Fossil fuel dinosaurs fudge the numbers to serve their interests (and save you 50c a week)
This is a full renewable energy catastrophe for Australia. After painting the worst possible scenario and factoring in the most gloomy technology cost estimates, the most virulent anti-green business forces in Australia have come to the conclusion that the Renewable Energy Target is having such a devastating impact that it is costing the average household — wait for it — drum roll … less than $1 a week.
For this, the Business Council of Australia, the Australian Chamber of Commerce and Industry, and the Minerals Council of Australia would like the Abbott government to risk its remaining political capital and scrap the RET, at the cost of thousands of jobs and billions of dollars of clean energy investment. But they have actually stopped short of making such a strident and politically untenable call. Instead, the three lobby groups have suggested the RET be adjusted to a “real 20%” target — a change that would still scrap billions of dollars of green energy, but would bolster the profits of existing coal and gas fired generator — and save households the grand sum of 50c a week.
The report from Deloitte Access Economics has been keenly awaited — ever since a snippet of its supposed “devastating” modeling was trumpeted with great fanfare by the Murdoch press in June. In many ways it was considered to be the final roll of the dice for the fossil fuel lobby. Instead, it has produced a damp squib. It has simply reinforced what everyone already knew — making changes to the RET delivers the greatest benefits to the incumbent fossil fuel industry and satisfaction to conservative ideologues. It is not about the cost to consumers at all — otherwise they would be applying their modelling and economic gobbledygook to much greater threats to household bills, soaring gas prices and rising network costs.
But let’s put this in context. It was expected that the Abbott government would drive its truck right through the RET, despite its stated bipartisan support before the election. In choosing to bypass the Climate Change Authority, which has the statutory requirement to conduct the current RET review, and appointing instead an “independent” panel comprising two people — Dick Warburton and Shirley In’t Veld — who do not accept the science of global warming, and another — Brian Fisher — with strong interests in lobbying for fossil fuel interests, the government made its intentions clear.
Two realities have thrown a spanner in these works. The first is economic: the anti-RET lobby simply has not been able to produce economic modeling that justifies their position. Even ACIL Allen, sometimes described as the fossil fuel industry’s modellers of choice (it prepared the anti-RET submissions of EnergyAustralia), concluded that households and businesses get a long-term benefit from keeping the Renewable Energy Target as is. And it agreed, contrary to the protestations of the incumbent utilities, that the target could be met if the industry was given policy certainty. Instead, it sought to base opposition to the RET — and the construction of wind and solar farms, and the installation of rooftop solar — as a “transfer of wealth” from fossil fuel generators to the consumer, as though that prospect would somehow cause outrage in middle Australia.
The second reality is political. Abbott does not have the numbers in the Senate to force through changes to the RET. The Palmer United Party and the Greens stand in their way, and as the cheerleaders in the Murdoch media trumpeted today, may only be dissuaded with convincing economic arguments against their position.
It’s hard to imagine Abbott risking more political capital for the sake of 50c a week per household — that’s the estimated saving by Deloitte. It’s even harder particularly when renewables, and rooftop solar in particular, are so popular with the electorate.
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