Negging the NEG

The proposal of the pompously named “Monash Group” that public funds should be allocated to investment in coal-fired power stations is, of course, absurd. Leaving aside its environmental effects, new coal-fired power is far more expensive than renewables or gas.

Nevertheless, the proposal is welcome in a number of respects.

First, in combination with Turnbull’s Snowy 2.0 proposal, it represents a repudiation, by the conservative side of politics, of the ideology of privatisation. From now on, anyone who wants to make a case against the extension of public enterprise will have to do so on the merits rather than on the ground of free market dogma. Proposals for coal-fired power fail on the merits, but the case for public investment in renewables is strong.

Second, it exposes Turnbull’s National Energy Guarantee for the sham it is. As has been more-or-less admitted by its main architect Kerry Schott, the idea of the NEG is to provide a technology-neutral facade for a set of rules designed to keep existing coal-fired power stations open a little longer. That’s obviously unsatisfactory for anyone who cares about climate change. It’s equally unsatisfactory for those on the right who imagine coal can be kept going forever.

The Monash proposal makes a mockery of the idea, promoted by the Grattan Institute and much of the Canberra commentariat, that the NEG represents some kind of long-term resolution of the debate over climate change policy.

The reality is that no such resolution is possible. Everyone who cares about the enviroment knows that we need a rapid global phase-out of coal-fired power. The Monash Group know this too, but their primary goal is to spite their enemies in the culture war . They are happy to treat the future of the planet as collateral damage. The middle path imagined by Turnbull and Schott is an illusion.

As with gun control in the US, the idea of a compromise here is nonsense. Our only hope is to vote these vandals out and keep them out long enough to make the end of coal irreversible.

33 thoughts on “Negging the NEG

  1. @chrisl As you hadn’t provided a source I felt free to look it up,

    “Currently, over 1 600 new coal plants and units are planned or under development in 62 countries. If built they will add over 840 000 MW to the global coal plant fleet.”

    But that is old news, reports of cancellations and/or delays indicate otherwise;

    “In 2017, the number of plants in the permitting and planning process fell by 22 per cent compared to 2016, bringing the decline to 59 per cent over the last two years.”

  2. There is no market for electricity in Australia because it is distorted by government mandates.

    Dude, I’m just going to be up-front and blunt here: this sentence categorically demonstrates that you have no role to make useful comments about… pretty much any economic issue ever. Government intervention is inherent in all markets everywhere, as private property is created by the state.

    [like… what you write is so ignorant as to call your mental stability into question, and I’m not being even a teeny bit hyperbolic here]

  3. John Quiggin,

    It was before the election of Rudd and, yes, the focus was on market mechanisms. However, even then the tone was one of needing urgent action so the uncertainty of a market mechanism was risky as has been proven. The only comment that the proposal got on both LP and JQ was “this would create a slush fund, and we all know what happens to slush funds”, which too will come to pass if the LNP use the RET to build coal infrastructure.

    The levy approach would have yielded $8 billion per year for direct investment while keeping the retail electricity price under 17 cents per unit at the time. Is $8 billion the annual fund size for the RET?

    Now the need for action is way beyond urgent when you see what is happening in the Arctic now. The warnings of Sir Ian Axford (the scientist who did the calculations on the interaction of Earth’s magnetic field and the Solar Wind, now deceased) of the imminent risk of the perma frost thaw were ignored, and not even calculated in to the IPCC determinations, and the permafrost is in full on collapse. see the Arctic-News website.

    The tone in the scientific community has changed from we can arrest this, to how bad will it be. Disasterously, still we have politicians doing their best to bury climate action.

    The only good news is that at least one country, Portugal, has managed to mostly decarbonise their electricity sector with their March month yielding 104% renewable energy.

    Australia should have been close behind.

  4. More on the what we should be doing with our coal front…..

    Check ou the image of Prof Eric Eddings holding a lump of coal. Look familiar? We’ve seen this very posture in out parliament from the likes of Scot Morrison and Barnaby Joyce both of whom valued that kilogram of coal at 10 cents to make CO2, whereas Eric Edding wants to, and can, turn that one kilogram of coal into $70 worth of Carbon Fibre (the price I pay for the fibre I buy).

    Do you see the difference between the grasp on reality between our politicians and science based engineers?

  5. Rog, that is almost certainly dead money.

    The point being made is that with a fraction of that expenditure directed to other uses for coal, cardon fibre production and epoxy resin production, can yield 500 times the return than thermal coal, or 5 times the return for 1/100th of the resourse depletion rate with the end product being the environmental equivalent of bio char.

    The problem here is that the government is ideologically locked into an anti climate action platform and cannot see past it.

    Turnbull’s whole argument that preserving old coal stations will deliver lower electricity prices is demonstrably false due to the altered carve up of the revenue pie with the transmission (wheeling) taking a full 50% of the gross revenue. So unless Turnbull is planning a sneak attack on the transmission industry contracts, nothing Freydenfella does will make any difference to retail electricity rates.

  6. A more complete analysis of coal and electricity is below.

    “But, crucially, coal stations are not being used as much. The amount of electricity produced across the planet by burning coal has fallen each year since 2013.

    “A distinction needs to be kept in mind between capacity and electrical output,” Nace says. “Even though there are more power plants, the actual production of electricity from those plants – and likewise the amount of coal used worldwide – has fallen every year since 2013, with a small drop in 2014 and larger drops in 2015 and 2016.”

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s