Consultant Dan
10 May 2011
Australian Budget preview - solar, wind, renewable energy politics
We live in a time of rapid change and look to a Federal Budget to tell a story that makes sense of the world and our place in it. The speeches of the Treasurer and the response by the Opposition leader should allow us to judge their vision for Australia. Do they understand the cleantech trends shaping the world? Can they tell us how to benefit from or even shape the scenario we face?
The world is embracing renewable energy and Australia is finding it hard to keep up, because we lack a price on carbon or good industry policies for renewables. We were held back by 11 years of climate inaction by Liberal PM John Howard. Unfortunately, Labor’s anti-green Minister for Energy, Martin Ferguson, has views almost identical to John Howard when it comes to climate change and energy.
As the Opposition keeps reminding us, a carbon tax is coming. This means that the Budget story will be rewritten in July when we see the details of the deal reached by the Government, Greens and independent members of the Multi-Party Climate Change Committee (MPCCC).
Solar, wind and other renewable industries need the Government to ensure a reasonable degree of certainty and profitability in order to make investments to deploy currently available technologies. If Australia is to benefit in an increasingly competitive renewable sector, then Government must support both R&D and early commercialisation.
Yesterday the IPCC meeting in Abu Dhabi released the Summary for Policymakers of an upbeat, 900 page study of global renewable energy potential (the Special Report Renewable Energy Sources or SRREN). This major effort was initiated in April 2008 and so it does not include the recent growth or innovations and so it underestimates the potential.
This landmark report aggregates the findings of 164 energy scenarios by researchers around the world. It shows that renewable energy already accounts for 46% of new power stations built around the world. Out of 300 GW of new electricity generating capacity in 2008-2009, 140 GW came from renewable energy. To get an idea of the scale, this is more than double Australia’s total generation capacity (of about 60GW). This new renewable generation will keep producing clean electricity from free, renewable sources, for 20-30 years.
Both the Treasurer and the Opposition Leader will tell us in their speeches tonight that they want to balance the mining boom. The answer is clear; do it with renewables. Renewable generation is best distributed deep into the consumer end of the grid, with solar panels on roofs and small wind farms built around many communities. This means that the direct jobs and indirect economic benefits are spread more evenly around our cities and towns than mining ever will be.
Likewise, the manufacture of solar and wind components is mostly located in the Eastern states and is best located in areas that have traditionally had manufacturing industries.
The electoral benefits of this kind of investment are clear. Figures released at Clean Energy Week in Melbourne last week show that around 3-5% of homes already have solar panels or solar hot water. We installed about 350MW of solar PV last year, which is 2% of the international market, roughly in accord with our share of the global economy.
If we are lucky, the Budget will have some good news for our solar and wind industries. Energy Minister Ferguson will hopefully pull his finger out on the interminable Solar Flagships program, release serious funds for building solar generation on an industrial scale. (The program was announced on Budget day 2 years ago, but so far all we have in announcements and re-announcements.)
We should see more forward expenditure promised for R&D and commercialisation. There should be narrative in the Ministerial statements about national policy settings that the renewables sector needs. For example, the electricity networks and traders should be forced to open the market fairly to renewables, paying a fair price to households who connect solar to the grid.
The rest of the world will not wait for Australia to catch up. According to the SRREN report, 2009 saw amazing growth in new build of renewable energy, notably grid-connected photovoltaics (53%, 7.5 GW added), wind power (32% increase, 38 Gigawatts (GW) added), and solar hot water/heating (21%, 31 GWth added).
Most of the lobbyists here in parliament today represent the big polluters and miners. They can have the corridors for now. I am taking my solar Juice Bag to the terrace cafe, where I can charge my iPad in the sun, for free.
RSS