There we have it. Australia is about to embark on one of the country’s longest ever election campaigns after Prime Minister Julia Gillard announced the federal election would be held on September 14, with writs written, and the formal campaign, beginning on August 12.
This, of course, will be a crucial election for the clean energy industry in Australia, with major questions over the future of the hard-won policy initiatives of the last few years – the carbon price, and even the Renewable Energy Target. The RET, along with a string of grant-based funding schemes, have been the product of the Labor government, but the carbon price, and the creation of the Climate Change Authority and the Clean Energy Finance Corp have been the product of the minority government agreement with the Greens that followed the 2010 poll.
As we highlighted in our story on Monday, Opposition leader Tony Abbott, in his informal campaign launch, repeated his vow to repeal the carbon price – and will put the motions for that repeal to take effect from day 1 if elected.
He has also said he will scrap the $10 billion Clean Energy Finance Corporation, and said on Monday he would ask the CEFC to desist from allocating funds once the caretaker period begins.
It will be interesting to see if the Coalition pushes for that to occur earlier. The CEFC has a $2 billion budget in its first year, and is keen to announce its first investments from July 1.
An equally important question for the clean energy industry in Australia is the fate of the renewable energy target. The Climate Change Authority – which Abbott has also vowed to dump – recommended that it remain largely unchanged, with a fixed target rather than a floating target urged by some industry and fossil fuel generators. All the conservative-led state governments have pushed for the RET to be modified – a decision that would effectively reduce the number of wind farms and solar farms to be built over the next eight years by half – and protect the value of network and generation assets that they may be trying to sell.
The government has yet to endorse that finding, and the position of the Opposition is still not clear. It will be surprising if some of those utilities that have opposed the RET will engage in contracts to build new utility-scale wind farms until the result of the election is known.
Indeed, the calling of the election and the uncertainty over the Opposition’s position could, in fact, usher in some sort of capital strike on renewables – fears of such a strike have already been expressed privately by some in the renewable industry. Sadly, the utilities can find yet another excuse for delay.
A big question will be the extent to which climate change becomes an issue during the election campaign. It failed to do so in the US election campaign, until the last week when Hurricane Sandy struck the eastern seaboard. In Australia, however, bush fires, heat-waves and this week’s floods has brought the issue to the front pages.
As Gillard told the National Press Club luncheon today: “Climate change is not a future proposition. We are living through climate change.”
That is a lot more positive response than Abbott’s position on Monday: “Just think of how much hotter it might have been the other day but for the carbon tax!”
Or that of NSW Liberal Premier Barry O’Farrell on Tuesday when asked about the floods: “If the question is about climate change go and ask me another day. Let’s not turn this near-disaster, this episode that has damaged so many properties and other things, into some politically correct debate about climate change. Give me a break.”
Update: One added thought. Given that we are now facing an effective 8-month election campaign, would the electorate put up with another 12 months if Abbott held true to his promise of calling a double dissolution if his carbon price repeal is stalled in The Senate?
Giles Parkinson is a journalist of 30 years experience, a former Business Editor and Deputy Editor of the Financial Review, a columnist for The Bulletin magazine and The Australian, and the former editor of Climate Spectator.