November 4th 2017


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Articles from this issue:

COVER STORY National Energy Guarantee: lots of smoke, but no coal-fired power

EDITORIAL Popular revolt against the ideology of globalism

CANBERRA OBSERVED Paris still rules in the party room

ENERGY Renewables and gas conspire to push up prices

ENVIRONMENT Climate change did not cause California fires

ELECTRICITY Consumers will wake up only when there are blackouts: economists

ECONOMICS Something new under the sun from China

NATIONAL AFFAIRS Abbott gets brickbats for exposing house of straw

NATIONAL AFFAIRS Australia is far from fulfilling its potential

TECHNOLOGY Aussie scientists 'write' with adult stem cells

75TH ANNIVERSARY NCC: new challenges, kind of new adversaries

MUSIC All around the beat: the essential drummer

CINEMA Happy Death Day: Deja vu with a sharp edge

BOOK REVIEW Traditions under threat fight back

BOOK REVIEW Journey to freedom

LETTERS

ENERGY Coal-fired power needed to restore economic growth

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CANBERRA OBSERVED
Paris still rules in the party room


by NW Contributor

News Weekly, November 4, 2017

Malcolm Turnbull and Josh Frydenberg have been lauded as achieving a brilliant policy breakthrough with their bold new energy policy, which will allow the nation to escape the “climate wars” that have dogged the political landscape for the past decade or so.

"We'll always have Paris."

The problem though is that in achieving a policy consensus among all the conflicting players, the competing interests and ideologies that have been at loggerheads over this time, the Coalition also needs to focus on the main game, which is being re-elected.

The Government describes its National Energy Guarantee (NEG), designed by five top experts in the energy industry, as a credible, workable, pro-market policy that will make energy more affordable and reliable, and that has the potential to achieve a political consensus for the first time.

News Limited columnist Terry McCrann, who has been a powerful critic of the futility of efforts of Australia forgoing its bountiful coal and gas for the supposed more “morally responsible” renewable energy sources, says the new Turnbull policy is an improvement on the “current mess” and is certainly “light years away from the insanity that a prime minister Shorten in de-facto coalition with Richard Di Natale and his crazy Dark Greens would (disturbingly, arguably, will) deliver”.

However, he warns in the starkest terms that it does not deliver a politically viable solution.

“They have also turned their — and the Government’s collective — back on what is not only a golden opportunity to win the next election but arguably the only way to do so: nailing Labor Leader Bill Shorten on his commitment to guarantee even higher power prices and blackouts,” McCrann wrote after the policy was released.

In its defence, the NEG is a clear break from the concept of the market mechanisms of the past such as the carbon tax, emissions trading and emission intensity schemes.

In essence the NEG will demand that retailers purchase a minimum amount of “dispatchable” or reliable power as well as a minimum of low-emissions electricity.

So there must be enough base-load power to maintain energy security while separately mandating a certain level of low-emissions energy, which would include renewables, sufficient to meet Australia’s Paris emissions reduction commitments.

Support has been considerable, coming from the Business Council of Australia, the Australian Industry Group, Chief Scientist Alan Finkel and energy giant AGL, to name a few.

Labor is thinking about supporting the policy, which would mean there would be bipartisan support for the first time, providing “policy certainty” but also denying the Coalition the possibility of prosecuting a campaign on a highly charged issue at the next election.

The alternative view within the Government, put most potently by Tony Abbott, is that the Coalition should instead be wholeheartedly attacking Labor’s clean energy target because this will lead to blackouts, skyrocketing power prices, and billions of wasted handouts to businesses riding on the environmental bandwagon.

Indeed Labor’s hypocrisy is astonishing. While it considers the policy merits of the Government’s plan, it lambasts the same Government for delivering negligible power savings to consumers.

The NEG promises to deliver electricity affordability and reliability, but also “responsibility”, which is code for meeting Australia’s Paris target of a 26 to 28 per cent cut in emissions.

In fact the policy manages to seem to be all things to all people – reliability, affordability, and environmental responsibility by encouraging policy certainty for long-term investment in renewables and lower-emissions technology. But soothing words alone will not achieve those ends.

The Abbott view, notably much hardened from when he was prime minister, is that this third element will make prices much higher than they need to be, and that the policy should put Australia’s consumer first by junking Paris commitment. He argues that whatever Australia does will have no discernable impact on the bid to reduce global emissions.

However, the Coalition party room, perhaps exhausted from the long-running debate, has fallen in behind the Prime Minister.

And it could be argued that Abbott be credited for pushing Turnbull and Frydenberg into dumping the clean energy target and finding this new super solution.

But the coming summer is likely to be the first test of Turnbull’s promised solution. The first blackout (a number of which are predicted to be likely) will refocus the Australian people’s attention on the energy issue.

Meanwhile, Labor’s policy remains in limbo as it bides its time on how to respond to the proposed NEG, but appears to be clinging to its costly, futile, unachievable and potentially disastrous 50 per cent renewable energy target.

Turnbull the ex-businessman prides himself on finding good policy outcomes and working compromises, but often forgets he is also fundamentally now in the business of politics.




























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