Editorial: Renewable energy still just a risky bet

The government insists it’s got a plan to turn Queensland into a renewable energy powerhouse, but can it deliver, asks the editor.

The state government insists it’s got a really well-thought out plan to turn Queensland into a renewable energy powerhouse. But can it deliver, and at what cost?

Premier Steven Miles has not only decided that the government can, but will also go for broke – whatever the cost.

Mr Miles used a column he contributed to The Courier-Mail for Queensland Day to reveal that next week’s state budget will allocate another $7bn to his Renewable Energy and Jobs Plan, boosting the four-year total to a hefty $26bn.

That pledge is despite the fact that the plan’s big-ticket energy decarbonisation items – two huge pumped hydro projects, at Borumba near Gympie and Eungella inland of Mackay – are still only in the planning or pre-approval phase, with cost estimates and budgets that just keep soaring.

In other words, Mr Miles is not exactly betting on a sure thing – and so he is committing to projects that are a high-risk use of public money.

The big problem, at least as the Miles government sees it, is that we do not have a choice.

The Premier claimed yesterday that “if Queensland doesn’t meet our renewable energy targets, jobs and growth will be devastated” – quoting Deloitte Access Economics modelling which says Queensland stands to lose out on 87,000 more jobs in the renewable energy sector by 2035 if the state misses its 75 per cent emissions reduction target.

“We are at a turning point,” Mr Miles declares. “Our investment in renewable energy is as important today to our economic future as that investment was in the railways in the second half of the 1800s.”

Even if all this is correct – rather than a combination of best-case forecasting by paid consultants and pre-election bombast – this latest multibillion-dollar addition to the government’s renewable energy budget points to an unpleasant truth: that energy users are likely to be paying more for power, rather than less, for a long time to come.

And so enjoy your $1000 towards your power bills this year that the government will give you at a cost to the budget of another $3.5bn, because you will be paying even more soon. That’s because the simple fact is someone has to pay for this proposed $26bn investment in renewable energy.

And, logically, it will be the customers of Queensland’s state-owned power companies that are supposed to build these new renewable energy assets. That is, Queenslanders.

But that scenario remains some time off, and it is certainly long after this October’s election, which is no doubt Mr Miles’ main focus at the moment. This huge and risky bet with public money will presumably play well with left-leaning voters in inner-city electorates who might otherwise be considering casting a ballot for the Greens.

It also sets a political trap for the $1.08 election favourite, Opposition Leader David Crisafulli – who has committed any future government he leads to honouring in totality next week’s state budget sight unseen, in the service of “stability”.

There is of course some truth to the Premier’s claim that our state needs to invest now in options for power generation that are not just coal-fired.

But to jump from that reality to betting the house on the equivalent of a foal that is yet to be born winning the Stradbroke three years from now is an even riskier punt than dropping $10,000 on the $8.50 odds currently being offered for Labor to win in October.

NO GIANT LEAP, JUST COSTLY SMALL STEPS

The revelation that NASA put men on the Moon for pretty well the same cost per minute – adjusted for both inflation and the current exchange rate – that the Miles government will spend over the next four years on just delivering the infrastructure Queensland needs should set off alarm bells.

After a decade of chronic under-investment in meeting the needs of a growing state, and four years of stupidly generous deals with the construction unions, this Labor government’s chickens have well and truly come home to roost.

That the result is the Treasurer has no choice but to burn every cent – and more – of the once-in-forever royalties boom that he trousered from the state’s coalminers, thanks to record world prices over the past couple of years is the tragic icing on what can only be described as a certain kind of sandwich.

The same government that says it cannot afford politically to allocate $2.7bn or so of already budgeted cash for a new stadium so we are not embarrassed on the world stage when hosting the Olympic and Paralympic Games in 2032 is now boasting of the fact it will spend 10 times that every year over the next four years just building the basics.

It points to not only a decade of poor planning and decision-making, but to a bunch of career politicians who treat taxpayer cash as if it is Monopoly money. In that game, constructing the most expensive building sets you back a total of $1400. In Labor’s Queensland, you can easily multiply that by a million.

Responsibility for election comment is taken by Chris Jones, corner of Mayne Rd & Campbell St, Bowen Hills, Qld 4006. Printed and published by NEWSQUEENSLAND (ACN 009 661 778). Contact details here