For a Government that has been so vocal about not picking winners, the Turnbull Government seems to be very comfortable picking coal as Australia’s future energy source.
The latest intervention by Minister Canavan trumpeting coal isn’t about securing a reliable and affordable energy future; at its core it is just the latest ideological attack on renewables by a government desperate to draw attention away from the fact it has no plan on energy and climate.
Labor has always taken the view that what is crucially important is to have a clear, rational and stable policy framework that will support long term investment in new power plants, support the transition to a reliable low pollution energy system, and do both at minimal cost to consumers and the economy as a whole.
This is what is sorely lacking and no amount of trumpeting coal as the future will change the fact that there is a vast national policy vacuum that is stopping investment, undermining reliability and fuelling price rises.
The energy industry, large energy users, the CSIRO, the Chief Scientist, the Prime Minister’s former energy adviser, the ACTU, and experts such as the Energy Markets Commission all support an emission intensity scheme (EIS) as the right policy framework to support cutting pollution and investment in new generation. This is the policy Labor took to the last election and remains committed to.
Yet under pressure from the Liberal extreme right, the Prime Minister has ruled it out, even though it has been estimated to save $15 billion on electricity bills compared to alternatives, including the Turnbull Government’s current plan of doing nothing.
If Ultra-supercritical coal fired power stations can provide part of the solution to our energy challenges, as the Government now claims, then they will attract investment under any rational national policy framework that is consistent with our Paris obligations, including an EIS.
Labor remains sceptical that new coal power stations will be able to do that, not least because of the global trend to divestment from coal and the competitiveness of renewables and their continuous falling costs. This scepticism isn’t ‘ideological’ as the government claims, it is based on a rational economic and scientific analysis and is supported by experts and industry.
For example, just today the Australian head of Bloomberg New Energy Finance, Mr Bhavnagr stated on ABC radio “Renewables cost less than would be the case if you were to build more fossil fuels and definitely less than doing nothing and having no plan”.
AGL, the largest electricity generator in the country, has an official policy that states AGL will “Not build, finance or acquire new conventional coal-fired power stations in Australia”. Likewise, Origin Energy’s former CEO Mr King has stated “I don’t think there is going to be another coal-fired power station built in Australia”.
But we will not know for certain what if any role new coal power stations will play until we have a rational national energy policy that is consistent with meeting our Paris obligations to cut pollution and deliver a net zero pollution energy system by 2050. The Turnbull Government has shown no sign of being able to deliver this most important and basic requirement.
Until they do, the Government pitting one technology against the other should be called out for what it is; nothing more than a distraction from their inability to govern.