Deadlock on climate action helps no-one
Blog Post | Blog of Christine Milne
Friday 22nd January 2010, 11:17am
by ChristineMilne in
On December 2 last year, after being blind-sided by the unexpected elevation of Tony Abbott to the Liberal Party leadership, the Rudd government made a hasty announcement that they may well come to regret - that they would bring back their twice-defeated emissions trading bill a third time as soon as Parliament resumed in February.
With the date swiftly approaching, blind Freddy could tell you that the opposition will not support the bills and the government is still making no attempt to negotiate amendments with the cross-bench. The whole exercise is looking like a fruitless, time-wasting political stunt.
This deadlock helps no-one. The community is denied action on the climate crisis, the business community is denied the investment certainty they crave, the government looks increasingly impotent and the opposition looks like spoilers.
There is a solution to this deadlock - one that Professor Garnaut suggested a year ago in his final report, fully expecting the political difficulties involved in legislating for a full trading scheme. The government's stonewalling has got to stop and we should pass an interim measure that, for two years, would use the CPRS reporting architecture with a fixed $20 carbon price.
We Greens are now proposing that we adopt the Garnaut suggestion and get Australia moving with this interim carbon pricing scheme. We can then, over the coming two years, discuss the longer term solutions Australia will need, secure in the knowledge that a carbon price is already in place, helping to unleash innovative and job creating climate solutions. [Read the detail here.]
This option has many benefits. Although there would be no trading in the interim period, the use of the CPRS reporting structures means that, should we reach agreement in the next two years on an effective emissions trading scheme, there would be a smooth transition into that environment for business. The mostly uncontentious parts of the legislation would be passed, with the deeply problematic questions such as targets, international trading and permit allocation mechanisms set aside for further debate. Business would get certainty from the knowledge that, if no agreement is reached, the fixed price would continue and slowly rise over time.
The absence of trading means that there can be no use of international offsets in the scheme. This tremendously increases the environmental integrity of the scheme - since the government has steadfastly refused to accept the Greens' amendment to cap the use of international permits or even require them to be gold standard accredited, seemingly keen for dodgy offsets to flood the Australian market. It also ensures that all emissions reductions driven by the carbon price happen at home, truly beginning the transformation of Australia's economy. That stands in stark contrast to the CPRS as drafted, which would effectively guarantee a future for polluting industries here at home as long as limitless supplies of cheap offsets are available from offshore.
The Greens' proposal would allocate the same proportion of revenue to householders as under the CPRS, leaving no low- or middle-income earner out of pocket. Ideally, as we have long argued, some of the $5 billion this scheme would direct to householders would be invested in making their homes more energy efficient, saving them money while reducing emissions, instead of being pumped straight into wallets across the country.
Our proposed reduction of industry support to Professor Garnaut's recommended levels would put the scheme well into the black - $3 billion in surplus over two years, in contrast to the almost $1 billion deficit the CPRS would accrue over that time. This would leave room for a substantial investment in R&D, renewable energy, energy efficiency and public transport, using the scheme's revenue to support its aims instead of undermining them as the CPRS's back-to-front compensation structures would do.
We are under no illusions that this solution is perfect. It is clearly a third or fourth best solution. But, unlike the CPRS, there is no way it can hold back climate action. Where the CPRS is designed to make it as difficult and expensive as possible to strengthen once it is passed, this proposal is designed to be strengthened.
Mr Rudd has no reason to bring the CPRS bills back next month. He has his double dissolution election trigger and he is making no serious attempt to actually pass the legislation. This futile political exercise can get him nowhere.
He would be wise to embrace this proposal and work with the Greens to secure the two extra votes we would need to pass this into law and get Australia moving towards a zero carbon future.
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Comments
Green Loans -massively oversubscribed
Dear Greens
just received news that the Greens Loans Scheme is an absolute shambles
here is the message posted on the web this morning (and since withdrawn)
From ABSA website
Applications for assessor certification under the Green Loans Program close today – Thursday 21st January.
ABSA identified the need to limit the number of registrations. In early November we announced that only applicants who completed their training by December 24 and submitted completed applications by January 21 would be admitted for certification under the program.
Despite this action, the program has been still been massively over-subscribed, with 5,000 assessors either accredited and working under the Green Loans Program or about to be accredited and, as of cut off date today, a further 5,000 unprocessed applications.
How many of these new applicants will receive any work under the program? Recent statistics received from DEWHA suggest that 166,840 assessments have been booked and 121,330 assessments completed out of an expected pool of 360,000 funded assessments. On the basis of assessments currently being booked at a rate of 15,000 per week, ABSA has reason to believe that the budget allocation under this program will soon be fully subscribed, possibly around end April 2010.
In other words, it is highly likely that the program will end before ABSA has been able to process all these new applications.
ABSA recognizes that all those applicants who are awaiting processing have already spent money on training and professional indemnity insurance, but it seems unethical for ABSA to accept applications and take further fees from a large number of people who, on the face of it, seem unlikely to gain any financial benefit under this particular program.
ABSA believes that it has a duty of care to disclose this fact to the applicants and to offer them an option to withdraw their application. Applicants choosing to withdraw will have their certification and membership fees returned to them.
Applicants who choose to continue with their application for registration will still become ABSA members and be “in the loop” for receiving information about any new programs for which they may become eligible.
Thanks
GreenLoans, we were aware of that and have been following it. More to come on it from Christine very soon.
Place a Hold on Carbon Price Until World Agrees
Sorry, but you will still have the same problem as the CPRS, and that is any system MUST be agreed by all importing, exporting countries, else Australian Industries will be hit with an impost not applicable in other countries. Even the Arts areas could be demolished. Who will pay hundreds of dollars to see live performances, if as quoted for Victoria, energy costs will rise by 400% over the next 10 years, and theaters have to pass their additional costs on to the public by increased ticket costs.
How can Australian Industries be expected to pay (although for local consumption they will have to pass the increased costs on to the public of everything locally manufactured or grown), when foreign imports to Australia are not impacted, so will become even cheaper.
To me, we need to wait to see what the rest of the world, including Australia, agrees, and then local industries will not be dramatically disadvantaged.
Having said the above, the Fed Gov can do much to reduce emissions, as quoted by many in this forum, by making all 3 tiers of Gov as emission neutral as possible, and by subsidising local industries to REDUCE their emissions, probably with large tax breaks, or some other mechanism.
With the population of Australia planned to skyrocket over the next 40 years (to 35 mil by 2040) we can expect our total emission tonnage to dramatically rise as new homes are built, large quantities of energy consumed, and millions of additional motor vehicles on our roads. With Gov planning, and subsidies, we should be able to retain our per capita emission levels, or with much effort even reduce our per capita output over the next 40 years (people need to remember that items (eg. motor vehicles, electrical appliances etc. etc.), including infrastructure, currently in the community will continue to be used, probably to increasing levels if climate change impacts temperatures.
Price rise?
Grant, your 400% electricity price rise quote is completely outside any analysis I have seen and way past any reputable ones.
The problem with your suggestion of subsidising companies to go green is that the subsidies have to come from somewhere - and that'll be government coffers. So either you increase government debt (causing economic problems that we all, as taxpayers, will pay for) or you lift taxes (so we all, as taxpayers, pay more) or you put a price on carbon (that we all, as energy consumers, will pay for) and use that revenue.
No matter which way you do it, we pay. We have to pay for change. Let's get used to that.
In terms of Australians facing an impost that others don't, firstly if we want to have a competitive advantage in the green stakes, we have to pay for it, secondly if we want to go green anyway we have to pay for it, thirdly there are plenty of other countries we trade with and compete with who already have carbon prices of some kind in place, and fourthly, the claims of carbon leakage due to a country like Australia putting a price on carbon that others don't face are wildly exaggerated. Carbon leakage virtually never happens because the price of energy pales into insignificance next to the fact that companies operating here in Australia already have existing heavy plant, a great supply of raw materials, and a trained and willing workforce.
THose aren't the problems we see in the CPRS. The problems we see are around the fact that it won't reduce emissions. In fact it will lock in a high emitting future for at least 10-15 years. This proposal won't do that.
Govt carbon neutral
Tim
I noticed you didn't address the point Grant raised about the possibility of government going carbon neutral and have not addressed it elsewhere when it has been raised. Is there some reason for not engaging that point?
Government taking the initiative on its own account avoids the need for industry handouts which in the end is an important cause of your prime concern about the CPRS being ineffective.
Lets consider that Federal government tax revenues are of in the ballpark of 22% of GDP and that by and large over time on average all taxes are returned as spending in the economy. If that 22% of economic activity becomes carbon neutral by say 2020 then we will have made huge advances in the task of emission reduction without being stymied by industrial lobbyists in the way we are now.
This would require that a condition of a federal grant for a project is that the project is assessed as carbon neutral. It might require that one REC is purchased every two months for each public servant which would make expenditure on their salaries carbon neutral in terms of their household energy use.
Imagine how much progress we will make in 10 years and with the benefit of that how much easier the next steps will be given what has been learned and whats skills and capabilities have been developed.
We have campaigned on that
Indeed, Jim, the Greens have campaigned on that issue for some time, and have been closely involved in questioning the government, for example, in Senate Estimates hearings about their too weak promises which aren't even being met.
I didn't mean to avoid that issue. I simply missed it in amongst everything else here.
Price Rise
Tim, reference to 400% price hike came from front page Melbourne Herald-Sun Thursday 21 Jan. Planned for introduction over 4 years, from 2011, however the State Government is panicking and going to try to fight the rise (they have an election coming up this year).
Text in part reads, Energy distribution company, SP AusNet has asked the Australian Energy Regulator to allow it to introduce the increases. If you can get a copy of the Herald-Sun, you can read the rest.
The proposed increase is not part of any CPRS rise, but is designed to reduce energy consumption in hot periods. Maybe a Gov initiative to reduce the load on the pension system as hundreds of elderly will die from the heat, but a pain with additional loading on the public hospital systems, as those who can, will turn up in Hospital casualty centres. In the last Melbourne heat wave, we already had the State Government requesting neighbors to watch out for the elderly who did not have airconditioning.
It will cut energy consumption alright, if added to any CPRS increase, so many people will have their electricity disconnected for not being able to pay their bills, or die, that energy usage will definitely drop.
Sorry, but I see carbon leakage as major issue. Either companies in Australia will have to raise all their costs to meet green targets, or they will just move overseas, eg. to China or India. As you state, most companies already have existing plant, and will not be able to afford to replace with more energy efficient plan. Just look at the number of items you can buy with Made in Australia on them, you are battling to find more than a handful (even food), with our manufacturing industries dying, unless massive Fed subsidies are made available, like the automotive manufacturing industry.
As for reducing emissions, I hope you are talking about the per capita emissions (even per capita will be unlikely), because with a planned 60% increase in population, there is not a snow flakes hope in hell, of ever reducing our our overall emissions. Just consider the huge increases in everything from public transport to the huge number of new homes to be built and fitted out with electrical appliances, heaters, airconditioners, the new suburbs to be built in every capital city, all the new arrivals buying / running motor vehicles, and the huge numbers of additional diesel trucks required to supply the new suburbs / homes. With the huge amount of additional electricity required, no Government would even be able to reduce the number of coal fired power stations, unless the Federal Government is prepared to pay for them to be converted to natural gas.
Sorry Tim, but the general Mr and Mrs Average living in the mortgage belts will be very harsh on any Government, State or Federal, who does not control any price increases which impact their current life styles, and the ability to pay their mortgages. Having said this, I doubt that the $5 billion proposed for subsides by the Fed Gov, would more than just scratch the surface. Luckily we live in a democratic country, where we can sack the Government of the day if they do not meet the publics requirements, and install a Government who WILL meet the publics requirements eg. lower costs, including Senators who support higher costs of living. We did it in 75-76, and a number of times since, and can / will do it again.
"not a snow-flake's hope in hell"
Grant, you say there's not a snow-flake's hope in hell of reducing total emissions. If we take that attitude, we condemn ourselves to a hot and dry and nasty death. The Greens will not accept that kind of defeatist attitude. We will keep fighting for action in line with the science.
I think if someone had told you in 1990 that, by 2010, the great majority of us would be communicating with small hand-held devices that contained many gigabites of information, downloaded our endless streams of email, connected to a worldwide web of billions of websites, and could track our and others' movement to the metre, you would have told them there was not a snowflake's chance in hell that would come to pass. The world can change very fast, when it finally changes. We have to keep pushing for that, or we are committing mass suicide.
Re the electricity price rises - that is an ambit claim intended to frighten people. It's not based in reality.
Not a Snow-Flakes Hope in Hell
Tim, I can see that we can reduce our per capita emissions, but would love to see how we could ever hope to reduce our total emissions with 60% extra population (Sydney, Melbourne and Brisbane with double the current populations).
I find the huge numbers of homes that will need to be built, the huge numbers of additional suburbs that will be required with all the associated lighting requirements, the hundreds of millions of additional electrical appliances, the tens of millions of additional motor vehicles on our roads, the huge amount of additional water, and the huge increase in electricity generation that will be required, to be overawing.
Maybe the Greens could publish how they would try to reduce (even stabilise) total emissions with all that will be required to meet the expectations of the extra 60+% population increase.
In reference to the 400% increase in the cost of electricity, I agree it is an ambit claim, they are probably only expecting 200% - 300% increase over the next 4 years. It would nearly be cheaper to run your own little diesel generator in the garage.
Switch to renewables
Grant, that's why we have no choice but to launch an all out transformation of our energy and transport networks. Policies that tinker around the edges can only fail.
If we get cracking now, I have no doubt we can successfully replace all our existing energy generation and more with renewables over a decade or so. We can and must rapidly upgradethe energy efficiency of all existing homes, offices and industry. There is no reason why we can't join the UK and France in requiring that all new buildings as of 2015 or so are net zero emissions - this can be done. We can replace much of our existing car fleet with the most efficient possible, and invest massively in public transport and cycleways. And we can stop cutting down our forests NOW, and switch livestock and feedstocks to lower emissions alternatives.
Who knows if we can do it, Grant. I honestly don't know. But I think biggest thing holding us back is the defeatist attitude that it's impossible, not any technical or empirical evidence that it is.
What is the Greens' population policy?
Tim, I realise you are passionate on these issues, but some of your responses are almost evangelical. Let's not scare peole away.
If we replace all of our energy generation with zero emission renewables, then the energy efficiency of our homes, our industries, and our businesses is of little consequence.
Zero emission buildings are a fantasy when you factor in construction and decommissioning, the infrastructure that supports the building, and the opportunity costs of all that this entails. Reducing the energy/resource intensity of new buildings (across their life cycle) is commendable, but reducing the demand for new buildings is even better. This is more of an immigration/population policy issue than it is a building standards issue.
Abolishing forestry is very hard line, we'd just increase imports of timber and paper from abroad, and these would probably travel larger distances than if they were sourced locally.
The main defeatist attitude I have experienced with regard to environmental pressures has to do with population policy, and Grant is right to press the Greens on this issue. I reread the Greens' population and immigration policies prior to the Bradfield bi-election, and I have no idea where the Greens stand. I was less than impressed. Although I view many of One Nation's policies as toxic, on immigration you know where they stand - if the One Nation candidate had resided in the electorate Suzie Gemmel (Greens' candidate) would have got one fewer vote.
From my perspective, what is holding us back as individuals is capitalism, what is holding Australia back is globalism, and what is holding the world back is democracy and a growing population.
Efficiency still necessary with renewables
We need a big push towards efficiency, Zoltar, to reduce the amount of necessary new generation from renewables as much as possible.
Zero net emissions buildings means reducing the lifecycle emissions from construction as much as possible and offsetting remaining emissions by making sure the buildings generate more power than they demand. This is being done already in Europe, with geothermal, micro wind and solar being built into housing developments, as well as residential block scale cogeneration and tri-generation plants. It's not a fantasy, it's a reality.
I personally believe that it is far more important to reduce the size of the homes we build than reduce the number. Our homes have grown out of all reasonable proportion, wasting huge amounts of resources in construction and in energy demand for heating, cooling and lighting.
Re forestry - by stop cutting down our forests, I should have said "old growth forests", not just forests. Australia has currently a massive glut of plantation forestry, both soft and hardwood. We do not need to increase imports at all if we tap that supply. Agreed that would be a bad outcome.
Re population, the Greens take a global perspective on the issue. We do not support deliberate global population crash, in which case Australia has an obligation to take increasing numbers of refugees - which is why we support reducing economic immigration.
Besides (my personal opinion), Australia cannot be a fortress. We cannot stop people coming to this country. And they will come, in greater numbers and in greater desperation as the decades go on. We have to ensure that we reduce the environmental impact of that migration because we can't stop it when Bangladesh goes under...
Now who's being defeatist. Ooops
Opportunity costs
I take a slightly different take on a zero net emission building, I judge the building against if that building never existed, rather than judge it against other comparable building designs. This change in starting points makes a big difference. For example if you are comparing one building verses another building, then the road that leads to this building, the materials that make up this road, and the opportunity cost of having this land paved by a road rather than being covered with vegetation, are all excluded from your analysis. If there is no building, then a road, and all the other infrastructure that supports this possible building, may be avoided. This is why I described a zero net emission building as a fantasy, the opportunity costs deliver the killer blows.
I'll refrain from elaborating further (in this thread) on the Greens' population and immigration policies, and how they interplay with Australia's ability to meet any emission targets. Population/Immigration policy is a big issue, how about a new thread?
Dodging the big one
Whilst I fully agree with much that you have said regarding what can be done with existing knowledge and technology in the energy reduction area, I am afraid that by refusing to face the expanding population question you are yet again dodging the issue. If we allow, let alone encourage, unhindered population growth then all our conservation and reduction measures amount to nothing more than running in order to stay still. We are told that Australia, on current trends, can expect to reach a population of some 35 million by 2035. If previous trends are anything to go by this will doubtless be exceeded, so I would suggest that we are looking to at least double our population before we reach the middle of this century. This is far more than enough to fully offset and more anything that we can realistically expect to achieve by way of reductions given the current political/economic system. Anytime that one suggests that China's one child policy is the greenest policy of all time in practical terms one is greeted with cries of shock and horror from the polite middle classes who tend to vote Green. To which I am forced to reply that whilst it may not be the user friendliest piece of legislation, I don't think that the collapse of a civilisation is a very pretty scenario either.
Howard Gibson
Population
As Bob Brown said in a press conference here in Canberra yesterday, and as he has said repeatedly over many years, the Greens do believe that we should reduce economic immigration, but ensure that we can increase our refugee intake which is so much smaller. He also emphasised that Australia must also invest globally in reducing population pressures in our neighbours.
The Greens are not avoiding the population issue, but we do not subscribe to the view that it is the trump issue which swamps all others.
Target population
Okay, so if the Greens are not dodging the issue what, pray, do the Greens embrace as a target for a sustainable population in say 2050? It may be very emotionally satisfying to say that you will stop migration by people that you feel no particular sympathy for and replace them with those that you approve of but we are talking about the laws of nature here and they don't give a toss. Unless you are looking at a decrease in population from current levels then population is a major issue and to try to pretend otherwise is just dodging an issue that people of a middle class, small L liberal disposition are uncomfortable with, which, I might add, some of your critics would say just about sums up the Greens.
Howard Gibson
Population/Immigration thread please
Tim, I stand corrected. My understanding of the Greens' immigration policy before the Bradfield bi-election was as you described, though there remains uncertainty as to the level of immigration if the Greens had their way. Vote Labor or Liberal and Australia gets swamped with comparatively wealthy and skilled immigrants, vote Green and Australia gets swamped with comparatively poor and unskilled refugees/immigrants [D7.14 and D7.33]. Not much of a choice for voters who support a steady (or declining) population rather than population growth.
As for population policy and a target population for Australia, I still have no clear idea where the Greens stand, but the impression I get is of a significantly larger population than Australia currently supports. [A7.5.3 and A7.16 I view as plans to fail]
"Grant, you say there's not a
"Grant, you say there's not a snow-flake's hope in hell of reducing total emissions. If we take that attitude, we condemn ourselves to a hot and dry and nasty death. The Greens will not accept that kind of defeatist attitude. We will keep fighting for action in line with the science".
TimHollo,
Are you in a fantasy world? "we condemn ourselves to a hot and dry and nasty death". Stop believing the scaremongering from mainstream media and the politicians. We are not going to dry up. Look at how much rain has fallen since February in QLD and NSW. The climate always changes, it goes dry then wet, hot then cold.
And by the way the science is wrong. Do some research and look outside the box.
CPRS / MRET- REC?
Yes it all sounds like some of us know whats going on, what isn’t and what should be. Thats great.
Can anybody tell me how the CPRS relates to the existing MRET / REC scheme and if it will have any effect upon this existing modus which the grid connect Renewable Energy industry is relying on for its continued growth (and existence)? There seems to be an Orer of mystery surrounding the relationship, if any.
Also is anybody able to prise any information out of the policy makers with regard to the future of RAPS & Fringe of Grid funding formally supported by the Diesel replacement program and other Remote Area Power grant schemes?
This funding supported the growth of valuable exportable expertise as well as directing moneys to a much smarter sustainable energy future. That is; away from a future of enforced collective support for clunky inefficient and environmentally unsustainable large scale fossil fuel derived base load infrastructure, toward interlinked smaller Renuwables / diesel Hybrid derived decentralised supply systems.
The as required grid growth and interlinked RE/ HYBRID SGU is the only practical answer for future energy needs in Remote areas and in fact for most of SE Asia and much of Africa where our technology and expertise can find export interest under international co operative Copenhagen/ Mexico inspired efforts.
This industry in Oz is in hiatus while the policy makers and Canberra bearocrats are on a regular stipend sipping their middies and champagne and feigning concern.
This upto 50% funding for the RE quotient for RAPS & Fringe of Grid systems used to be administered at a state level from a Federal bucket. There has been little discussion as to the replacement of this funding.
It’s vital to the continued growth of the industry and to the future of intelligent energy design responses, here and in the developing world we are a part of.
The Primary resource and fossil fuel Energy oligarchs are given an incredible amount of government derived support, let’s see a little of it diverted to the industry and the experts that are inevitably going to inherit the future from those that care little and think they have nothing to learn.
It would be nice to know what is actually planned for our RAPS future, is there a ballpark budget, at all?
Remote renewables
Hi Anonymous,
the Rudd Govt withdrew funding last year for the remote renewables program to replace diesel. The Greens and many others protested this, and we tried to fix the problem by giving remote renewables extra benefits through proposed amendments to the RET legislation. Unfortunately the government rejected them. We are still working on ways of helping that vital sector after the government dropped the ball on it.
Re the link between RET and the CPRS, there was only ever one link in reality, and that was that the government linked industry assistance in the RET to the industtry assistance package in the CPRS. If the CPRS didn't come into effect, there would have been no industry assistance in the RET. That was fixed before the RET bill passed.
Christine, well done
I can remember reading Garnaut's interim/draft report several years ago, in which limitless carbon credits could be bought from overseas, and then not much later Wong reduced all of Garnaut's work to "input". I was completely dispirited, and didn't bother reading Garnaut's final report. I had always thought that the "right" thing for a rich high emission country (like Australia) to do was to make genuine reductions at home, and to gift a percentage of the funds to poorer countries to tackle their low hanging fruit (without claiming benefit). To Christine and the Greens, thank you.
A couple of questions though. What about emissions from agriculture, are they included or excluded? Is it right to assume that all abatement measures are excluded too?
Thanks and yes
Thanks Zoltar. This is a critical issue, isn't it?
Re agriculture, the Greens have been consistent in saying for some time now that agriculture should be kept separate from a carbon pricing scheme until we have reliable accounting for the sector. In the meantime, we should be investing in emissions-reducing activities for agriculture, including switching feedstocks, changing tillage practices, shifting crops and livestock, etc, as well as, of course, encouraging sensible reafforestation in line with community, water and ecosystem needs.
It is the lynch pin
If anything critical is an understatement. I regard it as the lynch pin issue, because without it there can be no global agreement that includes poor/developing countries, and which will survive the test of time. Period.
Even gifted money for greenhouse reduction measures in poorer countries poses risks. It would be a mistake to secure the forests in poor countries from logging cheaply.
greens proposal on the CPRS
Well done on putting a constructive proposal forward. Last November there was a majority in the Senate in favour on a carbon price - let's hope that with goodwill, and give and take on all sides, Senators can now make it happen. It may be improbable, but they say politics is the art of the possible!
How does this set carbon price help Australia's farmers?
Australian farmers have not been compensated for land and vegetation 'locked up' to meet Kyoto targets. Can you please explain how setting the price for an inoperative Carbon Trading scheme will assist farmers?
Thank you.
Simple carbon tax that is hard to argue with
1) Take the average wholesale price of electricity in 2009.
2) Set a floor price on electricity in 2010 as 1c/kWh more than the 2009 price.
3) Set a tax on fossil fuel based electricity generators of 0.8c/kWh
4) Increase the floor price by 1c/kWh every year thereafter.
5) Similarly increase the tax on fossil fuel based electricity generators by 0.8c/kWh
6) Freeze the floor price when it reaches 20c/kWh. Freeze the tax at the same time.
The actual numbers could be optimised with the benefit of a study of the issue.
Fossil fuel generators cannot complain since it guarantees an incrementally increasing net price for their power. Their business case is totally unharmed. They will have ample opportunity to see out the life of their plants. However for future plants they will have excellent reasons to consider renewable choices.
It send a clear message to prospective investors in large scale renewable energy farms, that the value of their product will have a decent floor price, providing the certainty required to make the investments.
It will also greatly encourage the uptake of energy efficiency measures.
This is not complex. It is not controversial.
Is there a reason why the Greens policy makers believe this will be inferior to their plan?
Not uncontroversial
Jim, that proposal could form part of a good policy structure, although it will not be sufficient. But I'm not sure why you think this is uncontroversial! Your policy would see an increase in electricity prices by some 50% in 3 or 4 years. That would be controversial.
Controversial
At no point did I suggest it was the end game plan. I have been consistently arguing you need to eat this elephant one bite at a time, rather than all at once. Break it down and do the bits you can and then move forward. Ratchet your way to a solution.
A key point is, it should not suffer from resistance by the energy providers which is your current dilemma. It totally sidesteps their objection since their margins are fully protected.
50% in 4 years seems an extreme interpretation. We are talking about a 4c/kWh increase.
The more important thing is renewable generators can financially model the increases in years beyond that and thereby lock in project financing far more easily.
We tolerate a major kick up in fuel prices without undue hardship. Electricity prices are far less of an impost and the increment described here will be similarly tolerated.
Grant correctly argued we will fall short of required production in years to come. The simplest and most obvious reliable cure for that is to increase electricity prices.
I am not sure how it will be possible to decarbonise if we hold to a policy that electricity prices should be frozen. Freezing electricity prices will have the clear perverse outcome of ensuring we create a decrepit and inadequate energy sector.
Increasing electricity prices solves two problems at once.
People might think they want to save $50 on an electricity bill, but they'd pay thousands not to have replace fused electrical gear and replace the contents of their fridges due to spoilage after blackouts. Talk about short termism!
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The science and public opinion
I think it is fair to say that there has been a large upswelling in support for so-called climate sceptics in Australia recently, and perhaps world wide. This has come from the flattening of the temperature anomaly graph since 1998 and the uncertainty that this adds in the interpretation of the temperature data, and also a lack of care on the part of the IPCC in keeping the science grounded and avoiding exaggeration on the issue.
While in my view the data still does clearly support the theory of human induced climate change, I feel that in the current political climate there is a need for a great deal of caution on the part of the Greens to ensure that they do not get painted as 'green evangelists' rather than a party that is responding to the science and the calculated risk of continued human-induced warming.
I believe that while there is a continued need for substantial and immediate action on climate change there is an equal need for the greens to be aware of public sentiment and the way this is changing the political landscape. I therefore support the current negotiation by the Greens with the government and the proposed interim carbon price. Should that proposal not succeed in those negotiations, however, I would strongly urge the Greens to adopt a fallback position of accepting the government's target but as a temporary 3 or 5 year policy, allowing revision of the target when there are a few more years of temperate data to inform the debate.
When the target could presumably be changed in future by a single act of parliament by the government of the day, I do not see why the Greens should view it as a deal breaker.
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