Canberra’s costly carbon follies outdo even the Danes
1 August 2014
AUSTRALIANS are learning the hard way that moral vanity comes at a high price. After many years of climate policy chaos, we know that most people want some action on climate change but they don’t want to waste money on expensive, inefficient schemes.
Yet politicians spruik and implement them, we all wake up to the cost and the policy has to change. It’s bad for households, consumers and investment. And the merry-go-round achieves little or nothing for the planet.
Bjorn Lomborg recently exposed on these pages the folly of Copenhagen’s plans to be the world’s first CO2-neutral city.
Hot on Copenhagen’s heels, Canberra has announced a plan to mandate that a dizzying 90 per cent of the ACT’s electricity supply will come from large-scale renewables by 2020, with a 50 per cent reduction in carbon emissions.
Canberra’s blueprint suffers from the same overreach as Copenhagen’s. As old-style industry protection has fallen out of favour, rent-seekers are hungrily eyeing green industry subsidies.
The ACT government is hopping on the merry-go-round with a blueprint focused on building masses of wind turbines, and the odd solar farm.
Not content to focus on efficient means to reduce carbon emissions, the proposal props up the troubled wind industry. Yet as the Productivity Commission, last week’s Deloitte report and mainstream economists tell us, wind energy — viable only on the back of vast subsidies — is an expensive way to reduce carbon emissions.
The ACT has ignored sensible alternatives. For instance, decentralised solar is economic without, repeat, without subsidies in many rural and remote areas. Farmers know this — many have been using solar for years for a range of purposes.
But the present NSW regulatory regime hurts the economics of solar: electricity distributors increase profits and returns through massive network investments where rooftop solar is a better option. Nor is increasing soil carbon part of the ACT plan, despite the obvious opportunity in the surrounding agricultural regions.
On the ACT government’s own numbers (which are questionable), the 90 per cent renewables plan will cost an additional $370 million between now and 2020. These costs will be passed on to ACT households in their electricity bills, hurting the poor, and the government tries to downplay the impact by assuming offsetting efficiencies.
In many countries, renewable energy targets are growing rapidly because today’s huge investment costs are hidden in tomorrow’s electricity bills.
The ACT plan expects wind power to cost about $100 per megawatt hour, roughly three times the market price. This is consistent with Deloitte’s recent finding that the federal large-scale renewable energy target is costing $103 per tonne of carbon abated — four times the cost of our inflated carbon tax.
Ironically, in a recent effort to reduce costs, the ACT government itself has pulled back on the use of green power — renewable energy use in the government’s nine directorates plunged by 83 per cent in 2012-13.
It is unclear how the ACT plan may fit with a revised federal RET. The present federal target is intended to include all renewable generation, and ACT efforts should ordinarily be taken into account. This will be a decision for the federal government following the RET review, but there is a real prospect that the ACT’s expensive efforts will have no impact at all on Australia’s emissions.
The ACT blueprint also does not include the extra costs of full-scale back-up from another electricity source. Wind blows only some of the time, so Canberra will need to call on coal-fired electricity. In practice, this means that when the wind blows, ACT-sponsored wind farms will send their electricity into the NSW grid, yet the ACT will demand a reliable and constant supply in return. The NSW grid also will need to address large fluctuations in supply, causing unprecedented operational pressures and additional costs.
The most extraordinary part of the blueprint is the assertion that communities outside the ACT, where the turbines will be built, actually want them. This wind-industry-inspired propaganda is simply untrue.
I represent a large swath of NSW where there are turbines and where many, many more are planned. I know that a growing majority of people in these quiet, beautiful, unique, windswept communities do not want them.
Wind farms nearly always cause deep community fractures and risk serious downward pressure on the value of adjacent land. Typical wind-farm victims are tree-changers from Canberra who have put their life savings into their dream block, only to find it virtually unsaleable. Wind developers have been known to tell these people they should simply “take one for the planet”.
Middle Australia is willing to support sensible carbon emission-reduction efforts, but it will not tolerate big economic hits to achieve it, which is why Australia rejected the world’s biggest carbon tax.
Experience abroad (witness the 2009 Copenhagen Summit) and here tells us that overreach will thwart well-intended initiatives. We need efficient, careful and well-timed emission-reduction policies. The ACT renewables blueprint fails on every front.
Angus Taylor is the federal member for Hume. He was a partner at McKinsey & Co and director of Port Jackson partners, where his work included carbon and energy strategy and policy development.
STT agrees with Angus Taylor’s observation that decentralised (“stand-alone”) solar makes good economic sense: providing grid access to handfuls of remote rural properties (at huge ongoing expense) makes little sense where a stand alone solar system (panels, batteries and back-up generator) can be set up for around $35,000 (see our post here).
The other point raised by Angus’ article is that the ACT’s plan is dependent on turbines being slung up in NSW – not in the ACT. The ACT has banned wind farms through planning controls that are aimed at protecting the visual amenity enjoyed by Canberra residents. So, to add hypocrisy to insult, it’s their neighbours in NSW who are being told to “take one for the planet”.
But don’t expect them to take it lying down.
Communities across the Southern Tablelands faced with the threat of a turbine invasion are up in arms at the ACT’s plans to destroy their lives and properties.
Anger has erupted at Lake George near Tarago, NSW over the Jupiter wind farm proposed by Spanish-Australian company EPYC. Locals are furious at the developer’s lies, treachery and deceit – the level of community outrage is clearly palpable (see our post here).
And – just up the road at Rye Park (near Goulburn) in NSW – locals have united in their opposition to plans to spear 100 or more giant fans into their peaceful community. A little while back, in covering what “community division” caused by wind farms really means, we touched on the developer’s “community consultation” that took place there (see our post here).
The “community consultation” in question was held by Epuron – an outfit hoping to develop what it calls the “Rye Park” wind farm (north of Yass and east of Boorowa, NSW).
On a show of hands, the 32 present “divided” as follows: 23 locals, firmly against; and 9 in favour – 4 of whom were employed by Epuron, 2 were contracted as turbine hosts and 3 were “unknowns” (check out this video of the count).
A few weeks after the “community consultation”, the community of Rye Park held its own meeting, where – joined by others from the neighbouring communities of Boorowa, Yass and Rugby – 104 turned up to hear – among others – Angus Taylor (their local Federal Coalition MP) talk about the greatest state sponsored fraud of all time. Angus is clearly on a mission to bring it to a screaming halt – as the cracking speech covered in this post makes clear.
A survey of those at the meeting was taken by organisers to determine the level of support for wind power development in Boorowa, Yass, Rugby and Rye Park. After the speakers finished the crowd delivered their responses to the survey to organisers: of the 104 in attendance, 88 people participated. The results were:
- “I do not support wind power development in Boorowa, Yass, Rugby and Rye Park”: 80 votes (91%)
- “I do support wind power development in Boorowa, Yass, Rugby and Rye Park”: 6 votes (7%)
- “I am undecided about wind power development in Boorowa, Yass, Rugby and Rye Park”: 2 votes (2%).
No surprises there.
One thing’s for certain: the ACT government’s plan to invade NSW is going to be met with an eruption of hostility and anger from people who aren’t willing to “take one for the planet” – especially given the fact that wind power cannot and will never reduce CO2 emissions in the electricity sector. People will generally suck up a little pain; but not without a purpose.
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