GILES PARKINSON & SOPHIE VORRATH “Scoal-Mo” as PM. What does that mean for climate and energy policy? (RenewEconomy, 24.08.18)

It says something about the state of Australia’s politics that the new prime minister, the man who brandished a lump of coal in parliament, is considered a moderate, at least in comparison to the forces he beat to the job.

Scott Morrison is regarded as a “centre-right” politician, but a social and economic conservative, who got the job after first knocking out the moderate Julie Bishop, and then defeating the ultra conservative candidate Peter Dutton.

The vote on Friday – 45-40 in favour of Morrison – is a devastating blow to the conservative forces led by Tony Abbott who managed to tear down Malcolm Turnbull, largely because they never liked him, and found a point of argument on climate and energy. Yet another PM lost on climate and energy policy.

That’s a relief for the renewable energy industry in Australia – because it is clear that Dutton may have led Australia out of the Paris climate agreement and even brought renewable energy schemes to a crashing halt.

But it may not be cause for celebration. Morrison will lead and will have as his deputy Josh Frydenberg, the man who put together the National Energy Guarantee that proposed no new investment in wind and solar for a decade.

Morrison is known as “Sco-Mo”, an abbreviation of his name. But he might just as well be known as “Scoal-Mo” after brandishing a lump of coal thoughtfully lacquered by the Minerals Council of Australia in parliament in February last year.

“This is coal,” the then treasurer said triumphantly. “Don’t be afraid … don’t be scared.”

But we were. In doing this, Morrison was pinning his colours to the mast of energy policy idiocy of the sort you find in the Murdoch media and on talk back radio, and on the front and back benches of the Coalition.

And Morrison dived even deeper into the murky depths of ignorance a few months later.

South Australia had followed that outage in February, caused by the failure of a gas plant to switch on, by building the Tesla big battery – in just 100 days – but Morrison decried it as being as useful as the Big Banana.

“I mean, honestly, by all means have the world’s biggest battery, have the world’s biggest banana, have the world’s biggest prawn like we have on the roadside around the country, but that is not solving the problem.”

Analysis by the Australian Energy Market Operator suggest otherwise, proving it it not just bringing down prices, it is enhancing energy security with its breathtaking speed and versatility. Dozens of battery storage projects are now proposed around the country, to AEMO’s relief.

The man Morrison beat to the post, Dutton, didn’t have a better idea about battery storage or renewables.

“We’ve seen in south Australia that sometimes you can get 100 per cent energy source out of wind …. and that when the wind is not blowing you can’t turn the lights on,” he said in an interview on 3AW earlier this week.

“You can’t run the economy like that – you can’t own the local shop and the cold room has been told off two or three times a day.

“Until technology catches up – that is until battery storage goes for longer than 7 minutes or 10 minutes, we are going to have coal as part of the mix.”

Morrison, as Treasurer, also ignored climate change in his most recent budget, making no mention of it in his speech, apart from insisting that Australia would “maintain our responsible and achievable emissions reduction target at 26-28 per cent and not the 45 per cent demanded by the opposition.”

In November, 2015, he was even more strident about Labor’s targets, which he called a “job crunching, economy munching, carbon tax on steroids”.

So what happens now?

As Turnbull observed in his farewell speech:

“I think the truth is that the coalition finds it very hard to get agreement on anything to do with emissions.

“Emissions policy and climate policy issues have same problem within coaltion of bitterly entrenched views, that are actually more idelogical views than based on engineering and economics.”

He compared it to the former differences over marriage equality. “As to what future holds with energy policy, you will have to talk to Scott,” he said.

With Frydenberg at Morrison’s side, it looks to be pretty much business as usual. They were the two ministers who flanked Turnbull when he announced that the emissions obligation would be dropped from the NEG.

But exactly what is business as usual? Business as usual, according to AEMO forecasts, would deliver a renewable energy share in 2030 of 46 per cent, a percentage that frightens the ideology of the right.

What does Morrison say about high shares of renewables? He had this to say about Queensland’s 50 per cent renewable energy target for 2030:

“It’s nuts … because it means people under this system will have to pay more and it would probably mean they would be subsidising emissions reduction in NSW… I think it’s a muppet of a proposal.”

One positive is that Morrison has dismissed the idea from the Abbott and Craig Kelly forces that new coal is a good idea, telling the AFR that “new cheap coal is a bit of a myth”.

He’s also a former managing director of Tourism Australia from 2004 to 2006. So maybe he will understand the environmental and climate change threats to the Great Barrier Reef. That begs the question about why he bought a lump of coal into parliament.

Perhaps it was to impress the lobby groups. “We know he’s a fan of the coal industry, which he proved on the floor of Parliament,” said the Queensland Resources Council in a statement on Friday on the change of leadership.

“Scott Morrison understands what makes regional Queensland tick, and he understands the importance of our most valuable industries – like resources,” said QRC CEO and former Liberal party resources minister Ian MacFarlane.

One big question might be: What is the fate of Turnbull’s pet scheme, the $6 billion and counting Snowy 2.0 scheme, now it’s strongest backer has gone.

Right now, there is no policy in place. Australia’s emissions are rising, predicted to miss the weak 2030 target by a wide margin, and there is complete uncertainty about the National Energy Guarantee that Frydenberg has been spending a year putting together with the Energy Security Board and the big business lobbies.

Frydenberg has had to run the line between good energy policy and the madness of the right wing, and ended up with a policy proposal that sought no emissions reductions from the sector that can deliver the cheapest.

That modelling beggared belief. Just how free he or whoever succeeds him as energy minister might feel to push towards good sense, good economics and good engineering in climate and energy policy, remains to be seen.

And whether Frydenberg will continue as environment and energy minister is a moot point. As deputy prime minister, he gets to choose his own portfolio. The pundits are suggesting succeeding Frydenberg will succeed Morrison as Treasurer.

Which means Australia gets to have as many environment and energy ministers as PMs – Martin Ferguson, Gary Gray, Greg Combet, Ian Macfarlane, Greg Hunt, Josh Frydenberg. Half of those now work or worked for the fossil fuel lobby.

One thing to think about is that Morrison may well give Labor and Bill Shorten a run for their money, when the election does come – which is likely to be later rather than sooner. He’ll probably take care to learn how to eat a pie the Australian way.

Note: We will update once Morrison holds a news conference scheduled for later this afternoon.

This article first appeared in RenewEconomy

 

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2 Responses to GILES PARKINSON & SOPHIE VORRATH “Scoal-Mo” as PM. What does that mean for climate and energy policy? (RenewEconomy, 24.08.18)

  1. Peter Farley says:

    There are now dozens of companies from Telstra to Mars, Sun Metals, Bluescope, CUB and One Steel who are contracting to buy renewables for part or even all of their electricity generation, most of these contracts assign little or no long term value to RECs. Why will that trend stop, when it is getting easier every month to make such contracts and the prices are continuing to fall, NEG or no NEG.

    August is heading for 22% renewables and coal falling to around 60% CF. Within a year there is so much wind and solar being installed that we will achieve close to 30% renewables in a good month. A year after that when Lincoln Gap, Coopers Gap, Murra Murra and Stockyard Creek and half a dozen other wind and two dozen solar farms are on line, there will be weeks where we exceed 50% renewables. This will play hell with the economics of coal plants where average Capacity factor will be just over 50%. As the best plants are around 75%+ CF, you can easily imagine some coal units will be offline most of the year. Thus for coal to survive either 3-4,000 MW will close or prices rise.

    If prices rise the economics of renewables and storage will improve and more companies and individuals will justify demand defection from the grid. If a coal generator closes, the gap will need to filled and the quickest and cheapest way will be with renewables and controlled loads. Hazelwood’s entire output will be replaced by renewables within 20 months of closure. Even the “firming” requirement of 1,400 MW will be filled with minor upgrades to Loy Yang and Bayswater, new gas generators and new batteries in front of and behind the meter probably by the end of 2019 if not before.

    In summary renewables are cheaper than gas and will gradually drive coal out of the market in 5 minute auctions because of the inflexibility of coal. We don’t need a NEG we probably don’t even need an emissions policy for the power sector, economics is driving rapid de-carbonisation

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