The Great Australian Energy Crisis – It’s a conspiracy!

Last month I attended a breakfast seminar on the 2017 outlook for the Australian economy hosted by an eminent economist. For those who are interested, he predicted that it was full steam ahead for the Australian economy notwithstanding the occasional Trump induced risk factor.

I asked the economist if Australia’s ageing power infrastructure, coupled with the current political leadership vacuum on energy policy would be a drag on growth. He smiled and reassured me that energy policy had no impact on his economic model but admitted it was an interesting question.

Two days later all hell broke loose. New South Wales suffered a series of blazing temperatures across the state, over one hundred catastrophic bush fires erupted and air conditioners went into overdrive. Three major power generators failed including the Liddell coal fired power station and the Tallawarra gas plant. The Australian Energy Market Operator, fearing widespread blackouts across NSW ordered the Tomago aluminium smelter which consumes twelve percent of the state’s energy to shut down its pot lines.

New South Wales, which relies on coal for over ninety percent of its generating capacity, suffered a load shedding event of 580 MW which was almost six times that of South Australia’s 100 MW event three days earlier. The political furore was almost as bad as the extreme weather that had caused the black outs. The Australian federal government pointed the finger of blame firmly at the states claiming that they were ‘drunk on left ideology on energy’ and threatening people’s livelihoods. One week later, the Energy Minister Josh Frydenberg suggested that the Clean Energy Finance Corporation that was set up to fund Australia’s 23.5% renewable energy commitment by 2020, would be used to build new ‘clean’ coal fired power stations.

Reasoned public debate on the future direction of Australia’s energy policy and its commitment to the Paris climate accord has become mired in vitriol and disinformation. Short term political posturing seems to be more important than long term strategic energy planning.

When I embarked on my latest novel set in the oil industry, I wanted my main character to be a free-thinking sceptic who is unwittingly drawn into a global climate conspiracy. I conducted my year long research into the topic with some trepidation. I was cynical about the strident nature of climate science. The claims of the environmentalists seemed far-fetched and alarmists. Their message was depressing and their smug tone reminded me of the ‘god botherers’ of old who turned up uninvited on my doorstep.

Twelve months and several books on climate change later I emerged from my research with a massive wake up call. For example in Australia’s own backyard, David Attenborough claimed that sections of bleached coral on the Great Barrier reef have suffered complete ecosystem collapse. Hiking on Foxs and Franz Joseph Glaciers in New Zealand is now banned because of rapid glacial melting. And since 2013 we have sweltered through four of the six hottest years on record. A coincidence? You must be kidding.

If you can’t trust the evidence in front of your eyes, ask the scientists. A 2013 paper in Environmental Research Letters reviewed 11,944 abstracts of scientific papers matching ‘global warming’ or ‘global climate change’. They found 4014 papers which discussed the cause of recent global warming, and of these 97.1% endorsed the consensus position that humans are causing global warming. Call me naïve, but I find that statistic pretty convincing.

So why have whole sections of society, especially the ‘Alt Right’ adopted climate change denial as a badge of honour and successfully paralysed effective energy policy? The average guy in the pub is probably ‘sticking it to the know-it-all greenies’ which is understandable. I would probably do it myself with a few schooners under my belt. But our senior politicians, upon whose decisions our quality of life and financial wellbeing depend, are suddenly rendered incapable of rational behaviour when discussing energy supply.

The answer in Australia’s case is that we are sat upon the largest and cheapest deposits of coal in the world. Its continued exploitation adds to our economic output. It employs over 140,000 jobs and makes us all a little wealthier. The sheer scale of our mining industry allows it to wield massive political influence which is no bad thing when done responsibly and in the interests of the country. Australia has recently poured billions into new coal mines and ports making the industry the most efficient in the world. Unfortunately this is at a time when the industry’s markets are dropping off a cliff. Our champion coal industry is all dressed up with nowhere to go.

Coal is the environmental bad boy of the fossil fuel industry. Nothing else comes close including natural gas. The term ‘clean coal’ is relative and would still make coal top of the pollution food chain by some margin. A typical coal plant with emissions controls, including flue gas desulfurisation emits 7,000 tons of SO2 per year. This SO2 causes acid rain which damages crops, forests and soils, and acidifies lakes and streams. Its emissions include lead, mercury, nickel, tin, cadmium and arsenic. The amount of CO2 generated by coal fired power stations worldwide is over five billion tonnes per year. Coal combustion waste is the second largest waste stream on the planet after municipal waste. The list of environmental hazards produced by the coal industry goes on and on (and on).

Before things get too depressing it’s worth mentioning that the environmentalist’s war on coal fired power stations outside of Australia has already been won thanks to the impact of capitalism at its ugliest. In the last twelve months, the cost of generating electricity from solar and wind has dropped below that of coal and investment finance for new coal powered fire stations has dried up as no bank wants a stranded asset on its books. This has had a profound effect around the world.

• The United Kingdom, which powered the industrial revolution on the back of coal over two hundred years ago, produced more electricity from solar power than coal in the second half of 2016. Employment in the British coal industry which once stood at 1.2m in 1920 (including generations of my own family) is now zero. However, Britain is now the European leader in solar and 35,000 new British jobs have been created in the solar industry.
• India’s 50GW capacity of half built coal powered power stations are considered ‘stranded assets’ and will only be completed as reserve capacity as it moves towards its target of 57% renewable energy by 2027.
• China has just scrapped plans for over one hundred coal plants as it moves to address overcapacity and gears up its huge solar and wind industries.
• In the U.S. last year, 39% of all new build electricity generation capacity came from solar. No new coal plants were built in 2016 but 135 were closed over the last two years. One of the world’s leading coal producers, Peabody filed for bankruptcy in the US in April of last year.

Australia is uniquely positioned to benefit from a new ‘industrial revolution’ led by the renewable power industry. With its abundance of sun, wind and wave resources and its technical and engineering excellence, it is well set to take a cut of the 8.1 million jobs in renewable industries that were documented worldwide in 2015. These high quality jobs would include positions in research, manufacturing, sales, distribution and installation that would create wealth across all social strata’s and all geographies in Australia.

Coal will not disappear completely until existing plants reach the end of their useful life and there is an argument to keep some fossil based generating capacity in reserve (although this should be gas where possible). But do not expect the coal industry to go down without a fight. Any blog on climate change is systematically ‘trolled’ by hyper aggressive industry supporters who invent conspiracies, cry ‘hoax’ and disparage eminent scientists for producing data that runs counter to their belief systems. This blog will be no different.

It’s time that the politicians in Australia remembered that they joined the noble profession of politics for the greater good of society rather than marginal political advantage. Australia urgently needs a carefully considered energy policy. Part of that policy should involve the encouragement of a world class and viable renewables industry to absorb the inevitable decline in coal mining jobs over the next decade. It is time for strong leadership. Failure to act will cost Australian jobs and growth at a critical juncture for our economy.

In the meantime, I’m off to order my (Australian built) solar panels before the lights go out.


One thought on “The Great Australian Energy Crisis – It’s a conspiracy!

  1. Very informative. Nice to have someone present us the facts in a light-hearted manner that has been seriously and independently researched. You confirm my view that 90% of all information put out is driven by people with an agenda. And it is remarkable how quickly politicians adopt an agenda.
    Now who was it that said ‘the end justifies the means’?

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