There is an embarrassment of subjects to write about at the end of the week. I had my eyes on the UK General Election, if only because in 1964, now 53 years ago, I worked as a behind-the-scenes analyst on the BBC’s election night coverage, and then became part of the Australian election night coverage for the next nearly twenty years. It is too early to say too much about the outcome, other than to me it seemed a bit of a re-run of the Brexit referendum. There will have been much more than this, of course, especially with respect to the terror episodes during the campaign. Mrs May will govern with the support of the Democratic Unionist Party, which won its seats in Northern Ireland.
But this outcome, plus that of the French a few weeks earlier says to me that Western democracies have no clear sense of what to do, who to trust, or where to go. I wouldn’t be at all surprised if our next federal elections have the same sense of bafflement. Where, indeed, is there a Western country which seems united, clear-sighted and purposeful?
The Report on what to do and where to go with respect to energy in Australia has been delivered by Dr Alan Finkel, the Chief Scientist. He must have done something right because the Greens are scathing about it. His preliminary report, issued in December last year you can read here . What is new?
First, let us agree that he was given a tough remit. Australia has committed itself to certain targets for emissions reduction under the Paris Accord, and though President Trump has walked away from that Accord, and it is not binding on anyone anyway, even Australia, Dr Finkel has to accept that it is there. So whatever he says has to at least make a respectful bow in that direction.
Second, the Commonwealth has no direct Constitutional responsibility for energy generation or transmission anyway. So he has to pitch his report towards the Premiers and Chief Ministers as well as the Federal Government, which commissioned it. At the time of writing I have only read extracts from the Report, which seems to have been widely circulated to the media but not to the public.
To summarise, he accepts that there is a commitment to emissions reduction that has to be honoured, says that investment in electricity supply has stalled because of ‘policy instability and uncertainty’, and proposes a Clean Energy Target rather than an ‘emissions intensity trading scheme’ (the other rumoured mechanism) to help manage the ‘transition’ to a lower emissions energy generating system.
What is the difference? Well, in the Clean Energy Target suppliers like AGW and Origin will have to purchase a higher proportion of their energy from low emissions sources like wind, solar and gas. In an emissions intensity trading scheme industries (including power generating companies) are given some kind of baseline for their emissions intensity — that is, how much GGE they produce per megawatt hour. Plants that are above the baseline would have to buy permits from those that are below it. Since coal is the big emitter, this would advantage solar, wind and gas, which would presumably be below it. The CET does not punish coal as much as the trading scheme. Dr Finkel says that coal’s contribution to electricity generation would drop from around 70 per cent now to 53 per cent by 2030.
Got that? Where does it all take us? I am not sure. I could find no references to the dispatch problem — the more solar and wind you have in the system the more unreliable it becomes, and the more you have to back those sources up. Gas might fill the bill (coal does it anyway), but there are obvious problems with gas supply. The Greens don’t like the Report at all, which suggests to me that there must be some good in it. The Greens website starts as follows.
The review of Australia’s energy markets handed down today by Chief Scientist Dr Alan Finkel is more interested in fixing a political problem for Malcolm Turnbull and Bill Shorten than in addressing the great issue of our times, dangerous global warming, said leader of the Australian Greens Dr Richard Di Natale and Greens Climate Change Spokesperson Adam Bandt MP.
“The goal should be to stop dangerous climate change, not find a political fix that won’t keep the climate safe or save the reef,” Dr Di Natale said.
So saving the reef is more important than fixing our energy problem? What is Labor’s response? At the moment one can understand from news reports that Bill Shorten has written to Malcolm Turnbull offering to work with him to find a solution. Predictably, those on the Right don’t want any marriage with Labor, let alone on such a central issue in Australian politics.
I may have it wrong, and in any case a great deal will depend on what the Target is. While it is not a tax as such, it will have the effect of raising electricity prices, since coal is the cheapest source. It also provides more scope for sudden leaps in demand when the weather is cloudy and still, and I don’t see any quick solution to the possible outages in the coming summer.
Given the news two days ago that I will be paying between a fifth and a sixth more in the next financial year for heating, lighting and keeping the machines running, I need such an extra inducement for higher energy prices like the proverbial head-hole. I thought Chief Minister Andrew’s Barr’s stated belief that Canberra people would be understand the need for/be in favour of these increases was, to put it mildly, a strange belief. But then he probably thinks that the increase of about 350 per cent in my rates over the last little while is also something my neighbours and I should be ecstatic about.
In the meantime, those actually responsible for providing us with electricity and gas have become rather silent. It is agreed we have a major energy problem, but we are not going to do anything about it quickly. The head of ACTEW/AGL said on television a couple of nights ago that the problems we have in this field are the result of ‘inadequate national leadership over the past decade’ (I didn’t write it down but I repeated it a couple of times in the hope that my memory would retain it.)
Well, I could agree with that summary, but since ACTEW/AGL has gone down the alternative energy path in an almost ludicrous way over that time, I think he and I would be looking at rather different sorts of poor leadership. It would be so much easier if the Federal Government said that it would suspend its Renewable Energy Target until it had deal with the real problem of reliable and affordable energy to everyone. Alas, that’s a pipe dream with the present Government, though a minority of its members would go that way.
From a Martian point of view, you can see in this whole energy problem the mess that our political system is getting into in a number of fields. Thirty years ago people got exercised about greenhouse gas emissions and runaway warming. That became a fashionable cause, and political parties decided they had to have policies about it. Sections of the electorate found in global warming a new religion. Governments tried to appease the noisy ones with half-baked visions. Before long the price of energy started to rise. Energy is the constant element in all our prices.
Now we are in a pickle. Global warming is not the threat it was said to be, and may not be a threat at all. And we no longer have reliable and affordable energy. But the threat notion is built into all sorts of practices and expectations. It is almost impossible to get out of some of them, at least in the short run. And in a remarkably short period we have seen governments do almost crazy things in order to appease the warmers, while making electricity more and more expensive, and less and less reliable. We have only just started on the energy review but I can’t see how the Finkel Report, at least what I have seen of it, is any help at all in real terms, however much it may solve a short–term political problem for the PM, who will have to decide what the Clean Energy Target really is, and how it is to work. I’m not at all sure it solves any problems for anyone.
And we have the same kind of muddle with respect to immigration, to free speech, to terrorism, to what should be taught in schools, and how to deal with obesity. Where is that ‘national leadership’? Where is ‘the community’? As I’ve said before, most of the time I can only see lobby groups uninterested in anything but their own concerns, and g0vernments terrified about the next election.
End note The title for this essay came at once, and I tried to use it, with Dr Finkel finding clever solutions in his cave, but it didn’t work. Maybe a reader will come up with one. The reference is to Mendelssohn’s most famous orchestral piece, an overture about his reaction to Fingal’s Cave in Scotland.