Government reports on energy policy are almost inevitably boring and full of jargon and this is certainly the case with the Tasmanian draft Energy Strategy “Restoring Tasmania’s Energy Advantage”.
While acknowledging the complexity and risks in the electricity industry, the tone of the report is clearly intended to convey the feeling that the government has everything under control, that the future will be better than the past (which is taken mainly to mean cheaper electricity and more choice for customers). The subtext is that previous governments are responsible for past unpopular increases in electricity prices.
The Strategy talks in vague terms about anticipated “global trends towards less emissions intensive energy generation” but is silent on the impact for Tasmania of the Abbott government’s sustained attack on renewable energy.
Abolition of the carbon price and uncertainty about the future of the RET have had a negative impact on the Tasmania economy to the extent of hundreds of millions of dollars.
Another important thing to understand about this strategy is that it is not about energy policy in Tasmania, it is about the electricity industry. Despite the fact that around half of Tasmania’s primary energy is imported petroleum products, the report focuses almost entirely on electricity.
Only 5 ‘Actions’ relate to transport …
While the electricity industry certainly faces challenges, these are of much less potential impact on the Tasmanian economy than for example the possibility of a major price increase or supply disruption to the flow of oil products. Of the 46 Actions identified in the report, only 5 relate specifically to transport.
Within the electricity industry there are some very significant potential developments that would have a major impact over the next few years which present both challenges and opportunities for Tasmania:
• A global agreement on the need to rapidly reduce greenhouse gas emissions would have a big impact on Tasmania, increasing the value of our renewable electricity resources, but also possibly increasing the cost of aviation and negatively impacting our tourism industry. One would hope that such an agreement is reached this year in Paris but just about everyone except Tony Abbott and Joe Hockey believe it is necessary in the very near future.
• Rapid price drops for battery storage make it viable for many consumers to go off-grid, leaving TasNetworks with the same network to maintain but many fewer customers to pay for it.
• Innovative new entrants use the value of electric vehicles combined with in-home battery storage to cherry-pick the most valuable customers, leaving Aurora Energy with a sparser and poorer customer base.
• As the impact of climate change become more widely felt, Tasmania experiences a rapid increase in population and associated energy demand.
• Political disruption in the Middle East leads to a sudden major price increase in the cost of oil and associated disruptions to supply.
• Closure of one or two major industrial electricity users leads to a massive over-supply of electricity and a sudden reduction in income for the state owned businesses Hydro Tasmania and TasNetworks.
Some of these possibilities are mentioned in a low-key way in the draft Strategy, but without any real sense of urgency and certainly without any detailed discussion of how they could be dealt with.
t is hard to avoid the feeling that the government is more enthusiastic about chopping down trees than …
Scenario planning is a well-established methodology for dealing with uncertainties, but is not favoured by government report writers because any serious consideration of the possible scenarios that could impact on Tasmania’s energy sector tends to undermine the impression that everything is under control.
Over half of the 46 ‘Actions’ in the Strategy involve little or no actual change in our energy future, proposing simply to advocate, monitor, investigate, identify, explore or review.
Only two Actions have actual budget figures associated with them, and both of these relate to bio-fuels, particularly from forest ‘residues’. These may well be desirable initiatives, but it is hard to avoid the feeling that the government is more enthusiastic about chopping down trees than it is about expanding Tasmania’s generation of electricity from hydro, wind and solar.
Positive aspects of the Strategy include:
• acknowledgement of the complexity of planning the future of the electricity industry
• the Strategy is more measured about the claimed cross subsidy of solar PV owners than a lot of the more strident anti-solar statements by politicians and utility spokespeople and it does acknowledge that there are other classes of customers who could also be argued to be not meeting the full cost they impose on the network
• the proposal that the Office of the Coordinator-General develop prospectuses for future industries with potential to locate in Tasmania could be a welcome development provided it is undertaken in consultation with the community and relevant industry representatives and focuses on industries that create sustainable jobs, not just big energy users.
The Strategy claims to have a “20 year horizon” but does not spell out a detailed picture of what Tasmania’s energy future might look like in 20 years.
The ‘vision’ is a very vague set of statements about affordability, consumer choice, energy efficiency, growth and opportunities.
Nor do any of the actions have a timeframe beyond 2019. One can be pretty confident that this document will not be guiding our future in 5 years’ time and however Tasmania is placed in 2035 it won’t be a result of this document.
Comments on the draft Strategy are due by Sunday 15 February.
Details are at:
http://www.stategrowth.tas.gov.au/energy/strategy
