Opinion Piece - If smart, nation can head of energy pack - Wednesday, 29 September 2021

Opinion Piece - If smart, nation can head of energy pack - Wednesday, 29 September 2021 Main Image

By Joel Fitzgibbon

29 September 2021

The Labor Party is 130 years old.

Over that time, it suffered two major and damaging splits, one over military conscription and another over the infiltration of communists into its ranks.

The National Party is now suffering a split of sorts too. But their fight is not about war service or ideology.

Rather, it's merely about a target.

Carbon reduction targets are not policy, they are policy-shaping tools. Like personal weight-reduction goals, they invite discipline, encourage success, and guide choices.

A goal is hardly good reason for a major barney, but one such goal is tearing the Morrison government apart. It seems the tables have turned.

Most countries around the world wealthy and developing - are committing to net zero emissions (NZE) by 2050. So too has every Australian premier.

Most of the world's major companies have also done so, as have most of the major peak industry groups, including those representing the fossil fuels and agriculture sectors.

If Australia does not join the rest of the world in committing to further efforts on carbon emission reductions, we'll become an international pariah and economic harm will surely follow.

We must, therefore, do our bit, and to do it proportionately and smartly.

Policies such as carbon taxes are a 20th Century solution to what is now a 21st Century challenge. Carbon constraints punish energy intensive industries and are unnecessary given the progress we've made, and continue to make, on the technology front.

Carbon constraints also lack broad community support and, to succeed in our ambitions, we need to build a community consensus.

In the Hunter, our coal-fired electricity generators will stop contributing to the National Electricity Market when they come to the end of their physical and economic lives. Some in just a few years, others over the next 20 years.

Policies designed to force earlier closures would be counter-productive. Indeed, we need more time to ready ourselves for the new job opportunities, to keep the electricity grid stable, and to ensure energy reliability.

Meanwhile, we are attracting new forms of electricity generation to the Hunter: pumped hydro, PV solar, solar thermal, and gas peaking generation (power plants that can also be fuelled with hydrogen). Battery storage is also in the mix.

We are also positioning ourselves to take a leading role in the production of hydrogen, including that produced using fossil fuels that have had their carbon captured and used for other products and processes.

None of this has short-, or medium-term, consequences for our coal mining industry.

Overwhelmingly, our coal goes to export markets.

There is nothing in the Paris Agreement that requires us to curtail our coal exports and we should not volunteer to do so.

While ever the markets of Asia want our local product, we should sell it to them. Tens of thousands of local jobs rely on it.

Both our thermal and metallurgical coal will be in demand for decades to come, and denying our markets our coal will only cause them to buy less efficient coal elsewhere.

That will increase, not decrease global emissions.

Sure, our customers won't want to use unabated coal forever. That's why the Hunter region's political, business, academic, and community leaders spend so much time building further diversity in our local economy and shaping our education and training ambitions so they are providing the skills needed for the jobs of the future.

In doing so we have the support of some magnificent local research institutions such as the CSIRO Energy Centre, the University of Newcastle with its Institute for Energy Resources, and a range of local research programs dealing with industrial transformation, low emissions technologies (including carbon capture and utilisation), renewable energy, and competitive hydrogen production.

Of course, the Hunter Medical Research Institute is another example.

These research institutions collaborate with local industry and industry groups to put the Hunter at the front of the pack as we strive to make the most of the opportunities a changing world offers.

Technology will help us reduce carbon emissions while also protecting existing jobs and to generate new employment opportunities.

We can easily achieve net zero emissions in 30 years and indeed benefit from the process, but only if we play it smart.