Jobs thrown on rubbish heap

Sunday Age
Sunday 3/6/2007 Page: 18

The Federal Government's lack of support for eco-technologies is forcing business off-shore.

THE long-awaited Prime Ministerial taskforce on emissions trading may have sounded the death knell for Australia's renewable energy sector. Backing a national emissions trading scheme, it recommended that it be "technology neutral", which means Mandatory Renewable Energy Targets would be abolished in favour of letting the market decide which energy source was most likely to cut carbon emissions. The lack of targets has already relegated Australia, once a global leader in renewable technology, into a "could have been".

As Prime Minister John Howard released the report, China's SunTech Power Holdings company was busily churning out shiny solar panels, ready to soak up all that free energy. Suntech has every reason to love the sunshine: it's said to be hoping for a $135 million profit for 2007 - a 70 per cent increase on last year.

And it might just have been an Australian success story. Suntech's chief executive, Zhengrong Shi, according to Forbes rich list, is Australia's fifth wealthiest man (and China's third) and he learnt the tricks of his solar trade in Sydney. A graduate of the University of New South Wales's School of Photovoltaic and Renewable Energy Engineering and worth a reported $2.8 billion, he lives in China but holds Australian citizenship.

With inadequate Federal Government support and a coal industry that, according to its growing chorus of opponents, is unfairly courted, there are many renewable energy enterprises with Suntech-style potential that have either given up or turned their attention overseas, according to the Greens' climate change spokeswoman, Senator Christine Milne.

She says it's an economic and environmental tragedy. Ms Milne launched her Re-energising Australia report last month and says scant Federal Government support for the renewable industry has also made Australians feel the onus is on them to make changes. "People are feeling guilt-tripped," Ms Milne says. "Wherever I go it's clear to me that the community are way ahead of the politics when it comes to climate change. They are really worried and they want to take whatever action they can." But she says shifting to solar electricity or a hybrid car is often prohibitively expensive.

Ms Milne says renewable energy enterprises frequently tell her they are ready to dive into the local market but the Government's refusal to increase the Mandatory Renewable Energy Target (MRET) has dried up investment and to varying degrees forced businesses out. Because the Government won't increase the MRET (originally set at 9500 gigawatt hours, equivalent to about 2 per cent, of additional renewable energy generation per year by 2010), Victoria, NSW and South Australia have instead taken the lead with various targets of their own. Victoria is aiming to buy 10 per cent of power from renewable sources by 2016.

Another study, released recently by the Australian Conservation Foundation, Greenpeace Asia-Pacific and Climate Action Network Australia, said a renewable energy target of 25 per cent by 2020 could deliver 17,000 new jobs and provide enough electricity to power every home in Australia. It said such a target would reduce emissions by about 15 per cent from 2004 levels and bring big savings for Australian households.

Tristan Edis, policy and research manager for the Australian Business Council for Sustainable Energy, says there is now a global battle to develop renewable technologies and industries that can tackle greenhouse emissions and at the same time end dependence on "unreliable, volatile and often hostile regimes" that supply oil and gas.

Renewables are a $40 billion plus global industry; and while Australia used to be a leader in solar technology, Mr Edis says the world "has flown past us", with Germany now taking the lead, building a solar and wind turbine industry that exports globally and employs 157,000 people, closely followed by Spain. The rest of Europe is following, with the EU setting a 20 per cent renewable energy target for 2020. Even the US, which along with Australia has refused to sign the Kyoto Protocol to reduce greenhouse emissions, is in the ascendant, with populous states such as California setting a 33 per cent target for 2020.

Some renewable energy enterprises remain hopeful. After announcing in May last year that it was halting work on its big Australian wind farm projects and focusing overseas, the Roaring 40s company is now taking an optimistic line. Its spokesman, Josh Bradshaw, says he now sees a more buoyant market and, with an approaching federal election, the Howard Government is making "good movements" towards an emissions trading scheme, announcing on Friday that Australia will begin carbon emissions trading by 2012.

Melbourne-based Pacific Hydro, a renewable energy power plant development company owned mainly by an Australian super fund, has had a hard slog locally but is also having great success - overseas. Its director, Andrew Richards, says all its Australian wind projects were stalled for several years due to the Federal Government's refusal to expand MRET.

But in the meantime the company has been busy developing a number of hydro and wind projects in developing countries such as Chile and Brazil (both are $500 million investments). Because Victoria has instituted its own renewable energy target, Pacific Hydro has now revived its local wind projects at Portland (a $300 million investment) and South Australia. It is also investigating a geothermal project in central Australia.

While Mr Richards and others estimate that enormous investment opportunities have been lost while waiting for the Government to take a firm stand, a spokeswoman for the federal Environment and Water Resources Department says it is not true to say that current measures are focused disproportionately on fossil fuels. Renewables are important in Australia's "energy mix", she says. "The Government is supporting a range of low emissions technologies," she says.

This includes the $52 million it has spent on the photovoltaic rebate program, $25 million committed under the Asia- Pacific Partnership on Clean Development and Climate program, plus $75 million on the Solar Cities program. In last month's budget, $741 million of extra funding over the next five years was committed for bigger rebates for solar panels and other climate change measures. "Making coal and coal mining less greenhouse intensive is perhaps the most important contribution Australia can make on climate change," she says.

But Senator Milne and the ACF remain sceptical about "clean" coal (removing the CO2 from its emissions), with few signs that effective technology will be online - or even feasible - within the next decade. The ACF's executive director, Don Henry, insists that the demand for renewables is there already, with people keen to live more sustainably.