The more it changes, the more it stays the same. It’s an old refrain, but the closer we get to the Clean Energy Future legislation ducking and weaving its way through parliament, the more we are reminded of the ghosts of the current proposal’s stepmother, the Carbon Pollution Reduction Scheme.
The CEF package is due to be presented to parliament next Tuesday in 13 (lucky for some?) different pieces of legislation. And the grenades are being repaired. There’s a lot at stake — not just for action against climate change, a commitment to a transition to a low-carbon economy and the course of renewable energy development, but also the short-, medium- and long-term careers of many MPs.
Many are anxious. Labor only has to look at the polls, and its own record of party discipline and dispatching of leaders. The Greens, who believe in this most of all, are nervous because they voted down the last one and need this to stop them looking foolish. The Coalition is worried about what should happen if the legislation is voted through and implemented, and the world does not end.
So it’s time to lob grenades. Last time, it was a Labor government lobbing them into a hopelessly divided opposition, only to have it blow up in their own face with the emergence of Tony Abbott. This time, the Coalition has returned fire at what most presume to be a hopelessly divided cabinet. The Coalition’s climate change spokesman, Greg Hunt, got the ball rolling at the Ecogen conference in Brisbane, taking the cue from an even more disastrous showing by Labor and Prime Minister Julia Gillard in the polls:
“There is now, from what we are being told by very senior executives, a push to topple the carbon tax within the cabinet. Now, that may not happen, but it makes it absolutely clear that this government, at its core, doesn’t believe in it and … it would be an act of arrogance and folly to take this tax forward until they’ve resolved their leadership issues.”
Of course, it suits the Coalition to say this and there is mischief in his prediction. It was insurrection in their own ranks, after all, over this very issue, that killed the CPRS. Now they are hoping that similar forces are at work within Labor, although it would seem that government members would have more at stake than a party in opposition.
While the ability of Labor’s rank and file to panic and make poor decisions should not be underestimated, the Liberals know that their chances of a sweeping election victory in 2013 will diminish the longer a carbon price is in place and is shown to be benign. The tactics are the same, only the roles have been changed — although one still wonders why the ALP bothered to go there in 2009. Wise heads would tell them not to take the bait, but the polls are stark.
Labor says publicly it is better prepared this time. It and the Greens indicate they are prepared to guillotine the legislation through parliament, to ensure they are passed by late November. Asked today at the Ecogen conference if there was division in cabinet, parliamentary secretary for climate change and energy efficiency Mark Dreyfus said no. “We’re here to govern,” he told 1. “It will become law. Our prosperity and way of life will be improved,” he told the conference earlier. “People will look back in years to come, and say that the government did the right thing.”
However, Dreyfus said he did understand the anxiety of the renewables and associated industries, who have experienced the disappointment of the past. The Greens are also concerned. Not so much about the passage of the initial legislation, because there is little they can do to alter the course of events, apart from playing their role. What was troubling Greens Senator Christine Milne on Tuesday was the fate of the so-called complementary measures, in particular the crowning achievement of the multiparty committee negotiations, the Clean Energy Finance Corporation.
The $10 billion CEFC, which is what interests the renewables industry most, is the most vulnerable part of the package. Its legislation will not go through parliament until next year, and will barely begin to operate before the next election in 2013. A victorious Coalition government could find this the easiest to dispatch, or at least severely nobble.
Milne took this message to the audience at the Ecogen conference in Brisbane, saying that they risked losing many of the complementary measures designed to boost renewables unless they became more vocal. Not just the CEFC, but the renewable energy target was also under threat, from the energy sector as well as the political arena. “It’s no longer possible to be an advocate of renewable energy and be apolitical,” she said. “This is a rearguard action we are now fighting. You must understand the forces that are ranged against you.”
She predicted a “massive assault” from industry and from within the energy sector against the MRET, the mechanism that will largely underwrite an anticipated $30 billion in wind farm, solar and possibly geothermal and biomass plants over the next decade. The MRET retains bi-partisan political support — a position that Hunt reinforced on Tuesday — but given the lack of enthusiasm from some newly elected Coalition state governments, and the disintegration of bipartisan in the US, there is a fear this could spread to the federal arena.
Milne also said she was concerned about the structural problem created by the concentration of power of the big three retailers, who hold the key to the power purchase agreements needed to finance renewable developments, and who have done little of that in the past two years.
“Would the companies prefer RECS prices to spike to penalty rate — to create political pressure to get rid of the scheme altogether? Or will they start signing contracts soon to deliver cheaper energy? Where is the public outcry from people in this business on this issue?” The answer to that is that while many in the industry do share her concerns, none will say so in public, because they may have to go and ask one of the big three retailers one day for a power purchase agreement.
Milne reserved particular criticism for Origin Energy, whose CEO Grant King in recent weeks, including in this interview with Climate Spectator, has suggested the RET be modified, and has questioned the “ideological” campaign against coal-seam gas. She seemed particularly incensed by King’s portrayal of the farm gate issues plaguing CSG as being the same as for wind, and by his previous predictions that 6000MW of peaking gas plants would be needed to be built to balance wind, and his forecast a potential trebling in electricity prices because of it.
*This article first appeared on Climate Spectator