Instead Of 'Fair Dinkum' Power, How About Some 'Fair Dinkum' Action?

The Guardian - Katharine Murphy

Labor was lashed for doing something about carbon emissions; the Coalition is being lambasted for doing nothing

Former Labor minister Greg Combet says if the world is to do what is necessary to contain warming at 2C, then almost all coal-fired power will be gone by 2040. Photograph: Julian Smith/AAP 

Seven years ago, Greg Combet, then a Labor minister, implemented a carbon price in a minority parliament, an experience so arduous it helped curtail his political career. Now, safely outside political life, he looks on with bemusement about where the climate and energy debate has washed up.
On Tuesday, Combet launched a new report by the Industrial Relations Research Centre at the University of New South Wales investigating how countries such as Australia can achieve a fair transition for coal workers displaced as the economy decarbonises.
It got a bit lost in the wash of the week – let’s face it, it’s hard for substance to compete with the rolling spectacle of political dysfunction – but it’s an interesting bit of analysis funded by the CFMEU’s mining and energy division.
In 2011 Combet had to fight almost everyone in the country to get the clean energy package legislated. Business was hostile. The energy sector was hostile. Barnaby Joyce was screeching apocalyptically about $100 lamb roasts.
But while Combet’s experience was everyone shouting at him for doing something, we’ve now come full circle. Now, all the shouting is about the current government doing nothing.

Business and energy retailers are on the frontline of increasingly frantic calls for policy certainty. The Gillard government would have killed for the conditions the Coalition has blown away over the last three years with reckless abandon.
In any case, Combet ventured out this week about the future of coal. He insists the outlook is clear. If the world, and specifically Australia, is to do what is necessary to contain warming at 2C, then almost all coal-fired power will be gone by 2040. “That’s only 22 years away,” he tells Guardian Australia. “The energy companies get it. This is very much front of mind for the asset holders, and they want rational policy. They aren’t fighting it anymore. They don’t want stranded assets.”

A hands off approach has left many retrenched workers and their communities with very difficult transition problems

He says the energy market is going to transition “whether or not we’ve got Scott Morrison at the helm” and government owes it to people who will be materially affected in the transition to play it straight.
“Workers in coal power stations need to know the truth. You really have to tell people the truth about structural change when it’s coming – you can’t be populist about it”.
Earlier this year I asked the resources minister Matt Canavan whether he felt an obligation to help Australian communities face up to the inevitability of a carbon-constrained future. He responded as if I’d committed a thought crime.
Labor, for its part, is putting a package of measures together. It’s likely to include a new statutory authority to oversee the transition and the programs intended to ameliorate it; specific industrial relations arrangements to ensure workers are managed through the process; and programs to drive economic diversification.
Labor took a policy on coal transition to the last federal election, but it has to be re-engineered in some respects to take into account lessons learned from the closure of the Hazelwood plant, and also to reference the requirements of the reliability obligation in the national energy guarantee.
Scott Morrison dumped the emissions reduction component of the Neg – it was a casualty of the Liberal leadership implosion – but Labor is likely to keep the policy with its own tweaks. A Labor Neg will have a higher emissions reduction target than the 26% proposed by Malcolm Turnbull, which will drive coal closure, but the reliability obligation (which requires retailers to provide sufficient quantities of dispatchable power to the grid) could mean that some coal persists in the system in a reserve capacity.
Labor’s objective is to land the policy before the party convenes in Adelaide in mid-December for its national conference.
The government’s new energy minister, Angus Taylor, is pushing in the opposite direction. Taylor is a bright bloke, with a lot of expertise in energy, which makes some of the positions he is pursuing hard to comprehend.
While the science says the energy sector has to transition, and quickly, Taylor is digging in for coal. He’s signalled he wants to extend the life of existing plants and achieve new investment in generation by offering government support, including the possible indemnification of new coal-fired power from future carbon risk, which transfers the risk of these projects from private proponents to taxpayers.
Taylor will also meet with the energy companies in Sydney next week to waggle his finger censoriously at them over their pricing behaviour. Now, why? Because he needs an outcome on that before voters go to the polls next year, because Morrison, in the spirit of handing on a poisoned chalice, has dubbed him the minister for getting power prices down.
Power prices are high, and it would be terrific if they were lower. Ministers should stick up for the interests of consumers, that’s a given, but we also need ministers to think about interests that extend further than the next six months – something this government has become incapable of doing, which is what happens when the sum of your mistakes forces you to live minute to minute, without much care for whether anything connects to anything else, or whether things make sense.
As the chairman of the Clean Energy Finance Corporation, investment banker and company director Steven Skala, noted this week, the transition is on in the energy market. It can’t be reversed. Business has moved. The financial markets have moved. “The question now is not one of direction, but of pace,” he said.
Unlike some disruptions, which present too quickly for governments to ameliorate the effects, we can see this one coming. We are living through the first phase of it.
When it comes to Australia’s 8,000 coal workers and the communities that depend on those workers spending their incomes locally, governments can either pretend they can hold back the future, indulging inane, virtue signalling with Alan Jones about “fair dinkum” power while letting real people be crunched in the transformation, or they can act to make the shift as just as possible.
The report Combet launched this week warns that a hands off approach has left many retrenched workers and their communities with very difficult transition problems.
“Because of lack of subsequent support, some problems – like intergenerational unemployment, poverty and poor physical and psychological health – continue and worsen with time, becoming entrenched and systemic,” it says. “These people, their families and communities have been left to carry the main costs of structural adjustment. This represents a very unfair transition.”
So here’s a thought.
Instead of “fair dinkum” power, perhaps we could contemplate some “fair dinkum” action?

Links

• Scott Morrison says national energy guarantee 'is dead'
• Coalition urged to revive 'necessary and inevitable' emissions reduction
• 'Investors are mostly concerned about political risks': energy minister Angus Taylor – full interview
• Clean Energy Finance Corporation signals it may accelerate reinvestment