Don’t let Abbott slash renewable energy target

Tony Abbott is coming after renewable energy, with plans to junk the Renewable Energy Target (RET).

He set up a review of the RET chaired by climate denier and former Caltex head Dick Warburton, and including three others all connected to the fossil fuel industry. Shirley In’t Veld is a former head of WA’s biggest coal generator, Verve Energy. Brian Fisher is a long-standing consultant to fossil fuel emitters and Matt Zema is CEO of the Energy Market Operator.

The Renewable Energy Target is one of the few climate policies that have actually worked. It forces power companies to source a percentage of their power from renewables, with the target reaching 20 per cent of power by 2020.

Since 2001 the amount of energy produced by renewables has doubled. South Australia produced half its electricity from solar and wind in June and it is estimated around 13.5 per cent of electricity produced this year in Australia will come from renewable sources. Growth has mostly been in wind energy and rooftop solar.

The review produced two proposed options. One is to close the RET to new entrants, and so stop any further growth in renewable energy. The second is to review the target each year and only grant increases if electricity demand is increasing. Demand has decreased for each of the last five years. Both options recommend the target be scrapped in 2030.

The review panel said that the RET is “contributing to a large surplus of generation capacity”, has therefore put downward pressure on wholesale electricity prices and caused “a transfer of wealth among participants in the electricity market”. In other words renewable energy has eaten into the market share and profits of the fossil fuel generators. Modelling actually found that power bills would fall from 2021 if the RET was kept in place.

The Climate Institute, the Australian Conservation Foundation and WWF-Australia commissioned modelling found that weakening the RET could result in “$8 billion additional profit to coal and $2 billion to gas generators”. Greens Senator Scott Ludlam has said that 21,000 jobs are threatened by the attack on the target.

Abbott is Prime Minister for profit, and therefore backs the fossil fuel industry. Australia has abundant reserves of coal that still produce relatively cheap electricity, and companies have sunk billions in the existing coal and gas plants. Renewable energy also makes profits, but nothing comparable to the scale of the existing generators.

The panel claimed that the RET is a “high cost” emissions abatement measure that requires government subsidies, but refused to name any “low cost” alternatives. The panel also found that because of falling demand for electricity the RET “could achieve a 26 per cent share of electricity from renewable sources by 2020”. That the RET is tracking ahead of target should be cause for small celebration, and for the climate movement to demand the target to be raised higher still.

Demand investment in renewables

Abbott, still trailing in the polls after his unfair budget, shouldn’t be able to get away with reducing renewable energy. Even when first elected he wasn’t confident enough to begin by slashing the RET, targeting other climate policies first.

Supporting the carbon tax as the key policy on climate has helped Abbott. The carbon tax allowed Abbott to mask his climate denial by pretending to care about cost of living. Yet it did nothing to help renewable energy.

Media reports say that whilst much of Abbott’s cabinet want the target scrapped altogether, they are politically nervous, and want a compromise of reducing the RET to a “real 20 per cent”. This would take falling energy demand into account and reduced it to 20 per cent of that level.

Renewable energy to reduce emissions remains hugely popular. It works and it needn’t mean price rises.

The climate rallies on the 21 September can be the beginning of fighting to defend the RET. But we need to move beyond simply general demands for “climate action”.

Labor’s version of “climate action” is an Emissions Trading Scheme that won’t work. Even the existing RET hasn’t delivered the large scale solar power needed if we are to move to 100 per cent renewable energy. One large solar power plant first proposed for Mildura in 2006, which has been cancelled and then revived many times, has just been scrapped yet again.

We should demand government funding to build large scale solar power plants, just as governments once build all the coal-fired generators. This would produce hundreds of thousands of jobs, which should go alongside job guarantees in new industries for fossil fuel industry workers. Demands like this could help restart the climate campaign.

By Chris Breen


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