If, as seems more likely than not at this point, Energy Minister Josh Frydenberg manages in the next three months to bring the states and territories on board for the his National Energy Guarantee (NEG) proposal and secure both federal Labor and joint party room support, the headlines will be glowing about his achievement. He’ll be the new golden-haired boy of the government, his leadership credentials burnished, the man who delivered us from a decade of policy paralysis on energy and climate action.
The plaudits will be well-earned, if only for Frydenberg repeatedly enduring the silliness of fossil fuel advocate and rabid coal-seam gas opponent Alan Jones. But they’ll in effect be celebrations of a profound policy failure, Australia’s worst since John Howard lied us into the Iraq War.
For a short while (two years), Australia had a high-quality climate action policy, one that lowered our emissions while having a minimal impact on inflation. That was abandoned in 2014 when the Abbott government repealed the Gillard government’s carbon-pricing scheme. Gillard had also taken some tentative steps to addressing the relentless gaming of the electricity market by participants — especially state-owned distributors — which were, in retrospect, entirely inadequate. We’d have to wait several more years for a government to take real action to stop the gaming.
The carbon pricing scheme, which was by no means perfect, was “replaced” by a kind of joke policy, a back-of-the-envelope idea devised in a hurry by Greg Hunt after Malcolm Turnbull was rolled in 2009, in which the government would hand billions to corporations and farmers to undertake energy efficiency projects they would have done anyway, or plant trees and otherwise conjure “soil magic”.
More sensible figures within the Liberal Party hacked this idiot policy back until it eventually appeared briefly as a $3 billion handout program that wasn’t renewed. That left the Renewable Energy Target, investment by the Clean Energy Finance Corporation — which Abbott was desperate to abolish — and various state renewable energy targets as Australia’s climate policy — even as the Abbott government signed itself up a hard commitment to reduce emissions by 26-28% on 2005 levels.
But Abbott had an informal policy, too, one of relentlessly demonising renewable energy, which drove a 90% fall in renewable energy investment. Malcolm Turnbull’s ascension to the prime ministership changed this dynamic. Indeed, there’s a fair argument that Turnbull’s primary contribution to energy policy as Prime Minister has been his signalling that the war on renewable energy that had been launched by his predecessor was over. Renewable energy investment has surged since he became Prime Minister, such that we’re on track to comfortably beat the Renewable Energy Target for 2020. It’s the one positive in climate-energy policy — to the extent that we actually have any “policy” other than the remnants of former government’s targets, state government one-out commitments and an energy market regulatory framework that’s in recovery phase from the over-optimism of neoliberal policy design.
After being tempted by an emissions intensity scheme, which was strongly backed by business and backed by the opposition, Turnbull backtracked from that under pressure from the right. The subsequent Finkel Review recommended a Clean Energy Target, which Turnbull was initially keen on, but again was forced to abandon under pressure from the right. Then came the National Energy Guarantee, effectively a requirement for retailers to back on-demand (not baseload) power, with a figleaf of emissions reductions thrown in.
Julia Gillard’s carbon-pricing scheme was never perfect, but if that was the closest to best policy we got, an emissions intensity scheme would have been second best policy. A renewable energy target, or a Clean Energy Target a la Finkel, would have been third best. To the extent that a NEG pitched at Australia’s woefully low Paris Accord targets slows the surge in renewables investment, it will be clearly fourth best in policy terms. But the Nationals and some of the Neanderthal faction Liberals like Abbott want to make the NEG worse by tacking on government intervention (because that worked so well with Soil Magic) in the form of billions in funding for state-controlled coal-fired power, because the private sector won’t ever touch coal again.
That would give us fifth-best policy — and be portrayed as a remarkable political achievement. That says a lot both about the government and the media.
16 thoughts on “Australia’s history on climate policy is so awful it makes the NEG look like a victory”
Wayne Cusick
June 28, 2018 at 1:45 pmDoesn’t the NEG put energy policy in the hands of retailers, who have sometimes been criticised by the ACCC for guessing a household’s consumption rather than actually bothering to read the meters?
klewso
June 28, 2018 at 2:42 pmThe “golden-haired boy” who deliberately told porkies about the reason for SA’s blackout – for maximum political effect – that it was “their reliance on renewables”? When a storm blew down the delivery system that would have been delivering power from no matter what (other) source as well, that would have been blown down in the same way in the same storm, causing the same black-out?
…. From a government so low, what’s one more “reward for misrepresentation”?
Arky
June 28, 2018 at 4:16 pm“Indeed, there’s a fair argument that Turnbull’s primary contribution to energy policy as Prime Minister has been his signalling that the war on renewable energy that had been launched by his predecessor was over. ”
Which signalling was that, the intense attack on State renewable energy targets, the playing up of renewable energy as unreliable compared to coal, or the pressure applied to private companies to keep coal power plants open? All of which were done by Turnbull personally, not just actions by the likes of Abbott or Abetz from the backbench?
It’s weird how these Keane articles keep making good points, like how most of the media as well as the government will sell the NEG as a triumph because at least it finally “ends” the energy “wars” even though it is 5th rate as an actual policy (but then, few of the media care about policy, only the war), but then tries to find a way to praise Malcolm Turnbull personally in the face of direct evidence to the contrary. I dunno when Keane became a Turnbull apologist but at least try not to make up alternative facts in the process.
Roger Clifton
June 28, 2018 at 4:58 pmThe NEG is good in that it can be seen as the Australian Govt taking action on meeting the Paris targets for decarbonisation. It is a backward step in that most of that apparent decarbonisation will result from replacing the currently diminishing coal with increasing gas. Subsequent decarbonisation will be much harder, because it requires replacing gas, including all those nearly brand new installations.
Replacing gas should not be a tomorrow job. Tomorrow’s adults are today’s youngsters, already reading Crikey and questioning our logic.
Marcus Hicks
June 28, 2018 at 5:09 pmOh come on, Bernard. Like Direct Action, NEG is nothing but a fig-leaf. A desperate attempt to *appear* like they are doing something, whilst doing next to nothing, & also providing a nice “Trojan Horse” to funnel money to the CSG & Coal industries. Say what you want about Gillard’s scheme, but it was clearly working at reducing both the Carbon & Energy intensity of our economy-by encouraging people from across the economy to find new ways to cut emissions (which we did see in various enterprises, like cement-makers & abattoirs) . All this current mob have done is waste tax-payers money by handing it out to people who promised to do what they were already engaged in doing.
Paul
June 28, 2018 at 6:08 pmWe will not be told the NEG is a great policy, we have been told this since Turnbull decided that he wanted nothing to do with lowering emissions, and the progressive media decided that if they lied about it enough people would believe the lies and Turnbull would be reelected.
There is something pretty weird when idiots like Murphy decide that if they stick their fingers in their ears and cover their eyes and pickle their brain then the comments and submissions by people who are actual experts will just not exist.
It becomes doubly galling when they also want a free press, which I guess means free to lie.
AR
June 28, 2018 at 7:48 pmWay to put lipstick on a pig, BK.
Never mind the facts, feel the lurve!
Jim Egan
June 29, 2018 at 12:01 amAR,
Is your thumbnail pic Saddam’s nuclear plant (before the Israeli treatment) or a Mosque?
Dog's Breakfast
June 29, 2018 at 9:42 amPlus we had to waste a few hundred million on the clean coal technology pipedream. Govt action on energy policy has been wrong almost every time (the carbon tax, RET and CEFC the only exceptions)
Selling State owned power generators, regulators being gamed, climate wars, it could hardly have been worse.
The citizenry eventually gave up waiting and bought solar panels and eventually business followed. And still the dinosaurs roam the land hoping their irrelevance doesn’t last. They will whine and undermine until their last breath.
kyle Hargraves
June 29, 2018 at 10:47 amLet’s give a damn about accuracy Bernie.
> But the Nationals and some of the Neanderthal faction Liberals
Do you imply superior to homo sapiens or inferior to homo sapiens? You’re on thin ice if you are implying “inferior to homo sapiens”
> like Abbott want to make the NEG worse
Actually no. China, United States, European Union, India, Russia and Japan account for 68% of CO2 emissions (in order of decreasing contribution with China at ~30% and Japan at ~3.5%. Australia emits 1.24% of total emissions.
It would be “nice” if Australia could approximate a per capita emission rate of (e.g.) the UK at 6t (compared with 18.6t : higher then the USA at 16.1t!) but on a world scale it doesn’t make a damn of difference. International Aviation emits 1.4% of the total.
U.S. household carbon consumption is about 50 tons (imperial) CO2 per year with an emission rate of about 14.3%. Consumption for other countries may be estimated by simple proportion.
For the nth time a new coal power station has an emission of somewhere between 1/6 and 1/7 of a similar station built 25 years ago. Coal remains an option but so does nuclear power. Abbot was correct in another respect. Wind power is not an option – but not for the reasons that Abbott mentioned. The materials required to build one wind-power generator are not insignificant. Then there is the geographical location. It makes more sense to place such units in the north of the UK when compared to Solar power and v.v. for Australia.
As to “total emissions” Mexico, Indonesia, Saudi Arabia, Canada and South Korea are “ahead” of Australia. Were Australia’s contribution to emissions to decline to zero the world situation would not change. There are more important considerations for the country.
Marcus Hicks
June 29, 2018 at 11:32 amLOL, Kyle spouting his usual Right Wing BS. You claim no IPA membership or Right Wing sympathies, Kyle, but your post history tells a very, very different story. Please show us actual examples of either new coal or nuclear providing emission reductions at a better cost per tonne than renewables or gas. I doubt you actually can, because you never once provide a single source to back your position.
Indeed, your position on everything from Coal/Nuclear to Australia’s emissions compared to the rest of the world (either total or per capita) is not remotely backed by any evidence…..or at least none you ever see fit to provide. Solar & Wind have extremely good energy payback times, & Australia has wind resources that put most of the UK & the US to shame…..which just makes our slow uptake on renewables even more ridiculous-as we are blessed with ample wind, solar, tidal & even geothermal resources that we’re not remotely tapping into.
Marcus Hicks
June 29, 2018 at 12:45 pmStill, I do love the irony of someone who lives on a Fact Free Diet-like yourself-is accusing Bernard of “not giving a damn” about accuracy. I guess you must be more used to the “accuracy” on display on Sky News, or one of Murdoch’s crap sheets…..the place facts go to die.
Wayne Cusick
June 29, 2018 at 12:49 pmKyle:
“For the nth time a new coal power station has an emission of somewhere between 1/6 and 1/7 of a similar station built 25 years ago. ”
The idea that a coal fired power station is 1/6 or 1/7 the emissions of an older station implies that it is 6 or 7 times more efficient. Which would put them over 100% efficient….
At best the efficiency has doubled (from low to mid 20s to high 40s).
The other alternative for your claim would be carbon capture and storage. Which has proven to be technically difficult and hideously expensive. No more than a handful of such plants have been built or planned, and I believe one in the US has been closed as it is not viable.
Carbon capture and storage also uses significant amounts of power, eating into the power station’s capacity.
“Coal remains an option but so does nuclear power. ”
They are both options, but not very good ones.
They are both more expensive to build new capacity than solar or wind power.
“Wind power is not an option – but not for the reasons that Abbott mentioned. The materials required to build one wind-power generator are not insignificant.”
No, the materials don’t come cheap. Still a lot cheaper than a new coal or nuclear powered facility.
The gerat improvement in wind turbines is that for not much more materials they have gone from 1MW to 2, 3, 4MW machines in a relatively short period of time. There are wind turbines up to 10MW for offshore installations (offshore installations cost more but also have more consistent winds).
Then there is the geographical location. It makes more sense to place such units in the north of the UK when compared to Solar power and v.v. for Australia
The West coast of Tasmania is exposed to the “Roaring 40s”, the trade winds which sailors used for hundreds of years to hasten their journey east (to the Dutch East Indies, for example). That is not an insignificant wind resource.
We do have other energy resources available, but the technologies aren’t as advanced as wind turbines and solar panels.
Such as geothermal, as mentioned by Marcus. Unlike some places in the world where geothermal is relatively easy to access, in Australia it requires drilling down into the rocks miles beneath the surface and forcing water through to be heated and converted to steam, to run a steam turbine.
Then you have tide and wave energy. Several technologies have been developed to take advantage of each of these. Waves can be forecast reasonably well for the near future, while tides are consistent and predictable, and can be forecast months, if not years, ahead.
But these technologies are immature at the moment, and are not viable for large scale use.
“As to “total emissions” Mexico, Indonesia, Saudi Arabia, Canada and South Korea are “ahead” of Australia. Were Australia’s contribution to emissions to decline to zero the world situation would not change. There are more important considerations for the country.”
Sure, we are not the world’s biggest emitters. But if every country whose emissions were similar or less than ours did nothing, then 40-50% of the world’s CO2 emissions would remain, or increase, regardless of what the big emitters did.
In terms of importance, climate change must surely be one of the biggest for Australia, particularly for primary producers. Australia has to be one of the mos susceptible countries to climate changes, with our record of droughts, floods and bushfires. Climate change will, possibly, make these events more severe, which would be a significant impact on our economy.
Texas Ranger
June 30, 2018 at 1:22 pmGreat response Wayne. Thanks
gerald butler
July 4, 2018 at 5:14 amIf everyone thought like you and Chris Kenny then no one would do anything about emissions and we could all blame each other for fucking the planet.
Andrea
June 30, 2018 at 7:51 amJulia Gillard would’ve made a great long-term PM. Sigh.