In coal we trust: Australian voters back
PM Morrison's faith in fossil fuel
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[May 20, 2019]
By Sonali Paul
MELBOURNE (Reuters) - Australia's
re-elected Prime Minister Scott Morrison once brandished a lump of coal
in parliament, crying, "This is coal - don't be afraid!" His surprise
win in what some dubbed the 'climate election' may have stunned the
country, but voters should know what comes next in energy policy - big
coal.
Battered by extended droughts, damaging floods, and more bushfires,
Australian voters had been expected to hand a mandate to the Labor party
to pursue its ambitious targets for renewable energy and carbon
emissions cuts.
Instead, they rejected the opposition's plans for tax reform and climate
action, re-electing a Liberal-led center-right coalition headed by
Morrison, a devout Pentecostal churchgoer who thanked fellow worshippers
for his win at a Sydney church early on Sunday.
The same coalition government last year scrapped a bipartisan national
energy plan and dumped then-prime minister Malcolm Turnbull because he
was viewed as anti-coal.
Power companies and big energy users, who last year rallied behind the
national energy plan to end a decade of policy flip-flops, said on
Sunday they wanted to work with the coalition anew to find ways to cut
energy bills and boost power and gas supply.
"We just need this chaotic environment to stop and give us some real
direction," said Andrew Richards, chief executive of the Energy Users
Association of Australia, which represents many of the country's largest
industrial energy users.
The country's power producers - led by AGL Energy, Origin Energy and
EnergyAustralia, owned by Hong Kong's CLP Holdings - want the government
to set long-term goals to give them the confidence to invest an
estimated A$25 billion ($17 billion) needed for new power supply.
"Customers are looking to energy companies and the government to get
bills down and secure our energy supplies," said EnergyAustralia
Managing Director Catherine Tanna.
"We have an opportunity now to reset our relationships and recommit to
working toward a clear, stable and long-term energy policy," she said in
comments emailed to Reuters after Saturday's election.
At Origin Energy, Chief Executive Officer Frank Calabria said in emailed
comments he would be looking for appropriate policy that would allow the
company to invest in a pumped hydro project and gas exploration in the
Northern Territory.
DIVISIVE DEBATE
Australia has endured years of divisive debate on energy policy, with
attacks by the Liberal-led coalition on Labor's "carbon tax" policy
helping to bring down the government of then-leader Julia Gillard in
2013.
Despite top companies, from global miner BHP Group to Australia's
biggest independent gas producer Woodside Petroleum, calling for the
country to put a price on carbon emissions, the Liberal-led coalition
killed the carbon price mechanism in 2014.
Its own attempts to fashion a bipartisan national energy policy
foundered amid fierce opposition from coal supporters and climate
skeptics on its right-wing.
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A reclaimer places coal in stockpiles at the coal port in Newcastle,
Australia, June 6, 2012. REUTERS/Daniel Munoz/File Photo
Its policy now is focused on driving down power prices and beefing
up power supply. For the moment that includes underwriting a new
coal-fired power plant and providing A$1.38 billion toward a A$4
billion energy storage expansion at state-owned hydropower scheme
Snowy Hydro, designed to back up wind and solar power..
While the coalition stuck to an official target to cut carbon
emissions by 26-28% from 2005 levels by 2030, the United Nations
warned last year Australia was unlikely to meet this goal.
The opposition Labor party campaigned on more aggressive targets,
aiming to cut carbon emissions by 45 percent by 2030 and reach 50
percent renewable power by 2030. The re-elected Liberal-led
coalition has no renewable energy target beyond 2020.
ADANI JOBS = VOTES FOR COALITION
In the election, stopping a coal mine in the northern state of
Queensland proposed by Indian conglomerate Adani Enterprises was the
catchword for inner city voters in the south pressing for tough
action on climate change.
Labor, torn between its traditional union base and its urban
environmentally conscious supporters, made no commitments on the
Adani mine. The move backfired in the mining heartland of
Queensland, where voters with jobs in mind handed the Liberal-led
coalition crucial seats in the election.
Adani Mining Chief Executive Lucas Dow said the state Labor
government, which has repeatedly extended environmental reviews of
Adani's Carmichael mine, should learn from Labor's defeat in
Queensland, listen to its own voters and let the mine go ahead.
"As evidenced by this weekend's election results, Queenslanders have
no tolerance for political actions that are unjust and put people's
livelihoods at risk," Dow said in a statement.
A spokesman for Queensland's Department of Environment and Science
said departmental representatives had met with Adani on Monday and
"negotiations are continuing" on the company's plans.
Energy users and the power industry, however, see the transition to
cleaner energy as inevitable, with states pushing ambitious targets
out of line with the national government.
At the same time, Australia, the world's second-largest exporter of
coal for power, faces falling demand for coal as its biggest
customers - Japan, South Korea, China, Taiwan and India - are
shifting towards cleaner energy, said Tim Buckley, a director at the
Institute for Energy Economics and Financial Analysis.
"I would expect the coalition to fight a rearguard action that will
slow the transition, but they can't stall it," he said.
(Reporting by Sonali Paul; Editing by Richard Pullin and Kenneth
Maxwell)
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