FEDERAL ELECTION 2010: by Patrick J. ByrneNews Weekly
Vote Green: a good way to wreck your investments
, August 21, 2010
The Greens' economic policies will do far more damage than Labor's discredited mining super tax to the investments of Australians in the stockmarket, managed funds and superannuation.
What's puzzling in this federal election campaign is why so many mainstream Australians are prepared to vote Green.
Typical Green voters are often 30-somethings, have no kids, are inner-metropolitan city-dwellers and have lots of investments.
They don't like Tony Abbott because he led the Coalition in voting down the emissions trading scheme (ETS), and they don't like Labor because the mining tax will depress the value of their investments.
So how can they fail to see that voting Green will bring down the economy and the value of their investments far more dramatically than did Labor's mining super tax?
For starters, Greens leader Senator Bob Brown said recently that he planned to ignore the Labor Government's backdown on a 40 per cent resources super-profits tax (RSPT) in favour of a 30 per cent mineral resources rent tax (MRRT). If he could, he would revert immediately to the original higher tax on mining.
In April, before Rudd's 40 per cent mining tax was announced, the Greens said they wanted nothing less than a 50 per cent
mining tax! (Sydney Morning Herald,
July 23, 2010).
Further, the Greens have made it clear they wish to shut down Australia's huge $50 billion coal export industry within three years, according to their leader Bob Brown (Brisbane Courier-Mail,
February 2, 2007).
More than that, they want to shut down the entire coal industry. They oppose the opening of any new coal mines or expansion of existing mines (Greens policy no. 35: Agriculture and natural resources).
They oppose the establishment of any new coal-fired power stations or expansion of existing ones (Policy no. 18: Climate change and energy) and want a ban on public funding to refurbish existing ones (Policy no. 19: Climate change and energy).
The Greens took part in a national day of actions on July 17, 2010, to replace the huge Hazelwood Power Station, which provides 25 per cent of Victoria's electricity (Greens media release, July 14, 2010).
So how will Australia generate the electricity to run its industries, offices and homes?
The Greens claim that Australia could be powered by 100 per cent renewable energy within 10 years (Greens media release, June 23, 2010).
Their media release on the Beyond Zero Emissions
report says that Australia has the "potential for base-load thermal power with storage supplemented by wind power and other forms of renewable energy".
How much would this cost? The Greens estimate a cost equivalent to 3 per cent of gross domestic product (GDP) annually for the next 10 years. That amounts to around $33 billion annually, or, as they colourfully put it, the cost of a cup of coffee per day per person for 10 years.
For the average family of four, that amounts to an extra $4,000 or more a year in added electricity costs.
The Australian Productivity Commission, in its submission to the Garnaut Climate Change Review (p.73), estimated that the cost of wind energy was three times that of coal power; solar electric panels around 10 times the cost of solar power; and solar hot-water systems around three times the cost of coal-fired power.
Solar radiation has a very low energy density, too low to provide base-load electric power.
What's more, wind power cannot produce reliable base-load power. Economics writer Terry McCrann publicised a devastating piece of research by Andrew Miskelly and Tom Quirk on the Rudd Government scheme to rely more on wind power as part of its planned emissions trading scheme.
Miskelly and Quirk tracked the power output of all the now quite substantial wind farms in South Australia, Victoria, NSW and Tasmania for every minute of June 2009. They found that when the wind stopped blowing in one state, it simultaneously stopped blowing in all four states they monitored.
As McCrann says "This utterly shreds the claim that if you build enough wind farms nationally the wind will be blowing somewhere. You have to keep fully equivalent coal power up and running, not just when the wind is not blowing, but all the time.
"So, we have a government that is proposing a massive new tax [i.e. the emissions trading scheme].
"It then proposes to waste most, if not all, of the money from it. Either by compensating people for higher costs, or by pouring it into 'alternative' energy production that can't work." (The Australian
, August 8, 2009).
What about relying on "hot rocks" for producing geothermal power?
According to a Geosciences Australia report, Electricity Generation from Geothermal Energy in Australia (
2007), as of 2007 there were "no Hot Rock systems generating electricity on a commercial scale anywhere in the world; however, the Landau Project in Germany is scheduled to be on-line in late 2007". It was intended to produce 2.5MW.
Since 2007, according to the New York Times
, Germany is reassessing geothermal power after the Landau project "set off an earthquake in mid-August , shaking buildings and frightening many residents of this small city ...
"In the United States, the Energy Department is scrutinising a project in Northern California run by AltaRock Energy to determine if it is safe. (The project was shut down by the company last month [August 2009] because of crippling technical problems.)
"Another project, in Basel, Switzerland, was shut down after it generated earthquakes in 2006 and 2007 and is awaiting the decision of a panel of experts about whether it can resume." (New York Times
, September 10, 2009).
But according to the Greens, the Beyond Zero Emissions
report argues that by 2020 Australia's need for electricity will have halved because of a big shift to public transport and the use of electric cars and the improved efficiency of a $92 billion upgrade of the national electricity grid (ABC News report, June 22, 2010).
These assumptions are fanciful. Electric cars can be useful for short-distance city-driving; but the renewable energy upon which the Greens want Australia to rely to recharge such vehicles is much more expensive than coal power.
The one cheap form of power that electric cars could use is nuclear energy, but the Greens are opposed to nuclear power and want to shut down the $1 billion annual uranium export industry.
The Greens policies, if they are ever realised, will dramatically increase costs to every office, business, home and industry.
The Greens and Labor have agreed to swap preferences, so a vote for Labor will also be a vote for Green policies.
As the ancient Chinese curse says, "May you live in interesting times."Patrick J. Byrne is vice-president of the National Civic Council.References
"Mining tax compromise a fake: Abbott", Sydney Morning Herald
, July 23, 2010.
, February 2, 2007.
"Hazelwood, it's closing time", Greens MPs in Victoria statement.
"'Zero Carbon Australia' plan points the way to 100% renewable energy fast", Greens' media release, June 22, 1010.
Terry McCrann, "Emissions trading is a tax, no matter what the name", The Australian
, August 8, 2009.
"Electricity generation from geothermal energy in Australia", Geosciences Australia
"German geothermal project leads to second thoughts after the earth rumbles," New York Times,
September 10, 2009.
"100pc green energy possible by 2020: report", ABC News report, June, 22 2010.