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The Third-Rail: Australia's Feud with Energy Policies.









The Third-Rail


 Australia’s Feud with Energy Policies

And how it affects the average household


Australian Politics have many issues that when dealt with, result in the death of the party and most likely the minister’s reputation. A prime example is the energy policy otherwise known as the third rail. Infamous energy policies like the National Energy Guarantee have been debated by both members of parliament and the public, resulting in unstable and erratic energy prices. However, energy crises are not limited to the domestic political climate. On an international level, countries such as Canada and America have also struggled to uphold previous agreements and targets that kept them in public favour. Similarly, in Australia, disagreements regarding energy policy often stem from the so-called ‘donations’ made by the oil and coal industries to the federal government. This then dictates the development of sustainable green energy, the funding of coal, oil and gas industries that only have limited natural resources. Although not officially recognised as bribery, this begs the question of how independent International and Australian governments are from corruption. Sustainable energy and affordable energy prices have been portrayed as mutually exclusive, however many studies have found otherwise.
      

Previously in politics, there have been reforms and band-aid solutions to a much bigger, more significant underlying issue; that the world’s current trajectory is not sustainable both in the environmental and economic sense. There are two instances in which the government has attempted to find permanent solutions to the dilemma of Demand versus Price and Sustainability. The first in the 1950s with the centralisation of the NSW energy industry and the second occurring in the 70s in which - as a result of the decline in hydroelectricity and the increase of coal-fueled energy - caused a drastic change from the previous flatline prices (of energy per household) at the beginning of the decade. The general prices spiked and trends such as the constant increases in national energy prices begun (APH - Thornton, July 2018).      

Energy Crises are nothing new to Australia. Post-WW2 Australia began the ongoing uphill battle against the demand for energy and the available energy that was generated (see graph 1). Under the Menzies government, Australia was able to reform the energy sector with the strict centralisation of the industry. Coupled with Menzies as the longest serving Prime Minister, the nation saw direct effects of the liberal’s targeted areas like domestic economic growth and the general wealth of the country, which elevated and supported the coal industry through relations that remain even in current times.

Australia’s general population is continually concerned for the future, especially in regards to energy & gas costs. This weariness is reflected in the current events that surround Malcolm Turnbull and the Coalition’s National Energy Guarantee; events such as the Leadership spill and the overall disbelief in the success of the policy put forward. There is a distrust of the current coalition and the instability that is a direct result of the conservative-progressive liberal divide. The energy policies, in turn, are then struggling. Without a current energy policy, Audrey Zibelman states that “energy market agencies are forging ahead with measures to help the grid work better” (Oct 7 2018 - Financial Review), with the NEG abolished it is increasingly easier for the energy markets to create sustainable and economically viable energy within Australia. If the energy market is required to run itself without parliamentary supervision, why is the current coalition continuing to push a policy that is detrimental to the industry and in turn Australian households?

On an international level, many countries like America, particularly California, have faced similar issues surrounding energy policy and as a result have created fast-acting, brutal long-term plans as a solution. California is environmentally progressive as a direct result of being a “deep blue state” and coupled with the ‘jungle primary’ electoral system is doesn’t appear to be likely to change any time soon (The Daily Signal - Jarrett Stepman, April 17 2018). Through the elimination of coal dependency in California, they have been able to support and expand the sustainable energy industry which in turn creates reliable jobs for the future.  It is clear the positive effects of having a one-party like system is for the state’s energy policies and further emphasises the detrimental effects of constant leadership changes in Australia as a 

Historically, there are two options when trying to achieve a successful policy. Either the party needs to remain in power for long enough to see through to the end of the polices necessity like California’s state government, or there needs to be a bipartisan agreement on a particular policy so that both parties can - both in the present and future - uphold it and have it succeed. Therefore, when addressing Australia’s current political issues, it can be beneficial to observe other governments on a global scale and learn from their behaviours to further our own endeavours.

It is widely accepted in Australia that cheap energy and sustainable energy are mutually exclusive. However, this notion has been proven false again and again by countless studies and should be disregarded as no longer relevant when putting forward an energy policy. Australia is facing increased gas and oil prices and to combat this the government has put millions of dollars into building better infrastructure for a dying industry (Energy Market Challenges - Australian Government). No transition goes smoothly, however ignoring the blatant problem that the nation is currently faced with - increased demand, but limited sources - is not the solution. There are two sides to this issue that are calling for action. APPEA (a representative of the oil and gas industry) wants to “welcome the White Paper’s (2012) advocacy for reducing red and green tape that continues to limit the development of Australia’s immense gas resources”, which is all well and good until we consider why the tape is there in the first place: to prevent major companies ruining natural resources for the future in the name of profit. On the other hand, sits the environmentally-focused members of the public and science sector. Many are concerned for the future and APPEA’s want to remove the red and green tape.

“So where does the Australian government sit in all of this?”


The problem with a representative government is in the very essence of the system; it represents the public. A public which is divided to the point in which a decision cannot be made. A decision needed to form the much-required energy policy. The reason energy policies are such a hot-button topic is that for one to come into existence the coalition must make a strict decision on how to run the industry and what parts have precedence overall. Turnbull’s government decided to put forward rather “progressive” (in terms of the liberal party) policies and as a result, Turnbull was kicked out in the recent leadership spill. Although Turnbull was trying to cater to public opinion he was at a disadvantage within his party, due to the conflict of interest between the public and the government. Therefore, the idea that creating an energy policy is the third-rail for a political career has been proven, because of course if you touch it you die.

Thus, it is not the energy policy itself that creates the conflict of party and public, but the indecisiveness of parliament and inconsistent leadership that hinders the country. The third rail exists to be a reflection of the weariness and distrust the public has of the coalition and represents why Australia needs a collaborative government to create an energy policy that will be upheld in the future by all parties. Australia needs its government to recognise that sustainable energy and cheap energy aren’t mutually exclusive and need to form an energy policy to encompass that. Furthermore, the Australian government needs to fulfil their job as parliament and provide the energy industry with the policy they need so that Australia will have the services promised to them. Therefore, the third rail is not the energy policy it is the government that made it.

  
 References

  1. http://www.abc.net.au/news/2018-01-04/solar-image-conversation-custom/9298446 Picture 1 (Cover Page): The Conversation: Marcella Cheng 4 Jan 2018 ABC
  2. http://www.abc.net.au/news/2018-01-04/energy-policy-solar-electricity-bills-air-conditioning-costs/9298346 (Graph 2 - ABC, Blowers 4 Jan 2018) 
  3. http://aph.org.au/decisive-new-south-wales-government-action-solved-the-electricity-crisis-but-that-was-in-1950/ ((Graph 1) APH, Thornton July 18 2018)
  4. http://www.abc.net.au/news/2018-08-19/labor-unveils-plan-to-cut-power-prices/10137298 Interview with Malcolm Turnbull on the Energy Policies.
  5. http://www.iea.org/publications/freepublications/publication/EnergyPoliciesofIEACountriesAustralia2018Review.pdf International Energy Agency (Australia Review 2018)
  6. https://www.appea.com.au/industry-in-depth/policy/energy-policy/
  7.  http://gobulk.com.au/a-brief-history-of-energy-in-australia/
  8. https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/BriefingBook45p/EnergyMarket
            Energy Market Challenges - Australian Government
  1. https://www.energy.gov.au/government-priorities/better-energy-future-australia
  2. https://www.energy.gov.au/government-priorities/energy-markets
  3. https://www.energy.gov.au/sites/g/files/net3411/f/enr032-1017-powering-forward-brochure_faweb.pdf National Energy Guarantee. (Turnbull Government)
  4. https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/BriefingBook45p/RenewableEnergy Renewable Energy Targets (Turnbull Government- 2018)
  5. https://www.cleanenergycouncil.org.au/policy-advocacy/renewable-energy-target.html
  6. http://www.abc.net.au/news/2017-02-13/industry-groups-demand-bipartisan-energy-policy/8263928 13 Feb 2017 Peta Donald ABC
  7. http://www.abc.net.au/news/2018-08-19/turnbull-announces-more-changes-to-energy-policy/10137746 Video - Turnbull, Policy Changes 19/08/2018
  8. http://www.abc.net.au/news/2018-07-04/pm-says-energy-policy-has-almost-universal-support/9940020 Video - Turnbull, “universal support”
  9. https://www.afr.com/news/special-reports/afr-focus-energy/australias-energy-policy-is-shipwrecked-on-the-same-reef-again-20181001-h163p5 Oct 7 2018 - Financial Review
  10. https://www.dailysignal.com/2018/04/17/the-changes-that-made-california-become-a-liberal-fiasco/ The Daily Signal - Jarrett Stepman, April 17 2018
  11. https://theconversation.com/california-aims-to-become-carbon-free-by-2045-is-that-feasible-102390 The Conversation - Professor Sarah Kurtz Sept. 12 2018


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