Bowen’s Reliable Renewables plan is serving us ill

Minister for Climate Change and Energy Chris Bowen during question time at Parliament House in Canberra this week. Picture: Martin Ollman/NewsWire

The Albanese government is facing a loss of social licence for its energy transition, particularly in regional areas. A recent survey confirmed this decline, with less than half of the respondents (47 per cent) feeling positive about the renewables transition compared with the peak of 70 per cent in August 2022.

Instead of dealing with concerns, Climate Change and Energy Minister Chris Bowen persists with a rebranded Reliable Renewables plan and attempts to convince us it’s working well. Labor’s message doesn’t accord with the experiences of many communities or acknowledge the burden of rising power bills and systemic problems.

To claim weather-dependent, intermittent renewables are reliable is akin to Bowen’s claim that renewables are the cheapest form of energy because the sun and wind don’t send you bills. People see through the spin, knowing the cost of power has never been higher.

Governments are responsible for ensuring the lights stay on and industry functions. Labor believes reliable renewables, backed up by batteries and pumped hydro, can power our economy. They can’t. Baseload power is essential in the energy mix to guarantee certainty of supply. It’s like previous assurances that Labor’s modelling stood up to scrutiny, only for it to unravel with the first broken promise that household power bills would be reduced by $275 by 2025.

Last year the transition stalled, with investment falling to the lowest level since 2017. Emissions fell by 0.5 per cent and renewables were 50 per cent short of target. With the government desperate to meet its 2030 targets, the Capacity Investment Scheme will now underwrite a further 32 gigawatts of renewable capacity.

The scheme operates off-budget with no stated cap on costs. In secret contracts for difference, risk for revenue losses below the floor will be transferred from investor to public. It’s an incentive to invest and profit from subsidised renewable projects. No wonder overseas investors are lured by such terms.

The saga of Snowy 2.0 continues. After years of delay, huge cost overruns and problems with tunnel boring machine Florence, a complex fault zone has been discovered. It has required the purchase of a fourth tunnelling machine, costing $75m and now awaiting approval to be used.

It’s unlikely Snowy 2.0 will be operational this decade, if ever. What if and what then? We’re also told repeatedly “there’s no transition without transmission” but, two years on, not one of five “urgently needed” transmission projects is at the construction stage.

Labor remains conflicted about the importance of gas for domestic use, to provide industry with reliable and affordable power 24/7, to firm renewables, provide stability to the grid and underpin 225,000 manufacturing jobs. With Victoria, Bowen repeatedly has rejected gas, even as a transition fuel, and excluded it from the CIS. How does he intend to replace 90 per cent of our baseload power with coal’s exit during the next decade?

Now there’s concerns with the Kurri Kurri gas plant. Costs have blown out to $1.4bn for a plant that doesn’t tap into the main trunkline. The construction of a 21km gas and storage pipeline has been delayed another year, with approval needed to run the plant on diesel next year. How will future gas supply be guaranteed? So much for Labor’s promise the plant would open on a 30 per cent hydrogen-gas mix and run on hydrogen by 2030.

With Labor’s ambivalence about gas and an irrational prohibition on nuclear, the public needs to know how reliable baseload power will be provided under Labor’s plans. Instead of the minister addressing this critical issue, his focus yet again is on targets; the emissions reduction target for 2035. He’s awaiting advice from the Climate Change Authority, chaired by Matt Kean, which previously suggested an increase in the 65 per cent to 75 per cent range.

Virtue signalling and targets continue to drive Labor’s agenda. In a world of magic pudding economics, the energy transition is held together by subsidy on subsidy, temporary relief packages and grants galore. Hydrogen projects, central to Labor’s vision of being a renewable energy superpower, depend on these grants. Despite billions in taxpayer support, private capital has remained wary. Fortescue and Origin Energy have cut their losses and walked away from involvement. Labor’s $63.2m grant to underpin the promise of green steelmaking at Whyalla also is teetering on the brink.

Labor’s demand that the opposition “finally lay out detailed costs, analysis and modelling” is the right call. It should apply equally to Labor’s plans. The government should respect the public’s right to know and provide its whole of system costings, incurred and estimated, as well as funding for the CIS and transmission costs passed on undeclared in our power bills.

Labor’s plans are not working well and its 2030 targets won’t be met. We’re at a crossroad where decisions about our energy future will have lasting consequences.

The warning signs are there, but is Labor listening?

Jennie George is a former ACTU president and Labor MP for Throsby.