Dear cynics and fools: Australia's had jack of your taxpayer-funded failure on energy
Katharine Murphy on politics National energy guarantee (Neg) Dear cynics and fools: Australia's had jack of your taxpayer-funded failure on energy Katharine Murphy
If the national energy guarantee dies, it will join the host of other climate policies Australia has squandered millions on
Itâs an unfortunate journalistic cliche â" on the brink â" but if you are looking for the Turnbull governmentâs national energy guarantee, thatâs where youâll find it. On the brink.
Next Monday, cabinets in the ACT, Victoria and Queensland will resolve their final negotiating positions on the Neg, the policy that imposes reliability and emissions reduction obligations on power retailers from 2020. After that, energy ministers will gather for the first of three critical meetings.
The Coag energy council will meet next Friday to consider the mechanism. The following Tuesday, there will be a phone hook-up to assess the commonwealthâs emissions reduction component. The final meeting, probably in September, is to consider legislation the states will need to implement if the scheme is going ahead.
In between those fraught conversations, the energy minister, Josh Frydenberg, also has to steer the required emissions reduction legislation through the Coalition party room.
As usual, government MPs are wandering around like Brownâs cows, feeling all the feelings. âWhat the fuck is Neg-plus?â one exasperated state official exclaimed to me on Friday after a front-page story in the Australian pointed to the government now pursuing an outcome that was apparently the Neg, but with additional measures to reduce power prices. âWhen you find out, can you let me know?âVictoria not satisfied with energy plan's emissions reduction target Read more
Apart from the predictable parade in Canberra, thereâs another material complication: the Victorian government is in all sorts of political strife.
After Jay Weatherill lost the South Australian election, it was always going to fall to Victoria to be the critical voice in the Coag energy council on the Neg.
Victorian Labor faces a difficult political choice: say yes to the Neg and have progressive groups campaign against you in inner-city seats, or say no and have the federal government rain down fire and fury every day of the looming state election campaign.
As the critical sequence of meetings looms, the Labor states are coalescing around the concerns they have pursued from the start â" but the compromises they want are deal-breakers for the #Coal4Eva faction of the Coalition party room.
The state wish list looks like this: an emissions reduction target higher than 26%; any legislation giving effect to 26% should be clear that 26% is a floor; better still, the target shouldnât be in legislation, but in a subordinate instrument so a future government can ratchet it up easily; and it should be ratcheted up every three years to make sure we meet our Paris commitments.
If the state and territory cabinets dig in behind that log of claims, Fry denberg is in a difficult position. If the states hold firm (and that remains an if), then the Neg looks more dead than alive.
Perhaps that shouldnât come as a shock. If the Neg ultimately dies, it will join the host of other climate and energy policies Australian governments have spent millions of dollars developing over the past decade, only to see them contemplated for five minutes and then dumped, or legislated and then repealed.
Weâve been running failure drills for 10 years. Over and over. Creating these elaborate policies for the remainder bins.
Hereâs my message to the political class of this country. Wake up. Get your act together. We havenât got time to fail.
Thatâs what happens when zero sum, rather than sense, becomes the determining factor. Unfortunately, we know what this looks like â" cynics and fools narrowcasting to their base at our expense. Self-interested rent-seekers and politicians prepared to traduce facts, reason and evidence have thus far won every round of this battle, leaving the Australian people the biggest losers.
So hereâs my message to the political class of this country.
Wake up. Get your act together. We havenât got time to fail.
People who care about the future of this country are sick of your taxpayer-funded self-indulgence, and we havenât got the patience to buckle in for another round. Weâve seen too much of it.
So what we need from you in the next few weeks is for all of you to get over yourselves. We need you to come together, in good faith, and sort this out.
One way to sort it out would be this.
The 26% target the government proposes is manifestly inadequate. Thatâs not a partisan point, itâs a clear-eyed assessment of the available evidence. The architects of the scheme, the Energy Security Board, said it without saying it when the final design paper confirmed electricity would hit 24% in the first year of the scheme. That leaves a reduction of 2% for the remainder of a decade. As John McEnroe might say to an offending umpire, you cannot be serious.
But Frydenberg canât offer the states a more ambitious target because heâs constrained by internal opposition. One way of splitting the difference between what Frydenberg can offer and what the states can live with would be to make it easier for a future government to scale up the target.
This could be done in a few different ways. The target could be implemented by regulation, which makes it easier to adjust, or if the premium is on certainty, the commonwealth could set out a series of default targets stepping up over the decade to 2030, which take effect unless otherwise adjusted.
The Coalitionâs coal faction would carry on as if this was high treason but itâs actually common sense. Frydenberg could sell it as pragmatism. If you set out staggered targets, you would offer business more certainty than it gets at the moment, where one government would legislate 26% and the alternative government 45%. If you set the target by regulation, you could say itâs not up to current governments to tie the hands of future governments.Coalitionâs national energy guarantee predicted to drive up power prices Read more
The other point is consistency. As it stands, the Neg target is inconsistent with another Abbott/Turnbull government policy â" Australiaâs commitments under the Paris agreement. Paris was voluntarily entered into, first by Tony Abbott and then by Malcolm Turnbull. It wasnât foisted on the Coalition by a roving troupe of progressive bandits.
A range of experts say two things about the collision between the two policies: 26% in electricity is too low to allow Australia to meet its international climate commitments; and itâs not sensible to have a low target for electricity when abatement costs are lower there than in other parts of the econom y â" such as transport or agriculture.
A bunch of Nationals have been out in recent days declaring a Coalition government will never impose emissions reduction on agriculture. If thatâs the case, two options present themselves: just succumb to full Trumpism and pull out of Paris, or stick to the governmentâs freely given commitments and require electricity to do more of the heavy lifting.
Then thereâs price. The good news is the technology delivering the abatement, renewables, will also deliver cheaper electricity over the life of this policy. This isnât just my feeling, or something I wish was true. The Australian Energy Market Operator told us this recently in very plain English when it said the lowest-cost replacement options for retiring coal plants were solar, wind and storage, with some flexible gas back up.
So thatâs what you would do if you wanted to turn a corner. Youâd split the difference, shake hands, and try and get this settled.
But is that what these folks want?
Do Australiaâs political parties want war or peace on climate change and energy? Will it be detente, or is there political profit in confecting a state of permanent war, where virtue signalling triumphs, and practical progress is nailed to a national monument called failure?Topics
- National energy guarantee (Neg)
- Katharine Murphy on politics
- Australian politics
- Liberal party
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