Down Under, Mindless Fantasies of Net-Zero

Peter Smith24 Feb, 2023 4 Min Read
Life in Cloud-Cuckoo-Land.

We have a government scheme in Australia which I’ve mentioned before. Its objective is to ensure the lights don’t go out during the chimeric transition to a bountiful job-rich renewable-energy future. It’s called the capacity mechanism. I suspect most western jurisdictions have one, in one form or another. In Australia it came under the purview of the Energy Security Board. Alas, the ESB is effectively no more; it’s been absorbed by the ever-expanding renewal-energy hegemony (akin to The Blob); namely, in this instance, by the Australian Energy Market Commission, the Australian Energy Regulator and the Australian Energy Market Operator. We got a million of 'em.

The ESB made the mistake of proposing the use of gas and coal to “firm” the supply of electricity during the transitional period and was duly given a damn good thrashing for its trouble. So now the plan, so far as I can work out, is to firm unreliable renewables with unreliable renewables, plus a few batteries thrown into the mix. Don’t dare say it won’t work. They visualize therefore they actualize.

The transition itself, which I’ll come to, via a different government scheme, this time mysteriously called the safeguard mechanism, is still no more than a gleam in the eyes of renewable-energy aficionados. To illustrate: the latest official figures, for the year 2020-21, show that coal, oil, and gas accounted for 92 percent of Australia’s energy consumption. Energy badged as "renewables" accounted for only 8 percent; and of that wind and solar was only 45 percent, or 3.6 percent of the overall total. That’s where we’re at after three decades and more of huffing and puffing and spending billions of dollars on subsidies and tax breaks. And yet, mindless fantasies of net-zero persist unabated among the zealots who populate governments and the plethora of assorted climate-change bodies.

Walter Mitty, stand aside.

Surely the world is doing better than Australia in saving the planet? I consulted the BP Statistical Review of World Energy, to find that 92.6 percent of energy consumption came from coal, oil, gas, nuclear, and hydro in North America in 2021, and 93.3 percent in the world as a whole. Of the rest, including biomass and ethanol, wind, and sun form only a fraction. Consolingly, Australia is not letting the side down.

But we must do better, so says Chris Bowen, "climate change" minister in the federal government. Bowen is on the job, single-mindedly; or, more aptly, simple-mindedly. Hence the so-called safeguard mechanism; named, I can only assume, to keep the planet safe from the one percent of world emissions being spewed out recklessly by Australian industry.

To give effect to the mechanism, legislation is afoot to make the 215 largest emitters of CO2 reduce their emissions by 4.9 percent per year from July this year until (end) 2030. Why 4.9 percent? Well, compounded, it comes to 43 percent after seven and a half years, in line with the government's goal of reducing emissions overall by 43 percent. Is that scientific enough for ya? Those who better this hurdle will be allowed to sell carbon credits to their recalcitrant fellows, who will also be allowed to buy carbon credits (domestic and some selected foreign credits) on the open market to assuage their polluting excesses.

The Greens (Party) don’t like the scheme. Giving miners the option of paying to pollute doesn’t row their boat. But, transactional to their bootheels, they’ve offered their votes in the Senate—required if the legislation is to pass—with the proviso that all new coal and gas projects are prohibited by law. I am not sure why they’re bothering to seek de jure prohibition when, de facto, the job is pretty well done. A combination of state government bans, onerous federal and state environmental hurdles, green and indigenous lawfare are already preventing any new projects from going ahead. It can only get worse as Australia’s judiciary inevitably becomes still Woker. Capital will flee.

Take a recent court case in which Australia’s largest gas producer, Santos, lost its ability to restart drilling at a multi-billion-dollar gas project off the Tiwi Islands, 265 kilometres northwest of Darwin. Santos thought it had jumped every environmental hurdle, consulted every indigenous group with a legitimate interest. It missed someone. Tiwi Islander Dennis Tipakalippa launched legal action, claiming successfully that he was not consulted over the company's plans and should have been. Apparently, his rights had been trampled on.

Rights to the sea country [in question] were based upon longstanding spiritual connections as well as traditional hunting and gathering activities in which they and their ancestors have engaged.

Spiritual connections you see. And how could Mr Tipakalippa afford to take legal action to protect his spiritual connections? Look no further than the Environmental Defenders Office (EDO); a bunch of lawyers on a well-financed mission to stymie fossil-fuel developments. If you look hard enough, and the green-left are indefatigable in their oversight, there is not one patch of Australian land for which an indigenous person can’t be found to have a spiritual connection. It’s game over, short of a sufficiently faltering grid bringing about a return to sanity. Cling on to that last best chance.

Clingers of the world, unite!

Back to the safeguard mechanism. It covers only 28 percent of Australia’s emissions. It will have a marginal effect, if any measurable effect at all. It will impose further costs and regulatory burdens on many of the businesses and industries which underpin Australia’s prosperity, and thereby lessen their international competitiveness. As to that, the government has engaged in silly speculative talk about placing tariffs on imported products which compete with products hit by the safeguard mechanism, which have not been similarly hobbled in their home country. The mind boggles as complication is heaped on complication is heaped on cluelessness. And all for very little to nought.

Be done with it. Close Australia down. Save the world. Shucks, forgot. China emits more greenhouse gases in 16 days than Australia does in a year. Never mind. As the late and great Leonard Cohen might have put it on behalf of alarmists: First we take Sydney, then we take Shanghai.

After a career in economics, banking and payment-systems management, Peter Smith now blogs on the topics of the day. He writes for Quadrant, Australia’s leading conservative online site and magazine. He has written Bad Economics, of which, he notes, there is much.


See All

2 comments on “Down Under, Mindless Fantasies of Net-Zero”

  1. Thanks Craken. My arithmetic is wanting. However, I should have looked more closely, the actual legislation before parliament has no compounding. For the record, the annual percentage decline of 4.9 percent applies each year on the intial base. Thus 95.1 percent of the base in the first year, to 90.2 percent in the second, to 85.3 in the third, and so on.

  2. "reduce their emissions by 4.9 percent per year from July this year until (end) 2030. Why 4.9 percent? Well, compounded, it comes to 43 percent after seven and a half years, in line with the government's goal of reducing emissions overall by 43 percent."
    There is no compounding effect here because the original amount is being reduced each year, not increased. 7.5 years of increasing at 4.9% runs to about a 43% increase. 7.5 years of decreasing at 4.9% runs to less than 36.75% (7.5 x 0.049) because the 4.9% reduction is being applied to an ever smaller amount with each passing year. The correct figure is 31.3%.

Leave a Reply

Your email address will not be published. Required fields are marked *