Analysis and Commentary

Morrison’s gas-fired electricity play – damn the expense, damn the environment

Analysis and Commentary

Comment by Peter Roberts

Today prime Minister Scott Morrison broke cover – yes Canberra is prepared to subsidise a totally uneconomic gas-fired power station in New South Wales, ostensibly to reduce energy prices.

The Coalition has talked about cutting energy prices so often only to disappoint that we can discount that as the real reason.

We know prices will not go down.

Having abandoned the fossil fuel pipedream of subsidising a coal fired power station, Morrison is now pushing for gas…yes the same fossil fuel we need to transition away from as quickly as possible to avoid destructive climate instability.

Of course you wouldn’t build a coal station when the cost of unsubsidised wind power at $27 per MWh and unsubsidised solar PV at $31, compared to the marginal cost of existing conventional coal generation of $41/MWh, according to Lazard.

But why gas, an energy choice that is more expensive than solar and onshore wind generation according to Bloomberg New Energy Finance?

And why gas when Australia’s existing base load gas generators are only operating at 30 per cent capacity because they are too expensive, according to the ANU.

Atalassian founder Mike Cannon-Brookes put it this way in a tweet today:

“- AEMO? More gas generation not needed
– CSIRO? Gas generation = expensive electricity
– Economists? Gas extraction creates very few jobs
– Scientists? Gas incompatible with our Paris goals
– Investors? Gas has bad returns. No $.
Politicians? MORE GAS!”

What can you say about such an obviously poor policy choice?

Picture: Tesla big battery, Hornsdale, South Australia

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