Saturday, June 29, 2013

Clean Energy Finance Corp inks first deal - $100 million for business in renewables and energy efficiency

The Clean Energy Finance Corporation (CEFC), set up as part of the Clean Energy Future/Carbon Price law, has just signed it's first deal to supply up to $100 million dollars in loans to businesses looking to improve their energy efficiency, buy solar panels or set up cogeneration and trigeneration plants.

The CEFC, which will have $10 billion dollars to invest over the next 5 years, was set up to help fund renewable energy, low emission technologies and energy efficiency investments. The general idea is the fund will partner with the private sector and chip in some of the money for these investments, for example this new deal includes $50 million from both the CEFC and $50 million from the Commonwealth bank. In this way the CEFC can use it's $10 billion to stimulate much greater amounts of investment in clean energy and energy efficiency. Operating at arms reach from the government, the CEFC also aims to make it's money back in the long term.

Unfortunately, the Coalition has vowed to scrap the CEFC if it wins the election, which would be a shame because the CEFC plays an essential role in promoting renewable energy. Currently it can be difficult for renewable energy plants to attract financing and get built, this is especially so where the technology is new and/or the first of a kind in Australia. This so called "valley of death" makes it extremely difficult for renewable technologies to get started and start to power Australia. By making at least part of the financing required available, the CEFC makes such projects more attractive to the private sector and spurs investment in renewable. Scrap the CEFC and it will likely be much harder and more expensive for Australia to meet it's targets for generating renewable electricity and lowering greenhouse gas emissions, as well as for companies to bring new and innovative technologies to the market.

Wednesday, June 26, 2013

Obama takes climate action in the USA

You might have missed this in the Gillard vs Rudd rumble in the jungle, but earlier today President Obama outlined a wide range of actions to tackle climate change.

In the USA the conservative controlled congress is hostile to any action on climate change, this means that Obama cannot, for example, introduce carbon pricing but he can pursue regulatory action. Hence Obama has chosen to exercise his executive powers at President to reduce US greenhouse gas emissions, forge international action and increase resilience to a changing climate.

You can find a list of the major actions here. One of the more important actions will be using the Environmental Protection Agency to put limits on emissions from new and existing power plants. This will have the effect of either shutting down or forcing the clean up of many coal plants and since coal plants produce a large percentage of greenhouse gas emissions in the USA, this will cause a large decrease to emissions in the long run.

Other actions include higher standards for appliances and buildings so they use less energy and for trucks so they use less fuel. More renewable energy production on the vast amounts of land owned by the US federal government will also be encouraged etc. etc. 

Overall, while not as effective or efficient as carbon pricing, Obama's actions make it possible for the US will meet it's targets for reducing greenhouse gas emissions and therefore help to limit global warming.

Sunday, June 16, 2013

Queensland electricity prices to soar by 22%, who's to blame?

Many of you will have heard that electricity prices in QLD are skyrocketing by 22% this year. For the average household this is predicted to increase bills by $268 a year, while "the average electricity bill for a family of four will increase by $343 a year".
But why? 

If you listen to Campbell Newman or the energy minister Mark McArdle you might be forgiven for thinking that this increase was due to carbon pricing or renewable energy. With McArdle complaining that "Ninety-two thousand homes don't pay any power bills at all in Queensland" - well yes Mark, that's because they produce their own electricity. 

However with the help of this article and Queensland Competition Authority price determination I've made this little graph of where the price rises are coming from:

As you can see, less than 20% of price rises are due to carbon pricing or paying people for the solar power they produce. Much greater is the price rise due to the end of the Newman government's electricity tarrif freeze, which only lasted for 12 months. This policy might have sounded great during the last state election, but there's no free lunches in this world, and we are paying for it now.

"Other*" is the biggest category, breaking this down is hard, but it includes increased network prices (ie: the poles and wires), increases in the costs of generating power and then some mind-blowing stuff like electricity companies being allowed to increase prices because power demand has been dropping and they have been making less money than they want to.

So it seems that the government is very concerned about the 20% of the price rises due to polluters no longer being able to pollute for free and for actually having to pay households who are producing clean energy from their solar panels. Instead they seem rather unconcerned (or want to shift our attention from) what is actually causing 80% of the price rises. This is like the captain of the titanic blaming the water on drinks that were spilled when the ship hit the iceberg rather than the gaping hole in the ship.

From all this I draw two conclusions:

1. All that kerfuffle from certain politicians that the (basically one off) 9% rise in power prices from the carbon price was going to ruin us all was self serving nonsense. A year later we are facing over double that rise for different reasons and the idea this will ruin us all has been conveniently forgotten.

2. We as a community are going to have to start demanding explanations for what's causing 80% of our power prices rises and then demand useful ideas for what to do about it, or we'll continue to see politicians scapegoating renewable energy and a continuation of massive price rises.