Nationals energy vote ends renewables strategy

The Nationals party has voted to remove all $2.8bn of subsidies for renewable energy, in a move which will change government policy towards delivering a reliable energy source, and which came after intense lobbying by the PIAA.

Print as the largest manufacturing industry remaining in Australia has been suffering from spiralling energy prices and unreliable supply following the drive to renewable energy sources, SA printers had their power cut last November, with those printers and Melbourne printers predicted to suffer power cuts this summer.

Andrew Macaulay, CEO at PIAA says, “We produced a letter outlining the serious energy issues facing Australian manufacturing, the consequences of unreliable supply, and we are delighted to see that many of the recommendations in that letter were taken up by the Nationals at their conference.

“The Nationals as the junior Coalition partner has woken the government up to the reality of the energy crisis manufacturers are facing, and has done something about it, which will have a beneficial effect on government policy by stopping the stampede to renewables.”

In a report commissioned by the Minerals Council of Australia, research consultancy BAEeconomics says that renewable energy sources are set to receive subsidies of $2.8bn a year until 2030. However the Australian Energy Market Operator is predicting a 1000 megawatt energy shortfall in 2022 once Australia’s coal plants shut down.

The fossil fuel industry also receives subsidies from the government, in the form of fuel credits, free water powering coal power plants, and cheap, long-term contracts. The mining industry alone received $2bn in fuel subsidies in 2010-11, as the biggest beneficiary of the scheme, which came to a total cost of $5.1bn over the same period.

For the past year, the PIAA has been discussing with various MPs including Josh Frydenberg Minister for Environment and Energy, about the energy crisis facing Australia which has seen some printers paying nearly triple on their bill.

On its most recent lobbying trip to Canberra the PIAA met with backbenchers, ministers and Senators, to push the demand for reliable energy.

Macaulay says, “It is inexcusable that a resource rich nation like Australia that South Australia has the most expensive electricity in the world, New South Wales, Queensland and Victoria also rate amongst some of the most expensive countries globally. There is no reason for this other than the failure of government. It is good to see the Nationals have recognised this.”

“Policy that is based in sound economics understands supply and demands. Policy understands you cannot interfere with supply without the price being affected. It is time the government acts to ensure reliable supply of cost effective energy to Australia."

The impact of the National’s decision is set to be strong, even now the prime minister is in a stand-off with a major NSW coal fired power plant over its decision to close it.

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