Whenever a businessman, and in many cases an environmentalist, recommends the on-going subsidy for renewables it almost always means someone with a vested interest in forcing consumers or taxpayers to pay for something that is not in their interest.
So it is with the Renewable Energy Target. Today The Australian has a piece by Innes Willox of the Australian Industry Group which calls, on behalf of its members, for even longer contracts to provide the 60% plus subsidy that renewables need. He laments that “uncertainty could strangle investments” without pondering the fact that these investments are of negative value. Mr Willox tries to flavour his rentseeking by also seeking to have the bans on unconventional gas overturned.
A far more edifying Australian piece is by Senator Leyonhjelm, headed Ditch the RET to set economy free. The Lib Dem Senator cites evidence that the scheme costs the economy $29 billion and adds
The net effect of this subsidy is to hand an additional $17bn of our money to these companies over 15 years for no measurable environmental benefit.
It is undisputed that despite being a mature technology the wind generation industry is not viable anywhere in the world without government or customer subsidies. It is just government- mandated corporate welfare.
Grant King, chief executive of Origin Energy, one of Australia’s largest electricity retailers with extensive interests in gas and wind energy generation, has said that the RET would be the main driver of electricity price rises by 2020 and that renewable energy costs now accounted for 14 per cent of electricity bills, up from 2 per cent five years ago; for larger users it is 30 per cent of their bills.
If Labor, the Greens and Clive Palmer really care for social justice they will not allow working families, pensioners and the disadvantaged to be ripped off by wealthy wind generators and will back the abolition of the RET.
Meanwhile Dick Warburton’s RET review has submitted its report. According to the AFR’s Mark Ludlow its options offered are “keeping the target in its current state; move to a 30 per cent target by 2030, move to a “real” 20 per cent target, wind back with a grandfather clause or abolish the scheme altogether.”
Sid Maher in The Australian sees a way out as being a freeze on new subsidised facilities. There is provision for the Industry Minister to take such a course without the Parliament being able to disallow. But it would amount to a grandfathering of existing facilities and no new ones being built. Although it would stop the cancer spreading it would impose a cost to consumers and benefit to the rentseekers of between $6 and $13 billion. It would still contribute to Australia having among the highest electricity costs instead of the lowest before the climate change madness took shape.
The appropriate policy option is to abolish the scheme and all payments accruing to the spivs and conmen who lobbied for it. and who have been richly rewarded at the expense of the consumer and industry competitiveness.