Feed aggregator

A federal election is an opportunity to take stock of how Australia is doing, where it’s going, and what governments can do about it. This series, written by program directors at the Grattan Institute, explores the challenges that Australia faces and advocates policy changes for budgets, economic growth, cities and transport, energy, school education, higher education and health.

Over the next few decades Australia, like many countries, faces the prospect of an energy transformation that will challenge every aspect of stationary and transport energy: from production, transmission and distribution to consumption and exports.

The ultimate imperative is to move our economy to a low-carbon footing, while ensuring that consumers don’t pay unnecessarily high costs. The COAG Energy Council, the decision-making body of federal and state energy and resources ministers, formally recognised the critical connection between energy and climate policy last July. Later that year the world’s governments brokered the Paris climate agreement, with Australia promising to cut emissions to 26-28% below 2005 levels by 2030.

Yet this need for wholesale transformation has emerged at a time when Australia’s policy structures are already struggling to maintain the delivery of affordable and reliable electricity, after the reforms of the 1990s lost momentum in the 2000s.

It also comes at the end of a three-year period in which the Coalition government’s actions to address these challenges made modest progress at best. Tony Abbott’s administration repealed the carbon price, wound back the Renewable Energy Target and established the Emissions Reduction Fund (ERF), which has contracted for more than 100 million tonnes of CO₂ emission reductions at less than A$14 per tonne. But it largely sidestepped the reforms needed to address emerging energy trends such as low demand growth, the rise of distributed wind power generation, the boom in domestic solar power and the dramatic growth of coal seam gas.

The upshot was that 2013-16 has left the energy industry with huge uncertainty about what is in store, at a time when it craves reassurance more than ever.

This leaves the new government with three key priorities. As elsewhere, its capacity to deliver will be constrained by the reality of the new parliament.

The first priority will be to build on its current climate change policy to create a stable, long-term approach that will lead the transition to a low-emissions economy. The government will be able to do this through a combination of administrative action and bipartisan support.

The second priority is to revive energy market reform through the COAG Energy Council. The third is to maximise the value of Australia’s gas resources and ensure continuity of supply.

These are not politically partisan issues but they do require galvanising cooperation across state and territory governments.

In addition, the government should develop a renewed reform agenda for the COAG Energy Council – one that addresses all these issues with a focus on outcomes, rather than being mired in process as it has been so far.

Climate policy

For most of this century Australia has lacked a credible, long-term climate policy. Instead we have had toxic debate, policy bonfires and a mishmash of unstable and unpredictable federal and state policies that have threatened industry investment, not to mention the environment itself.

Existing government policy (the ERF and its new safeguard mechanism, plus the reduced Renewable Energy Target) is likely to be enough to meet Australia’s 2020 emissions target – a 5% reduction on 2000 levels by 2020 – but far from enough to meet the stronger 2030 target, or indeed to get us to zero net emissions thereafter.

An economy-wide carbon market is the best way to cut emissions and meet Australia’s targets without excessive cost to the economy. But in the absence of the political will to implement this, we must work with what we have.

The government should therefore strengthen the safeguard mechanism, which puts pollution limits on 140 of Australia’s biggest-emitting businesses, so that it becomes an effective market mechanism. This approach has the potential to gain the bipartisan support that energy companies seek as they consider investments in long-lived assets.

Technologies that might produce plentiful low-emission electricity will still be expensive and risky in the short term. To overcome these market barriers, the government will need to expand its existing clean energy research funding to reduce the costs of moving to a low-emissions economy.

Electricity reform

Energy market reform began in the early 1990s but stalled in the 2000s. Privatisation became politicised and governments baulked at introducing electricity prices that more closely reflect the costs of producing power. Meanwhile, prices climbed by 60% in real terms for all customers.

The government should work through the COAG Energy Council to push for network privatisation and tariff reform, with the goal of delivering fairer and cheaper electricity bills.

In reforming power networks, two issues come first.

The process for defining the costs that networks can recover from customers takes too long and encourages networks to overspend. It must be overhauled.

Second, governments must decide who will pay for surplus network infrastructure that was built to meet overly cautious reliability standards and exaggerated demand forecasts. This “gold-plating” is one of the main causes of power price rises over the past decade.

Network infrastructure has been built to meet the peak demand that occurs only once every summer in most states, yet customers are charged on their year-round use. Pricing to reflect the cost of meeting this peak would make electricity prices fairer and cheaper for all consumers in the long term.

Federal and state governments have agreed to introduce new network tariffs from the start of 2017. But progress is slow, as the losers from policy changes have loud voices that have deterred risk-averse state ministers.

This lack of tariff reform is one of the factors (alongside the large subsidies on offer) that have prompted so many Australian households to install solar panels. By our analysis, the benefits have fallen far short of the costs so far.

Yet as solar panels and battery storage continue to get cheaper, cost-reflective network tariffs will encourage consumers to combine them fairly and effectively.

Since its creation in 1998, the National Electricity Market has helped to provide affordable, reliable and secure electricity supplies. But now it faces new challenges that were not envisaged when it was established.

Thanks to the surge in household solar and other factors, more and more electricity is now generated at zero or even negative marginal cost. A similar situation in European markets has led to serious financial losses for major energy companies in Germany. This is forcing governments in Britain, Germany and elsewhere to introduce supplementary markets for generation capacity even if it is not used.

Although Australia is not yet in this situation, the government should initiate a review of the National Electricity Market to avoid such threats arising.

Gas markets

Opening the east coast domestic gas market to international buyers has pushed up prices. These pressures are exacerbated by the lack of progress toward a transparent and liquid wholesale market and by patchwork regulation of unconventional extraction such as fracking.

The government should lead the implementation of recommendations from the recent Australian Competition and Consumer Commission’s East Coast Gas Inquiry to create a more effective and efficient market. Reverting to protectionism by reserving a proportion of gas for domestic use is not the answer; in the long run this would reduce the availability of domestic gas and drive up prices, while also reducing export revenue.

Fixing the COAG Energy Council

A recent review of how Australia’s energy markets are governed identified problems with the COAG Energy Council and the operation of the government agencies that implement its decisions.

In a way this serves as a neat illustration of the problems facing the government if it is going to get energy policy right. Governance, rules, regulations and policy settings are desperately dry issues. But if Australia gets them right, the problems people really care about – like expensive energy bills and climate change – will be much easier to solve.

Tomorrow in the series: schools and higher education.

Read more: A snapshot of the challenges facing the new Turnbull government

Tony Wood owns shares in several energy and resources through his superannuation fund.

Generating more electricity from renewable sources will benefit the poor and boost jobs and the economy at a time of uncertainty, says UN’s top energy official

Theresa May’s government must increase its commitment to greening the country’s energy supply, despite the “distraction and disruption” caused by the referendum, the top energy official of the United Nations has urged.

Rachel Kyte, chief executive of the UN’s Sustainable Energy for All initiative, and special representative of the UN secretary-general, said generating more energy from cleaner sources would boost jobs and the economy at a time of uncertainty, and help poorer people the most.

Continue reading...

A kayaker spotted humpback whales feeding in San Francisco’s waters on Sunday. Lyrinda Snyderman was out in the bay with three other kayakers when they saw the whales. The humpbacks breached the surface over the course of half an hour to dine on fish. They are likely migrating north

Continue reading...

Marine scientists from Israel and California have developed a microscope that for the first time provides a window into the small scale behaviour of marine life.

This koala has heterochromia, so its rescuers called it Bowie; David Bowie actually had anisocoria, unequal pupil sizes.

Draft proposal reveals new loopholes on a pledge to phase out fossil fuel subsidies within a decade

Trade negotiators in Brussels are proposing new loopholes on a G20 pledge to phase out fossil fuel subsidies within a decade, in the latest leaked TTIP proposals seen by the Guardian.

The EU’s draft text for a trade and sustainable development chapter also appears to draw an equivalence between the need to prevent trade distortions and the fight against climate change.

Continue reading...

New technique for measuring ancient temperatures finds two pulses of climate warming at the end of the Cretaceous

In a paper published on Tuesday in the journal Nature Communications, scientists from the University of Michigan and the University of Florida show that there were big jumps in climate warming when the dinosaurs went extinct at the end of the Cretaceous. This brings the end-Cretaceous mass extinction in line with the other mass extinction events, which occurred at times of abrupt and sometimes extreme climate change (including the end-Permian, the end-Triassic, the Toarcian, and others).

By employing a relatively new ancient-temperature-measuring technique called “carbonate clumped isotope paleothermometry,” scientists have uncovered an 8ºC jump in seawater temperatures that unfolded rapidly, at the same time as massive CO2 emissions from the Indian Deccan Traps eruptions (“rapidly” here means anything less than about 30,000 years, possibly centuries; such are the limits of time resolution). They also found a second, smaller spike in warming about 150,000 years later, at around the same time as the asteroid impact at Chicxulub in Mexico.

Continue reading...

Solar-powered plane will next make a final flight to Abu Dhabi where its round-the-world journey will end

The Solar Impulse 2 landed in Cairo on Wednesday for its penultimate stop as the solar-powered plane nears the end of its marathon tour around the world.

After the two-day flight from Spain, just one final leg lies between it and its final destination, Abu Dhabi, where it started its odyssey in March last year.

Continue reading...

Prakash Javadekar says India is now a world leader in tackling climate change and other countries need to follow its example, reports Climate Home

India could meet its carbon reduction goals earlier than expected, the country’s outgoing climate minister told a meeting in Delhi on Tuesday.

By 2030, the world’s fourth largest greenhouse gas emitter plans to cut the carbon intensity of GDP up to 35% on 2005 levels and boost the share of clean power in the energy mix to 40%.

Continue reading...

Scientists using a new underwater microscope have observed features as small as single cells in organisms in their natural environment. The instrument brought ‘the lab to the ocean, instead of bringing the ocean to the lab’, said study co-author Tali Treibitz from the University of Haifa in Israel. The scientists captured images of millimetre-sized coral polyps in the Red Sea attacking other species of coral in microscopic turf wars. In one colony they saw polyps ‘kissing’ – which they suspected might be for the purpose of exchanging materials

Continue reading...

Conservation group seeks help to pay for the $100,000 licence which lets owner drag 1.2km nets along length of the reef

A conservation group has taken the unusual step of buying a commercial shark fishing licence on the Great Barrier Reef, and will retire it, saving the sharks that it would otherwise be used to catch.

WWF said it was now seeking funds to cover the cost of the $100,000 licence, which gives the owner the right to drag a 1.2km net anywhere along the length of the Great Barrier Reef, targeting sharks. It can also be used for fishing with lines to target other species.

Continue reading...

Experts call on new prime minister Theresa May to halt ‘failed’ policy, calling it ‘risky, costly, and inhumane’

The imminent expansion of England’s controversial badger cull “flies in the face of scientific evidence”, according to the nation’s foremost experts, who have called on new prime minister, Theresa May, to halt the “failed” policy.

The scientists say the badger cull, intended to curb tuberculosis in cattle, is a “risky, costly, and inhumane” distraction and may actually increase TB infections.

Continue reading...

Turnbull might be hamstrung by his barely-there majority. AAP Image/Paul Miller

The re-elected Coalition government has the opportunity to revamp its policies on climate change. Transition of the energy sector is key if the 2030 emissions target is to be met. But with a razor-thin majority in Parliament, will Prime Minister Malcolm Turnbull have the appetite and internal authority to tackle the challenge?

In contrast to the past three federal elections, climate change policy was not one of the big issues in this campaign. Faced with a fairly comprehensive climate policy blueprint from the Labor Party, the Coalition opted not to say much on the subject. A carbon tax and emissions trading scheme have been ruled out, but the door for climate and energy policy reform has not been slammed shut.

In fact, there has been a clear sense that the government accepts that there needs to be a more comprehensive policy framework than just the subsidy-based Emissions Reductions Fund, with its inherent problems. In 2015, Environment Minister Greg Hunt announced that there will be a climate change policy review during 2017.

But the internal politics of the Liberal Party could yet stand in the way. Turnbull has traditionally supported measures to cut emissions, and this fits with his emphasis on innovation. But many on the right of the party oppose action on climate change.

The fact that the Coalition only just scraped into government might be seen as an argument in favour of more moderate policies. But it could also strengthen the hand of Turnbull’s detractors, including opponents of climate change action.

Is that a price on your carbon?

One tricky issue for the Coalition in the election was the plan for the Emissions Reductions Fund “with safeguards”. In the expert community it is generally thought that the Coalition’s plan has been to transform the current mechanism into a so-called “baseline and credit” scheme or a variant thereof.

Baseline and credit would put a price signal on carbon emissions in electricity and possibly industry. It has drawbacks compared with normal emissions trading, among them that there would be no revenue for the government from selling carbon permits; that it would not fully reflect carbon costs to electricity users; that some or many businesses may not be covered; and that it may perpetuate carbon-related investment uncertainty. Its main attraction is political – it would limit effects on electricity prices, and it has been depicted as something that is not a “carbon price”.

Energy transition

The energy challenge is of an altogether different magnitude. Climate policy needs to be integrated with energy policy, and it must get the transformation of Australia’s power sector under way. As the Deep Decarbonisation project showed, a near-zero-emissions electricity supply by 2050 is at the heart of a low-emissions strategy.

This is possible and affordable, but waiting for it to happen all by itself would take too long.

Unless there is a significant and durable price on carbon, other approaches are needed to get the most emissions-intensive power plants off the system – for example, through a market mechanism for brown coal exit and/or regulated closure of old plants.

Support for new zero-emissions energy is a big open question. Will the Renewable Energy Target be extended, perhaps as a low-emissions energy target? Will there be fixed-price auctions for large-scale renewable energy, such as those in the ACT? Should funding for clean energy research and development be ramped up, and how?

Then there are questions about energy market reform and structural adjustment. How to provide adequate revenue for a future power system that largely relies on renewables, when the existing electricity market was designed for fossil-fuel-powered generators? How to manage the social and economic adjustment in the coal regions?

The government will need to tackle energy transition, and it has the opportunity to make this one of its contributions to help modernise the economy. There might even be some common ground for it in parliament.

Ambition needed

Marginal policy change is not going to do the trick. Australia’s pledge under the Paris Agreement is a 26-28% reduction in emissions by 2030, relative to 2005. This is at the lower end of the range, according to many indicators, and it is likely that the target will need to be strengthened for the next round of international pledges.

Labor’s proposed target is a 45% reduction. This is on the way to much deeper required reductions down the track.

Achieving even a 28% target through domestic reductions would be a big step for Australia. Net national emissions have been roughly flatlining for more than two decades, thanks to falling emissions from land-use change.

Brexit, Trump and the future

Amid the current global destabilisation, there are concerns that climate policy will take a back seat despite the momentum created by the Paris Agreement. In Europe, Brexit, terrorism and refugees are top of the agenda. But unless they herald a global shift towards inward-looking governments or wider economic malaise, Europe’s troubles should have little bearing on the transition to cleaner energy in Asia and Australia.

A Donald Trump presidency, on the other hand, could throw a spanner in the works by providing a rallying point for opponents of climate action. Hillary Clinton as president, however, would push for meaningful climate policy both globally and at home.

Those determined to push ahead will do so regardless of the to and fro in Europe and the United States. China, for example, seems unlikely to waver in its push to modernise its economy and thereby dampen carbon emissions.

Turnbull has a chance to help position Australia for a future in which the carbon-intensive way of doing things is on the way out. We will see whether he chooses to do so – and whether his party room will let him.

Frank Jotzo has received research funding from a range of organisations. He has been a member of various review panels and advisory bodies, most recently as a member of the ACT Climate Change Council and the SA government's low carbon economy expert panel.

The Sun-powered aircraft Solar Impulse finishes its penultimate flight, landing in Egypt's capital, Cairo, after a 24-hour flight from Seville.

France’s ban on supermarkets throwing away unwanted food has led to greater calls for laws on food waste, campaigners say

Efforts to force supermarkets and other businesses to waste less food are gaining momentum following France’s ban on supermarkets throwing out unwanted food, according to campaigners.

Earlier this month MEPs voted 600 to 48 to bring forward laws to end unfair trading practices by supermarkets, many of which lead to overproduction and food being wasted.

Continue reading...

Head of government advisory group warns that generations of young people in the UK lack basic cooking skills

A failure to teach children to cook at school is one of the reasons to blame for UK householders throwing away £12bn of food each year, according to a former leading government adviser on food waste.

Liz Goodwin, until last week chief executive of the Waste and Resources Action Programme (Wrap), said that while avoidable food waste had been cut by a fifth in the past decade, reductions had stopped.

Continue reading...

From community food banks to food waste kitchens and even a supermarket, the Danes have embraced the concept

A six-year-old sniffs asparagus suspiciously as his father grapples with a grapefruit and several women admire a selection of cabbages, in search of a bargain.

“Everyone pays 20 kroner (about £2) for a reusable bag to fill with whatever they like,” says Bettina Bach, 31, of Bo Welfare, a social housing project in the Danish city of Horsens that runs the food waste pop-up shop.

Continue reading...

The demand for ‘perfect’ fruit and veg means much is discarded, damaging the climate and leaving people hungry

Americans throw away almost as much food as they eat because of a “cult of perfection”, deepening hunger and poverty, and inflicting a heavy toll on the environment.

Vast quantities of fresh produce grown in the US are left in the field to rot, fed to livestock or hauled directly from the field to landfill, because of unrealistic and unyielding cosmetic standards, according to official data and interviews with dozens of farmers, packers, truckers, researchers, campaigners and government officials.

Continue reading...

Coalition says it is "the only ones that can protect against the electricity price rises". But in week after its re-election, electricity prices were nearly double those during the carbon tax, and soaring gas prices and the investment drought in renewable energy are to blame.

Morfa Harlech, North Wales The eye follows the incoming tide across the beach, racing into dunes green with marram grass

I know these plants: pyramidal orchid, lady’s bedstraw, common centaury, restharrow and wild thyme. I saw them up the Windmill hill only yesterday evening and to me they spell summer in the surviving fragments of limestone grassland on Wenlock Edge. I did not expect to find them so gloriously contradictory at the seaside.

A tumble of dunes barricades the golf course below Harlech castle against Cardigan Bay, the dune shapes mimicking the architecture of Snowdonia’s mountains behind them. I always fall for that trick of the sublime, looking landward from the sea: the silver of the rippled flow, the lone lost crab and scribble of seaweed.

Continue reading...