Minister Josh Frydenberg has just implied Australia might drop ongoing endless renewables subsidies (and thus dump the Finkel chief-“scientist” plan). He didn’t say that in so many words, but hinted at it, and will now wait to see how the idea goes down.
Soak in this reasoning — renewables are becoming so cost competitive they don’t need subsidies. He’s calling their bluff. It’s like the announcement to sack climate scientists because “the science is settled”. Let’s take them at their word and follow that propaganda to its logical end:
The key message from Josh Frydenberg is that subsidies for renewable energy are coming to an end.
There is no Clean Energy Target in sight in Frydenberg’s plan for a new policy by the end of this year. The phrase does not get a single mention in his new speech on the way ahead.
In a key argument, the Energy Minister argues that the cost of building wind and solar power has more than halved in recent years.
He does not rule out more subsidies explicitly, but the clear suggestion is that renewable energy generators are now at a point where they can stand on their own two feet. This is exactly the message from Coalition backbenchers who are sceptical about the Renewable Energy Target and any CET to continue the subsidies after 2020.
— The Australian
Frydenberg is giving the industry what it asked for: “stability”:
The energy minister, Josh Frydenberg, says Australia’s electricity sector is looking for stability, “not necessarily” for handouts, in a signal the Turnbull government is poised to abandon the clean energy target.
In comments to an energy summit on Monday, Frydenberg pointed to the falling costs of renewable energy as one of the calculations in the government’s consideration of the clean energy target recommended by the chief scientist, Alan Finkel. —The Guardian
I don’t think they’re going to want this sort of stability. What they really want is “subsidy”.
This is not over yet:
When Turnbull was asked if the government had abandoned the Finkel hot favourite list, he played it both ways, ambiguously waffling about meeting Paris agreements while delivering reliable affordable energy which says exactly nothing. Write to your elected rep. Write to your newspaper editor. Write, ring, holler, don’t stop now. The renewables industry will be doing it like their next ski trip to the Swiss Alps depends on it.
Bluff meet reality:
We can measure the truth of the “competitiveness” by the outcry from the renewables industry lobbyists. How loud will be the squeal? At Reneweconomy.com, David Leitch, principal of ITK (whatever that is), puts in his best effort to scare the Coalition today declaring it is Frydenberg’s election losing speech. “In our dreams”, say skeptics, this next election will be about energy policy like it was in 2013. Bring it on. We might see a 90 seat landslide again. Labor are running with their 50% renewables plan, death to Australian manufacturing.
Tellingly, Leitch’s first graph is about the cost of nasty storms in the US, because subsidies for windmills will stop droughts, floods and tornadoes. Yeah, baby. (Please keep reminding people. Please.) He then talks share prices, gas prices, trading volumes and baseload futures. What he doesn’t graph are the countries which have lots of renewables and their electricity costs. I wonder why?
His reading of the implications of Frydenberg’s speech as the same as everyone else:
Mainstream media, specifically “The Australian Financial Review” and “The Australian” have taken the Federal Minister for “The Enviroment and Energy” speech to a conference today to state that the Government is “set to dump clean energy target”.
Frydenberg reasons that the public won’t support climate change action if they have to pay too much for their bills:
Should reliability and affordability be compromised, public support for tackling climate change will quickly diminish and previous gains will be lost
How does Finkel justify more subsidies in a cost competitive industry?
Because “management”:
Finkel told the gathering a clean energy target was a framework allowing an orderly transition away from carbon-intensive power sources to low-emissions power sources.
“It remains a useful tool even if there is an extreme rate of reduction in the price of the new technologies,” Finkel said. “You need a managed transition.”
So Finkel the chief scientist hath spoken on economic matters of energy policy and the answer is to manage the transition, which shows what a pointless position “Chief Scientist” is. He didn’t assess the scientific reasoning at all, and fails on economic basics. If renewables were competitive, the transition would manage itself. Who wouldn’t want solar panels and batteries if it really did cut the electricity bill in half? But solar still has subsidies, the payback time is long, uncertain, and there are horrid aftereffects making the whole grid unstable, driving out the cheapest baseload providers, and ultimately intermittent “cheap” electricity drives up the cost of electricity overall.
h/t Eric Worrall — See his take on it on WUWT.