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Finkel Report – Groundhog Day or Green Way Forward?

Kim Brebach - Tuesday, June 27, 2017

The Finkel Report – Groundhog Day or a Way Forward for Renewable Energy

Australia’s Chief Scientist, Dr Alan Finkel, recently produced an energy report which focused on the consequences of energy generation – emissions – not the technologies deployed. No fuel type or technology was excluded – including coal and gas – so why are so many conservative politicians up in arms? We dig deeper into the murky realm of technology and politics.

Coal Still in the Mix

inkel’s Independent Review into the Future Security of the National Electricity Market, presents a classic model of ‘Let the market decide’ which should delight the conservatives en masse. The measures that Finkel suggests don’t penalise polluters, but instead reward those who produce cleaner forms of energy. This means that, as renewables become cheaper and more ubiquitous, more electricity companies will find more reasons to take them up. In any case, in the short term, power from coal and gas will continue to play a major role in the energy mix, so where is the problem?

Image Source: Sydney Morning Herald

‘The shocking Finkel report will burn us’

So says Piers Ackerman in the Daily Telegraph. According to Laura Tingle at Businessinsider, former PM Tony Abbott doesn't get the nuances of the Finkel positioning, seeing it as a 'tax on coal' and isn't keen to listen to those who disagree, including Assistant Minister for Industry, Innovation and Science, Craig Laundy. Tingle reports that ‘in front of appalled colleagues, including a number of cabinet ministers … Abbott persisted with a stream of unpleasant abuse directed at Laundy and then invited Laundy to “go f**k yourself”.’

‘Of the 104 Senators and MPs in the Coalition party room,’ Andrew Probyn reported on the ABC’s 7.30 program, ‘about a third spoke, two-thirds of them largely spoke against it.’

The ‘Get Finkel campaign’, says Laura Tingle ‘started almost before the Finkel report was officially released at the Council of Australian Governments meeting in Hobart.’ She adds that ‘most of the people engaged in this discussion haven't actually read the 212-page Independent Review into the Future Security of the National Electricity Market. Most cheerfully admit to that.’

Out of Step with Everyone - except Donald Trump

Why are the Liberals so vehemently opposed to a market-based solution to our power crisis? One that Greens Leader Richard di Natale describes as ‘little more than a short term political fix, which Malcolm Turnbull will use to appease the right wingers in the Coalition’? Di Natale adds that the Coalition is now ‘wildly out of step with its traditional base in the business community that now wants policy sorted, is putting its investment eggs in the renewables basket, and is appalled and confused about what on earth the politicians are doing.’

Why are Australian conservatives so backward, when their counterparts in the rest of the world have moved forward? Big business everywhere has embraced renewable energy, from Apple to Google, from Goldman Sachs to Walmart, from Nestle to Unilever and BT. By March of 2016, 93% of Apple’s facilities ran on renewable energy. Google will soon run its data centres on 100% renewable power, yet Australia’s political leaders are still stuck in the coal age, and relishing it.

Image Source: In Daily

Even our own electricity companies have embraced renewable energy: Origin Energy says it’s on track to close to 1,500 MW of renewable power by 2020, and AGL has set up a Future Fund that is targeting approximately 1,000 MW of large-scale renewable generation, with a total investment of $2 -3 billion dollars. Late last year , EnergyAustralia announced $1.5 billion renewables drive.

A Entire Decade Wasted

Alan Kohler reminds us that ‘We had a bipartisan policy after the 2007 election when both main parties were proposing an emissions trading scheme based on the Shergold Report of that year … [The report] recommended an emissions trading scheme and both major parties agreed. It was a sound process that came to a sound conclusion, until it was blown up by Abbott and his gang in 2010.’

Kohler adds that the Coalition’s repeal of the emissions trading scheme in July 2014, and its replacement by Direct Action, ‘was a con. Since then power prices have tripled and carbon emissions are rising.’ As if to underscore that statement, Energy Australia and AGL announced electricity price rises of close to 20% across the board in the same week the Finkel Report saw the light of day.

On the 7.30 Report 3 years ago, Abbott boasted that repealing the ‘toxic’ tax had removed a handbrake on the Australian economy. He claimed that Australian households would be $550 a year better off, that gas prices would fall 7% and electricity prices would drop 9%. ‘Everyone would be a winner', he told 7.30's Leigh Sales.

‘Even Without Help, Australia’s Renewables Are Booming’

The Finkel Report recommends a CET as the best way to enable Australia’s transition to cleaner energy sources, which will allow it to meet its Paris Accord commitment of reducing emissions by 26 – 28% on 2005 levels by 2030. Alan Finkel added that a CET ‘would restore investor certainty to a volatile and dysfunctional energy market, resulting in slightly lower prices. The most expensive option in terms of power prices would be to do nothing … while a CET will unlock $890 billion in investment which is needed for power generation, transmission and distribution by 2050.’

According to the Finkel Report, wind is the cheapest sources of electricity today, closely followed by brown coal, black coal and solar. It may surprise you to learn that the worst performer is gas. ‘It's by far the most expensive option,’ says Ian Verrender, ‘a cruel irony given we are set to become the world's biggest gas exporter in four years and a sad indictment on the short-sighted nature of Australian policy makers.’

We Have The Technology – but for How Much Longer?

What is lost in all the ballyhoo is this simple fact: by promoting Australia’s reliance on coal and natural gas, our government is putting the brakes on development of  renewable energy technology. It means we’re in real danger of falling further behind, instead of seizing the opportunity to be at the forefront of developing leading alternatives. We have the technical know-how; what we lack is political vision. Plus ca change.

Further Reading

Finkel report: Major review of Australia's energy sector explained (ABC NEWS)

INFOGRAPHIC: Implied cost of new generation (Supplied: UBS)

Turnbull on Renewable Energy: Leadership in Reverse (Technoledge)

Effective Leadership Skills: Learning from Turnbull’s Mistakes (Technoledge)


Kim Brebach
Content Chief

Kim loves people and words. He is our lateral thinker, ideas guy and genius story teller. He can conjure engaging technology yarns out of thin air.

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