Wednesday, 27th August 2014

GOLD-PLATED FIBS

The Renewable Energy Target was implemented in January 2011 to help ensure that 20 per cent of Australia's electricity comes from renewable sources by 2020. It works by creating financial incentives to drive both large- and small-scale investment in wind and solar energy. But in February, Tony Abbott appointed climate change sceptic Dick Warburton to review it. While government ministers have made vague assurances that the RET would stay, Abbott himself has always been highly critical of it. He regularly parrots the coal industry's line that the RET is driving up electricity prices, and even told an industry lunch earlier this month that his government had already decided to amend it despite not yet having received the Warburton report.

The government will formally respond to the report next month. But the whole debate about the RET is almost entirely disingenuous. In fact, the RET contributes about 4 per cent to the price users pay, which has doubled in the last five years. (For the record, the carbon price was responsible for under 10 per cent of the price rise.) As Jess Hill makes clear, the real driver of the price increase has been a massive, government-backed over-investment in both "poles and wires" infrastructure and new coal generators in an era of falling demand for coal-fired power delivered through the grid. Privatised and government-owned power companies, worried about their revenue forecasts as the RET encourages households to invest in solar, have lobbied hard to abandon the RET.

What might otherwise be the result of fair competition and environmental policy is instead being presented as a reason to ensure "investment certainty" in a carbon-intensive industry. But the government's attacks on the RET – even its decision to review it – have created enormous uncertainty in the renewables industry. Meanwhile Australia's power prices are now among the highest in the world, and are equivalent to those in Germany, which now generates over 30 per cent of its energy from renewable sources.

Russell Marks
Politicoz Editor

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Review calls for slow end to RET

"The Abbott government should wind up the Renewable Energy Target but protect current investment until 2030 or scale it back to a ‘real’ 20 per cent target, an expert panel has recommended." (Mark Ludlow, Australian Financial Review)

Comments: Renewable energy target in the spotlight (Peter Martin, The Age); Is Abbott crazy enough to axe the RET? (Tristan Edis, Business Spectator)

Labor cries foul on NBN analysis

"Shadow communications minister Jason Clare has ridiculed the government’s $2 million national broadband network cost benefit analysis, saying the decision to have the review conducted by known opponents of the Labor government’s scheme amounted to a broken election promise." (Paul Smith, Australian Financial Review)

Analysis: NBN cost-benefit analysis signals the end of an era (Michael de Percy, The Conversation)

Joe Hockey says GP co-payment not dead, despite Clive Palmer's declaration the measure is 'finished'

"Mr Palmer appears to have closed the door on any future negotiations over the $7 fee on GP visits, blood tests and X-rays, saying it is ‘dead’ and there would be ‘zero’ compromise from the Palmer United Party." (Emma Griffiths, ABC News)

Also: Crossbenchers to block terror laws (Stefanie Balogh, The Australian)

Comment: There's still time to talk their way out of it (Greg Jericho, The Drum)

Leaked modelling forecasts massive windfalls for top unis

"Australia's elite universities could gain hundreds of millions of dollars a year from changes proposed in the federal budget, leaked documents show." (Benjamin Preiss and Marc Moncrief, Fairfax)

Comment: The verdict on university fees is in: it's checkmate for Christopher Pyne (Luke Mansillo, The Guardian)

Tony Abbott's visit to cancer hospital used to 'justify' fund-raising visit

"Tony Abbott told government MPs he had to schedule an early morning visit to a cancer research centre in Melbourne on Tuesday so that he could justify billing taxpayers to be in the city for a ‘private function’ the night before." (Latika Bourke and James Massola, ABC News)

Also: Tony Abbott ties ‘Kevin 747’s’ travel record (Phillip Coorey, Australian Financial Review)