In his outstanding address launching the compendium Making Australia Right, Tony Abbott offered a fivefold agenda. Malcolm Turnbull recognised this as, in effect, throwing down a leadership challenge.
The key feature, as when Turnbull first lost the Liberal Party leadership to Abbott, is energy policy. Turnbull is addicted to the renewable creed and will, as he once did before, sacrifice his leadership to keep it in operation.
Turnbull’s lame response to Abbott’s challenge was to claim that his government is on track to reduce emissions in accordance with our international obligations, emission reduction plans that are atrophying with the Trump ascendancy. He spouts the need for “a coordinated plan between all governments” otherwise, he says, we will end up like South Australia.
His prejudices against fossil fuels are reinforced by the technology fix approach of his Chief Scientist, Alan Finkel, presently studying Ireland and Denmark, the world’s two least successful energy policy jurisdictions. Turnbull wants more storage batteries when the issue is the high costs that the energy policy is creating by substituting renewables at three fold the cost of coal and nothing like its reliability
Turnbull’s sledging of the hapless crow-eaters is a convenient way of deflecting criticism of his own (and in fact Abbott’s) policy. But it is totally inaccurate. South Australia, in facilitating wind, was doing precisely what the Commonwealth sought it to do under the Renewable Energy Target. Even though the government in Adelaide evinced the cockeyed optimism of the green loons, policy was driven by Commonwealth subsidies which South Australia attracted by putting fewer impediments in the way of new wind development than other states.
Turnbull’s coordinated planning between government agencies is precisely what has got us into the present impasse. Australian energy policy is a living proof that, as with a national plan for the supply of food, petrol or entertainment, management by high level committees of government is a prescription for inefficiency.
This is only worsened in the case of energy by having decision making dominated by a new class of renewable energy anti-carbon evangelicals. Government ministers determining how an industry should operate will inevitably mean political overrides of the nature that has transformed Australia from the world’s lowest cost to among the highest cost – and unreliable – electricity industry.
Even without meddling by ministers keen to win favors from vested interests and to please the elites, as demonstrated by the pathetic solutions of more intervention and more regulations offered by Finkel (see here for a critique) the “experts” they choose to advise them will only exacerbate the difficulties, especially in light of the highly politicised public servants ghost writing the reports. The policy departments at state and federal levels advising are utterly bereft of understanding of the energy market – the Commonwealth even sent a delegation to Adelaide to examine the feasibility of exporting black coal from New South Wales – presumably using Australian union-manned coastal shipping!
With the seemingly imminent closure of Hazelwood, politicians’ minds are being concentrated by the gallows that this disaster will bring to them personally and are jockeying to shift the impacts onto other jurisdictions. But South Australia will be just the first man to be tossed overboard.
As Abbott has said, the solution of providing offsetting subsidies for a new coal generator to redress the damage that subsidies to wind have done to the low cost, reliable generators fed by coal is just the latest desperate effect of papering over fissures created by political decisions and one that is likely to create its own future distortions.
Abbott takes some pride in winding back the subsidised renewable distortion for 28 per cent of the market to 23 per cent and acknowledges that this is not enough. That’s a total understatement.
The distress caused by the renewable program has led to a doubling of prices, closure of low cost power stations and dare one say, political instability. But with the current policy we still have to increase the renewable poison by another 50 per cent.
From a small base in 2002, RET requirements in gigawatt hours have grown and are scheduled to continue growing
The only solution involves an immediate cancelling of all energy subsidies and withdrawal of government from management of the energy market.