Mandatory RET Just Another Form of Punishment for the Poor

bread and water for dinner

His family couldn’t pull off an exemption from the RET.

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The mandatory RET has seen around $9 billion worth of Renewable Energy Certificates issued to wind power outfits, so far; the cost of which has been added to retail power prices and recovered from all Australian power consumers.

With a further $50 billion to be transferred from power consumers to wind power outfits via the REC Tax/Subsidy over the next 17 under the Large-Scale RET (see our post here) – and that cost added to already spiralling power bills – there will be many more households who will be unable to afford power; adding to the tens of thousands of homes already deprived of what was once a basic necessity of (a decent) life. And thousands more destined to suffer “energy poverty” as they find themselves forced to choose between heating (or cooling) and eating.

If our political betters in Canberra don’t line up to kill the LRET very soon – in less than a decade – Australia will have created an entrenched energy underclass, dividing Australian society into energy “haves” and “have-nots”.

For a taste of an escalating social welfare disaster, here are articles from Queensland (click here); Victoria (click here); South Australia (click here); and New South Wales (click here).

There’s something deeply troubling about thousands of Australian households descending into gloom after dark – unable to afford the power needed for electric lighting; or troubling, at least, for those with a social conscience.

The ONLY justification for the massive stream of subsidies filched from power consumers and directed to wind power outfits is the claim that wind power reduces CO2 emissions in the electricity sector and, therefore, provides a solution to climate change (or what used to be called “global warming”). The former proposition is a proven fallacy (see our post here). And, because the planet hasn’t reached boiling point (in bitter defiance of the IPCC’s models), the once concrete relationship between CO2 emissions and increasing global temperature now seems murky, at best.

Claiming the “global warming” moral high ground, wind power proponents continue to blindly chant the mantra that wind power reduces CO2 emissions – although they rarely, if ever, talk about the actual cost of the claimed reductions.  Probably because there are, in fact, no reductions.

STT has focused on the fact that industrial scale wind power does not – and will never – reduce CO2 emissions simply because it is intermittent; being delivered at crazy, random intervals and must be backed up 100% of the time by fossil fuel generation sources (see our post here).  Accordingly, we call it an environmental fraud.

Because wind power fails to deliver on its primary claim (and the wind industry’s only reason for existence) the $billions in subsidies purloined from taxpayers and power consumers have been received on an utterly false premise. Accordingly, we call it an economic fraud.

With that in mind, power consumers and taxpayers are clearly entitled to ask whether the subsidies received by wind power generators represent a cost-effective means of reducing CO2 emissions.

Here’s STT Champion, Alan Moran writing in The Australian and asking that very question.

IPCC calculations show global warming won’t be harmful if it resumes
The Australian
Alan Moran
8 October 2014

But keeping the renewable energy target will exacerbate the hardship of the poor

OCTOBER 1 marked an important anniversary: 18 years during which the earth average temperature has remained unchanged.

Satellite data available from 1988 has allowed very precise measurements of global temperatures. These at first confirmed a warming trend.

But the satellite recordings, greeted with such enthusiastic fanfare by the warmist fraternity, have, for the past 18 years, bitten the hand that fed them.

A number of hypotheses have been advanced to explain the inconvenient truth of this data. But NASA has just reported that there is no evidence that the increased heat is hiding in the deep oceans.

This invites the question: how much damage does a doubling of carbon dioxide levels bring and what is the cost of measures to prevent this doubling?

Significantly, the costs the Inter­governmental Panel on Climate Change attributes to warming are quite small. The IPCC draws from three studies that attempt to estimate the net losses in world GDP from global warming under business-as-usual conditions. One of these (Nordhaus 2008) estimates a loss across the next 50 years of 2.5 per cent, with a 3C warming. The second (Bosello et al) has a 0.5 per cent loss resulting from a 1.9C warming. And the third, (Rosen and van der Mensbrugghe) estimates a 1.8 per cent loss as a result of a 2.3C warming.

The IPCC’s summary for policymakers glosses over the numbers and concentrates on scary rhetoric, an outcome that led to the resignation of Richard Tol, co-chairman of a key working group.

Yet the efforts to restrain global warming are to prevent a loss over 50 to 100 years of about half to one year’s annual growth in world income levels. Even this overstates the losses from warming because it magnifies ocean rises, the need for new infrastructure, losses from tourism and new security scares.

Having been forced to acknowledge that global warming has a relatively trivial effect on real levels of human welfare, the IPCC seeks to ensure that its estimates of the costs of pursuing serious carbon dioxide reductions are not too great. It does this by assuming massive new low-cost breakthroughs in solar, and in decarbonising coal emissions as well as by foreshadowing technologies not yet on the drawing boards.

Of course, if these technologies are really about to emerge there is no point in investing in current generation renewable energy. Indeed, whether we are on the cusp of technological breakthrough or not, there is no point investing in renewables that will always rely on expensive subsidies.

The IPCC puts the costs of its interventions from forcing the world off fossil fuels at just 2.7 per cent in 2050. This is increased to over 8 per cent if the carbon capture and storage does not work, nuclear is phased out and renewables cannot provide more than 20 per cent of world energy.

Even this higher figure is clearly understated as we can see with Australia’s experience. Many of those who support the retention of Australia’s mandatory renewable energy target now want to let aluminium smelting off the hook. The exclusion of aluminium smelting would still maintain the cost of the MRET for all other businesses and for consumers. This would exacerbate the hardship of many of Australia’s most vulnerable, including the disabled and the elderly already living in energy poverty.

The emerging world superpowers, China and India, consider the costs of abatement to be exorbitant and refuse to impose such measures on their economies. Without them no world agreement would be meaningful. For the moment, the evidence for global warming is lacking but, even if warming resumes, the IPPC’s calculations show that it will not be very harmful. Attempts to prevent it, even if politically feasible, will cost more than the damage emissions may be causing.

The only certainty is the immense costs of Australia maintaining its renewable energy requirements will offer no benefits except to the rentseekers calling so loudly for its retention.

Alan Moran is with Regulation Economics.
The Australian

alan moran

Alan Moran: RET is just punishment for the poor.

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STT keeps out of the “climate change” debate, in the main.

However, we recognise that the last line of reserve for the wind industry is the argument that so called, “global warming” requires immediate action – ergo, giant fans have to be slung up all over the planet – without any consideration for the costs of the power generated – or the impacts on human beings, birds, bats or the environment, more generally.

As Alan observes, take away the overblown threat of “global warming” and the wind industry loses its very foundation.

STT is, for the purpose of simplifying the argument, happy to concede that man-made CO2 emissions may cause an increase in atmospheric temperatures – whether or not modest increases in atmospheric temperature from present levels represents a threat to humans or the planet is another question again.

But, whether or not “global warming” is a “problem”, STT is certain of one thing – and that’s the fact that wind power solves nothing.

It will never provide meaningful, reliable on-demand electricity and – because it will never displace base-load generation sources – it will never reduce CO2 emissions.

With the myth about wind power reducing CO2 emissions in the electricity sector stripped bare, there can be NO justification for the retention of the mandatory LRET. Here’s The Australian’s latest line on the RET.

RET needs to be sustainable
The Australian
8 October 2014

Exempting aluminium should be one step in broader reform

EXEMPTING the aluminium industry from the renewable energy target makes sense. Despite a partial exemption already, the RET costs the industry about $80 million in higher electricity prices, putting pressure on aluminium producers and jobs when metal prices are low. As the Australian Workers Union pointed out recently, thousands of jobs are in danger of being transferred offshore, with no environmental gain through carbon leakage. Labor’s willingness to negotiate with the Abbott government over an exemption for the industry is a good sign. Any agreement, however, should be part of wider RET reforms.

Six weeks ago, in a balanced review of the RET, businessman Dick Warburton and his panel found it had met its objectives, encouraging renewable electricity generation and usage and delivering modest reductions in carbon dioxide emissions. Economically, however, it was inefficient. The real cost of carbon abatement through rooftop solar photovoltaic systems, for example, was $100 to $200 a tonne, up to 33 times the market-driven European carbon price of $6. That level of subsidy is unsustainable and unfair. Poorer people who cannot afford to invest thousands of dollars for solar panels and water heaters on their roofs are paying higher power bills to subsidise wealthier households that can afford the technology.

Possible exemption of aluminium from the RET shows the weaknesses of a piecemeal approach. An exemption would relieve costs in an important manufacturing industry, in which Australia’s raw materials are a comparative advantage. But such an exemption would cost other businesses and households more as it would reduce the number of entities paying for renewable energy. At the very least, the RET must be reduced to compensate for the exit of the aluminium industry. As the Warburton report noted, without wide reform the RET will cost a further $22 billion in cross-subsidy by 2020. Allowing the status quo to continue would divert resources from more productive uses and do nothing to make the renewable energy industry viable economically as well as environmentally.
The Australian

The mandatory RET is beyond “reform” – and piecemeal “exemptions” will do nothing to prevent the economic and social calamity that will follow if the Large-Scale RET remains.

While exempting the aluminium smelting industry from the LRET would save around 4,500 jobs (see our post here) – leaving the LRET in place threatens 10s of thousands of other jobs in mining, manufacturing and other power hungry industries (see our post here). And, as discussed above, there’s the disproportionate impact on the poorest and most vulnerable in Australian society.

The only sensible exemption is one that covers every single Australian power consumer plugged into the grid.

The LRET is simply unsustainable. Any policy that is unsustainable will fail under its own steam; or its creators will be forced to scrap it. It’s a matter of when; not if.

turbine collapse 9

It’s a matter of when; not if.

About stopthesethings

We are a group of citizens concerned about the rapid spread of industrial wind power generation installations across Australia.

Comments

  1. Jackie Rovenksy says:

    “Of course, if these technologies are really about to emerge there is no point in investing in current generation renewable energy. Indeed, whether we are on the cusp of technological breakthrough or not, there is no point investing in renewables that will always rely on expensive subsidies.”

    And this is the rub, while it makes sense there are those who bizarrely think differently.

    Victorian Greens MP, Greg Barber, after stating he wants 100% renewable energy asap, and the removal of the 2km setback regulation in Victoria, retention of the RET and stated there’s only two choices available to Victorians – renewables or unconventional gas.

    I must be getting old because I seem to remember people spouting the two choices were between renewables ie wind and nuclear, perhaps he’s confused or the Greens have changed their minds, or have simply changed tactics for localised political reasons.

    Anyway, recently at Portland in answer to a question about Thorium, which has none of the dangers of Uranium, and is in large supply here in Australia, he answered that it’s experimental technology, that the race had been run and won by solar and wind. These he contends would be cheaper than building new coal or gas plants and there was no need to take risks or “wait for amazing technology that’s around the corner”.

    Yes he actually said “amazing technology that’s around the corner”. Obviously he and others are so fixated with wind they’re unwilling to wait for a source of energy production that will be cheaper than wind, that will be available when needed, that has none of the dangers of Uranium, and that Australia has a plentiful source of at its disposal to produce cheap energy for Australians to utilize, is of no interest to him.

    He doesn’t in his address even look at cleaning the pollutants we already have in the system. He actually says that even with 100% renewables, what we have when we reach it is as good as it gets re effects on the environment. He also said technology had ground to a halt. This would suggest even technological research into finding ways to store energy or improve his precious turbines has no future.

    He appears to have either a confused understanding of what he wants and or what is going on out in the real world, or he’s succumbed to some sort of mental overload and is no longer able to rationalise his stand on energy production and the environment – if he ever was able to.

    What are those people who don’t believe in continual research, the possibility of making things better, that believe there is no point in researching to make even their precious turbines more efficient and possibly more environmentally friendly, doing in Government at any level?

    Or is it that the Greens and other wind industry supporters, in their imaginations they think that they have run and won the race, so they can now sit on their laurels and pat themselves on the back? Meanwhile, people are energy starved, and industry continues to rush offshore where environmental concerns are no more than just words on paper.

    Do they realize that unless things change in these offshore places, nothing we do here will make a difference that the world will not be as good as it is now, but worse? Don’t they realise that it doesn’t matter if or when we reach 100% renewables, when others are be spilling pollutants into the atmosphere to feed our needs?

    Shouldn’t we be researching and creating better ways to produce energy environmentally, efficiently and reliably, instead of sitting back and grooming each other in the sun like contented monkeys?

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