Day 87: 'Confusion-opoly'
An introductory weekday newsletter from Schwartz Media. Counting the days since Australia had an energy policy.
Good morning and welcome to day 87.
Today in summary: the IEA’s 2018 World Energy Outlook is released; Energy Minister Angus Taylor is confident the government’s big stick is not unconstitutional; and over 1 million Australian households are reportedly paying too much for their power.
— Sophie
Today’s policy spin level: 💨💨💨
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The 2018 report from the International Energy Agency has been released, and it’s got something for everyone. The report forecasts that globally, renewables will keep squeezing out coal, with solar PV becoming increasingly dominant over the next 20 years. It also predicts, under a ‘new policies scenario’, that coal exports will remain steady going towards 2040, and Australia will remain the world’s largest exporter and even increase its exports.
ABC | AFR | SMH | PV Magazine
Resources minister Matt Canavan issued a press release saying the report’s figures:
“show a bright future for Australia’s coal industry… Coal is here and it’s here to stay.”
In response, shadow energy minister Mark Butler said Canavan was:
“literally celebrating catastrophic global warming”.
Energy Minister Angus Taylor has brushed off legal threats from big power companies over potential price capping and forced divestment. Yesterday, the Australian Energy Council released legal advice saying the enforcement powers mooted could breach Australia’s constitution; Taylor, on RN’s Breakfast with Fran Kelly, said he wasn’t worried.
“We’re not concerned about what they’re saying on this, they’re talking their own book. We get legal advice on these issues and we’re confident in our position on this issue as with other legislation that is in that package.”
At least 1 million Australian households are paying too much for energy, and customers are staying on standing offers because the market is a "confusion-opoly", according to the latest Tariff Tracking report from charity group St Vincent de Paul.
The report recommends a national policy review of the cost/benefit sharing from rooftop solar and battery storage, a revised National Energy Customer Framework, regulatory removal of products designed to confuse customers, and better funding for government comparison websites.
The Commentariat
Australia has been led by visionless leaders into an "abyss of indecision, negative politics and not-in-my-backyard obstructionism", according to Woodside Petroleum chief executive Peter Coleman. He also called for a price on carbon.
“Today's policies simply do not take high-intensity carbon out of the market.
“This means that, as renewables achieve scale, we risk wasting money on building more power into the system, resulting in generation overload. We risk ending up in a situation like Germany, where the growth in renewables without a corresponding increase in gas-fired power has resulted in issues with intermittency and overcapacity – and failure to reach emissions reduction targets.”
The last COAG Energy Council meeting for the year will take place on December 18, and commentator Keith Orchison says it’s one of the last chances for the government to offer up something it can portray as a win on energy policy.
“Two years ago this month Josh Frydenberg (then Environment & Energy Minister) defined the challenge like this: “It is a big job to ensure stability, security and reliability in the energy system while at the same time balancing the costs to industry and consumers and the need for a transition to a low carbon, low-emissions economy.”
“This November, as the government in which he is now Treasurer limps towards what most in the media commentariat are portraying as inevitable election defeat, the “big job” remains nowhere near done.”
Three more things
Energy Minister Angus Taylor is expected throw his support behind the proposed expansion of Snowy Hydro, with the caveat that the business case must stack up. The expansion would add 2,000MW to the hydro scheme’s 4,100MW capacity. Taylor will reportedly say he expects Snowy Hydro to be a “fundamental part of our future energy needs for many generations”.
Oil prices have taken a tumble after peaking at the start of October, amid strong supply and concerns about the economic outlook for the year ahead. With American production on the rise, US President Donald Trump criticised Saudi Arabia for its plans to curb output.
The EU says new energy saving and renewables targets will put it on course to overshoot its climate goals. The European Parliament on Tuesday agreed to energy savings targets of 32.5% and a renewable energy uplift of 32% by 2030. The plan is expected to see emissions cut by 45% from 1990 levels by 2030 versus a target of 40%.