I have a piece in The Spectator addressing the zero emissions by 2050 vogue, which most energy companies, their industry associations and controlling government agencies have climbed aboard. But two of the 24 members of the Australian Energy Council (AEC) have broken ranks pointing out that the technology is not here.
The AEC’s zero emissions majority is not quite as overwhelming as it appears since most of its 24 members are retailers, subsidy-seeking renewable businesses or owned by (ALP) state governments, while the Big Three (AGL, Origin and EnergyAustralia) are retailer-generators and have learned to profit from renewable subsidies.
For their part, industry association executives need to provide value to their members and this requires them to have strong relationships with the appropriate government agencies. As those agencies overwhelmingly favour green energy and carbon taxes, industry association personnel think that they face reduced access by being energy neutral.
Many leaders of the industry associations, like those in regulatory bodies, are besotted by the notion that, in a future world dominated by wind/solar, Australia has an advantage. But world industry is actually becoming dominated by coal-loving countries like India and China and, in any event, Australia’s solar advantage is only true if we all move to the Great Sandy Desert! Solar radiance in populated areas is not markedly great.
In an industry where most of the boots on the ground are male, a disproportionate number of regulatory/industry associations (including the AEC, BCA, and AER) are headed by women. This is no coincidence. Indeed, one regulatory head, being chided by an energy minister for not making a senior appointment on the basis of “diversity”, responded, “With the current industry staffing, a middle-aged Anglo male is diversity”. But I digress.
In the Spectator article I note
Establishing a goal for 2050 is absurd. Any industry member punting on a position 30 years hence would be wise to reflect on how their predecessors in 1990 might have envisaged the industry in 2020. In 1990, the industry comprised state government-owned integrated monopoly generator, transmission, distribution and retail entities. There were no subsidised wind/solar renewables.
But the industry was poised to become market-oriented and largely privatised and would, within 10 years, become the world’s lowest-cost electricity supplier. It is now once again focussed on government policies and favours. This has meant sacrificing the magnificent coal deposits that allow low-cost electricity for households and industry alike and substituting them for high-cost, low-reliability wind/solar.
Compounding the issue is the announcement today that the industry’s largest firm, AGL, is to restructure its executive bonuses to reflect progress in moving towards a “zero emissions by 2050” target. While AGL has had two of the industry’s most, err, colourful CEOs its present CEO, Brett Redman, is firmly grounded. Indeed, on close examination, the move depends upon cheaper sources of power emerging and customer preferences for non-fossil supplies. AGL is seeking to become credentialled for green consumers and the all-important institutional investment community.
Climate News, issued yesterday, provides the latest global developments on these matters.