Thursday, October 21, 2021

Is "renewable" electricity now economical?

If you ignore the capital costs it probably is. But the capital costs are mostly subsidized from taxes so that is free money, right? Wind turbines in particular are hugely expensive. They could never pay off their costs or even deliver a market return on capital invested

Thanks to a storm of innovation and competition, business and industry has made renewable power more ubiquitous and affordable than even its greatest proponents dared to hope.

“It’s just staggering,” former chief scientist and now special Adviser to the government on low emissions technology Dr Alan Finkel said.

“If you went back to 2010 and looked at all the predictions of battery price for 2050 and now pick up a catalogue, you will see we’ve achieved those 2050 predictions already,” Dr Finkel said.

“We’re seeing the same with solar. Nobody back in 2000 or 2010 predicted solar and wind would be as cheap as they are today. Ninety per cent reduction in the cost of solar electricity per unit in a 10 year period or 11 year period from 2010 to now.”

In other words even just a decade ago it wasn’t even predicted — let alone known — that renewables would be so competitive and cheap.

And so when it comes to power bills, for example, there is no longer a question of any hip pocket pain for environmental gain. Instead it is a clear win-win.

Likewise when it comes to jobs and industry there is now an economic argument for net zero every bit as powerful as the environmental one.

That is why even green groups like the Australian Conservation Foundation are now pressing the industrial case for things like renewable-powered hydrogen, aluminium and steel.

“A target for Australia to reach net zero by 2050 is meaningless without a credible plan with policies and targets to drive down emissions this decade,” CEO Kelly O’Shanassy said.

“The solutions I’ve outlined are part of that credible plan because they address the reason the Prime Minister and Deputy Prime Minister have so often used to not take greater action: the economic cost.

“These solutions will create wealth and wellbeing, replacing the jobs and industries lost as the world moves away from fossil fuels. Harnessing these solutions is good for our climate, our economy, our jobs and our communities.”

And of course there is also the obvious fact that there is a growing global consensus in the lead up to the Glasgow summit that means that whatever the politics or ideology, Australia needs to act simply to preserve its international trading partners.

Plus there is clear political momentum within the Coalition government and geopolitical pressure from our closest allies in the US and UK.

All of this and more has led to a moment where after years of torturous inaction which Labor, the Liberals and the Greens all brought upon themselves there is now an unprecedented alignment of environmental benefit, economic prosperity and political will.

A moment that might finally bring an end to Australia’s climate wars.


Why Australia is foolish to embrace net zero emissions

Senator Matt Canavan

Australia is lagging the rest of the world. Just as we are set to sign up to a net zero emissions target, everyone is in a desperate rush to get more coal, oil and gas.

In the UK, they have reopened coal power stations because there has been a wind drought, and Vladimir Putin is not sending them as much gas as he used to.

The US has asked Middle Eastern countries to increase oil production because the woke Wall Street bankers are no longer financing fracking in Texas.

In China, Premier Li said this month that “coal supply is crucial to people’s lives” and that he would review China’s emissions targets in light of their recent energy crisis. He stressed that energy security was China’s priority.

India has demanded that all coal power stations use at least 10 per cent imported coal so they can boost their fuel security.

This is all happening because of Europe’s ill-fated attempt to reach net zero. The failure of Europe to develop their own fossil fuel resources has led to a cascading effect through world energy markets. The price of coal and gas are at record highs, which is good for Australia given we are the world’s largest exporter of both of these things.

But we are set to look this gift horse in the mouth by signing up to a net zero emissions target. A “net” zero emissions target means that any new coal mine or gas field in Australia would need to “net” off its emissions by purchasing carbon credits. These credits cost money and will, in effect, tax the creation of working class Australian jobs.

Over 1 million Australians work in the mining industry alone but these requirements will also impact agriculture, manufacturing and construction jobs too. A net zero target will be the first time that an Australian Government has adopted a policy to make us poorer.

How much will these carbon credits cost? UK Government modelling shows that the carbon price will have to be A$295 per tonne to reach net zero. Julia Gillard’s $20 carbon tax increased electricity prices by 10 per cent. Electricity bills are already skyrocketing in the UK under their net zero plans, and they have a lot higher to go.

But there will be some winners. The banks are happy with this outcome because they will trade the carbon credits. Banks are some of the biggest supporters of net zero emissions. My rule of thumb is that if something is good for the banks, it is probably bad for me.

Turning our back on our domestic supplies of coal and gas will also mean that we will become reliant on China for our energy needs, as that is where our wind turbines and solar panels are made. All of this just as we learn that China has invented a hypersonic, nuclear capable missile that can land anywhere on earth and avoid existing missile defence systems.

China now has space nukes but they can’t match us on plans to reach net zero.

At the last election, Scott Morrison rightly warned of the dangers of cutting our emissions by too much. He called Labor’s proposed 45 per cent reduction in emissions a “wrecking ball through the Australian economy.”

The working men and women of Australia agreed, and rewarded the Liberal and National parties with an unexpected victory. If we turn our backs on their jobs, the Quiet Australians will become loud and angry.

These Australians don’t care what world leaders think of them. They just want their government to create jobs, keep living costs down and make Australia stronger.


Pressure to disband OIA as more petty investigations come to light

The Office of the Independent Assessor has been accused of threatening the free speech of local councillors following the revelation it was probing Barcaldine Mayor Sean Dillon after he questioned the Covid vaccine rollout in a public council meeting.

But while Premier Annastacia Palaszczuk conceded the probe was “ridiculous” and a “storm in a teacup”, her Government has washed its hands of the situation, with Deputy Premier and Local Government Minister Steven Miles resisting calls to launch a review into the watchdog.

Instead, Mr Miles said concerns should be raised with the Queensland Ombudsman.

Community leaders rallied around Cr Dillon following revelations in The Courier-Mail that he had been accused of potential misconduct by the OIA after he questioned the Central West Hospital and Health Service’s planned vaccine rollout.

LNP senator James McGrath called for the OIA to be reined in with tighter legislation or “ideally” be abolished.

“The OIA, the Gestapo of local government in Queensland, is alleging that (Cr Sean Dillon) made comments that could be considered detrimental to public confidence in our health service provider,” he said.

“The last time I checked, one of the primary roles of local government councils is to raise concerns on behalf of their local community.”

The OIA received 1074 complaints from across the state during 2020-21, which was a 4 per cent increase on the previous year, however it noted this was not unexpected because it was the first full year all 77 councils had come under its remit. It completed 187 misconduct investigations during 2020-21.

Former premier Campbell Newman labelled Cr Dillon’s matter as an “extremely sinister development” in Queensland’s democratic system. “I think this office should be shut down and we should go back to local government legislation that was tried and tested and worked well for generations of this state,” he said.

Ms Palaszczuk said it was “a bit of a storm in a teacup”. “I don’t think what he (Cr Dillon) said was unusual, I think it’s a bit ridiculous, but that’s a matter for the independent assessor,” she said.

“But those comments I think were made earlier this year and they’ve had great vaccination rates out there, and the mayor Sean, I know him, he’s done a great job.”

Deputy Premier and Local Government Minister Steven Miles said the Palaszczuk government supported the right of councillors to speak freely, but he resisted calls for a review.

“The Office of the Independent Assessor is an independent statutory body,” he said. “If anyone has concerns about the actions of the OIA, they should raise those concerns with the Queensland Ombudsman.”

It is alleged Cr Dillon made comments about the CWHHS on February 17 “that could be considered detrimental to public confidence in a health service provider and lead agency in the rollout of the Covid-19 vaccination program in the region”. It came after he raised concerns at a public council meeting, including that his community couldn’t be vaccinated in the days allocated and that he had “no confidence in them”.

An OIA spokesperson said it did not comment on specific case, but that the following applied to matters involving a councillor’s implied right of political expression: “Local government councillors have the same right to implied freedom of political expression as all members of the community, however this right is not absolute for anyone and may be limited by legislation such as anti-discrimination and anti-racism laws or by a code of conduct.

“When taking office councillors declare they will uphold the code of conduct and the local government principles set out in the Local Government Act, and the OIA is legally required to assess all complaints against these legislated standards.”

LGAQ chief Greg Hallam said the body staunchly supported Cr Dillon’s “right to speak publicly” while calling on the OIA to withdraw its action.

Cr Dillon said he had been “almost overwhelmed” by the amount of support he has received from politicians and members of the community. “Everyone has expressed their solidarity but also been checking in to make sure that I am doing OK,” he said.


We must fix a few problems before we can increase immigration

Abul Rizvi

In the past week we have seen NSW Premier Dominic Perrottet, federal Treasurer Josh Frydenberg and the Australian Chamber of Commerce and Industry advocate for much higher levels of immigration.

State bureaucrats have pushed Perrottet to lobby for an increase in Australia’s net migration to an unprecedented 400,000 a year for five years. The ACCI is calling for the government to issue 200,000 skilled migrant visas annually. And Frydenberg says Australia needs to rethink its migration targets after losing almost 100,000 people last financial year.

Only once in our history has net migration been a little more than 300,000 and that was just before the global financial crisis. I am not suggesting immigration had anything to do with that crisis, but net migration fluctuates with economic conditions, particularly the labour market. While the labour market is weak right now, there are predictions it will bounce back next year.

When John Howard was prime minister, I was responsible for firstly managing Australia’s immigration intake down, and then increasing it again from about 2001. Oddly enough, I found increasing numbers was more difficult than cutting them.

One of the challenges was that while the smaller states and regional Australia wanted more immigration, the NSW government insisted Sydney was full and any increase in the intake had to be directed away from Sydney. Presumably, Perrottet does not have the same concerns.

Leaving aside “trivial” questions of whether our infrastructure and services such as health, education, housing and transport can be ramped up quickly enough to accommodate the proposed unprecedented increase in immigration, the immediate question is how the increase would be designed and delivered.

The crucial means by which we increased immigration from 2001 was through an increase in overseas students, with clear pathways to permanent residence. These pathways became far more opaque from about 2008-09, but overseas students still represented more than 44 per cent of net migration in 2018-19.

The decision to make the pathways to permanent residency less clear has left hundreds of thousands of overseas students and graduates who have moved on to temporary visas to develop their skills in immigration limbo.

Despite huge numbers of students completing accounting degrees and accounting firms saying they can’t find qualified accountants, these students are struggling to secure jobs using their qualifications, which makes it harder for them to stay in Australia.

This is the status quo in many occupations. The business sector and education providers must address this problem before we again boost student numbers. Education providers need to encourage students to enrol in courses that meet long-term demand in Australia. And they must ensure they are teaching content and skills employers need. Employers too must be prepared to give students the chance to develop their skills without exploiting them.

Even if these problems are addressed, returning to pre-pandemic international student levels will not be simple given our tensions with China – our largest student source country – and the fact the student visa policy was tightened in 2019 for students from India, Nepal and other major source countries.

Some increase in immigration could be achieved by fixing the problems Peter Dutton created as immigration minister, when he made employer-sponsored visas more expensive, more complex and more restricted, leading to a significant decline in their use. But this will not be nearly enough to deliver the numbers NSW and ACCI want.

To reach these figures, the federal government will need to make it easier for older people and people with more limited English and/or lower skill levels to migrate to Australia. This risks large numbers of new migrants finding it even harder to secure a job using their qualifications, and with no access to social support for four years, many would have to accept very low paying and highly exploitative jobs to avoid becoming destitute.

As a country, we need to ask ourselves if that is a consequence we are willing to accept.




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