Coal and gas lobby attack state renewable energy targets

The attack on renewable energy initiatives and climate policies has taken a new shape: having abolished nearly all the effective policies at the federal level, the focus is now turning to the state-based targets, using the usual argument of higher costs and insignificant diminution as the basis for the assault.

The recent stance has been spearheaded by conservative institutions like The Grattan Institute with the enthusiastic backing of lobby groups that represent and support the coal and gas-fired generators, as well as the federal government, which gives no inclination of moving on from the Abbott-era policies.

The Grattan Institute recently released another key report which analyses the remarkable events in South Australia’s renewables market in the past few months. Sections of the report were immediately foiled by those keen to paint renewable energy, particularly wind and solar, in a poor light in order to foster the interests of the gas and coal industry.

The report is one of those that have underscored the complexities of the Australian situation, and the poor framework of policies. However, instead of focusing on the rules that allow exploitation of the market by fossil fuel generators, the focus should rather shift to state-based renewables policies. And the mainstream media needs some inspiration to accept the Grattan Institute’s invitation.

“Unilateral action by states or territories is likely to distort the implementations of national policies and increase costs with no environmental benefit,” The Australian newspaper quoted the Grattan report on its front page.

The ACT, which has been on the fore of state-based targets with its ambitious 100 percent renewable energy target by 2020, has successfully achieved its own carbon emission reductions. And obviously the fossil fuel sector is not happy.

South Australia has also pulled the plug on renewables, having achieved significant emission reductions by investing more in renewable energy. Effectively, it sought the highest share of the country’s target, as well as economic investment in the state. And clearly, it wasn’t that tough because other Coalition governments in the rest of the states were busy safeguarding the interests of coal-fired generators.

Truly, South Australia’s target of 50 percent renewables by 2025 isn’t really a policy as a mere piece of rhetoric; it had pretty much been achieved at the time when the announcement was made in 2014.

Similarly, the targets in Queensland, Victoria and more recently the Northern Territory, haven’t taken shape yet. Queensland has not outlined any mechanism of its 50 percent target by 2030, but has quickly agreed to write various power purchase agreements with specific solar farms in the recently advertised ARENA large scale solar tender.

Just like SA before it, Queensland has seized the lion’s share of the national policy. And by following the footsteps of the ACT, which has written 20-year contracts with several large-scale renewables projects, Queensland is likely to save money from this new move.

Context of the attacks on state-based policy initiatives

The national renewable energy target is actually the only policy still standing in Australia; seemingly the only weapon left to help reduce emissions and/or expand the uptake of renewables.

However, even this policy is so diminished, as the Abbott government spent the better part of its first year in office trying to scrap it all together. Actually, it will effectively expire in four years.

In frustration, the states have acted by adopting higher targets since the government has their hands tied. The story is the same across the globe, where practical ideas and actions by sub-national governments—states, cities and councils; are often more superior to national policies.

The pretext for the recent assault on state-based policies is the latest spike in prices in South Australia, and the active role played by solar and wind—or even the lack of it, on given occasions—during the leap in prices.

The Grattan report highlights this in detail, although it fails to mention that these price spikes were more common some five years ago, when SA hugely relied on gas and coal.

This report also downplays the effect of record-high gas prices which rose four times more than the long-term average for parts of July and twice the long-term average for most of the month. Ideally, it ignores the role played by the few existing gas and coal generators in setting roof-breaking prices.

Even though generators of gas have been cleared of any illegal operation, it’s obvious that they capitalise on their market dominance to make huge profits. Ironically, the Australian Competition and Consumer Commission even congratulated them for doing so, amidst questions as to whether this was entirely fair play.

Ultimately, the fossil fuel industry has begun manipulating an emerging set of circumstances as a battering ram to silence other renewable energy initiatives, and unfortunately, state-based policies are their prime target.

Even more surprisingly, coal-fired power stations are now being considered victims, “forced” by the reprehensible renewables with their virtually zero marginal cost of generation to roll up their smoke flues and leave coal intact in the ground.

These are the coal generators that have been operating for decades and never held to account—either financially, environmentally or morally—for the impact on health and climate.

Here’s the thing. Most Australian coal-fired power stations will cease to function within the next two decades. Australia must plan ahead—but not by reducing its renewable energy targets and placing all its eggs into the coal or gas basket—as Grattan and other institutions appear to compel us to do.

The solution is not to put a cap on investment in renewable energy, but to instead accelerate it and the rule alterations that could promote battery storage and other technologies, as well as new business models, along with replacing the archaic system build by and for a fossil fuel system that is fast being rendered redundant by environmental concerns and new technologies.

Tony Wood from the Grattan Institute is right about one thing—Australia urgently requires a coherent energy policy and climate change. This could be first initiated by inserting the word “environment” into the National Electricity Objective, upon which its rules and regulations are based.

On most occasions, regulatory and policy makers have used the lack of focus as an excuse to delay initiatives or do nothing that could speed up the inevitable transition.

Leitch notes that the lack of planning is a “complete disgrace” but the solution would be to aim at the most ambitious target and not the lowest possible target, and hasten and coordinate the energy transition.

The Author

Hi, my name is Erin and I am a journalist, content creator and editor working within the Public Relations department at Australian Solar Quotes. I am passionate about the continuously developing renewable energy industry. I am eager to educate others about the benefits and advancements of sustainable living, and I encourage you to join the conversation by leaving a comment below.