Sheradyn Holderhead analysis: SA power crisis — and what the State Government’s fix means for the nation
ANALYSIS: The State Government’s new power plan just deepens the ideological war between Labor and the Coalition over electricity, writes Sheradyn Holderhead.
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THE ideological war over power has only just begun.
Prime Minister Malcolm Turnbull and his Government have been prosecuting the message that SA’s energy woes were created through the State Labor Government’s “greenie ideological dream”.
They say if Labor had its way, it would infect the national grid.
In doing so, the Coaltion has done a good job deflecting blame away from obvious problems and gaps in national policy.
Jay Weatherill’s announcement today will further deepen the battle lines.
His plan boldly states “coal is our past” and introduces another state-based emissions target, clearly escalating the conflict in views.
While Mr Turnbull has been at pains to say his Government is “technology-neutral” when it comes to future electricity generation, there’s been a lot of support for the future role of coal — and only a few weeks ago Treasurer Scott Morrison passed around a lump of coal in Question Time.
The Coalition has also ruled out introducing any sort of price on carbon, claiming it would increase power prices.
This includes an Emissions Intensity Scheme — which Mr Weatherill has been pushing — and it has lashed state-based Renewable Energy Targets.
But Mr Weatherill proudly stated his Government is sticking to its Renewable Energy Targets and, in the absence of national leadership on an EIS, will introduce its own scheme.
An Energy Security Target will force energy retailers to source a set amount of energy from low emission, on-call local generation — likely to come from gas generators.
But an analysis of the scheme reveals “of course the retailers will seek to recover the costs of the subsidy from consumers”.
This admission will surely delight the Coalition, as it can use it to strengthen its argument that such schemes will only serve to cost households more.
While the Frontier Economics report goes on to explain that the “net effect of the EST will be that consumers will be no worse off” and could in fact be better off, every time prices increase — as they naturally will to some extent — the Coalition can blame this scheme.
The Premier says his energy plan will also ensure SA is less reliant on importing power from Victoria’s dirty coal-fired power stations.
Mr Turnbull will also be able to use this as a concession that SA Labor did not properly plan its embracement of wind power.
He has previously labelled Mr Weatherill’s “mindless wander off into renewables” as “very lazy and complacent”.
“Not only is it hypocritical because you’ve got businesses and households running diesel-fuelled generators, which obviously emit a lot of CO2, but you’re sucking more and more brown coal energy out of Victoria,” Mr Turnbull told The Advertiser last month.
The Coalition was already preparing to ramp-up its rhetoric over power security and this plan will surely add fuel to the fire.