Last weekend I had a fascinating meeting with the head of smart grids for one of the world’s biggest engineering and power supply companies. The pace of development that he was talking about – and the investment dollars driving it – was quite stunning.

As one small example: A new housing development in NSW about to begin construction will be entirely off-grid. The economics are simple. Connecting a new housing division requires a developer to spend millions on grid infrastructure which it then has to “gift” back to the grid operator, and then its consumers pay rent for its use. Half of their bills will come from “networks costs”. It is energy as an indirect form of taxation.

But new technology and financial modeling means the network is not needed for such developments. The cost of solar PV and battery storage has now come down to the point where it is a “no brainer” to operate on a mini-grid. This is being recognised by international investment giants, with billions of dollars being invested. This housing development will be the first, but most will follow.

And it’s not just new housing projects. One town in Queensland is currently negotiating to go off-grid, and another dozen are contemplating the same thing. The same thing is happening in NSW.

The engineer says that households and business electricity use – and whole communities – will be almost entirely delivered by on-site or localised energy supply. He says that centralised generation can forget about the household and commercial markets. They will need to find large industrial consumers, and many of them will be seeking cleaner options than are currently on offer.

As Simon Richardson, the mayor of Byron shire, told a forum on the weekend, this push towards localised generation will be an irresistible and unstoppable force.

“Things are happening so fast in technology, what was considered pie in the sky just a few years ago is now considered to be legitimate and mainstream,” he said. Richardson had just returned from the climate talks in Bonn, where he was presenting Byron shire’s plan to be “zero net emissions” within 10 years.

In these scenarios, as Rob Stobbe, the head of SA Power Networks, has suggested, large centralised generators struggle to find a role. Any new development will be renewable, not fossil fuel, and they will be paired with storage. South Australia is currently looking to install the world’s largest utility-scale non-hydro storage scheme in the world.

Australia is likely to be a leader, notwithstanding the roadblocks erected by the Abbott government and state-owned and private utilities. It has the highest electricity prices, the cheapest solar prices, and the best conditions for the deployment of battery storage, without subsidies.

Yet Abbott, his advisors, their cronies, and those with vested interests and nuclear ideologies understand nothing of this. Like Morris, they believe that renewables are costly and ineffective. They dismiss “unreliables”, they see nuclear as the only replacement for coal.

The current push back against wind turbines, and the Abbott-endorsed witch-hunt, is just one example of this. In a hearing last week, an ANU professor James Prest is called “a prat”, and howled down by cross-bench and LNP Senators, when he dares point out the health impacts of coal-fired power stations.

Abbott’s campaign against wind has halted investment, will slow down future projects and put the brakes on the energy transition, making it more expensive than it need be.

His comment seems intent on encouraging, or investing, billions of dollars in investment in assets that are likely to be stranded by these new technologies. The reason why the market price for both thermal coal and uranium has plunged is that global demand is evaporating. The rest of the world has discovered new technologies and embraced them. Abbott is still trying to sell them the energy equivalent of a fax machine.

At least it has spawned some humour. Check out the video below for a funny take on Abbott’s wind farm policy.

Print Friendly, PDF & Email

37 Comments
  1. trackdaze 5 years ago

    Maybe mr methane could be a candidate for the wind “pfft”commisioner

  2. RobS 5 years ago

    It is simply unbelievable for any educated person to look at the economics of new nuclear builds all around the world and think a third world country could ever even consider installing one.

    • James Prest 5 years ago

      Well, the Indonesians are still talking about it – see Jakarta Post of 13 June 2015, http://www.thejakartapost.com/news/2015/06/13/govt-increase-budget-new-energy-sources.html and the claim of the World Nuclear Association is that “The government said that it had $8 billion earmarked for four nuclear plants of total 6 GWe to be in operation by 2025, and aimed to meet 2% of power demand from nuclear by 2017”. (source: http://www.world-nuclear.org/info/Country-Profiles/Countries-G-N/Indonesia/) The most expensive, complicated and dangerous way to boil water ever invented, but when the nuclear club makes friends in government, don’t expect open and transparent decision making….

      • RobS 5 years ago

        They will start one of these mythical $2b plants, the cost will blow out to 10 billion dollars before soil is turned and they will either end up with none or perhaps at worst one with the rest shelved. I woudnt call INdonesia third world though, not fully developed but pretty advanced. The comments on q and A are talking about true energy poverty in sub saharan Africa and similar places, it is sheer madness to even consider installing a nuclear power plant in such a location, the most expensive water hungry form of generation.

        • nakedChimp 5 years ago

          wonder where they going to source the qualified personal there that wants to life in such an environment when at the same time they could be in Europe or the US or any other country that is inviting skilled people..

      • Mike Dill 5 years ago

        In the ten years it would take to build,the wind and solar sectors will have blown by their targets and will be supplying the power at a lower cost.

      • JeffJL 5 years ago

        Come on James, get with the program. It is not like Indonesia experiences earthquakes or tsunamis.

    • Jan Veselý 5 years ago

      It is not about cost, it is a PR action. Building a nuclear power plant is a national PR shouting to the world: “Look at us, we are rich and developed nation, we have skillful scientists and engineers.”
      An also this can be also used as a cover of a nuclear weapon program.

  3. Rob G 5 years ago

    I’d love to see a future documentary asking these polliticians why their views were so wrong, and saying ‘that most of our power now comes from renewables.’

    • Miles Harding 5 years ago

      Like the Rudd-Gillard cage-fight currently airing on the ABC, it’s only a matter of time…
      First step is to prise the LNP’s greasy, black hands off the nation’s tiller.

      • Rob G 5 years ago

        Yes, in fact a doco story like the ‘Killing Season’ for the current government would be nice. Wonder what that would be called? Maybe The brainless self-righteous season… Or the denier lair season?There’s no shortage of material, maybe 2 or 3 seasons all up might cover it.

    • RobS 5 years ago

      Don’t hold your breath, they will simply say it all happened as a result of the stunning success of their direct action plan, the terminally deluded are terminal, don’t expect contrition or an epiphany or you will be terminally disappointed.

      • Alastair Leith 5 years ago

        Exactly to whatever extent we mitigate climate change as a planet will be to the extent that denialists-come-luke-warmers will say ‘see told you so nothing to worry about to much’. It’s only by tanking spaceship Earth that we actual get to have proof enough for the denialists and luke warmers, so stuff them — they’re a waste of oxygen from a planetary perspective.

    • Alastair Leith 5 years ago

      They will invoke the “man of his Times” defence that Howard used to invoke for his dead white male idols.

  4. Bob_Wallace 5 years ago

    Giles, could we have an article describing this new stand-alone housing development?

    What sort of input mix are they planning on using? (Solar + diesel?) What kind of storage? How large does a development need to be to afford a staff to keep the system running?

    • Giles 5 years ago

      HI Bob Yes, it’s coming shortly. Sorry, it was a bit of a tease, but just wanted to flag the issue as part of this article. Ditto with those off-grid towns.

      • Bob_Wallace 5 years ago

        Color me teased.

        Looking forward to learning more. Thanks.

      • Tim Forcey 5 years ago

        Hi Giles: So does this housing development also eschew the gas grid? I await the report!

    • Alastair Leith 5 years ago

      I believe there are a number of developers having consultancies go over their off-grid and low-grid options for reasonably large mixed-use developments. The charges the networks invoice are big money and if the transmissions and transformers can be curtailed it’s a win all round. Especially in QLD and WA where solar resource is greatest.

  5. Peter Campbell 5 years ago

    “The push against wind farms is a symptom of the view that … green policy can’t be allowed to be right about anything.”
    I suspect that is behind the visceral objection to wind farms. Anything green for quite a while has included a friendly stylised wind turbine in an upper corner of a cute cartoon graphic. Now those who always characterised anything green as trivial and impractical see this green logo, full-sized and proud, standing on ridges for all to see across rural electorates. Must be galling.

    • Mags 5 years ago

      Also they are now cheaper than coal, even if you don’t include the cost of the damage of coal, so they are a serious threat to the LNP donors.

  6. David Simpson 5 years ago

    Come on, put your hand up all those who voted for these dills

  7. Lorraine 5 years ago

    I’d love my town to go off-grid. How would you go about it?

    • Pedro 5 years ago

      Talk to your local mayor and MP to see if they will push that wheelbarrow.

      • Mike Dill 5 years ago

        If they can get the community off the grid, then they can find some out of the way place to put in some windmills as well. No issues if not connected to the grid.

        • Miles Harding 5 years ago

          Tony will pelt your solar panels with lumps of coal!

          I like the thinking of taking the entire community along on the journey.

          Any town near the end of the grid is a really good candidate. I was surprised to learn that there are many places where up to half the centrally generated electricity doesn’t make it to these outlying consumers.

    • Alastair Leith 5 years ago

      Beyond Zero Emissions is currently working with a number of municipalities to help them assess and reduce their emissions with the goal of becoming just that, beyond zero (GHG) emissions.

  8. Russell Harris 5 years ago

    The Government is counting on revenues from coal & gas to underwrite Australia’s prosperity. It appears their plan was to sell it all as soon as possible, and then buy in low-emissions technology when prices reduced to a minimum.

    Unfortunately, low-emissions technology is destroying the markets for our fossil fuels, and the value of the remaining fossil fuel is diminishing every day.

  9. Miles Harding 5 years ago

    yes, Tony most be an android with programming glitches. (see the video)

    This debate is showing another very ugly face of the LNP. The vitriolic attacks on anybody who dares to disagree with the doctrine of the church of Tony is truly breathtaking. I don’t believe I have ever seen the likes of this behavior in an elected government.

  10. Paul Turnbull 5 years ago

    Giles I appreciate these articles where you describe the behaviour of those who don’t understand the danger of not moving away from coal. It is especially alarming when they surround the powerful and influence their actions.Evidence shows they are wrong – but balanced long term decision making is pushed aside in the frenzy of governing. Time will reinforce the danger of coal, nuclear and the benefits of wind, solar.. and in fact the behaviour of our EU, US and Chinese rulers are more important and better turned into the future. How is that these important others are now doing much better? How do they balance the need of their citizens with the lobbyist well targeted efforts?

  11. Ken Fabian 5 years ago

    In the mouths of climate science deniers calls for nuclear are really just intended to undermine renewables – and come with no actual commitment to use nuclear to replace fossil fuels. More than any other option nuclear must have consistent, strong, long running cross partisan commitment to the fundamental goal of transition to low emissions. Climate science denial and climate action obstruction are antithetical to any nuclear-for-climate objective.
    As long as our LNP is led by people who reject the science on climate and are 100% pro-fossil fuels these ‘best friends’ of nuclear are working at cross purposes with any nuclear for climate advocacy. And if nuclear can’t rely on the conservative Right to go beyond mere words of preference for nuclear that have a fundamentally anti-climate action intent into tangible policy commitment, how can getting ‘greenies’ to ditch their distrust and get onside with nuclear (mostly by telling them they are irrational, idealistic idiots) achieve this imaginary nuclear powered utopian future?

    • Bob_Wallace 5 years ago

      Advocating for nuclear might well be an attempt to buy coal another couple decades of profitability. Nuclear electricity would cost a lot more than from a paid off coal plant but the utility industry wouldn’t have to admit that for another ten years or so while a couple of new nuclear plants could be built so that people could see the actual cost.

      And then they might be able to hold off for a second round of “We’ll get it right this time reactors”. Or at least a few more years while renewables were installed.

      • Ken Fabian 5 years ago

        As nuclear advocacy currently stands, it’s more a rhetorical weapon used by opponents of action on climate for attacking ‘green’ politics and renewables than any genuine and effective advocacy for addressing climate change -although there are certainly some who are both serious about climate and can’t accept that anything less will be effective enough. I do wonder if a sub-agenda of appearing pro-nuclear within Conservative Right politics is aimed at keeping those within their ranks that do think climate is a serious issue quiescent, a “we can fix it later if we really have to but we have to stop ‘greenies’ and renewables first, so don’t break ranks” kind of argument.
        Of course if environmentalism loses it’s popularity and credibility and is politically weakened, some of the strongest voices for action on climate are taken out of the debate. What is clear to me is that in the absence of anti-nuclear advocacy, the Conservative right will continue to try and take climate and emissions reductions off the agenda, not rush to fix things with nuclear. Which even their own side have no great faith in.

        • Bob_Wallace 5 years ago

          The right has lost the ObamaCare war. They’ve lost the gay marriage war. They’re losing the climate change war.

          I suspect some on the right advocate for nuclear because they believe in “big things” and don’t understand that we can get to where we need to be quicker and cheaper with renewables.

          Of course some on the left don’t understand that either.

          • Ken Fabian 5 years ago

            Whilst I’m sure anti-climate action as a political position will eventually become untenable, i think we have a long way to go before that happens in any place with major fossil fuel reserves. I don’t think energy/emissions/climate politics is much like more inclusive medical care or marriage rights and I don’t think it will go the same way. But I do think some fundamental changes are happening, unexpected but positive, that can’t be stopped except by deliberately hostile regulation, and those arise from solar and wind becoming, intermittently and periodically, cheaper than ‘baseload’ power.

            I have my own views on how things could progress; i think that as long as renewables are not excluded or regulated out of an ‘open’ energy market, their ability to be intermittently cheaper than encumbent generation will force a defacto carbon price onto ‘baseload’ plant. Nuclear’s potential revenues and costs will get caught by this emerging market based shift – like coal they can give power away when the sun is shining and wind is blowing but at added cost to supply outside those periods. By normal market regulatory standards that would be unfair and possibly illegal under anti-trust, anti-monopilistic practices legislations. But this is an industry treated as essential and often is run as an effective monopoly anyway.

            Traditional plant will be increasingly forced into intermittency in response to renewables taking part of the market, like it or not. The costs of operation will have to be raised outside those periods to cover the lost revenues and that will make storage even more attractive. Thus the attempts to restrict solar input on the claimed basis of “grid stablity” – really just outdated plant that isn’t up to modern intermittent requirements – and shifting the balance of costs away from metered usage to fixed charges. Time of use metering actually adds to the incentives for adding more PV and storage and cheaper storage, as it becomes available, will add incentive to add more PV. Which I suspect is part of the reason the big power companies haven’t pushed as hard for it as we might have expected.

            Storage is interesting, not only for it’s ability to increase self supply by solar fitted homes and businesses, but for opening the possibility to purchase off peak power for non-solar consumers who are on Time of Use metering, and for solar fitted homes as well; with overcast weather predictions, they can purchase off peak in anticipation. But again I think there will be attempts to add extra charges or restrict access to off peak for solar and storage fitted homes.

            I think the real fight – ironically, given the major poltical opposition to renewables comes from ‘free market’ advocates – is going to be ensuring a free market in electricity, that doesn’t deliberately restrict renewables access.

          • Bob_Wallace 5 years ago

            Well written. And I agree with your analysis of how large thermal plants will be phased out. All paid off generation has operating costs, coal and nuclear operating costs are higher than those of wind and solar. In fact, some thermal plants have higher operating costs than wind (and not too long from now solar) that is still covering its capex and finex costs.

            Wind can underprice thermal plants and when demand is low thermal plants often have to sell at a loss. And now solar will be creating losses during the sunny hours. In order to stay in business thermal plants have to charge more during non-windy, non-sunny times. Those higher costs open opportunities for natural gas and storage. As NG and storage grab some of the remaining market thermal plants must once again raise their prices and the death spiral tightens.

            The fossil fuel industry has been and will continue fighting against the inevitable. But as their industry shrinks, so will their political power. As well the political power of renewables will grow. We’ll see small victories for fossil fuels and some setbacks for renewables, but like a defeated army fighting to slow their retreat all they can do is to slow things some. They’ve lost the price war.

    • Alastair Leith 5 years ago

      It’s also a way of supporting the expansion of Uranium mining in this country and trying to greenwash it at the same time. Our U mining industry already has large costs borne by the public including environmental pollution from spills, water depletion, social, heavy fossil fuel use etc etc. Plus there’s some enterprising folks looking to get into yellowcake processing and waste storage.

Comments are closed.

Get up to 3 quotes from pre-vetted solar (and battery) installers.