Archive for the ‘Deregulation’ Category


Liberals Part 5: Are they hiding a radical agenda?

31 January 2013

This is the fifth part of a series examining the Liberal Party of Australia. Part 1, Part 2, and Part 3 examine the party’s climate policies. Part 4 debunks their allegations that the incumbent government is illegitimate. This part argues they are hiding a radical agenda of deregulation and austerity.

The countdown has begun: 226 days until an Australian federal election in which the Liberals look likely to sweep into office. Yet we still have very little idea what the Liberals would do in government. Leader Tony Abbott contradicts himself from day to day, apparently depending on who he’s speaking to, and even his party’s official policies are not very clearly explained. At this stage, a vote for the Liberals is a blank cheque. In this vacuum of confirmed information, I am forced to resort to informed speculation. You’ll know whether I’m right when the Liberals finally announce their fully detailed policies (which looks like it will be about 5pm on 14 September).

The deregulation agenda

I fear an Abbott government would be a wrecker government. We already know the Liberals would repeal the carbon and mining taxes, axe most other climate change policies, and delegate environmental approval powers to the states. These policies should be disturbing enough for anybody, but increasingly appear to be only part of a broader agenda of deregulation and austerity which should trouble even those unconcerned about climate change. It would follow the precedent set by the Newman government in Queensland, which blindsided the state last year by sneaking into power under cover of opposing a long-lived incumbent then proceeding to implement massive cuts. Read the rest of this entry ?


Liberals Part 1: Climate denial and deregulation

11 January 2013

Almost all of my posts to date have focused on criticizing Australia’s incumbent Labor government. I have written very little about the alternate Liberal/National Coalition government. But as we enter an election year, it is time to examine the Liberals’ policies.

Can the Liberals be trusted?

To begin with, it is worth noting that the Liberals have given us every reason to distrust them on climate change.

According to a 2010 survey, only 38% of Coalition politicians accept that humans are warming the planet (compared to 98% of Greens, in line with the scientific consensus, and 89% of Labor politicians). Liberal and National politicians regularly spout denialist talking points, up to and including their leader Tony Abbott. Most notoriously, Abbott reportedly said in 2009 that the science of climate change is “complete crap” but “the politics of this are tough for us”. In 2010 Abbott met with Christopher Monckton, a man who claims climate scientists are conspiring to fake their results in a plot to create a socialist world government. In a speech to the Mining Council of Australia in 2011, Abbott said “the authors of the carbon tax do not see coal, oil and gas as the most important parts of our economy” but “as a threat to the very survival of our planet”, the obvious implication being that his party disagrees. In 2011 former Liberal Prime Minister John Howard launched a book instructing schoolchildren to raise denialist arguments in the classroom. Queensland’s Liberal National government wants to remove climate from the school curriculum, and its Premier and Environment Minister openly deny human-caused global warming.

I could list many more examples. Indeed, it would probably be quicker to list Coalition politicians who have never publically made denialist claims.

Almost all of the Liberals’ actions mark them as an anti-climate party. The Liberals did not take any significant climate action during the eleven years of the Howard government. They consistently prioritize short-term economic considerations like mining industry competitiveness and electricity prices ahead of climate change. Today they are putting way more effort into opposing Labor’s climate policy than in designing and promoting their own (the former is the subject of this post; the latter will be covered in Part 2). Thus it is questionable whether they would even implement their climate policy, let alone whether it would work. Read the rest of this entry ?


Climate deregulation still on agenda

6 December 2012

It’s called the COAG Taskforce on Regulatory and Competition Reform, and don’t be fooled by the boring name: it could be the gravestone of Australian climate policies and environmental regulation. Today Prime Minister Julia Gillard meets with the unelected Business Advisory Forum (BAF), and tomorrow with the Council of Australian Governments (COAG), to advance this radical corporate-driven deregulation agenda.

I was going to write that the federal government intended to hand over its environmental approval powers to the states tomorrow. Fortunately that has been delayed following a campaign by the Greens and environmental groups, though it remains very much on the agenda. Instead this blog post will focus on another, even more important aspect of the COAG Taskforce program, which has received less attention but presumably rolls on inexorably toward an imminent conclusion: reviewing almost all climate policies with a view to axing them.

The process is completely opaque and undemocratic. Federal and state governments are advised by business lobbyists, with no comparable consultation of anyone else, and the public are not told what is happening apart from vague communiqués following decisions at BAF and COAG meetings.

It is not even clear why the BAF was created in the first place, though I can offer an unsubstantiated conspiracy theory. Throughout 2011, business lobbyists campaigned against the Gillard government for daring to rock the boat even slightly by introducing a carbon price (never mind that it was full of holes). Some supported the Liberals’ campaign for an election and no carbon price, and I imagine behind the scenes some supported Kevin Rudd’s leadership plot in return for Rudd’s promise to weaken the carbon price. When Rudd was decisively defeated, the Business Council of Australia called for “a renewed commitment to make Australia more competitive and productive” including “a regulatory environment that encourages business to invest, adapt, and innovate”. Within a week, Gillard announced the formation of the Business Advisory Forum. The whole thing had a vibe of Gillard desperately trying to win the support of business. And what better way to atone for the carbon price than to dismantle all other climate and environment policies? Read the rest of this entry ?


The fossil-fuelled war on renewables

24 October 2012

In recent months, ~2 GW of Australian coal-fired electricity generation has been closed temporarily or permanently (~2.5 GW in winter), comparable to the 2 GW that would have been closed by the abandoned policy of contracts-for closure. Some might conclude Australia is finally beginning its transition to a low- or zero-carbon economy, and we can sit back and watch the federal carbon price and Renewable Energy Target (RET) drive it. But even if decarbonization was occurring fast enough (which is nowhere near the case), now is not the time to sit back, because the established electricity companies see their traditional business model disappearing down the drain, and they are fighting back. Read the rest of this entry ?


Why the RET review matters

18 September 2012

Last week, I made a submission to the Climate Change Authority review of Australia’s federal Renewable Energy Target (RET). In August, the Climate Change Authority released an Issues Paper on the review, inviting public submissions (which closed on 14 September, but you can still have your say in a poll by the Australian Youth Climate Coalition). A discussion paper with draft recommendations will be released in October, followed by final recommendations by 31 December. The Government must respond within six months.

The RET review is the first in a series of independent reviews of climate policies, intended to allow them to be strengthened, secured by the Greens in last year’s Multi-Party Climate Change Committee negotiations in return for agreeing to initially inadequate and potentially ineffective policies. However, a number of businesses and business lobby groups invested in fossil fuels are using the review as an excuse to demand the RET be weakened.

An internal document obtained by the Australian Financial Review in April showed the Australian Industry Greenhouse Network is lobbying for the RET to be to scrapped or weakened. Meanwhile, TRUenergy has joined Origin Energy in its more public campaign to weaken the RET. These two “gentailers” (companies who both generate and retail electricity) argue the RET should be adjusted downward so that it accounts for no more than 20% of 2020 demand. Such a move would cause renewable energy deployment in Australia to stop completely in 2016, with only gas-fired electricity generation built post-2016:

Projected new and retired electricity generation capacity under the reduced Renewable Energy Target advocated by TRUenergy. Green and purple bars are renewable energy sources; dark blue and red are gas-fired; light blue are retirements. (Image source: Renew Economy.) Read the rest of this entry ?


No closure for coal power

5 September 2012

Australia’s climate policy just got even worse.

Last year when the Multi-Party Climate Change Committee agreed a carbon price, they also agreed a number of complementary measures, many arguably better than the carbon price itself. One of them was a floor price; it was scrapped last week. Another was that the Government would pay electricity generators a negotiated amount to close 2,000 MW of coal power – so-called “contracts for closure”. Guess what? Now it’s gone too.

Contracts for closure were supposed to be completed by June, but generators failed to accept the amount the Government was offering, so now the policy has been cancelled entirely. Energy Minister Martin Ferguson, announcing the cancellation of the policy, said “the companies themselves will make their own commercial decisions as to their future over time.” Allowing the coal industry to decide the future of the coal industry will not address global warming.

The generators claim they are still profitable despite the carbon tax. This is a further demonstration (in addition to those I covered yesterday) of just how ineffective the carbon price is. In particular, it has to do with the $1 billion per year that coal-fired generators which continue to operate will get in “compensation”, supposedly to protect “energy security”. This ludicrous compensation, which the Greens should never have agreed to, effectively keeps coal-fired generation profitable and locks in its continued existence for years. It is just one example of many fossil fuel subsidies on which Australian taxpayers spend $13 billion annually, outweighing the $8 billion revenue raised by the carbon price. It’s the sort of thing you’d expect to have free market advocates up in arms; their silence on the issue betrays a double standard.

There is a silver lining: it is possible that something good may come out of this latest backflip. Greens leader Christine Milne says she will move immediately for the Productivity Commission to review the generators’ compensation, and that the Greens will “use every political and parliamentary lever we can to speed up the transition to a clean energy economy.” That’s stronger rhetoric than we’ve heard from the Greens for a while. Could it mean the Greens will finally get back on the front foot?

Update 6 September 2012

According to a new analysis by Frontier Economics, coal-fired generators have been overcompensated for the carbon price, increasing their profitability by up to $1 billion. This is partly due to the recent agreement to link to the EU ETS and not implement a planned carbon floor price.

All this reinforces what should have been obvious: the Multi-Party Climate Change Committee should never have decided to shower coal power plants with compensation. The Government cannot pay polluters to close while also paying them to stay open. Of the money allocated for coal power compensation $1 billion has already been spent, but the remaining $4.5 billion should be immediately cancelled and instead put into renewable energy.

I encourage concerned readers to sign this petition.


What would rumored carbon tax changes mean?

21 August 2012

It is rumored in the newspapers that the Australian Government is considering certain changes to its carbon price. I have been mulling over this for ten days because it’s difficult to assess the overall implications of an unconfirmed proposal lacking full details, and I have mixed feelings as some aspects of the rumored proposals are potential improvements and some are potentially regressive. However, my impression is the possible outcome has been leaked to gauge public reaction, so I figure I should express my thoughts, provisional though they may be.

Here’s the context: the carbon price policy as it currently stands was negotiated last year by the Multi-Party Climate Change Committee (MPCCC), consisting of Labor, Greens, and independent MPs; was legislated in November and came into effect last month. The policy is full of holes, but climate activists are failing to campaign for stronger action and industry lobbyists are campaigning to undermine it even further.

The first portent of the rumored changes was back in May when independent MP and MPCCC member Rob Oakeshott unexpectedly threatened to renege on part of the agreement. Oakeshott threatened to disallow regulations to establish a $15 floor price when the $23 carbon tax becomes an emissions trading scheme (ETS) in 2015. The floor price is in my opinion one of the best features of the Government’s policy, providing some price certainty so investors can confidently shift investment from high-carbon to zero-carbon or low-carbon assets. If there is no floor, the carbon price could collapse and limit emissions reductions instead of encouraging them – particularly given companies will be allowed to buy cheap international offsets (presently valued in the single digits). Read the rest of this entry ?


Gillard’s policy slammed by… younger Gillard

17 August 2012

Charles Berger from the Australian Conservation Foundation has unearthed a very interesting episode in our Prime Minister’s past. In 1999, then-backbencher Julia Gillard criticized the Howard government for trying to delegate to the state government its decision-making power on a proposed toxic waste dump in her electorate:

I rise to speak to this legislation because in my electorate environmental issues are pivotal. My electorate contains within its bounds both internationally protected wetlands, specifically the Port Phillip Bay western shoreline site, which is protected under the Ramsar Convention, and hazardous industries including, most notably, the petrochemical industry. Under this bill, there is nothing to stop—indeed this bill is predicated on allowing—the hand back of approval and assessment processes on issues like internationally protected Ramsar wetlands to the states.

Yet 13 years later, Gillard has promised business lobby groups her government will hand back approval and assessment processes on environmental issues to the states. Business wants all federal environmental protection powers abolished. Read the rest of this entry ?


Renewable Energy Targeted?

3 August 2012

Australia’s new independent Climate Change Authority recently embarked on a review of the federal government’s Renewable Energy Target (RET). At least one company, Origin Energy, is using the review as an excuse to demand the RET be weakened.

Australia’s current target is 45 terawatt-hours (TWh) of new renewable energy by 2020, split into the 41 TWh Large-scale Renewable Energy Target (LRET) and 4 TWh Small-scale Renewable Energy Scheme (SRES). That would bring the total amount of renewables to 60 TWh, 20% of the demand projected for 2020 at the time the legislation was passed. But future demand has been revised significantly downward in recent forecasts, implying the RET could potentially deliver enough renewables to provide more than 20% of Australia’s power in 2020.

Any reasonable person would welcome this possibility – but not Origin. Origin is a “gentailer” (both an electricity generator and a retailer) with large investments in gas, and the rise of renewable energy threatens their profits.

CEO Grant King complains that the RET is increasing electricity prices, and that a higher percentage will mean a higher cost. This is the latest in a long line of claims blaming climate change policies for electricity price rises. While it’s nice to know electricity retailers are so concerned about overcharging their customers, in reality the major factor driving up prices is ill-advised investment in the electricity grid. Of the price rise projected for the next two years, more than 85% will be due to network and distribution costs, and less than 15% from the carbon price and RET. While the grid does need to be updated for a renewable energy economy, the current investment is only to supply peak demand on the hottest days when everyone turns on their air conditioners, which could be rendered unnecessary by better demand management. And though renewable energy is painted as expensive, it is increasingly cheap and can actually reduce electricity prices. Read the rest of this entry ?


Environmental deregulation agenda continues

26 July 2012

As NASA reports record ice melt in Greenland, Australian federal and state governments remain convinced we have too much environmental regulation. They reaffirmed this belief at yesterday’s meeting of the Council of Australian Governments (COAG). The communiqué gives very little detail, but it appears the environmental deregulation agenda outlined at April’s meeting is rolling onward behind the scenes:

COAG noted the progress report from its inter-jurisdictional Taskforce which was set up to advise COAG following the successful Business Advisory Forum meeting in April.  The Taskforce has been consulting with peak business bodies and other organisations interested in specific reforms, including conservation groups which have an interest in environmental regulation reforms.

I assume the latter consultations are for show. This agenda was dictated by business lobby groups at April’s Business Advisory Forum; it’s not about protecting the environment. Recall that Gillard told business groups in April: “We are determined to get this done.”

COAG reiterated its commitment to reducing duplication and double-handling of environmental assessment and approval processes while maintaining high environmental standards that are risk- and outcomes-based. In line with the timing agreed at the COAG meeting in April, consultations are underway and negotiations for bilateral agreements are about to commence.

Recall that business wants all federal environmental protection powers abolished to fast-track environmental approvals. Recall, too, that in Queensland the mining industry is planning mega-mines and infrastructure to extract a billion tonnes per year of coal and coal seam gas, and ship it through the Great Barrier Reef World Heritage Area. Read the rest of this entry ?