Eric Worrall's paper
Domestic energy policy mistakes by politicians from all sides are killing Australia's manufacturing industry.
“Big Lie”: Why the Government Can't Provide Cheaper Power
For two decades, political leaders have been pledging lower power bills. But as the energy transition is in full swing, its high time clears its real cost.
Ryan Cropp Energy and Climate Journalist
March 27, 2025 – 5.00am
Since the early 2010s, when Australia's climate war began seriously, in fact, every federal political leader has committed to doing something about electricity prices at some point in the election cycle. They rarely follow.
The Albany government is the latest government to enter the trap. Treasurer Jim Chalmers offered a third round of electricity discount Tuesday night, partly because the incident has been replaced by activity after his poorly-fated 2022 election promised to reduce bills by $275, although that is largely beyond their control.
But, not threatened, the coalition is entering the federal election, with its equally unobtrusive counterclaim that the policy of replacing Australia's coal power plants with seven government-owned nuclear plants would reduce the electricity bill by 44%.
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But no matter what way you cut it, Australia's energy system is at a crossroads. It relies on an aging and increasingly unreliable fleet of coal-fired power plants that will eventually require replacement. Whether the government chooses to use renewable energy, nuclear, or something else to do this, it will cost a lot of money.
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Read more (PAYWALLED): https://www.afr.com/policy/energy-and-chimate/the-big-lie-why-governments-can-t-deliver-cheaiver-cheapower-20250318-p5lki3
Australia's energy infrastructure is not “at the intersection” but on the verge of collapse. Aging power systems have far exceeded their expected end of life as decades of hostile regulatory policies prevent investment in new generators.
The impact of powerless government energy policy interventions between Australian politics has been devastating.
Australia's energy system fails and economic collapse
Onselen's Leith
Tuesday, March 18, 2025Electricity price up to 9%
Labor's 2021 program, released by the Labour Party ahead of the last federal election, has provided impetus for the Australian plan, assured Australians will have $275 in residential electricity bills from 2025 to 2025 and $379 in 2030.
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Last week, the Australian Energy Regulatory Authority (AER) announced that electricity bills will rise by as much as 9% from July 1. The biggest jump will be seen in NSW (up to 9%), while Queensland's prices will rise as much as 6%.
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Incitec Pivot has reduced its fertilizer yield due to high energy costs. It closed its Gibson plant in Queensland in 2022, affecting 170 jobs. Last year, Incitec's Geelong fertilizer business also closed 40 jobs.
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Last year, Australia's last major plastic maker, Qenos, shut down due to high energy costs, leaving Australia completely reliant on plastic imported from China.
Australia's only architectural glass manufacturer, Oceania Glass, closed last week after 169 years of operation.
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Read more: https://www.macrobusiness.com.au/2025/03/australias-failed-energy-system-crashes-crashes-on-economy/
The article blames gas exports for high prices, but Why do natural gas companies give priority to exports over domestic consumption? Sometimes it is profitable at lower paper?
The answer is obvious – the export market is safer and more predictable. Exporters know when to sign these contracts and they will make money.
This cannot be said about the domestic natural gas market, which is subject to repeated government price control in Australia.
In theory, export markets are as susceptible to government patching as domestic markets, but in reality, the integrity of gas export markets is protected by angry foreigners who threaten mass economic retaliation as Australian politicians attempt to intervene.
If the Australian government is too interventionist, there are also hints that the gas giant will play “Atlas shrugging” cards. Argentines in particular have attracted attention to replace Australia, with huge, non-popular natural gas reserves. Pro-business President Milei is often described as Argentina's answer to President Trump, who is working to invest in the vast Vaca Muerta shale aura (estimated 308 trillion cubic feet). While Argentina is not a serious player in the gas export market at present, but faces the Atlantic Ocean instead of the Pacific, it won’t take long to find a solution if there is enough demand. In a few years, Asia will no longer need to look for Australian natural gas.
Faced with this imminent threat of demand disruption, Why is Australia such a troublesome gas export partner?
The reason for all this political stupidity is No mainstream Australian political leaders focus on prosperity. With some glorious exceptions, politicians from all sides of Australia’s political field are addicted to patching energy policies, trying to formulate energy policies with a minimum number of voters rather than effective ones.
No need to do this. Australia can easily have the best of both worlds in domestic industrial energy (especially brown coal) by using cheap coal, while Brown Coal is not subject to international price changes, because no one else wants it and let international trading partners have all the gas they want. Japan, which desperately needs gasoline, may be persuaded to stick to Australia rather than transfer development resources to places like Argentina. It might even be convinced that they will build some new high-efficiency coal power plants at the lowest price of rocks to better use Australian gas for a long-term use – if Australia's moves fast enough.
The mainstream opposition plan for the government-funded nuclear program is a comparison to the inconsistent renewable energy schemes of existing businesses, but the crisis hits the solutions needed by Australian manufacturing, which now offers solutions rather than those offered within 20 years. Nuclear energy is powerless in the short term to alleviate the pain of Australian energy prices.
The long-term interests of nuclear are suspicious for countries like Australia. Nuclear technology is a viable technology, but Australia has a lot of coal. The initial capital cost of nuclear power is much greater than that of coal. With the opposition’s proposed government-funded nuclear program, all the capital costs of building a nuclear power plant will accumulate on Australia’s national debt, just as the demographics of a baby boom began to bite people. Even if nuclear power plants are completed, the energy costs generated by nuclear power plants will be significantly higher than coal, especially in a country sitting on a large group of accessible shovel-ready coal resources.
Don't get me wrong, there are some places in Australia that make sense, remotely and lack local fossil fuel energy resources, firmly supporting nuclear energy. Advances in nuclear energy may further change this balance. But if there is a place where coal is available, Australia needs a solution that offers today, not 20 years later, otherwise there will be no manufacturing industry to rescue.
Even if you think I'm wrong with nuclear matters, we need to tide our stuff when building nuclear power plants. Construction of nuclear power plants should not be rushed, especially in countries as inexperienced as Australia.
The next Australian federal election is May 3, 2025. But no matter which mainstream party wins, Australian manufacturers will lose. This Australian federal election has no prospect of providing relief for what remains of Australia's manufacturing industry.
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