BLACK DAYS FOR ENERGY CONSUMERS
Thursday, 05 February 2009 02:34
The Federal Government’s announcement of $3.8 billion of spending yesterday on insulation and solar hot water is dabbling, not problem solving. It’s a one-off hand out that will be overshadowed by the energy industry’s core motivation: to sell more electricity.
The vast, untapped potential of energy efficiency is the only real cure for black-outs, escalating energy bills and ballooning greenhouse emissions. Real energy efficiency does not rely on altruism. It does not require people to reduce their standard of living. COAG has calculated that Australians could reduce energy consumption by a whopping 70% while maintaining or improving services. The McKinsey Report has confirmed that Australia could reduce its greenhouse emissions in 2020 by 20% at zero net cost to the economy simply by implementing energy efficiency. This would be four times better than Kevin Rudd’s sickly 5% cuts.
Energy efficiency generates ‘nega-watts’ not megawatts. It includes advanced control systems for lighting and air-conditioning, efficient motors and refrigeration, smart meters, reduced stand-by power settings, fuel switching (such as solar water heating) and many other smart technologies.
So why are we still installing inefficient air conditioners and building new houses without insulation? Why are we facing rising power bills and black-outs? Because the energy industry is running the show. Electricity companies have a vested interest in selling more electricity because that’s how they make money. The recent call by the Energy Networks Association for an extra $50 billion is a perfect example of this. It’s called ‘gold-plating’. The formula is simple: the more ‘poles and wires’ in the ground, the more revenue these companies can earn. It is money that comes out of the pockets of the same electricity consumers who are suffering black-outs in the middle of these current heat waves.
Australia’s electricity consumption has rocketed up by 70% since 1980. Over the same period, California has kept electricity consumption virtually static. How did they do it? Better regulation, which is exactly what Kevin Rudd has just called for. Simple carrot and stick: when targets for energy efficiency are met, the companies are rewarded, when they don’t, they are penalised.
The only way to fix the grid with better regulations is to crack open the clique that currently sets Australia’s energy industry policy. This tight-knit group of bureaucrats, energy industry players and regulators uses a lot of oxygen defending the free-market mythologies that have recently been so thoroughly discredited. Kevin Rudd needs to go the core of the problem, not just tinker on the edges. He needs to pull Federal Energy Minister, Martin Ferguson, and his state counterparts, into line and reform the mess at the very centre of Australia’s climate change crisis.
