The solution to our absurd gas crisis

CORPORATE and political cowardice in the face of green intimidation is skyrocketing our electricity prices, writes Miranda Devine. But there’s a simple solution.

In the United States, landowners share in the profits of the gas that is under the land they own. Should Australia adopt a similar strategy? (Pic: News Corp)

WINSTON Churchill described an appeaser as “one who feeds a crocodile hoping it will eat him last”.

In other words, appeasement doesn’t work. It just empowers your enemy.

Pity BHP doesn’t realise it. Not only has the big miner embraced the global warming religion, but it reportedly has forced out the head of the Minerals Council, Brendan Pearson, because he has been too effective a supporter of coal.

Corporate and political cowardice in the face of well-funded green intimidation is a big reason for our skyrocketing electricity prices. So is a decade of federal policy schizophrenia.

Pity energy minister Josh Frydenberg, whose job it is somehow to solve this Rubik’s cube of energy policy, where the political imperatives of affordability and stability conflict with emissions reduction promises baked into corporate decision-making and the distorting subsidies of renewable energy.

But the Prime Minister is right to focus on our absurd gas crisis which he says is the “single biggest factor in the current rise in electricity prices”, since gas largely sets the wholesale price for electricity.

Minister for Energy Josh Frydenberg has the job of solving our Rubik’s cube of an energy policy. (Pic: AAP/Mick Tsikas)

The shortfall on the east coast is caused by the fact that we now export most of our gas, without reserving enough for domestic markets, thanks to previous Labor policies.

But it’s also because of cowardly state governments of all stripes. Victoria banned coal seam gas extraction last year and NSW, under Barry O’Farrell, placed so many environmental obstacles on gas extraction, it may as well have banned it.

Green activists with huge war chests, and the Nimby locals they hide behind, know that they can paralyse a government and close down a gas project.

Santos’ project in the Pilliga forest near Narrabri, for instance, could supply half the gas NSW needs but it has been trying in vain to win approval for six years.

The solution is obvious: divide and conquer. Unlink the activists from local landholders who are understandably enraged that their land is being invaded by gas companies with no compensation.

Theresa May in the UK has figured it out: pay residents affected by fracking a portion of the proceeds.

Even South Australia, for all its green idiocy, has included a share of royalties for landowners in its latest policy.

It’s the only fair thing to do. It’s what happens in the United States. The landowner shares in the profits of the gas that is under the land they own. The US has become almost energy independent thanks to an oil and gas boom, fuelled by fracking, with farmers in out of the way pockets of Kansas and Texas becoming rich overnight.

If you own the land, you should share in the proceeds of what is underneath. And no longer will you be forced into the arms of activists.