Tony Abbott calls for end to all energy subsidies, including on coal

18 September 2017

Tony Abbott has used the second anniversary since losing the top job to declare he’s intent on looking forward, not backward – and has again weighed in to the government’s fraught energy debate to call for an end to all subsidies.

The former prime minister told on Thursday he welcomed signs from Malcolm Turnbull that the government was moving away from the clean energy target recommended by the chief scientist to what he is characterising as a “100% reliable energy target.”

For energy security, the failing Liddell coal plant is the last thing we need.  “I welcome these signs that we are moving away from a clean energy target to a reliable energy target, and, frankly, nothing less than a 100% reliable energy target will do because we’ve got to keep the lights on all the time … if we are to be a first-world country,” Abbott said.

Abbott declared the government should end all subsidies for renewable energy, and that would mean there was no need to subsidise coal. Despite leading the successful political campaign to scrap the former Labour government’s market mechanism, the carbon price, Abbott declared on Thursday afternoon: “I don’t want to see subsidies; I want to see a market”.

“I say let’s not subsidise anymore renewables, and if we don’t subsidise anymore renewables, we won’t need to subsidise coal, because coal in a normal market is the cheapest way of providing reliable power.”

“It is vastly cheaper than wind and solar and considerably cheaper than gas.”

And while acknowledging that he signed Australia up to the Paris climate agreement while prime minister, Abbott now argues we are not obliged to abide by the commitments made in the international accord.

Abbott said there was no need to walk away from the Paris agreement, because the emissions reductions commitments contained within it were not binding on Australia.

The former prime minister’s public intervention on Thursday afternoon followed an effort by Labor in question time to portray Malcolm Turnbull as being completely indistinguishable from Abbott on energy policy.

With a focus on the second anniversary since Turnbull took the Liberal party leadership, Labor asked Turnbull what had been the point of depojustifysing Abbott from the prime ministership.

To Abbott’s obvious amusement, Turnbull told the chamber he had built on “the outstanding work of the member for Warringah” and said he had delivered jobs and economic growth as prime minister.

The government this week has made it plain that its new investment framework for energy policy will be favourable to coal.

In question time on Thursday, Turnbull said the new policy would ensure all technologies were utilised “including coal”.

The clean energy target recommended by the chief scientist Alan Finkel was modelled at a level where coal would not get certificates, but the Nationals have been making it clear for months that keeping coal in the mix would be the price of their support for any policy change.

As it moves towards crunch point, the government is making it clear the new investment framework, which it wants to resolve before the summer parliamentary recess, will need to be geared to reliability and affordability as well as to emissions reduction, and encompass all technologies.

Earlier in the day, the head of the Australian Energy Market Operator, Audrey Zibelman, told a parliamentary committee she favoured the creation of a day-ahead market – a system where the market operator identifies the energy demand for the next day, hour-by-hour, then generators bid in to supply the market.

She said a day-ahead market would create more certainty and stability in the system, and also allow tools like demand management to be deployed in the event there was insufficient dispatchability in the system.

Zibelman said the market operator was looking for the Turnbull government to make key decisions in the next few months in order to have new market rules up and running by 2018, and she noted players in the energy market were currently “quite anxious” given the current lack of clarity.

She said market conditions worked against building new base-load power, and the future would be more focussed on flexible energy sources, such as peaking gas power.

The Aemo chief said investors in the national electricity market wanted the clean energy target. “I think any investor wants to have policy certainty that’s very important for any investor because they need to make their decisions”.

But while endorsing the clean energy target from an investor standpoint, she said her organisation was more focused on ensuring system needs were met.

Zibelman said there were incentives in the market to pull forward renewable energy investments, but the market had to also signal that reliability was important. She said the answer was a “portfolio solution”.

A major industry group also stepped up pressure on the Turnbull government to pull its gas export control trigger. The government has argued this week there is no immediate reason to move because more gas has been made available to the domestic market since the threat of creating a domestic reservation.

But that view has been rejected by the Ai Group. “Industry remains deeply worried about the state of the gas market,” said the group’s chief executive, Inness Willox.

He said the government needed to speed up the process and determine that 2018 is a shortfall year under the export control arrangements. “Despite some recent improvement, our industrial members have become alarmed by the extraordinary rise in the price, and reduction in the availability, of contractable gas”.

Source-thegaurdian