At last, an energy policy that has Australia headed in right direction

Today in The Australian:

If there is a lesson from Australian energy policy, it is that it is far easier to make a fish soup out of an aquarium than vice-versa. But even though Malcolm Turnbull and Josh Frydenberg have not worked a miracle, their National Energy Guarantee could be a first step to reversing the harm caused to what was once a relatively well-functioning electricity market.

About Henry Ergas

Henry Ergas AO is a columnist for The Australian. From 2009 to 2015 he was Senior Economic Adviser to Deloitte Australia and from 2009 to 2017 was Professor of Infrastructure Economics at the University of Wollongong’s SMART Infrastructure Facility. He joined SMART and Deloitte after working as a consultant economist at NECG, CRA International and Concept Economics. Prior to that, he was an economist at the OECD in Paris from the late 1970s until the early 1990s. At the OECD, he headed the Secretary-General’s Task Force on Structural Adjustment (1984-1987), which concentrated on improving the efficiency of government policies in a wide range of areas, and was subsequently Counsellor for Structural Policy in the Economics Department. He has taught at a range of universities, undertaken a number of government inquiries and served as a Lay Member of the New Zealand High Court. In 2016, he was made an Officer in the Order of Australia.
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33 Responses to At last, an energy policy that has Australia headed in right direction

  1. Gengis

    The trouble about all commentators talking about Australia’s mish-mash of energy problems is that no one will even mention Nuclear Energy. It is the only perceived electrical generator with little or no emissions. Until they do no one who has read widely on our energy problems will ever believe a word they write!

  2. zyconoclast

    Not it’s not.
    It’s another attempt to appear to be doing something.
    Maocolm’s Libs are screwed at the next election no matter how they tinker.

    We are screwed for at least another decade maybe more.

    While ever there is any reference to emissions reductions and Paris targets etc nothing will improve.

  3. Gavin R Putland

    But even though Malcolm Turnbull and Josh Frydenberg have not worked a miracle…

    Yes, they have: coal has become dispatchable. That’s like turning water into wine — unless you want to argue that the difference is one of degree, in which case it’s like feeding the 5000 with five loaves and two fishes.

  4. jupes

    You’re either joking or clueless Henry.

  5. jupes

    The trouble about all commentators talking about Australia’s mish-mash of energy problems is that no one will even mention Nuclear Energy. It is the only perceived electrical generator with little or no emissions. Until they do no one who has read widely on our energy problems will ever believe a word they write!

    The trouble with comments like yours Gengis, is that they accept the warmist’s propaganda that Australia’s CO2 emissions pose some sort of threat to the weather.

    They don’t. Australia’s CO2 emissions are totally harmless.

  6. RobK

    I don’t have access to the full article, but, “ could be a first step to reversing the harm caused to what was once a relatively well-functioning electricity market.“, has the makings of fixing bad policy by legislating on more layers of policy. A good solution should be simple. It’s not that hard especially when you had an example of something that worked reasonably well. Adding legislation will often only complicate unforseen consequences; which is what got us here in the first place.

  7. Helen

    Just. Get. Rid. Of. Subsidies. For. Renewables. And. The. RET.

    The market will fix itself.

  8. RobK

    Gavin,
    “Yes, they have: coal has become dispatchable. “
    Do you mean it’s a miracle that they now recognize that 30-90 days feed stockpile of coal has some intrinsic security to supply of electricity? It is a wonder.

  9. jupes

    Adding legislation will often only complicate unforseen consequences; which is what got us here in the first place.

    Word.

  10. Gengis

    In reply to Jupes, Australia’s emissions are a small part of global emissions I agree, but they DO form part of the worlds total emissions, and if you argue from that point then every country can claim they have little effect on emissions! Where I come from is that even if it is ‘warmist propaganda’ the world cannot dig up and burn 1 billion tonnes of coal a year (from carbon sinks) and eventually not have an impact on climate. Renewable Energy is crap and does not work and I point to you the AEMO graph of wind energy for May 2017, where wind generators averaged 20% of their capacity factor, often going as low as 5% – needing 100% backup.
    We may well see ‘global warming’ debunked but maybe we won’t, but destroying our economy for Green-leftist’ propaganda is definitely not the way to go.

  11. Art Vandelay

    As pointed out onBolt’s blog:

    Labor used question time to needle the government over the policy, arguing that the overhaul would force energy retailers to begin trading in “carbon abatement obligations” — effectively establishing an implicit carbon price. Concerned Coalition MPs questioned whether the scheme was too similar to a “cap and trade” or “cap and contract” system because retailers would be required to enter new power-purchasing contracts to shake up their energy mix if they exceeded the emissions cap.

    This policy is most likely an ETS in disguise. And Turnbull managed to dupe most of the dopes in his party into voting for it.

  12. Soberinthemorning

    There’s a taste there for coal generator owners in the reliability payments.

    But it is essentially an emission intensity scheme with an implicit (and indeed explicit through the price of international carbon units) carbon pricing element.

    The LNP’s right wing are SUCKERS for supporting this

  13. jupes

    Where I come from is that even if it is ‘warmist propaganda’ the world cannot dig up and burn 1 billion tonnes of coal a year (from carbon sinks) and eventually not have an impact on climate.

    You gullible idiot.

    Australia produces about 1% of global CO2 emissions. China produces 36% of global emissions and not only are they continuing to increase their CO2 emissions, but are building over 700 coal fired power stations in China and around the world. There is currently over 1500 coal fired power stations either planned or under construction in the world. None in Australia.
    If the rest of the world isn’t worried about the relationship between CO2 and the weather, why the fuck should Australia? Whatever decision Australia makes regarding CO2 emissions – increase, decrease, whatever – will have precisely zero effect on the world’s weather.

    Therefore we should go with the cheapest generation available. Coal.

  14. I cannot read Henry’s article behind the paywall but I suspected that it is the usual crap coming from this geriatric professor.
    Unless you working from the position that “global warming”, “climate change” is Crap!, you can not have sensible or workable “energy policy”!

  15. harry buttle

    Invest in reliables to provide domestic power, I recommend Briggs and Stratton, get in before the summer rush.

  16. Senile Old Guy

    This policy is most likely an ETS in disguise.

    It is an ETS and it is not much of a disguise.

  17. Art Vandelay

    It is an ETS and it is not much of a disguise.

    True! It certainly fooled most Coalition politicians though (except for Abbott, Canavan and Christensen), although I guess that’s not saying much.

  18. Ubique

    They don’t. Australia’s CO2 emissions are totally harmless.

    Yes. And in so far that CO2 is a superb aerial fertiliser, CO2 emissions are greatly beneficial. The biosphere is greatly increasing, crop yields improving and deserts shrinking owing to a small amount of additional trace gas CO2.

  19. Where I come from is that even if it is ‘warmist propaganda’ the world cannot dig up and burn 1 billion tonnes of coal a year (from carbon sinks) and eventually not have an impact on climate.

    Then you’re coming from the wrong place. The current marginally increased levels of atmospheric CO2 are the result of minor warming of the top few metres of the oceans, which in turn was the result of increased solar activity in the period 1970’s to 2000, and has SFA to do with the burning of fossils fuels, whether here in Australia, or elsewhere.

    Go read up on the Noble Gas laws.
    Junior high school stuff fifty years ago.

  20. struth

    All you have to do is read Henry’s blurb to know only people with vested interests would pretend to take such an institutionalised tax hoover of an irrelevance, seriously.

  21. struth

    No one single mind knows how our economy functions.
    There is no overall expert.

    And especially people from Henry’s background.

    The average truckie would understand the realities of our economy better than this fruit loop.

  22. Myrddin Seren

    A live run example of where Australia is heading:

    75,000 manufacturing jobs lost — that’s the price of Ontario’s electricity disaster

    Co-author: Ross McKitrick

  23. Rebel with cause

    Headed in the right direction?!? Pull the other one.

  24. Herodotus

    Coal is now dispatchable.
    How did they do that? Magic.

  25. egg_

    it is that it is far easier to make a fish soup out of an aquarium than vice-versa

    It’s called entropy – that’s how you get power from coal FFS.

  26. egg_

    There is currently over 1500 coal fired power stations either planned or under construction in the world. None in Australia

    I.e. a positive delta change of 1500 ± Hazelwood means Hazelwood’s closure had virtually zero impact on the planet, whether you believe in CAGW or not.

  27. PeterPeterum

    “Almost unique”

    No it’s not, Steve. It is either unique or it is not. I was taught vey early in my English class (in a Scottish school) that one cannot qualify the word “unique”. Having said that, there is no doubt that Tony Abbott is probably the only politician (Trump included) who has put the arguments against the AGW religion so succinctly and so well. What a man! I am sure that he is anything but delighted with the total hash Turnbull and his Energy Minister have made of their latest attempt to “control” the energy industry.

  28. candy

    I can’t understand this new policy, but perhaps the spin on it will get Newspoll up, as it seems a policy to please all the time, all the time, as M. Turnbull tries to do.

    Why not be old fashioned and begin more coal mines and stop all subsides within six months, and just see how it goes. Perhaps solar will thrive? If so, good. And think of uranium for the future.

    But it takes courage to support coal these days.

  29. candy

    I meant above that M. Turnbull tries to please all the people, all the time, as the saying goes.

  30. Sleight of hand magicians tricks. Look over here, it looks like we’re doing something to help you, while over there we’re going to keep gouging every last cent we can from you. Grubs, the whole damned lot of them.

  31. Arky

    It’s called entropy – that’s how you get power from coal FFS.

    ..
    That is a fantastic point.
    It never clicked with me before, but it just did having read that.
    Light and heat are the most diffuse forms of energy.
    This is the form energy takes before it fades away into the ether.
    A country trying to cobble together a grid out of wind and solar is like those prople you see in third world countries eeking out an existence picking through other people’s discards on rubbish tips.
    Sure, there is some little things of value there, but only the most desperate would bother to try to find it.
    Heat, light and wind are basically waste energy.
    Meanwhile, the new industrialised world will power ahead extracting energy from rich primary sources.
    We are idiots.

  32. Kneel

    ” it is that it is far easier to make a fish soup out of an aquarium than vice-versa

    It’s called entropy – that’s how you get power from coal FFS.

    I prefer the cruder version – “You can’t make chicken soup out of chicken shit.”

    What the green blob is doing is making chicken shit soup, and saying it’s chicken soup.
    Peas and thimbles stuff – and there are plenty of suckers out there who have and will fall for it, claiming that this new chicken soup tastes good and meets all your daily dietary requirements, while the brewers of this disgusting and damaging crap have themselves a nice roast chicken dinner.

    Or perhaps I’m just a cranky old bastard and need some more low fat, low sugar, low salt, low cholesterol, heart-smart, preservative free, no artificial colours or flavours, low GI, free-range, organic, rain-forest alliance certified, fair trade certified, carbon neutral, hallal certified, gender neutral, sustainable honey with my breakfast so I can “save the planet” – although I’m still a little confused why we need to “save the planet” rather than “save the people”. That will no doubt come to me once I get a few kJ inside me.

  33. Jimf

    As long as we’re strangled by Paris targets , energy policy will be a compromised contortion that ignores base load simplicity stating us in the face. We have the answer , our pollies have chosen UN virtue tickets over common sense .And let’s not even dare discuss the nuclear option!! 😖

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