Is a COVID based slump causing an energy policy re-think?

I have a piece in the Spectator this morning that builds upon the challenging commentaries by Senator Canavan and Craig Kelly calling for termination of subsidies to renewables and leaving the Paris Agreement under which Australia agreed to reduce its greenhouse gas emissions.  These measures, and those earlier under the Kyoto Accord, drive up energy costs and are destroying manufacturing which would be flourishing under the low energy costs we could have.

Some in the ALP, especially Joel Fitzgibbon representing a coal mining seat, also agree.

Australian electricity supply has, in the course of 20 years, moved from just about the cheapest in the world to one of the most expensive.  The present relative position is indicated by this graph.

Source IEA

Twenty years ago, Australia along with Poland and the US, enjoyed electricity prices that were less than half of those of Japan and most of Europe.

This morning the Australian carries a story about calls to scrap the $50 m a year subsidy to the Portland aluminium smelter.  Though the advocates are the Labor Party taxpayer-funded “thing tank”, the Grattan Institute, this not a bad idea – it is a miracle that the Australia has so far avoided countervailing duties on aluminium products as a result to the subsidy which is illegal under WTO rules.

However, aluminium smelters are a near perfect fit in Australia with what is potentially just about the cheapest electricity in the world. Grattan, with its ideology of promoting subsidies for wind and solar, has been instrumental in creating the conditions whereby this domestic world conquering industry is reduced to destitution.

The AFR is also a long-term supporter of renewable subsidies to hasten the “inevitable” triumph of wind/solar and regularly features agitprop from Grattan’s Tony Wood to promote this.  Yesterday, it also had an op ed from David Byers and Peter Cook, subsidy seekers for government grants to succour the impossible carbon capture and storage con. Laughably, the article points to several subsidised storages that successfully operate at massive costs but the AFR is seldom troubled by expenditure wasted on its favoured causes.  Governments, spearheaded by an always gullible Kevin Rudd, poured $1.3 billion into a body, grandly called “The Global Carbon Capture and Storage Institute”, that promotes the approach worldwide and carefully conceals its own expenditures.

There are some who say the COVID-19 will bring the western world to its senses and reverse the crippling effects its sojourn into carbon free energy has cost (needless to say the Chinese and Indians, number two and four in world CO2 emissions have powered on with coal).

Those of us seeking prosperity without mysticism all hope they are right.   But the immediate responses are not encouraging. Flouncing around Brussels, a masked European Commission President Ursula Von Der Leyen has upped the EU ante for renewable spending from €7.5 billion to €40 billion in response to the crisis.  And Spain, the world’s worst hit nation has just proposed climate legislation would ban all new coal, oil and gas extraction projects, seek a 35 per cent reduction in energy consumption through building renovation and “introduce climate change to the school curriculum”.

For Australia, this issue looms larger than for other countries.

We have at least two highly informed, credible and hardworking coalition MPs forcefully promoting the return to unsubsidised electricity supply.

However, Craig Kelly and Matt Canavan face immense opposition from the indoctrination that people have been subjected to (that renewable energy is cheaper, as well as that Australian inadequacies in emission controls causes bushfires and disease).  In addition, they face the massive funding from subsidy-seekers and their cohorts within the bureaucracy.  Even within the Coalition, there is a near preponderance of support for further action in support of renewables and Ministers always seem to become quickly captured by activists within their own departments.

So, the battle, 20 years on remains an uphill one, even though the economic devastation stemming from the destruction of the once highly electricity supply competitive industry becomes clearer by the day.

This entry was posted in Uncategorized. Bookmark the permalink.

10 Responses to Is a COVID based slump causing an energy policy re-think?

  1. Rafe Champion says:

    The battle has to be waged in every electorate by voters who care getting into ongoing conversation and correspondence with their local state and federal members. The sharp end of the stick is the choke point problem with the wind supply, that destroys the rationale for RE and it does not call for any reference to the climate debate, important as that is in the larger context. The “choke point project” that is in progress calls for volunteers across the nation to get involved in a way that does not involve a lot of time, money or any public exposure. Cats are invited to show interest with a comment and the choke point recruitment team will put you in touch with a local coordinator.

  2. cuckoo says:

    My gas supplier Origin is now sending out messages advising us to keep domestic heating to no more than 20 degrees. Not that I would want it any warmer anyway, but the deal is: I pay for what I want to use, they supply it and otherwise shut up.

  3. bemused says:

    We only need one straw to break the camel’s back.

  4. rickw says:

    De-industrialisation by economic measures. Inventive!

  5. Hay Stockard says:

    The hysteria over the Kung Flu
    The hysteria over global warning.
    What’s the next thing in the drive to take us back to the stone age?

  6. Hodor says:

    Whilst energy costs are a large part of the total impost on manufacturing, they do not account for everything.
    The red and green tape which businesses must outmaneuver or live with, the endless union backed demands which affect businesses right through their supply and distribution chains make it just too hard and costly.

    For an SME, which the gummint touts as their favourite to get ahead and grow, the hurdles are daunting.

    Take note of all Govt. funded infrastructure, its carried out by the big boys.

    The crumbs left behind wouldn’t feed a sparrow.

  7. Chris M says:

    What is that graph… cost per month? I though we were vying for Denmark in the top electric price.

    Simple measure going forward – insist all renewable energy sources provide a smoothed power supply; that is they must provide at least equal storage capacity to release on demand.

  8. AlanB says:

    The socialist & green agendas don’t care if a poor family freezes in winter … They don’t care about employment and strong business supporting economies and livelihoods. They prefer to keep borrowing $$ to push their morally superior social programs.
    Yes, the climate is changing, tho warming has all but stopped for a number of years , showing 102 or 103 IPCC models to be over to gross over estimates. I think the same people must have modelled the Covid19 death predictions ??!! AAAHAHAHAA.
    CO2 is NOT the evil “global temp control knob” as they would have us believe to sell their pre-determined agenda.
    They want us to issue policy based on 101 wrong models with more and more of the science behind them now being debunked. Yes we need to be responsible but they would have us back in the stone age on principle… not science.

  9. RobK says:

    Unfortunately, the fiendish subsidy schemes that parasite off coal are clever, entrenched and only ratchet up costs to RE as commitment to RE advances. The largess will of course eventually run out but it will be far too late to turn back without wearing large unproductive losses. Sad really.

  10. EllenG says:

    Smelters are the champs of rent seeking. Portland cost consumers and taxpayers billions over its years, facts of which were revealed by Kennett govt audit. Cast of characters in the original deals in Victoria Nsw and Queensland would make Putin blush.

Comments are closed.