23 August 2016, The Conversation, Australia’s new focus on gas could be playing with fire. Gas is back on Australia’s agenda in a big way. Last week’s meeting of state and federal energy ministers in particular saw an extraordinary focus on gas in the electricity sector. While the meeting promised major reform for the energy sector, the federal energy and environment minister, Josh Frydenberg, highlighted the need for more gas supplies and “the growing importance of gas as a transition fuel as we move to incorporate more renewables into the system”. Gas is certainly a lower-carbon energy source than coal, but gas prices have soared as Australia begins shipping gas overseas. So what might this mean for energy and climate policy? Rising gas. In 2013-14 natural gas-fired generation rose to account for 22% of Australia’s electricity generation, although the figure falls to 12% in the National Electricity Market (NEM), which excludes Western Australia and the Northern Territory, both of which use a large amount of gas. Among the NEM states, South Australia relies the most on gas-powered generation. This means that gas generators generally set the state’s average electricity price, which has usually been higher than those in the eastern states. Average electricity prices in Victoria, New South Wales and Queensland tend to be set more often by coal power generators than by gas. Read More here
Tag Archives: Fed Govt
22 August 2016, Renew Economy, Gas bubble looms as energy ministers baulk at zero emissions target. State and federal energy ministers hailed progress they made in their COAG Energy Council summit late last week, but they may have condemned Australia to another great big investment bubble – this time in gas infrastructure. The meeting of ministers – brought forward by the apparent energy “crisis” in South Australia – resulted in a couple of promising steps that may help contain price surges of the type seen in recent months, but it seems to have ducked action on the critical issues. On the plus side, there is the creation of two new gas trading hubs that might improve transparency into a notoriously opaque market, and the potential for a new electricity inter-connector linking NSW and South Australia to be bought forward. But elsewhere, not a lot of tangible progress was made. The ministers baulked at calls to write zero net carbon emissions into the electricity market goals, despite that being implicit in the Paris climate goals that Australia has signed up to.And if the energy ministers did avoid turning the meeting into an anti-renewable jihad – as they were lobbied to do and might have been tempted under a previous federal energy minister – they did come face to face with some of the significant barriers to the rapid transition to a low emissions grid that they profess to support. One such example came from the Australian Energy Market Operator, whose chairman Anthony Marxsen stunned the audience on Friday when he suggested during a presentation that battery storage technology could be up to 20 years away from making a commercial contribution. Some dismissed this as garbage and a plug for the gas industry. AEMO is 40 per cent owned by industry “players”. Another is the painfully slow progress from the main policy maker, the Australian Energy Market Commission, which has been dragging out crucial rule changes most people believe are essential to moving to new technologies. Read more here
August 2016, The Monthly, The message was clear. Brexit, Trump and the federal election show how the old categories of left and right are crumbling. Pauline Hanson is back in parliament, the United Kingdom has voted to leave the European Union, Donald Trump wants to build a wall along the United States’ border with Mexico, and the neoliberal agenda is failing badly at ballot boxes around the Western world. The old world order of the Washington Consensus has broken apart more quickly than a new one has been built, but the lack of a clear path forward in no way diminishes the significance of the collapse in public support for free trade, trickle-down economics and the privatisation of essential services. The new “right-wing” populists are hostile to all that the neoliberals held dear. The extent of the shift in public sentiment has been concealed by the chaos of new parties and new paradigms, which are being blamed, or credited, for the tumult. But it is not democracy that is in chaos, but rather the futile attempt to cram rapidly changing political alignments into the centuries-old categories of left and right. Take Brexit, for example. One of the Leave campaign’s most prominent voices, Nigel Farage, best known for his anti-immigrant politics, shamelessly argued that the UK’s financial contribution to the EU should be spent instead on improving publicly funded health care. This “left-wing” priority resonated across the political spectrum, and the political establishment spectacularly underestimated the potency of the issue. It was of symbolic importance, as was Britain’s migration program. The population voted for the promise of a national government that protected its people as well as its borders. Was Brexit a win for the “conservative right” on the issue of sovereignty, or was it a loss for the “libertarian right” on free trade? Read More here
11 August 2016, Renew Economy, Frydenberg to push ahead with repeal of ARENA grant funding. New environment and energy minister Josh Frydenberg says the Coalition government intends to go ahead with its plan to strip $1.3 billion of funds from the Australian Renewable Energy Agency and end its grant-funding mechanisms, and says he expects Labor to support it. In an interview with RenewEconomy on Thursday, Frydenberg also canvassed other policy areas under his new combined portfolio. Among the highlights: He repeated his pledge that the current renewable energy target is “set in stone”, despite a big push from some in the fossil fuel industry to have the target weakened further. He will seek “co-ordination” from the states on their climate and energy policies, although he did not say whether he would be insisting that individual states abandon their own targets. (Three states – South Australia, Victoria and Queensland – and one territory, the ACT, have renewable targets that are more ambitious and longer lasting than the federal target, which is equivalent to a 23.5 per cent target by 2020). In a response that will disappoint many in the climate policy arena, Frydenberg insisted that next year’s climate policy review will be a “sit-rep” – a situation report that will assess the ability of current policies to meet existing targets – and will not look at longer-dated targets (such a zero emissions by 2050), or as an opportunity to set more ambitious targets. He says the price of gas is the key component of future electricity prices, and he will be bringing “many” of the recommendations by the ACCC and the AEMC to the COAG energy ministers meeting next week. He said he was monitoring the progress of solar thermal with storage plants, such as the new $1 billion plant in Nevada, although he did not mention any specific policy or initiative to bring the technology to Australia. The tone of the interview – which you can read in full here – was one of caution. Frydenberg shows no sign of deviating from Coalition policies, even if he does recognise that a lot of effort needs to be thrown at climate and clean energy policies to avoid an economic and political train crash. Read More here