Climate hopes fade
The government today seemed to back further away from a clean energy target
AGL chief Andy Vesey addressing today's AFR conference. Supplied by ABC News
Back in June, just after Alan Finkel had delivered his famous recommendation of a clean energy target (CET), Victorian MP Russell Broadbent asked – at a party room meeting – the type of question you’d normally expect from a sharp radio interviewer. Katharine Murphy paraphrased it at the time: “How is it that we have spent the last six months railing against the evils of renewable energy targets and are now proposing one as the answer to the energy policy problem?”
By now, the answer to that seems simple: the government is doing no such thing. Today it became another degree clearer that the Coalition is not at all interested [$] in a clean energy target of any kind. It hasn’t said so yet, not precisely, and so this speculation might be premature. But it’s certainly dipping its toes in the water. Dangling its legs all the way up to the thighs more like.
This state of near-rejection wasn’t always the case. Asked about it in early June, Malcolm Turnbull said a target “has a number of virtues, very strong virtues”. Explaining those virtues, the prime minister concluded, “I think it has a lot of merit and as I say we will look at it very favourably”. He added an important “but” – “we will be considering it carefully, considering the Finkel Review with the care and respect which the hard work of the panel warrants”. Still, it was clear he kind of liked the idea.
Presumably he has since been persuaded otherwise, by facts or other matters.
If the government does back away from a CET entirely, it will offer reasons like those the Energy Minister, Josh Frydenberg, offered today: that the cost of renewables is falling dramatically, and therefore there is no need for subsidies. (A CET effectively subsidises renewable energy by offering financial incentives for the use of low-emissions power sources.)
The argument might sound plausible, but it is worth looking at what was said by experts at the Australian Financial Review conference today [$] at which Frydenberg made his remarks. Australian Energy Market Operator head Audrey Zibelman said a CET was needed. AGL chief Andy Vesey said something like the CET was needed. Former Coalition resources minister Ian Macfarlane said, “You're going to need a transition plan. You'll need something, whether it's a CET or whatever.”
This “something” is what Frydenberg and Turnbull are now likely to pin their hopes on. This was David Crowe’s prediction [$]: “Expect something with the bland title of an ‘energy investment framework’ instead. Loaded words like ‘clean’ and ‘target’ will be missing.”
What we are witnessing is a dramatic shift in the politics of the word “renewables”.
Renewable energy has long been an ideological villain for the hard right of the Coalition. It holds the same sort of power as phrases such as “political correctness” and “identity politics”. Forget about whatever words surround it; its mere mention is enough to trigger blood-curdling screams.
Recognising that fact, what we have witnessed over the past year is a concerted effort by senior members of the government to make “renewables” a byword for blackouts. This type of connection was already being made in various quarters, but the South Australian blackout was the point at which Turnbull really threw his shoulder into convincing the public.
It’s an interesting gambit, because “renewable energy” has long been the most popular element of climate policy. Voters especially like the idea of solar energy, and the idea that Australia has lots of it. The words themselves have always gone down well with focus groups. But by now the government has expended an enormous amount of sweat at changing that perception. Yes, it’s a nice idea, the line goes, but reliability and affordability are the most important things.
Tony Abbott makes this argument the most, but Turnbull is not far behind these days. Here he is, talking to the South Australian Liberal Party two months ago: “If you want it to replace coal-fired power with lots of renewables, it would dawn on you, you would think, with a moment’s thought, that the sun doesn’t shine all the time. And the wind doesn’t blow all the time.”
The argument Tony Abbott keeps telling Turnbull to pick – painting Labor as the party of unreliable renewables – seems to be precisely the argument Turnbull has picked. Jettisoning the CET will be the final logical step in setting up the contrast.
Assuming this happens, it will be interesting to see how Labor responds. Bill Shorten has offered to work with the government on a CET. This offer seemed genuine, though naturally was partly driven by Labor’s political desire to avoid the dangers of an ongoing climate change debate. If Turnbull backs away, that allows Shorten to take the moral high ground: We offered to end the climate wars, he will say – is already saying – but Tony Abbott wouldn’t let Malcolm Turnbull do a thing. Turnbull’s retreat will have the added bonus of protecting Labor on the left. Labor won’t have signed up to a CET with allowances for clean coal, which will deprive the Greens of an attack.
But with the prospect of Coalition agreement off the table, what does Labor actually do on policy? It has always said a CET is only the fallback option after an emissions intensity scheme – does it go back to that policy? Or does it offer a CET as the only plausible way forward regardless, saying it hopes the government will change its mind once it’s in opposition (this seems unlikely)? Or does Shorten continue to work for a deal, even without a CET, to avoid the risk of being blamed for any future blackouts? This would be hard to get the entire party to agree to, but then forging agreements is what Shorten has always been good at.
Just another day on which the country’s hopes of ever having a settled climate policy faded a little further.
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