Month: July 2013

Declining electricity consumption in Australia

John Quiggin68 Comments

I missed this when it came out a few weeks ago, but the Australian Energy Market Operation (AEMO) has released new forecasts of electricity demand to 2020. The forecasts represent a further reduction on the big cuts in estimated demand made between 2011 and 2012. In 2011, the medium forecast was for nearly 250 000 GWH by 2020, up from 200 000 in 2010. The latest medium forecast is 211 000 GWh for 2020, and the low forecast stays below 200 000 out to 2022-23. These forecasts would be even lower if it were not for three large export LNG projects in Queensland.

Even more striking is the forecast for residential and commercial consumption per persom. In much of the debate around energy issues, it is assumed that increases in living standards must go hand in hand with higher consumption of all forms of energy. But AEMO, assuming moderate rates of economic growth, is predicting that consumption per person will drop to 6000 KwH per year by 2020. In 2005, it was around 7200 KwH, so that’s a drop of more than 15 per cent. Over that time, income per person is likely to rise by around 30 per cent.

The AEMO measures don’t include rooftop solar, but they do include large-scale renewable energy (wind and grid-connected PV). Current policy calls for an additional 20 000 GWh of large-scale renewables by 2020, which would imply a significant reduction in energy-related CO2 emissions over the next decade.

Of course, a lot of this is the fortuitous result of high electricity prices, driven mainly by distribution costs. But it’s certainly an impressive demonstration that lower energy consumption does not mean lower living standards.

The right’s anti-wind campaign is pure scaremongering (updated)

John Quiggin113 Comments

That’s the headline for my latest piece in Guardian. Of all of the anti-science nonsense peddled by the political right, here and in Britain, none is more stunningly hypocritical than their campaign against the (non-existent) health risks of wind turbines. The self-image promoted by these guys (and, with a handful of exceptions, they are guys) is one of hardnosed scepticism about unproven risks, disdain for emotive appeals to feelings about the environment. But because wind turbines are supported by their tribal enemies, they swallow and propagate utterly absurd alarmist claims.

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Is there a solution to the refugee problem?

John Quiggin161 Comments

The announcement by Kevin Rudd and PNG PM O’Neill that asylum seekers arriving by boat would, from now on, be settled in PNG came as a shock to most of us. I’ve waited a while to respond, because I’m neither happy with the policy nor satisfied with the critical responses from the Left. It also remains unclear whether the policy will actually work as planned, but that will take some time to determine.

The benefit of waiting is that I’ve had time to see this piece by Tad Tietze, who I think sums up the issues pretty well, making the point that, while Rudd has outflanked Abbott regarding a hard line on boat arrivals, he has also outflanked critics on the left by increasing the total refugee intake, which is already claimed by the government to be the highest in the developed world on a per capita basis. [1]

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Rent-seeking rampant

John Quiggin86 Comments

The Rudd government’s proposal to tighten up documentation requirements for the very generous tax concessions provided for people who receive motor cars as a fringe benefit has produced some striking examples of rent-seeking from the Australian right, notably including Catallaxy and the Australian Financial Review. Catallaxy has a string of posts defending this rort.

The Fin gives lots of space to bleating rent-seekers, while imputing to “academics” the opinion that this is a subsidy. I guess that’s fair enough, given that the Fin regards basic science as a matter of academic opinion, while treating the failed dogmas of the 1980s as proven facts. And, of course, the Opposition has promised to oppose the measure, while weaselling out on the question of whether it would reverse the changes if elected.

This really is a test for Rudd. If he wants to refute the oft-repeated claim that he is all spin and no substance, this is his first chance, and one of the best he is going to get.

The return of the ETS

John Quiggin56 Comments

As a member of the Climate Change Authority, I’m constrained to some extent in what I can say about the plan to bring forward the date at which emission permits will become tradeable, so I’m going to make a few points, and leave discussion to others

* The really big change, which went largely un-noticed, was the link to the EU scheme, announced by Greg Combet shortly after the carbon price came into effect. Bringing this forward by a year is a minor adjustment by comparison

* The offsetting savings announced today are mostly good, the most obvious exception being the biodiversity fund. I supported assistance to Carbon Capture and Storage in the past, on the general principle of backing every horse, but it’s time to admit that this horse won’t run

* The tightening of Fringe Benefit exemptions for cars is, I hope, a recognition that subsidising motor vehicle use in general isn’t going to save the domestic car industry, which has a small and shrinking share of the market. The impending demise of the Falcon should kill the presumption that fleet cars are likely to be Australian-made I hope this view is taken more generally. Preservation of the domestic industry is probably a lost cause, but if governments are going to try, they should do so with direct subsidies to domestic production not subsidies to car use in general.

* I hope Parliament sits again, and that the government puts the necessary legislation forward. The amusement of watching Tony Abbott voting *for* the carbon tax would be well worth the price of admission.

Westminster in the Antipodes

John Quiggin29 Comments

I’ve written a piece for the Conversation about a side issue in the Rudd-Gillard contest, namely the view that, under the Westminster system, voters elect the politicians who then choose the PM. Rudd’s proposed reforms obviously contradict that. I argue that Rudd is effectively codifying the existing system, as established by the bulk of historical precedent and understood by voters, and rejecting the view of insiders (especially the kind who appear on Insiders, or so I’m told – I’ve never watched the show and plan never to do so).

As a side issue, my piece was extensively edited for publication. With the natural pride of authorship, I thought my original (over the fold) was better. But I’d be interested in a reality check on this from readers here.

As I’ve said before, I don’t want to rehash the substantive merits of Rudd and Gillard at further length here. If you want to have your say on this, go to the Crooked Timber post I’ve linked.

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