Day 57: 'Not surprised'
An introductory weekday newsletter from Schwartz Media. Counting the days since Australia had an energy policy.
Good morning and welcome to day 57.
Today in summary: Prime Minister Scott Morrison said he was “not surprised” big energy companies are turning against the government; Opposition leader Bill Shorten gave the strongest indication yet that Labor will revive the NEG; and the International Energy Agency declared “expensive energy is back” in its monthly oil report.
— Charis
Today’s policy spin level: 💨💨💨
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Chatter continues over rumours a Business Council-led group is going it alone on energy policy, including plans to set its own emissions reduction strategy. Prime Minister Scott Morrison sought to shift the focus to small business on Friday, telling journalists the “top end of town” might have its disagreements with the government, but he was backing “small and family businesses, medium sized businesses”.
“I'm not surprised the big end of town and the big energy companies are turning against us, because frankly they know that we’ll take them to task.”
Speaking at the Melbourne Institute’s Outlook conference on Friday, Energy Australia managing director Catherine Tanna said the government had forgotten the need to focus on all three of the energy trilemma: affordability, reliability, and the transition to a clean energy future.
“Whenever we focus on just one of those, and we do get away with that for a time, and then the system breaks and it breaks very badly.”
Tanna said reports of businesses going it alone on policy sounded like “bright people trying to do the right thing”.
“If you see a void and you are a leading business I think you have a responsibility to step into that space.”
Federal Opposition leader Bill Shorten has all but confirmed the Federal Labor Party will go to next year’s election with the NEG in its energy policy mix. Shorten also told The Guardian Labor would maintain subsidies for households and businesses to install small-scale renewable energy until 2030.
Oil demand growth might be headed downwards, but expensive energy could still hurt global economic growth, according to the International Energy Agency. Oil, gas and coal are trading at multi-year highs, and US sanctions on Iran aren’t helping. The report comes as US President Donald Trump threatens the other oil giant, Saudi Arabia, with “severe punishment” over missing journalist Jamal Khashoggi.
The Commentariat
The US government has drafted a bailout proposal for failing coal and nuclear power plants that would “dramatically increase the role of the federal government in energy markets and send a staggering amount of resources to a few chosen private companies,” writes the National Taxpayers Union’s Brandon Arnold.
“In a free market, outdated companies and technologies are routinely replaced by newer and more efficient competitors, which is exactly what is happening in the energy sector right now. The biggest threat to clean and affordable energy is heavy-handed federal intervention. When this intervention comes with a $35 billion price tag taxpayers should be outraged.”
“Because small modular reactors are self-contained, require very little human input and depend for their safety on physical laws rather than mechanical or human reliability, they have the capacity to be much safer even than many of the generation methods in use in Australia,” writes Queensland Liberal National Senator Amanda Stoker, advocating for research into and development of a nuclear energy industry in Australia.
Three more things
The US Department of Energy’s efficiency program for manufacturing companies now has more than 200 partners, and reported savings of more than US$5.3 billion in cumulative energy costs.
In the event that the United Kingdom leaves the EU with a “no-deal Brexit,” the country “will be excluded from the European Union’s Emissions Trading System”. The UK government published a series of papers covering the potential implications of a no-deal Brexit, one of which envisions the UK “meeting its carbon pricing commitments via a tax system”.
The Australian Renewable Energy Agency will provide A$2.97 million in funding to Monash University and technology company Indra Australia, to trial a microgrid on Monash’s Clayton campus, powering the campus with renewable energy.
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We’re not here to take sides, simply to cut through the noise, and help you make sense of the emerging policy and market trends you need to be across. We call it pure intel. You can read more about us here.