Australian energy policy driving us on the road to Venezuela?

The absurdity of the oxymoronic “National Energy Guarantee” continues.

Minister Frydenberg is urging all the states to sign onto his carbon tax with its fairyland projections of declining electricity prices on the back of higher roof-top investments. (The Government and its advisers did not get the ACCC’s memo that this subsidy should, in line with developments in the UK and China, be eliminated).  But the renewablesphile, fossil fuel-phobic state and territory ministers are dithering because they want to replace coal with renewables even faster than Turnbull thinks he can get away with.  Such policies would, of course, only hasten us over the economic cliff.

And they are joined by others, including wind farmer Goldwind whose CEO says, “We are at a pivotal point and the structure without the substance of an emissions target which is going to really be meaningful is something I’m not sure will really move us forward.”  This is the firm that claims it has sold its wind energy including the renewable entitlements for $60 per MWh (the market price without the subsidies is far in excess of that)!  So much for the plinth on which the NEG stands that renewables are now or will soon be so cheap that no subsidy will emerge from the new regulatory regime!

The hypocrisy and self-serving goes well beyond this.  Today we saw the release of wind farmer Infogen’s annual report.   Reported revenue is $200 million this year. $120 million of this is subsidies and much of the rest boosted by subsidy-forced plant closures. Directors paid themselves $11.2 million in 2017.

And the Clean Energy Finance Corporation annual report  out today illustrates the degree of wasteful malinvestments the taxpayer is shouldering in this nefarious body’s activities.  In the 12 months to June 2018, new commitments were $2.3 billion ($1.1 billion in renewable energy).  At 30 June 2018, total CEFC investment commitments since inception exceeded $6.6 billion. In five years of investing, CEFC commitments have now contributed to clean energy projects Australia-wide, with a total project value of $19 billion.  Not only a waste of resources but negative value as the program is undermining the electricity that can be commercially supplied at one third that which renewables get.

Maybe we have to accept a Shorten administration to allow us the purgation of the fools and scoundrels that represent us politically.  But the danger is that a Shorten administration with its greater skills at marching through the institutions will simply be a marker along the road to Venezuela, which in the 1970s, like Australia today, had a per capita GDP not far below that of the USA.

Post script: Not everyone agrees with this: apparently, talking to a Clean Energy Summit, Minister Frydenberg said, “And maybe here I’m speaking to some of my colleagues, but we are living in a carbon constrained world” @JoshFrydenberg #ACES2018

PPS Josh Frydenberg has suggested that this “carbon constrained world” he describes is as a result of financiers’ social constraints.  Perhaps so, but not in all cases as evidenced by the 1000 plus coal units underway around the world

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31 Responses to Australian energy policy driving us on the road to Venezuela?

  1. John Constantine

    Deindustrialising and fashionable decolonialisation theory moves towards the ‘happiness quotient’, bespoke services based society like Bhutan .

    https://en.wikipedia.org/wiki/Gross_National_Happiness

    “In 2011, The UN General Assembly passed Resolution “Happiness: towards a holistic approach to development” urging member nations to follow the example of Bhutan and measure happiness and well-being and calling happiness a “fundamental human goal.”[5] ”

    Comrades.

  2. miltonf

    The political class is trying to crash the economy.

  3. Singleton Engineer

    The elephant in the room is nuclear power.

    Even 30% nuclear, properly done, would satisfy quite a few wishes on the lists from both sides.

    Cost… tick.
    Flexibility/load following… tick.
    Safety… huge tick.
    Low emissions of CO2… tick
    Low emissions of anything else, including radiation… tick. (See radiation figures for coal Vs nuclear.)
    Small land footprint… tick. Much less land area occupied for power generation than any other technology.
    Australian sourced… world’s largest reserves of U are in Australia. So… tick.
    Low impact on wildlife with respect to wind or solar… Huge green tick. Far fewer birds and animals killed along the way than for solar thermal or wind. Burned, busted and decapitated birds and bats should be the public image of concentrated solar and of wind, but that is overlooked by the dreamers and those continued incomes are based on continued ignoring of the carnage.

    I read both the ACCC and AEMO reports. Neither goes far enough. 30% or more nuclear power, either conventional or SMR, is eventually be supported by us all, regardless of climate change, commercial point of view or anti-subsidy points of view.

    Why continue to avoid the discussion that we must have?

  4. BrettW

    $11.2 million in directors fees ! Follow the money to see who benefits as it is certainly not Joe Public.

    What the …. are our politicians doing !? They clearly are not working for the benefit of the country and seem to be determined to ruin the economy.

    However not to worry as more important things to concentrate on like diversity, female quotas and morons in the Navy painting their fingernails.

  5. I think the coalition political worm is thinking about starting to turn. But turn it only can if Turnbull is removed!

  6. RobK

    Farmers have a difficult time matching production to demand due to the vagaries of the weather. It is to the consumers advantage that today surpluses can be spread the world over and processing means food stuff is conserved to fill in lean years. Still prices fluctuate and there is need for food security concerns. Often countries stockpile for several months reserves.
    Renewables in high penetration increase our exposure to the vagaries of the weather. There will be energy gluts and famine just like farming. The track record in Australia in terms of security in energy is a worry. The fiasco of gas on the eastern seaboard, the dependence and miniscule reserves of foreign diesel are glaring examples. The data exits to show wind, rain and sunlight vary a lot from year to year. They are not so easily transported in time of need. For the sake of security and simplicity our energy distribution system needs inputs from varied sources to suit the particular location. Give the market a break to do what it knows best. Why turn our backs on coal, nuclear and gas. They are already stored onshore.

  7. RobK

    The other point is having an established and working expertise in all forms of industry takes time. Having a diverse spread means the best results are more likely. No subsidies required.

  8. Tel

    Farmers have a difficult time matching production to demand due to the vagaries of the weather. It is to the consumers advantage that today surpluses can be spread the world over and processing means food stuff is conserved to fill in lean years. Still prices fluctuate and there is need for food security concerns. Often countries stockpile for several months reserves.

    Technology to the rescue!!!!

    Take fresh food and convert it into a form that lasts longer.

    https://www.jacklinks.com/about-us/

    Oh look at that, the Americans are doing it, and selling to Australians (like me, who think it’s yummy).

  9. RobK

    Tel,
    We’re ahead of the game in the west with http://www.roadkilljerky.com.au

  10. Rafe Champion

    Don’t you have any kangaroos or wombats among your roadkill?

  11. RobK

    Under the counter only Rafe.

  12. Boambee John

    The hypocrisy and self-serving goes well beyond this. Today we saw the release of wind farmer Infogen’s annual report. Reported revenue is $200 million this year. $120 million of this is subsidies and much of the rest boosted by subsidy-forced plant closures. Directors paid themselves $11.2 million in 2017.

    So sixty percent of revenue is direct subsidies. If those were taken away, would there be any actual profit, even the directors worked for free?

  13. Boambee John

    PS is this the company that Turdball’s son has “invested” in?

  14. Australian energy policy driving us on the road to Venezuela?

    Yes. Forward on and past Venezuela.

    One of the few things going for us used to be cheap coal fired electricity.
    I presume malice from anybody that wishes to destroy it.
    Shirley, they can’t be that stupid.

  15. Fat Tony

    The Chicoms (& the mussies) don’t want a functioning society – they want what our politicians are doing for them:

    A large quarry & food for the Chicoms

    A shit-hole for the mussies – with plenty of sheep & goats (cattle kick too hard – apparently)

  16. Fat Tony

    incoherent rambler
    #2777543, posted on July 31, 2018 at 10:18 pm

    One of the few things going for us used to be cheap coal fired electricity.
    I presume malice from anybody that wishes to destroy it.
    Shirley, they can’t be that stupid.

    Shirley, they’re not stupid – just corrupt / treasonous.
    Nobody (apart from Greens) could be that fucking stupid.

  17. (apart from Greens)

    You mean, like human and IQ greater than a wombat?

  18. BoyfromTottenham

    Carbon constrained world – where the hell did you pick up that gem from, Frydo? Let me guess, was it the Greens, or one of your government’s pro-green energy / environmental quangos? God help us all.

  19. Herodotus

    “I think the coalition political worm is thinking about starting to turn. But turn it only can if Turnbull is removed!”

    Plus all those termites who sided with him.
    Politics is stuffed.

  20. manalive

    “A third home truth is, whether people like it or not, we are moving towards a carbon constrained …” Josh Frydenberg..

    That’s just a slogan he’s picked up from his department and lobbyists.
    Don’t Josh and Steve ever get together and compare notes?

  21. cohenite

    Nice work Alan; keep up the good work.

  22. manalive

    I keep hearing pundits on renewable energy saying we are in transition, but transition to what?
    Do they genuinely hold the lunatic belief that by 2050 windmills and solar panels will be able to supply over 10 billion people with access to the energy that they themselves enjoy today?

  23. the sting

    I need some facts to refute a claim about renewables ” creating ” jobs whereas I have read in the past somewhere that for every job in renewables we lose 5 jobs somewhere else . Can anyone here help me please, with some facts or sources to the facts surrounding jobs/employment ?

  24. AlanR

    Oh Alan. Now that you and your IPA cronies have been exposed as Gina’s puppet your ramblings have even less relevance than ever. Perhaps we could solve the energy debate by harnessing the hot air and steam coming out of your ears.

  25. Rob

    Singleton Engineer
    #2777353, posted on July 31, 2018 at 6:31 pm
    The elephant in the room is nuclear power.
    Even 30% nuclear, properly done, would satisfy quite a few wishes on the lists from both sides.

    Well said.
    Too many ignorant voters are letting our country down.
    If they really want Labor and Shorten, then achieving that outcome is the only way they will ever come to their senses.
    Imagine an Australia where the lights (if you can afford them) keep going out, heavy industry has gone offshore, no mining no work and ultimately no people in remote areas, no irrigated farming, agricultural production winding down, no petroleum fuels, rampant unemployment, massive taxes on those (at the ABC) still in work, debt piling ever higher, and a ruling elite oblivious and uncaring about any of it.
    Australia has seen better days and the possibility of a return to those happier circumstances is scarcely a remote possibility.

  26. Atoms for Peace

    I refuse to argue with people who can’t even say carbon dioxide. They are walking sacks of hashtags.

  27. Bushkid

    Atoms for Peace
    #2777846, posted on August 1, 2018 at 12:03 pm
    I refuse to argue with people who can’t even say carbon dioxide. They are walking sacks of hashtags.

    + 1000!

    If they can’t say “carbon dioxide”, then they have no offing idea what they’re talking about, and aren’t worth a moment of my time.

  28. Snoopy

    Australian energy policy driving us on the road to Venezuela?

    A soft landing then? It may not be as bad as I fear.

  29. Rayvic

    Sadly, the NEG is an exercise in massive deception. Going on overseas renewable energy experience, implementation of the NEG is guaranteed to reduce electricity supply reliability by reducing baseload power availability, but raise electricity prices.

    The unstated objective of the NEG is to guarantee CO2 emissions reduction in accord with the Paris accord, that is based on the false hypothesis that anthropogenic CO2 emissions cause dangerous global warming.

    It should be obvious that France with some 70% reliance on nuclear power, benefits significantly by selling power to neighbouring countries that have over-invested in the unreliable renewables.

  30. Alice Thermopolis

    CEFC

    “The CEFC is responsible for investing $10 billion in clean energy projects on behalf of the Australian Government. Our goal is to help lower Australia’s carbon emissions by investing in renewable energy, energy efficiency and low emissions technologies. We also support innovative start-up companies through the Clean Energy Innovation Fund. Across our portfolio, we deliver a positive return to taxpayers.”

    A government entity created to invest billions of other people’s money into RE, run by folk appointed solely for that purpose.

    As for its claim – “we deliver a positive return to taxpayers” – not audited profit – yet another example of deceitful spin. (Impact of RE on national electricity prices does not rate a mention.)

    See Quarterly investment report 30 June 2018. Definition of “expected rate of return” (page 2) really amounts to a disclaimer and make it a very dodgy figure.

    It includes this masterly example of obfuscation: “Returns have not been adjusted for positive externalities or public policy outcomes associated with the investments”.

    Presumably returns have not been adjusted either for “negative externalities”; such as (i) impact on electricity prices, and (ii) “public policy outcomes” when the Canberra Climate Carbon Cargo Cult Club is exposed as a colossal con.

    Another BIG reason why the government – and both major parties – will not change its/their CC narrative/tune at this (late) stage of the game.

    To do so would mean dramatically writing down the value of the billions of dollars it has already invested in the RE sector via CEFC, and dealing with an equally colossal PR/reputational disaster.

    Meanwhile, The energy “debates” are beginning to resemble an absurdist play, say “Waiting for Zero Carbon”.

    Frydenberg resembles Beckett’s Estragon – or Vladimir – as he attempts the impossible – squaring the NEG circle.

    “Let’s GO!”
    “We can’t.”
    “Why not?”
    “We’re carbon constrained….”

    Alice

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