The will-they-won’t-they saga of the closure of the Hazelwood power station in Victoria’s Latrobe Valley — finally confirmed by French owner Engie last week — is another display of shambolic energy policy in Australia.
For several years, policymakers have been aware of the impending closure of old coal-fired power plants as new capacity becomes available from gas and renewables, Australians curb their energy consumption due to rampant gouging by network owners and the need to transition to a lower emissions-intensive future required even by the paltry carbon abatement targets adopted by the Coalition.
The closure of Hazelwood, for example, has been discussed for the best part of the last decade — indeed, the Gillard government established a program to close down Australia’s most polluting power stations, including Hazelwood, but couldn’t agree on compensation with their owners. Now Hazelwood is going, without compensation, and with little in the way of planning for the workforce affected. It follows other coal-fired plants in NSW, Victoria and South Australia, closed or “mothballed” by their owners.
By leaving it to individual companies to make decisions, federal and state governments have effectively outsourced the main responsibility for the impacts of closures on local communities. The Victorian government responded to Engie’s announcement with a quarter-billion-dollar assistance package and an “economic growth zone”, but workers and communities are still left with massive uncertainty in regard to an event that everyone has known was coming but for which little planning has been done.
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Don’t look to energy white papers for any evidence policymakers have been thinking about the impact of the transition to renewables on workers. The only workforce issues addressed in the most recent energy white paper, from 2015, relate to skill shortages in the energy sector and the need to train and import more workers, the latter on 457 visas. But then that paper virtually ignores renewable energy, has only one mention of climate change and lauds coal as “underpin[ning] our energy generation mix for some decades”.
And while Labor in office tried to establish an effective transition program, the energy white paper Martin Ferguson released in 2012 (which addressed renewable energy at length) similarly saw the only workforce issue as about skill shortages.
Meanwhile workers in areas like the Latrobe Valley have to deal with the uncertainty and economic fragility that comes from closure. The refusal of governments, and especially the federal government, to develop serious policy around transition to renewables and its impact on communities leaves governments reactive and prone to politicised policymaking. A particular problem is that generator closures tend to occur in regional areas, which are represented by conservative party MPs who are either climate denialists and enthusiastic boosters of coal-fired power or take a more realistic view of energy transition but belong to parties that do not.
A group of businesspeople, academics and investors have tried to address the gap by forming an “Energy Transition Leadership Forum”, which today released a proposal for an energy transition plan. The group comprises business figures such as Jillian Broadbent (also chair of the Clean Energy Finance Corporation), former Telstra chair and CSIRO chair David Thodey, Citibank chair Sam Mostyn investment banker Mark Burrowes as well as academics, clean energy sector representatives and environment group leaders like Geoff Cousins.
A key part of the transition plan is establishing ground-up strategies for diversification developed by local communities in collaboration with governments, unions and generator owners, designed to start developing alternative industries and sources of employment ahead of closure, rather than following closure, as will happen with the Victorian government’s plans.
You’d think this would be a policy no-brainer, especially for an “agile”, “innovative” government that is focused on diversifying Australia’s economy to take advantage of the historical opportunities for growth we’re presented with. But at the moment it’s the supporters of energy transition who are doing the thinking about the inevitable impact on local communities, while opponents apparently think those communities can be frozen in amber.