Climate Action Makes Strange Bedfellows
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For ten years, the Liberal (right-leaning) federal government has delayed, obfuscated, and outright ambushed plans to move Australian power generation from reliance on fossil fuels to renewables. In response, many states have done what they can to make the transition without federal help. One of the most prominent has been New South Wales, under the guidance of Matt Kean. Strangely enough, Matt is a Liberal, and the NSW government is Liberal. Climate action makes strange bedfellows. …
The Australian energy industry was in danger of a chaotic exit from coal, without a plan or clear direction from the federal government. Most of the coal generators in use are old and experiencing increasing breakdowns, a situation that led to the dramatic intervention of Australian billionaire Mike Canon-Brookes earlier in the year.
In direct contradiction of their federal colleagues, New South Wales has forged ahead with plans for renewable energy zones full of mega batteries teamed with solar and wind. This week, at a combined cabinet meeting under the leadership of the new federal government, the New South Wales plans have been adopted as the way forward by all Australian states. Expect to see a massive surge in renewable energy investment which will rebuild “Australia’s electricity system to become more reliable, affordable and less polluting,” IEEFA reports.
“Australia desperately needed a policy framework to support the mass replacement of ageing and increasingly unreliable coal generators with energy storage and renewables. The announcement by Energy Ministers that they will implement a Capacity Investment Scheme ‘to accelerate the deployment of firmed renewable power’ is a pivotal step forward in implementing such a framework.
“The Capacity Investment Scheme — ‘a Commonwealth revenue underwriting scheme available to all jurisdictions nationally’ — has the critical features necessary to provide investment certainty that will enable the accelerated build-out of energy storage and renewables projects required to reach net zero emission goals.
“It should also keep costs low, as auction competition is likely to be fierce to win long-term contracts that provide stable revenue. In addition, the fact that the contracts will be able to claw back any windfall gains projects might capture from events such as those unfolding at present, will also lower costs for taxpayers.
“2022 has seen skyrocketing wholesale electricity prices in National Electricity Market prices on the east coast of Australia, driven by high coal and gas prices, coal-fired power plant outages and coal fuel supply issues. The Capacity Investment Scheme is set up to build a renewables and storage dominated electricity system. This will insulate Australians against volatile fossil fuel prices and put downward pressure on prices, and enable emissions reductions.”
Relief is at hand for the Australian public as they face cost of living pressures.
Featured image courtesy of CEBIT Australia (CC BY 2.0 license)
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