For all the acres of words being written about Peter Dutton’s fantasy of seven nuclear plants, no such plants will ever be built in Australia. Yesterday’s announcement by Dutton — so devoid of substance that even the press gallery’s fence-sitters derided its lack of detail — was really about creating a cover for the one solid Coalition energy policy that currently exists.
That policy is to sabotage investment in large-scale renewable energy — or to “cap” it, as Nationals leader (and putative deputy prime minister in a Coalition government) David Littleproud put it this week.
That cap will take the form of, if you like, a de jure one in which the Coalition would cut Commonwealth funding for large-scale renewables projects and the transmission and distribution projects needed for them, leaving the only investment in renewables to be by state governments or households in rooftop solar, and a de facto one in terms of the sovereign risk that renewables investors now face.
That is, why would you plan to invest in a large-scale renewables project if you know there’s a substantial chance — according to the latest polling — that a Dutton government would move to kill off funding both for renewables and for the poles and wires needed to move the power they produce and store to households and businesses?
This sovereign risk is already worrying business, especially those that rely on infrastructure construction. “What we’re doing here is bringing in sovereign risk again into this decarbonisation debate,” one group told the Financial Review.
It’s important to understand that that’s not some minor collateral damage from Dutton’s embrace of nuclear power. It’s not some unintended consequence — it’s the entire point. The Coalition knows that policy uncertainty is bad for investment in any industry, but especially one as dependent on regulatory certainty as energy infrastructure. With investment in renewables already badly affected by the inability or refusal of state governments to expedite transmission construction, the opposition knows the kind of impact it can have on investor sentiment even when not in government. A major change of policy in Australia is never more than three years away.
Normally it’s Labor being accused of “sovereign risk”, with the Coalition posing as the business and investor-friendly side of politics. But when it comes to the energy sector, the only friends the Coalition has are in fossil fuels and the uranium industry. The fact that the Coalition wants to derail even investment currently under consideration illustrates just how obsessed with a culture war on climate change it, and its media backers at News Corp and Seven, really are.
It’s been 15 years since the Coalition turned its back on John Howard’s embrace of a carbon pricing scheme — a sensible, market-based solution to the challenges of climate policy. As the side of politics most supportive of market, rather than regulatory, solutions, the Coalition should have been the ones to champion a price-based mechanism to curb carbon emissions. Instead, under the malignant influence of News Corp, it became the party of climate denialism and conspiracy theory around basic climate science.
By the time Malcolm Turnbull lost the leadership of the Liberal Party for a second time at the hands of right-wing denialists in 2018, the Coalition had moved on from rejecting market-based solutions to climate science to rejecting the possibility of climate action of any kind — Scott Morrison couldn’t even explain how Australia would ever get to his hopelessly inadequate 2050 net zero target, except by magical technological developments as yet undiscovered.
Dutton has now gone even further and is working to actively sabotage renewables investment. This is peak culture war: any economic, fiscal or philosophical logic has been abandoned in favour of the goal of destroying a hated enemy — renewable energy — no matter what the cost.
We’re all reporting this as a story about energy, about engineering, about public finance and costings and day-to-day challenges around delivering, operating and maintaining infrastructure. In fact it’s a culture war, pure and simple. And like any culture war, there’s no room for logic, evidence or reality — just enemies.
How can the government — and the media — avoid falling into a nuclear culture war with the Coalition? Let us know your thoughts by writing to letters@crikey.com.au. Please include your full name to be considered for publication. We reserve the right to edit for length and clarity.
