The Conversation

Pollution and debris off the Sri Lankan coast. David Jones/plasticoceans.org

We live in a world of plastic. Shopping bags, drink bottles, your toothbrush and even your clothes are among the everyday items made from plastic. But plastic isn’t fantastic, and neither is the current state of our environment.

Humans have been mass-producing plastic since the 1950s. We produce hundreds of millions of tonnes of plastic every year and production is only increasing. Unfortunately, most of it is used only once and then thrown away.

Only a small proportion of plastic is recycled. The majority ends up in landfill or, in the worst case scenario, our oceans.

A Plastic Ocean is a documentary film directed by the Australian journalist Craig Leeson. It dives into and investigates the devastating impacts that plastic has caused to our environment, especially our marine life.

What starts off as an adventure to film the blue whale, the largest animal on the planet, leads to the shocking discovery of a thick layer of plastic debris floating in the middle of the Indian Ocean. Craig, alongside Tanya Streeter, a world record-breaking free diver and environmental activist, then travel across the globe to report on the havoc caused by decades of plastic use.

The film presents beautiful shots of the marine environment. This contrasts with footage of heavily polluted cities and dumps full of plastic rubbish. The juxtaposition between these images sends the message that our actions and choices can severely impact the planet. Throughout the film, experts are interviewed to provide further insight into some of the problems derived from plastic.

Impacts of plastic use

Plastic is so widely used because it is durable and cheap. Unfortunately, this durability is the same quality that makes it so detrimental to the environment. Most plastics do not break down chemically. Instead, they break into smaller and smaller pieces that can persist in the environment for an extensive period of time.

Because it is so affordable, developing countries use plastics extensively. However, many regions lack proper waste management, and much of the rubbish is washed into the ocean when it rains. As a result, a large percentage of all plastics in the ocean are due to only a handful of countries. Scientists estimate that more than 5 trillion pieces of plastic are currently floating in our oceans.

Throughout the film, we are shown footage of numerous marine species that have been affected by plastic debris. Marine animals and sea birds often mistake floating plastic for food. Large pieces of plastic, when eaten, can obstruct the animals’ digestive tracts of the animals, essentially starving them to death.

When smaller “microplastics” are ingested, toxins are released and become stored in their tissue. These toxins accumulate up the food chain and can eventually end up on our dinner tables. The consumption of the contaminated seafood can cause many health problems including cancer, immune system problems, and even childhood developmental issues. This is a major problem, as almost a fifth of the world’s population relies on the ocean for their primary source of protein. Society’s huge appetite for plastic is literally poisoning us.

The future of plastics

There is no quick fix for a problem that has grown hugely over the past few decades. The use of plastics is so ingrained in society that it is all but impossible to eliminate them completely.

The film does, however, offer various strategies that can be implemented to reduce the impact of plastics.

Ideally, avoid plastic-containing products as much as possible. Avoid single-use plastic products and recycle whatever you can. Local governments also need to implement a refund scheme for the return of plastic bottles to incentivise recycling.

For unrecyclable plastics, new technology has been developed to convert them into fuel, providing a second life for those plastics.

It is up to us to embrace these changes and move away from the plastic culture. We need to get this problem under control, as it will only become worse as the human population increases. Our marine animals deserve to live in a blue ocean, not a plastic soup.

A Plastic Ocean is touring internationally, including screenings in Brisbane on March 25 and Cairns on March 27.

Gary Truong does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond the academic appointment above.

Just think of it as a battery that can also take you to the shops. Steve Jurvetson/Wikimedia Commons, CC BY

A key question amid the consternation over the current state of Australia’s east coast energy market has been how much renewable energy capacity to build, and how fast.

But help could be at hand from a surprising source: electric vehicles. By electrifying our motoring, we would boost demand for renewable energy from the grid, while smoothing out some of the destabilising effects that the recent boom in household solar has had on our energy networks.

Australia’s electricity infrastructure was built largely without renewable energy in mind, and primarily to maintain reliability for when demand peaks. The high uptake of solar panels, while good for reducing carbon emissions, has reduced grid demand by 5-10% in Australia, and as a side-effect has lowered the value of network assets, raised power prices, and made the grid trickier to manage.

Electric vehicles can ease the pressure on spikes in electricity prices by adding storage capacity. They are effectively a distributed storage system - with smart meters they can feed electricity back into the grid when prices are high. These vehicles’ battery reserves can thus help with the balancing of the grid and provide energy in the peak period. Electric vehicles would also add battery storage to the grid at the same time, which can reduce the need to size the grid for demand peaks.

One way to think of electric vehicles is essentially as batteries you can drive. So before the government pursues plans such as spending A$2 billion on expanding the Snowy Hydro scheme, it should do a cost-benefit analysis comparing the returns from similar infrastructure investment in electric vehicles.

According to the Office of the Chief Economist, Australia produced 6 billion kilowatt hours of solar PV in 2015 – enough to run almost 2 million cars, equivalent to 10% of Australia’s total current passenger vehicle fleet. Increasing demand for grid-sourced electricity will put downward pressure on network prices, which typically are roughly half of the cost of a household energy tariff. At a time when demand has declined and policy settings have created lots of investor uncertainty, the increased demand will also encourage investment in new generation capacity.

Electric vehicles can also increase economic activity in Australia and improve air quality and health. Australia has nearly 20 million cars that together drive 280 billion km each year. Passenger vehicles alone consume 20 billion litres of fuel each year in Australia. At A$1.50 per litre, that is A$30 billion per year that is burned, with roughly half the revenues going to multinational oil companies and the other half going into federal coffers as fuel tax.

The health costs of pollution from vehicle emissions adds a further A$1,450 per household per year in major cities, an annual impost of some A$14.5 billion on household and government budgets – roughly the same as what the government earns in fuel tax.

If all vehicles were electric, the same distance could be driven with electricity costing less than A$15 billion, because electric motors are more efficient than internal combustion engines (although this is slightly offset by minor grid losses). This would thus deliver a double saving, in terms of both household fuel bills and reduced health costs.

Changing gear

Of course this won’t happen overnight, but that’s not necessarily a bad thing. The electricity grid will need time to adjust and add extra renewable capacity, as the cost of electric cars comes down and coal power stations get old.

Both economic analysis and recent political experience suggest that encouraging investment in renewable energy is expensive, especially if the only driving factor is the need to cut greenhouse emissions (important though that is).

Here is where electric vehicles can really help the grid. Swapping petrol or diesel cars for electric ones on a large enough scale will increase Australia’s flatlining electricity demand, making it more lucrative for energy suppliers to invest in new generation capacity. Given the increasing cost of gas, and the declining support for coal, on balance most of this demand will be met with new renewable capacity, facilitated by the addition of all these new “batteries you can drive”.

A suggested pathway to energy sustainability via electric cars. Adapted from Andrich et al. Inequality as an obstacle to sustainable energy use, Energy for Sustainable Development

Government policy should be to set some high-level national interest objectives, such as maintaining gas for domestic use, and then simply not interfere with the market as much as possible. But political leaders are struggling to keep up with the rapid changes in technology and the market. The pathway to sustainability would have been smoother and faster if governments had looked to WA for a gas reservation policy, not intervened by closing coal, and reduced the subsidies that allowed solar power to grow so disruptively fast (particularly in wealthier households).

Making more effort to promote electric cars would also have allowed a more successful transition to renewable energy and reduced the price shocks being suffered by eastern Australia in areas such as the gas market. Fortunately, it is not too late.

Hitting the road

Investing in a new car is not a decision most households take lightly. This is especially true of electric cars, which are expensive, are not marketed widely, are available in only a limited range of models, and are subject to concerns about charging and range.

Presently, electric vehicles are only affordable for higher-income households, which is ironic given the benefits they would offer lower-income households in terms of fuel budgeting and reduced exposure to urban pollution and health costs.

One-third of an electric vehicle’s cost is batteries, which are rapidly coming down in price. Bloomberg New Energy Finance predicts that by 2022, electric models will cost the same as their petrol counterparts. That will be the point of liftoff for sales.

Meanwhile, electric cars have an undoubted cool factor. Buying one is a powerful way to show you care about your community’s future. Pardon the pun, but just look at the way Tesla founder Elon Musk electrified the debate over South Australia’s electricity problems.

For governments, electric vehicles offer an opportunity to make significant inroads on environmental and health problems, not to mention urban planning and infrastructure. The demand for car batteries could also boost related industries, such as lithium mining, in which Australia is a world leader.

Feeling electric

Simple, inexpensive policies could encourage electric vehicle uptake, such as reducing registration fees and stamp duty on electric cars and allowing them to drive in bus or other priority lanes, while also hiking the tax on diesel cars that cause cancer.

Other emerging transport trends, such as car-sharing clubs and ride-sharing apps, could also hasten the uptake of electric vehicles. Sharing increases the number of kilometres driven by each individual vehicle, meaning that the upfront costs are paid back more rapidly, leaving the owner with a car that is paid off and cheaper to run than a petrol or diesel model.

These facts are not lost on the car manufacturers themselves. But given the potential co-benefits to the electricity grid and community health, we might expect power utilities and health agencies to join the push to actively promote electric vehicles – not to mention politicians who are looking to deal with our energy issues and win a few votes along they way.

The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond the academic appointment above.

Soils play an important role in the nutritional value of our food.

The next time you bite into an apple, spare a thought for the soils that helped to produce it. Soils play a vital role, not just in an apple’s growth, but in our own health too.

The formation of soil, pedogenesis, is a very slow process. Creating one millimetre of soil coverage can take anything from a few years to an entire millennium.

But with soils around the world under threat, we’re in danger of losing their health benefits faster than they are replaced.

Healthy soils for healthy plants

A healthy soil is a living ecosystem in which dead organic matter forms the base of a food web consisting of microscopic and larger organisms.

Together, these organisms sustain other biological activities, including plant, animal and human health. Soils supply nutrients and water, which are vital for plants, and are home to organisms that interact with plants, for better or worse.

In the natural environment, plants form relationships with soil microbes to obtain water, nutrients and protection against some pathogens. In return, the plants provide food.

The use of mineral fertilisers can make some of these relationships redundant, and their breakdown can lead to the loss of other benefits such as micronutrients and disease protection.

Certain farming practices, such as tillage (or mechanical digging), are harmful to fungi in soils. These fungi play important roles in helping plants obtain crucial nutrients such as zinc.

Zinc is an essential micronutrient for all living organisms. Zinc deficiency affects an estimated one-third of the world’s population, particularly in regions with zinc-deficient soils. If food staples such as cereal grains are grown on zinc-deficient soils and further lack their fungi helpers, they become deficient in zinc.

If the way food is grown affects the composition and health of plants, could farming practices that focus on soil health make food more nutritious? A recent review on fruits says yes.

The researchers found that fruits produced under organic farming generally contained more vitamins, more flavour compounds such as phenolics, and more antioxidants when compared with conventional farming. Many factors are at play here, but pest and soil management strategies that benefit soil organisms and their relationship with plants are part of the equation.

The composition and function of animals and humans reflects, to some extent, what they eat. For example, the fish you eat is only rich in omega-3 fatty acids if the fish has eaten algae and microbes that manufacture these oils. The fish itself does not produce these compounds.

Increasing numbers of studies are demonstrating the link between nutrition and human health issues. We know, for example, that antioxidants, carbohydrates, saturated fat content and the ratio of omega-6 to omega-3 fatty acids contribute to immune system regulation.

We do not produce some of these nutrients; we must obtain them through our food. Therefore, how food is grown is a matter of public health.

Beyond nutrition

Soil is the greatest reservoir of biodiversity. A handful of soil can contain millions of individuals from thousands of species of bacteria and fungi, not to mention the isopods, rotifers, nematodes, worms and many other identified and yet-to-be-identified organisms that call soil home.

Soil microbes produce an arsenal of compounds in their chemical warfare for dominance and survival. Many widely used antibiotics and other drugs were isolated from soil. It may hold the answers to our battle with antibiotic resistance and other diseases including cancer.

It has also been suggested that exposure to diverse microbes in the natural environment can help prevent allergies and other immune-related disorders.

The road to healthy soils

Unfortunately, we are doing a poor job of looking after our soils. About two-thirds of agricultural land in Australia is suffering from acidification, contamination, depletion of nutrients and organic matter, and/or salinisation. And in case anyone forgets, soil is every bit as non-renewable as oil because soil formation is such a slow process.

On the other hand, soil erosion can happen very quickly. For a taste of what happens when soils are destroyed, nothing beats sitting through a dust storm and watching day turn into night. Dust storms inspired George Miller’s film Mad Max: Fury Road.

In the 2009 Red Dawn in Sydney, some 2.5 million tonnes of soil were lost within hours to the ocean in a 3,000km-long, 2.5km-high dust plume.

Australia’s major cities began on fertile land. Melbourne’s food bowl can supply 41% of the city’s fresh food needs. Such secure access to fresh and whole food needs our protection.

Healthy soils are part of the solution to some of our dilemmas – poverty, malnutrition and climate change – as they underpin processes that gives us food, energy and water. If we want to meet the 2030 Sustainable Development Goals, soil health is a linchpin we cannot ignore.

From this perspective, agricultural practices to maintain healthy soil are clearly an important target for policymakers. Looking after our soils ultimately means looking after ourselves.

Ee Ling Ng works at the Australian-China Joint Research Centre: Healthy Soils for Sustainable Food Production and Environmental Quality. She receives funding from the Department of Industry, Innovation and Science.

Deli Chen receives funding from Australia Research Council, Meat Livestock Australia, Australian Centre for International Agricultural Research.

Orange-bellied parrots are one of the species included in the government's Threatened Species Prospectus. JJ Harrison, CC BY-SA

Southern cassowaries, orange-bellied parrots, Leadbeater’s possums, and Australia’s only purple wattle are among the threatened species the government is seeking conservation investment for under its recently released threatened species prospectus. The prospectus seeks business and philanthropic support in partnership with the government and community groups to raise around A$14 million each year.

The government has proposed 51 projects, costing from A$45,000 to A$6 million. At first glance the prospectus is a positive initiative.

But it also highlights that the current government is unwilling to invest what’s needed to assure the conservation of our threatened plants, animals and other organisms.

The good news

The government’s partial outsourcing of conservation investment and responsibility might have some benefit. Raising broader awareness about the plight of Australia’s threatened species, particularly among Australia’s leading companies and donors, could lead to valuable conservation gains. It could translate to pressure for greater financial investment in conservation and less damaging actions by big companies.

The prospectus includes an excellent range of critically important projects. These include seed banks for plants facing extinction, and projects to control feral animals and create safe havens for mammals and birds.

These projects could help to save species on the brink of extinction, such as the critically endangered Gilbert’s potoroo, the Christmas Island flying fox and the orange-bellied parrot.

The projects have a high chance of success. Community groups and government are already on board and ready to take action, if only the funds materialise.

Why do so many species need urgent help?

The State of the Environment Report released in early March shows that the major pressures on wildlife have not decreased since 2011 when the previous report was released. The prospects for most threatened species have not improved.

Habitat loss is still the biggest threat. The homes of many threatened species are continually under threat from developments. Coal mines threaten the black-throated finch, urban sprawl eats away at the last 1% of critically endangered Victorian grasslands, and clearing for agriculture has spiked in Queensland.

Grasslands, such as these in Melbourne, are being lost to development. Takver/Flickr, CC BY-SA

Feral animals are widespread and control programs have been inadequate. New diseases are emerging, such as the chytrid fungus that has devastated frog populations worldwide.

The horticulture industry, for example, introduced myrtle rust to Australia. The disease was poorly managed when it was first detected. It now infects more than 350 species of the Myrtaceae family (including eucalypts).

We have so many threatened species because national and state governments don’t invest enough money in protecting our natural heritage, and environmental protections have been rolled back in favour of economic development.

Show us the money

Over the past three years the federal government has invested A$210 million in threatened species. This annual investment of A$70 million each year is minuscule compared with the government’s revenue (0.017% of A$416.9 billion).

It includes projects under the National Landcare Program, Green Army (much of which didn’t help threatened species) and the 20 Million Trees program.

The A$14 million that the prospectus hopes to raise is a near-negligible proportion of annual revenue (0.003%).

Globally, the amount of money needed to prevent extinctions and recover threatened species is at least ten times more than what is being spent.

In Australia, A$40 million each year would prevent the loss of 45 mammals, birds and reptiles from the Kimberley region.

Most species in the government’s threatened species strategy, like this northern quoll, are charismatic. S J Bennett/Flickr, CC BY

The inescapable truth is that Australia’s conservation spend needs to be in the billions, not the current and grossly inadequate tens of millions, to reverse the disastrous state of the environment.

Can we afford it? The 2016 Defence White Paper outlines an expansion of Australia’s defence expenditure from A$32.4 billion in 2016-17 to A$58.7 billion by 2025, even though the appropriate level of investment is extremely uncertain.

We are more certain that our biodiversity will continue to decline with current funding levels. Every State of the Environment report shows ongoing biodiversity loss at relatively stable, low-level funding.

And what will happen if industry won’t open its wallets? Will the government close the funding gap, or shrug its shoulders, hoping the delay between committing a species to extinction and the actual event will be long enough to avoid accountability?

In the past few years we’ve seen the extinction of the Christmas Island forest skink, the Christmas Island pipistrelle, and the Bramble Cay melomys with no public inquiry. Academics have been left to probe the causes, and there is no clear line of government responsibility or mechanism to provide enough funding to help prevent more extinctions.

Popularity poll

Another problem is the prospectus’s bias towards the cute and cuddly, reflecting the prejudice in the Commonwealth Threatened Species Strategy. The strategy and prospectus make the assumption that potential benefactors are inclined to fork out for a freckled duck, but not for a Fitzroy land snail.

The prospectus includes almost half of Australia’s threatened mammals (listed under the Environment Protection and Biodiversity Conservation Act) and one-fifth of the threatened birds.

Other groups are woefully represented, ranging from 13% of threatened reptiles to just 1% of threatened plants and none of the listed threatened invertebrates. The prospectus does not even mention spectacular and uniquely Australian threatened crayfish, snails, velvet worms, beetles, butterflies, moths and other insects.

The allocation of funds is equally problematic. We found that birds received the most money (A$209,000 per species on average), followed by mammals and plants.

Raising new funds to help save iconic species is valuable, and can help other species. This focus on birds and mammals wouldn’t be a problem if the government were to pick up the tab for the less popular threatened species.

But it hasn’t. That means our threatened species program will continue to be exceptionally biased, while many more species vanish forever, with little acknowledgement.

We think that the prospectus, despite its biases, is a positive initiative. It is vital to engage society, including business and wealthy philanthropists, in the care of Australia’s natural heritage. But it also highlights how little the government is willing to invest in preserving our threatened wildlife and ecosystems.

This work arose from discussions held by the communications team of the Ecological Society of Australia (ESA). Don Driscoll is president of the ESA. He has recieved funding to undertake research aimed at reducing extinction risks in the Christmas Island Giant Gecko and the Baw Baw frog.

Bek Christensen is vice president of the Ecological Society of Australia, and chair of their Policy Working Group. She works for the Terrestrial Ecosystem Research Network, which is a research infrastructure project funded under the National Collaborative Research Infrastructure Strategy (NCRIS).

Euan Ritchie receives funding from the Australian Research Council. Euan Ritchie is a Director (Media Working Group) of the Ecological Society of Australia, and a member of the Australian Mammal Society.

AAP/Lukas Coch

Who would have thought that, scarcely five weeks after Treasurer Scott Morrison, paraded a chunk of coal in parliament, planning for Australia’s energy needs would be dominated by renewables, batteries and hydro?

For months now, the Coalition has been talking down renewables, blaming them for power failures, blackouts, and an unreliable energy network.

South Australia was bearing the brunt of this campaign. The state that couldn’t keep its lights on had Coalition politicians and mainstream journalists vexatiously attributing the blame to its high density of renewables.

But this sustained campaign, which would eventually hail “clean coal” as Australia’s salvation, all came unstuck when tech entrepreneur Elon Musk came out with a brilliant stunt: to install a massive battery storage system in South Australia “in 100 days, or it’s free”.

The genius of the stunt was not to win an instant contract to follow up on such a commitment, but to put an end to decades of dithering over energy policy that major political parties are so famous for in Australia and around the world, and which have intensified the climate crisis to dangerous levels.

Musk’s stunt was not without self-interest. It also aimed to position Tesla as a can-do company for future contracts. But where it was lethal was in completely neutering the campaign against renewables.

Anti-renewable politicians around the country, regardless of whether they are captive to the fossil-fuel lobby, could no longer argue for a dubious “clean-coal” powered station that would take between five and seven years to build when Tesla could fix a state’s energy crisis in 100 days – and not emit one gram of carbon at the end of the process.

Both the South Australian and Victorian governments have responded to Musk’s proposal by bidding for 100 megawatts of battery storage in their states. In South Australia’s case, a state-owned 250MW backup gas-fired fast-start aeroderivative power plant is also to be commissioned.

The state-owned gas power plant is, however, only a support to plans for a renewable-fed grid to be the main source of emergency dispatchable power. It is a plant that anticipates the way extreme weather can impact on energy infrastructure in much the same way desalination plants do for water infrastructure.

This is one reason it must be state-owned. But another is that a private operator would insist on full-time generation to maximise investment and profits. Thus, the South Australian gas plant is actually a critique of the privatisation of energy provision in Australia, which is the single greatest cause of why electricity prices have gone up.

As Giles Parkinson from RenewEconomy points out, within a framework in which privatisation dominates, the current market rules actually disadvantage the merits of non-domestic battery storage for consumers – because private power retailers can exploit arbitrage between low and high prices.

They can load up the batteries when excess wind and solar are cheap and sell it at peak demand for inflated prices. So, storage can actually enhance profits for power suppliers and create a bad deal for consumers.

However, the intrinsic value of storage is that the more you add, the less volatility there will be in a market. This creates a stable price for consumers and less profits for the corporations.

An example Parkinson uses is the Wivenhoe pumped storage facility in Queensland. This is:

… rarely used, because it would dampen the profits of its owners, which also own coal and gas generation.

Nevertheless, as a concept, the battery storage solution proposed by Musk, followed by South Australian Premier Jay Weatherill’s decisive action, really had constricted Malcolm Turnbull’s options. For a start, it makes redundant the longstanding fiction of “baseload power”, which was coined by the fossil-fuel industry to justify coal.

By last week, Turnbull would have already had the results of focus groups telling him that “clean” coal doesn’t wash with voters at all.

So, after reeling for most of last week over the humiliation that the Tesla and Weatherill challenge presented, and after scrambling for a counterpunch, Turnbull came up with Snowy Hydro 2.0. Here Musk’s stunt could only be really met with another stunt, but one in which Turnbull is only trying to salvage a very bad hand that he has played against battery-friendly renewables.

It is true that pumped hydro is currently cheaper than battery storage, but cannot be implemented nearly as quickly, and is not infinitely scalable as battery farms are.

Also, whereas the cost of battery storage continues to fall, the cost of the engineering needed for pumped hydro is not. And there are limited locations suitable for its operation.

But more important than all these considerations is that it while Snowy 2.0 will stabilise the national grid no matter whether clean or dirty energy is powering its pumps, it will only assist decarbonisation if the pumps are powered by wind and solar, which has all been glossed over in its PR sell.

With current energy market rules, there is still some incentive for dirty generators to feed the Snowy pumps. This helps energy security but does nothing for the climate crisis.

Yet, with his PR campaign, Turnbull thinks he is on a winner. The Snowy is also an icon of Australian nation-building and fable. And there is probably some political capital to be scored there. But the Snowy is a once-off, and not a part of the future as battery storage is.

But in having to play the part of the Man from Snowy River, Turnbull may have forestalled the inevitable onset of batteries, the price of which was that he was snookered into committing to an alternative substantial renewable-energy-friendly project.

So significant was the original stunt by Musk that set off a train of events cornering Turnbull into offering counter-storage that Giles Parkinson declared:

Turnbull drives stake through heart of fossil fuel industry.

But then, just when you thought coal had been cremated for the last time, it is revived over the weekend with the work of Chris Uhlmann, the ABC’s political editor, who gained notoriety for his anti-renewable stance on South Australia last year.

In his latest piece on the ABC, Uhlmann forewarns that the closure of the Hazlewood power station (5% of the nation’s energy output) will lead to east coast blackouts and crises in the manufacturing sector.

Uhlmann salutes the language of the coal companies in predicting that an energy crisis will result from no new investment in “baseload” power, even though this is precisely what renewables plus storage actually amounts to. He then quotes a Hazelwood unit controller as his source to raise the bogie of intermitancy once again:

Intermittent renewable energy could not be relied on during days of peak demand.

But the most misleading part of his piece was to point to the Australian Energy Market Operator’s prediction that shortfalls in supply next summer can be attributed to the closure of coal power stations, rather than the fact that climate-change-induced hotter temperatures are driving up demand during this period – as they did in the summer just gone, when Hazelwood was operating.

Perhaps Uhlmann’s piece would not look like such an advertorial for the coal industry had it not appeared on the same day as Resources Minister Matt Canavan’s speculation that a new coal-fired plant could be built in Queensland that will be subsidised by the A$5 billion Northern Australia Infrastructure fund.

On the ABC’s Insiders, Canavan lamented that Queensland did not have a:

… baseload power station north of Rockhampton … We’ve got a lot of coal up here, the new clean-coal technologies are at an affordable price, reliable power and lower emission.

It seems that while South Australia is leading the progress on a renewables Kodak moment, Queensland, with plans to build a coal-fired power stations and the Queensland Labor government going to great lengths to support the gigantic Adani coal mine, at least two states are moving in completely opposite directions.

The long view: energy policy needs to stay firmly focused on the horizon. Mattinbgn/Wikimedia Commons, CC BY-SA

If you’ve been watching the news in recent days, you’ll know we have an energy crisis, partly due to a gas crisis, which in turn has triggered a political crisis.

That’s a lot of crises to handle at once, so lots of solutions are being put forward. But what do people and businesses actually need? Do they need more gas, or cheaper prices, or more investment certainty, or all or none of the above? How do we cut through to what is really important, rather than side details?

The first thing to note is that what people really care about is their energy costs, not energy prices. This might seem like a pedantic distinction, but if homes and businesses can be helped to waste less energy, then high prices can be offset by lower usage.

The second thing to note is that energy has become very confusing. A host of short- and long-term problems have developed over decades of policy failure, meaning that there is no single solution.

Take gas prices, which were indirectly responsible for South Australia’s blackouts last month. Last week, SA Premier Jay Weatherill responded by unveiling a A$550-million plan including a new state-owned gas power station, while Prime Minister Malcolm Turnbull claimed to have secured a promise of secure domestic supply from gas producers.

Short-term thinking

It is crucial to keep the ultimate goals in focus, or else our short-term solutions could exacerbate long-term problems.

For electricity, we want to avoid blackouts and limit prices and overall costs. We need to do this in ways that allow us to meet our climate constraints, so we need solutions with zero or very low greenhouse emissions.

For gas, we need to ensure enough supply for local demand, at reasonable prices, and give large consumers the opportunity to negotiate contracts over reasonable time frames.

This means we need to allocate more of our gas to local consumers, because increasing overall gas production would just add to our long-term climate problems.

Peak gas and electricity prices are entangled. In our electricity markets, the most expensive generator needed to maintain supply in a given period sets the price for all the generators. So if an expensive gas generator sets a high price, all of the coal and renewable energy generators make windfall profits – at the consumer’s expense.

So either we need to ensure gas generators don’t set the price, or that they charge a reasonable price for the power they generate.

Quick fixes

Demand management and energy storage are short-term fixes for high peak prices. Paying some electricity or gas consumers to use less at peak times, commonly called “demand response”, frees up electricity or gas, so prices don’t increase as much.

Unfortunately, policymakers have failed to introduce effective mechanisms to encourage demand response, despite the recommendations of numerous policy reviews over the past two decades. This is a serious policy failure our politicians have not addressed. But it could be fixed quickly, with enough political will.

Energy storage, particularly batteries and gas storage, can be introduced quickly (within 100 days, if Tesla’s Elon Musk is to be believed). Storage “absorbs” excess energy at times of low demand, and releases it at times of shortage. This reduces the peak price by reducing dependence on high-priced generators or gas suppliers, as well as reducing the scope for other suppliers to exploit the shortage to raise prices.

The same thinking is behind Turnbull’s larger proposal to add new “pumped hydro” capacity to the Snowy Hydro scheme, although this would take years rather than weeks.

Thus South Australia’s plan, which features battery storage and changes to the rules for feeding power into the grid, addresses short-term problems. Turnbull’s pumped hydro solution is longer-term, although his handshake deal with gas suppliers may help in the short term.

The long view

When we consider the long term, we must recognise that we need to slash our carbon emissions. So coal is out, as is any overall expansion of natural gas production.

Luckily, we have other affordable long-term solutions. The International Energy Agency, as well as Australian analysts such as ClimateWorks and Beyond Zero Emissions, see energy efficiency improvement as the number-one strategy – and in many cases, it actually saves us money and helps to offset the impact of higher energy prices. Decades of cheap gas and electricity mean that Australian industry, business and households have enormous potential to improve energy efficiency, which would save on cost.

We can also switch from fossil gas to biogas, solar thermal and high-efficiency renewable electricity technologies such as heat pumps, micro-filtration, electrolysis and other options.

Renewable energy (not just electricity) can supply the rest of our needs. Much to the surprise of many policymakers, it is now cheaper than traditional options and involves much less investment risk. Costs are continuing to fall.

But we need to supplement renewable energy with energy storage and smart demand management to ensure reliable supply. That’s where options such as pumped hydro storage, batteries and heat-storage options such as molten salt come in.

This is why the crisis is more political than practical. The solutions are on offer. It will become much more straightforward if politicians free themselves from being trapped in the past and wanting to prop up powerful incumbent industries.

Alan Pears has worked for government, business, industry associations public interest groups and at universities on energy efficiency, climate response and sustainability issues since the late 1970s. He is now an honorary Senior Industry Fellow at RMIT University and a consultant, as well as an adviser to a range of industry associations and public interest groups. His investments in managed funds include firms that benefit from growth in clean energy. .

South Australia has the most wind energy in the country. Wind turbine image from www.shutterstock.com

The last couple of days have brought the differences between state and federal energy policy into stark contrast. South Australia has unveiled an energy plan in which the state takes a much greater role in the energy industry. The plan includes storage, a new gas plant and greater powers for the state over the National Electricity Market.

SA has the highest proportion of wind energy in Australia – and the federal government has consistently blamed this for the widely reported blackouts last year.

In a acrimonious joint press conference with South Australian Premier Jay Weatherill on Thursday, federal energy minister Josh Frydenberg reiterated that states are responsible for the stability of their electricity system. The federal government has cast doubt on the legality of the plan.

Is reliability a state responsibility?

The federal government has repeatedly claimed that the SA government can’t keep the lights on. More generally, it has implied that the states are responsible for electricity system stability.

Under the National Electricity Market (NEM) framework, these statements are somewhat misleading.

The SA electricity industry is entirely privatised. The NEM governance framework is run by national institutions under the Council of Australian Governments Energy Council, a forum of federal and state energy ministers. This framework is supposed to ensure the system reliably delivers electricity to all consumers.

System security and reliability are the responsibility of the Australian Energy Market Operator. Network investment is the responsibility of private network businesses, overseen by the Australian Energy Regulator.

This governance system leaves little space for the SA government to take action to ensure system security. On the contrary, the NEM was set up to remove direct government involvement in the electricity sector. This was because a market was considered more efficient to achieve the same service.

The federal government has blamed wind energy for SA’s reliability issues. But, even if wind is one factor among many, did the SA government exacerbate the risk of blackouts?

South Australia has actively encouraged co-existence of wind farms and farming activities in its planning legislation. Land use planning laws can have great influence on the uptake of large-scale renewable energy, as Victoria shows.

While state renewable targets have been blamed for uneven investment in renewable energy, the SA target of 50% by 2050 is not actually backed by a particular mechanism. Wind generators settled in South Australia because it has good wind resources and favourable planning laws.

They were financed under the federal Renewable Energy Target, but also by the ACT reverse auction schemes, which led to considerable investment in SA.

The review of the NEM, chaired by Chief Scientist Alan Finkel, will consider how climate and energy policies can be aligned. As the policymaker for the NEM, the COAG Energy Council should be the responsible authority, not individual states, to resolve any mismatch.

Is South Australia breaking the rules?

Apart from public investment in storage and gas, SA’s energy plan aims to give the state energy minister “strong new powers to direct the national market in case of an electricity supply shortfall”. The federal energy minister has implied that some of the SA plans may be illegal and that the government will be seeking legal advice.

But is SA breaking any rules?

The governance arrangements for the NEM are based on an intergovernmental arrangement, which relies on federal-state cooperation. The Australian Constitution contains no clear powers to regulate for energy. This means that having both levels of government work together to overcome these constraints was necessary to set up and manage a national electricity system.

The intergovernmental agreement that sets up the NEM is the Australian Energy Market Agreement (AEMA). All governments – state, territory and federal – have signed this. The AEMA covers the setting up of the market institutions and legislation. Based on this document, all states have passed state legislation that contains the National Electricity Law.

The AEMA includes provisions for amending legislation. These mean that only the COAG Energy Council can amend energy market legislation. Whether the council would agree to SA ministers getting special powers is doubtful.

However, the agreement is political and not legal. Indeed, one clause states that “this agreement is not intended to give rise to legal obligations” for the state and federal signatories.

Where does this leave SA’s plan? It does not break the law, but, depending on how the actual legislation is drafted, it may well fail to pass COAG.

A dangerous development or much-needed leadership?

Due to the limits of the constitution, intergovernmental arrangements play an important role in Australian policy-making. An increasing number of agreements covers areas such as water, environment or trade.

As we’ve seen with debate about the Gonski deal on education funding, these agreements require trust between all parties and should not be lightly departed from.

SA’s frustration with the lack of COAG leadership and the blame game for the blackouts is understandable. The SA energy plan may galvanise energy market reform and lead to a better system. It can be interpreted as taking leadership in the energy-climate debate, where none has been forthcoming from the federal government or COAG.

On the other hand, a danger exists that other states decide to follow SA’s example. With a review of the market in process, one-sided action seems counterproductive.

An agreement on a timely and fair energy transition needs all parties at the table. It will need national coordination and a whole-of-system perspective. Finkel’s task of overhauling the electricity market may just have been made even harder.

Anne Kallies does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond the academic appointment above.

The federal government has announced a A$2 billion plan to expand the iconic Snowy Hydro scheme. It will carry out a feasibility study into the idea of adding “pumped hydro” storage capacity, which it says could power up to 500,000 homes.

Hydro is one of the oldest and most mature electricity generation technologies. And pumped hydro storage – in which water is pumped uphill for later use, rather than simply flowing downriver through a hydro power station – is the dominant form of energy storage globally.

But there are limitations to how much freshwater hydro can be accessed, so it’s worth looking at what alternate approaches are available. One promising prospect is to use seawater instead of rivers. This tactic could potentially help South Australia resolve its highly publicised energy problems.

Hydro basics

The principle behind conventional hydro power is straightforward: rainwater runoff feeds a river, which is dammed to create a large reservoir of water. This is then gradually released through pipes to a turbine at the foot of the dam, thus converting the gravitational potential energy into electricity. The water then flows on downriver.

Hydro power is fossil-free and also “dispatchable” – it can be turned on or off at will (provided there is water in the dam). This gives it a significant advantage over wind turbines and solar photovoltaic (PV) panels, which produce power only when the wind blows or the sun shines.

Hydro thus makes an ideal partner for wind and solar PV, as it can adjust its output in response to changes in output from these non-dispatchable renewables.

Pump it up

Pumped hydro energy storage (PHES) is very similar to conventional hydro power but differs in that rather than being a generator, it’s more accurate to describe it as a battery.

Normally done at smaller scales than conventional hydro, PHES uses excess electricity from the grid (such as during periods of low demand and/or high generation) to pump water uphill from a lower reservoir to a higher one.

Later, this water is released back downhill through the turbine, returning the electricity to the grid when it is most needed – typically during the evening peak. It is this approach that is being considered in the Snowy Hydro 2.0 project.

Pumped hydro storage thus helps to “smooth out” peaks in demand by effectively transferring excess electricity from periods of low demand to periods of high demand. It has a “round trip” efficiency of ~80%, which is comparable to that of batteries.

PHES is the most common form of grid-connected energy storage in the world, accounting for around 97% of the total. It is often built in partnership with “baseload” power generators such as coal and nuclear plants, to help them vary their output to cope with peaks and troughs in demand.

Australia already has three PHES facilities – at Tumut 3 in the Snowy Hydro Scheme, at Shoalhaven in New South Wales, and at Wivenhoe Dam on the Brisbane River in Queensland.

South Australia is arguably the place that is most in need of grid-scale energy storage. Unfortunately, South Australia lacks the rainfall, rivers and mountains to run a conventional hydro system, with or without storage.

However, there is a way to use this technology without rivers and mountains: by using the ocean as the lower reservoir, and building an artificial upper one.

The upper reservoir doesn’t need a river to feed it fresh water; it just needs to be significantly higher than the ocean (that is, there should be a steep slope on or near the coastline, up which the seawater can be pumped). Using seawater also avoids the need to divert freshwater resources into a large reservoir, where a significant amount would be lost through evaporation.

Testing the technology

So far, only one seawater PHES installation has been built anywhere in the world – on the island of Okinawa, Japan. It came online in 1999 and was decommissioned in 2016, after Okinawa’s power requirements changed. Seventeen years for a first-of-its-kind project is a significant success. However, the Okinawa project was combined with a coal-fired power station, so linking this technology with intermittent renewables has never been trialled anywhere.

So could this technology help to ease South Australia’s energy crisis? The Melbourne Energy Institute (MEI) report on Pumped Hydro Opportunities identifies several potential seawater PHES locations in South Australia. This includes a very promising site at the northern end of the Spencer Gulf, with significant elevation close to the coast and close to high-capacity transmission lines.

The Department of Defence manages this land, and discussions are ongoing as to how the project might be designed to not interfere with the department’s operations on the site. A win–win development is the primary design aim.

The MEI study suggests that PHES could be delivered at around A$250 per kWh of storage. This compares well with utility-scale lithium ion battery storage, which currently costs of the order of A$800 per kWh, although recent annoucements on Twitter from Elon Musk suggest this might be coming down towards A$500 per kWh.

The Spencer Gulf site has the potential to provide at least 100 megawatts of dispatchable generation, effectively making the wind and solar generation in South Australia significantly more reliable.

The Australian Renewable Energy Agency (ARENA) will help fund a feasibility study into the technology, working with partners Energy Australia, Arup and MEI. If the facility is ultimately built, it could become a key element in SA’s bid to avoid future power blackouts.

Roger Dargaville works with the consortium of EnergyAustralia and Arup that have been funded by ARENA to conduct the PHES feasibility study. He has previously received funding from ARENA to undertake energy system modelling studies.

An emissions cap could save Australians up to A$500 each year in fuel costs. Petrol image from www.shutterstock.com

The cheapest way for Australia to cut greenhouse gas emissions is to put a cap on car emissions. It would be so cheap, in fact, that it will save drivers money.

According to analysis from ClimateWorks, the toughest proposed standard would help Australia achieve about 6% of its 2030 emission reduction target, and save drivers up to A$500 each year on fuel.

The federal government is looking at policy options to meet Australia’s 2030 emissions target of 26-28% below 2005 levels. Last year it established a ministerial forum to look at vehicle emissions and released a draft Regulation Impact Statement for light vehicles (cars, SUVs, vans and utilities) in December.

There is no reason for the government to delay putting the most stringent emissions standard on cars.

Cars getting cleaner, but not in Australia

Australia currently does not have carbon dioxide emission standards on light vehicles. CO₂ standards work by improving the overall efficiency of the vehicle (the amount of CO₂ emitted per kilometre). These are different from fuel quality standards, which regulate the quality of fuels used by vehicles, and noxious emissions standards, which monitor a car’s emissions of noxious gases and particulates.

Currently, CO₂ emission standards cover over 80% of the global light automotive market. The lack of standards here means that Australia’s cars are less efficient than in many other countries, and this gap is set to widen.

In 2015, the average efficiency of new cars sold in Australia (in grams of CO₂ emitted per km) was 184g per km. In the European Union, the average efficiency of new cars was 120g per km for passenger vehicles and 168g per km for light commercial vehicles (such as vans used as couriers). In the United States – the spiritual home of the gas-guzzler – it is 183g per km and set to improve to 105g per km in 2025.

Australia’s cars account for about 10% of Australia’s greenhouse gas emissions, which are set to grow to 2030 if the market is left to its own devices.

Helping meet Australia’s climate target

In our submission to the draft Regulation Impact Statement, we confirmed that if the most stringent proposed target (105g per km) were introduced as proposed from 2020 to 2025, it would deliver 6% of Australia’s 2030 emissions reduction target. This would save A$49 per tonne of CO₂. Although there would be some costs in introducing the scheme, it would save A$13.9 billion by 2040 overall.

This saves an extra additional 41 million tonnes of CO₂ by 2030, 140 million tonnes by 2040, and an extra A$8.1 billion overall by 2040 compared with the least stringent proposed target (135g per km by 2025).

However, we found that a two-year delay would add an extra 18 million tonnes of CO₂ to the atmosphere, or 2% of the government’s 2030 carbon budget.

Any reductions not achieved in vehicle emissions will need to be made up in other sectors, or purchased through international carbon permits, most likely at a higher cost.

Savings on fuel and health

The most stringent target delivers A$27.5 billion in total fuel savings by 2040, A$16.7 billion more than the least stringent standard.

The draft regulations show that for an average car this is equal to a saving of A$197-295 a year for a driver doing 15,000km per year, and A$328-493 for a driver doing 25,000km per year.

To put this in context, based on 2012 household energy costs data, this would cut household energy costs by up to 10%, with even greater savings for low-income households.

But a two-year delay of the most stringent standard would also result in new car owners paying an extra A$4.9 billion in fuel costs by 2030, and an extra A$8.3 billion to 2040.

The reduction in fuel use will also potentially reduce air pollution, resulting in better health outcomes.

The most stringent standard will save deliver 2.6 times as much fuel as the least stringent standard, so should reduce health costs by a similar proportion. However, the introduction of emissions standards would need to occur in a way that does not increase noxious emissions such as nitrogen oxides.

No reason to delay

Given the enormous benefit of a more stringent standard, the government should also investigate an even more ambitious target.

Our research shows a standard of 95g per km by 2025 will deliver even greater benefits and is technically feasible based on achievements in other markets. The EU is aiming for this level by 2020.

While we also support improving fuel quality to reduce noxious emissions, research by the International Council on Clean Transportation (ICCT) shows that we do not need to improve Australia’s fuel quality standards before the introduction of standards to improve the overall efficiency of the vehicle.

Similarly, despite discrepancies between on-road and in-lab performance of vehicles as seen in the Volkswagen emissions scandal, a standard will still provide significant savings to consumers and the environment.

Standards alone are not the silver bullet. We’ll need a range of other measures to support emissions standards on cars to help improve efficiency and build consumer awareness of fuel-efficient vehicles.

With Australian car manufacturing due to cease by the end of 2017, it is an ideal time to ensure that new cars bought into Australia are the most efficient available. This will set us on the path towards lower vehicle emissions while reducing costs for motorists and improving health.

ClimateWorks is funded by philanthropy through The Myer Foundation with Monash University. ClimateWorks Australia also periodically conducts research with funding from Federal, State and local governments and from private companies; all our work is focused on supporting strong emissions reductions in Australia. The author has no other relevant affiliations

ClimateWorks is funded by philanthropy through The Myer Foundation with Monash University. ClimateWorks Australia also periodically conducts research with funding from Federal, State and local governments and from private companies; all our work is focused on supporting strong emissions reductions in Australia. The author has no other relevant affiliations.

The Great Barrier Reef has already been badly damaged by global warming during three extreme heatwaves, in 1998, 2002 and 2016. A new bleaching event is under way now.

As shown in a study published in Nature today, climate change is not some distant future threat. It has already degraded large tracts of the Great Barrier Reef over the past two decades.

The extreme marine heatwave in 2016 killed two-thirds of the corals along a 700km stretch of the northern Great Barrier Reef, from Port Douglas to Papua New Guinea. It was a game-changer for the reef and for how we manage it.

Our study shows that we cannot climate-proof coral reefs by improving water quality or reducing fishing pressure. Reefs in clear water were damaged as much as muddy ones, and the hot water didn’t stop at the boundaries of no-fishing zones. There is nowhere to hide from global warming. The process of replacement of dead corals in the northern third of the reef will take at least 10-15 years for the fastest-growing species.

The Great Barrier Reef is internationally recognised as a World Heritage Area. In 2015 UNESCO, the world body with oversight of World Heritage Areas, considered listing the reef as a site “in danger” in light of declines in its health.

Australia’s response falling short

In response to concerns from UNESCO, Australia devised a plan, called the Reef 2050 Long-term Sustainability Plan. Its ultimate goal is to improve the “Outstanding Universal Value” of the reef: the attributes of the Great Barrier Reef that led to its inscription as a World Heritage Area in 1981.

We have written an independent analysis, delivered to UNESCO, which concludes that to date the implementation of the plan is far too slow and has not been adequately funded to prevent further degradation and loss of the reef’s values. A major shortcoming of the plan is that it virtually ignores the greatest current impact on the Great Barrier Reef: human-caused climate change.

The unprecedented loss of corals in 2016 has substantially diminished the condition of the World Heritage Area, reducing its biodiversity and aesthetic values. Key ecological processes are under threat, such as providing habitat, calcification (the formation of corals’ reef-building stony skeletons) and predation (creatures eating and being eaten by corals). Global warming means that Australia’s aim of ensuring the Great Barrier Reef’s values improve every decade between now and 2050 is no longer attainable for at least the next two decades.

What needs to change

Our report makes 27 recommendations for getting the Reef 2050 Plan back on track. The following are critical:

• Address climate change and reduce emissions, both nationally and globally. The current lack of action on climate is a major policy failure for the Great Barrier Reef. Local action on water quality (the focus of the Reef 2050 Plan) does not prevent bleaching, or “buy time” for future action on emissions. Importantly, though, it does contribute to the recovery of coral reefs after major bleaching.

• Reduce run-off of sediment, nutrients and pollutants from our towns and farms. To date the progress towards achieving the water quality targets and uptake of best management practice by farmers is very poor. Improving water quality can help recovery of corals, even if it doesn’t prevent mortality during extreme heatwaves.

• Provide adequate funding for reaching net zero carbon emissions, for achieving the Reef 2050 Plan targets for improved water quality, and limiting other direct pressures on the reef.

At this stage, we do not recommend that the reef be listed as “in danger”. But if we see more die-backs of corals in the next few years, little if any action on emissions and inadequate progress on water quality, then an “in danger” listing in 2020, when UNESCO will reconsider the Great Barrier Reef’s status, seems inevitable.

This article was co-authored by Diane Tarte, co-director of Marine Ecosystem Policy Advisors Pty Ltd. She was a co-author of the independent report to UNESCO on the Great Barrier Reef.

Terry Hughes receives competitive research funding from the Australian Research Council. He is the lead author on today’s Nature paper on recurrent coral bleaching, and a co-author on the independent report to UNESCO on the Reef 2050 Plan.

Barry Hart does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond his position as Emeritus Professor, Monash University .

Karen Hussey does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond her position as Professor and Deputy Director at the Global Change Institute, University of Queensland.

In the third in my series on the crisis besetting the National Electricity Market (NEM) in eastern Australia ( see Part 1 & Part 2), I look at some evidence for how the market itself has played a role and specifically market power issues.

The recent troubles in our electricity market are well documented. As described in my earlier pieces in this series, two elements have focused the attention of our political masters and industry groups.

The first is the question of security, highlighted most dramatically by recent “black outs” in South Australia.

The second is the question of price, with both wholesale and contract market prices having risen dramatically across most regions in recent times but nowhere quite as dramatically as in Queensland (note that retail prices have also been rising as highlighted by the recent Grattan report).

While a tightening of the demand-supply balance in Queensland in response to an additional ~800 megawatt load from the massive CSG field developments and LNG export processing facilities partly explains the rise in wholesale or pool prices there, it is far from the full explanation.

Lurking in the details are issues to do with the very functioning of the market, and the exercise of market power by large generators who have, and continue to, exploit monopoly rents.

As described in the earlier posts, the NEM market is designed to signal changes in the balance of demand and supply via spot prices. But how much the spot prices respond is very dependant on the level of competition.

Recent experience of market participants flouting the spirit of the rules shines a light on competition issues and highlights a rather obvious, if somewhat trite, reality. That is, the benefits of competitive markets can only flow if markets are competitive.

The exercise of market power has been a perennial issue in the NEM. It is the role of the Australian Energy Market Commission (AEMC) to set the rules that allow for safe operation of the electricity network, and efficient operation of the market. It is the job of the Australian Energy Regulator (AER) to do the enforcing, while AEMO operates the market.

The AEMC periodically adjusts rules so as to minimise the impact of perceived or real anti-competitive behaviour. It did so most recently in December 2015 with the Bidding in Good Faith rule amendment because, to quote:

… The Commission considers that the current rules do not set adequate boundaries on the ability of some participants to influence price outcomes to the detriment of others. This is not reflective of an efficient market.

The statement “ability … to influence price outcomes” is key. It expresses AEMC’s concern that some participants have sufficient market power to extract so-called monopoly rents.

To understand why the particular rule amendment was introduced, we need to go back to the two important intervals on which the market operates, the dispatch interval and the trading interval.

The dispatch interval is where the physics of the power system meets the economics of the market.

The necessity to balance generation and demand in real time, requires a dispatch pool with an objective of serving the demand at minimum system-cost. Functionally, our energy market operates by pooling offers from generators and allocating dispatch for each five minute interval in order of increasing offer price.

A generator offer specifies the price at which a given quantity of electricity will be supplied into a given trading interval, if needed. The dispatch price is set by the last (highest-price) offer needed to meet the dispatch interval demand. All generation dispatched receives the same dispatch price, regardless of the offer price. Offers at prices above the dispatch price are not needed and so receive nought.

The theory is that, in a perfectly competitive energy-only market, generators will offer the majority of their capacity at their short run marginal cost, like that shown below for Victorian generators.

Short run marginal cost of Victorian generators, stacked from left to right in merit order of increasing marginal cost. The x-axis shows the cumulative nameplate capacity of the lowest cost power plants in megawatts. Because renewables such as wind have zero fuel cost they stack on the left side of the merit curve. Contrawise, gas and diesel generators stack on the right. Image by Dylan McConnell.

In practice, individual generators apportion their capacity into a range of different price bands. They are then allowed to rebid the capacity into different price bands at short notice as part of the mechanism for making rapid adjustments to unforeseen circumstances that periodically arise in the normal course of events. AEMC’s Bidding in Good Faith rule amendment requires a justification for any late rebidding within 15 minutes of the start of the relevant dispatch interval.

As a deregulated market, optimal bidding is insured primarily by the discipline of competitive forces. It goes without saying, that without adequate competition, there can be no such insurance.

The other key interval is the half-hour trading interval or settlement period, across which dispatch prices are averaged to obtain a settlement or spot price, so called because it is the period on which financial payments are settled.

Since demand normally varies only slightly across a given half hour trading interval there should be little difference in the dispatch prices across the six corresponding dispatch intervals and the settlement price, especially when averaged over many trading intervals. In an efficient market with generators offering the bulk of their capacity at near their short run cost, this trading interval averaging should not materially affect the financial outcomes of the market. A necessary, though not necessarily sufficient, signal of the efficient operation of our market will be independence of dispatch prices or revenues on dispatch interval.

As shown below, January 2016 provides an illustrative case. It shows the dispatch prices for each dispatch interval averaged across the month. The narrow range of variation across each of the four regional markets that define the mainland part of the NEM, meets the expectation of a well-behaved market.

Average prices for each of the 5 minute dispatch intervals that make up the half hour settlement price for January, 2016. Prices are relatively constant across all intervals as expected in a well-behaved market, trading in an interval of about $10-15 per megawatt hour, for all four regional markets that define the mainland part of the NEM. Note the period is the month following the Bidding in Good Faith rule amendment by the AEMC in December 2015, The good behaviour of the QLD1 market contrasts strongly with the same periods in the previous and following years as shown in the following diagrams.

There is no compelling theoretical or practical reason for the exercise of a half-hour trading interval, it being something of a historical artefact. However many of the operators of our large generators seem to love it (as witnessed by submissions to a proposed rule change that would dispense the trading interval).

Why so? The cynic would say because the current arrangements have afforded a convenient guise to engage in profiteering. For example, by rebidding capacity into higher price bands late in a trading interval, settlement prices can be raised, materially distorting the market because other participants do not have time enough to respond. While such a creative compliance would in theory only impact un-contracted customers trading directly on the wholesale market, any resulting price increase will eventually pass through to the contract markets thereby affecting all customers.

Does it happen? Well the AEMC certainly thought so, enough at least to amend the Bidding in Good Faith Rule in December 2015.

The AEMC was particularly concerned that such practices were impacting market outcomes in Queensland (QLD1). The smoking gun lies deeply buried in the detils of the offers and rebids. But the pointers are quite apparent, as shown in the figure below which covers the month of January in 2015, prior to the AEMC’s rule amendment. Rather than average price, it shows the wholesale revenue by the 5-minute dispatch interval (the two are strongly coupled and their graphs are identical twins). The striking feature is the asymmetry in QLD1 revenue distribution, increasing very substantially across the last two dispatch intervals, compared with the earlier intervals. A crude estimate of the excess revenue generated by the anomalous, or inefficient, market behaviour is given by the sum of the differences between the dispatch interval prices and the lowest average dispatch interval price for the period. As noted on the right, in QLD1 it amounted to some 30% of total market value, or ~ $200 million for the month.

Notional wholesale markets revenues for 5 minute dispatch intervals for January, 2015. The figures on the right correspond to the total market revenue for the month, and (marked with a +) the anomalous revenue given by the sum of the differences between the dispatch prices and the lowest average dispatch price. The latter is a guide to distortion that can be attributed to non-competitive market forces - about $200 million, or 30%, for QLD1 in this case.

Given the magnitude of the anomaly the AEMC’s interest in a rule change is hardly surprising. To quote from their rule determination:

… the price volatility that arises from deliberately late rebidding … [is] … estimated to have added around eight dollars per megawatt hour to the price of caps in Queensland in the final quarter of 2014, and around seven dollars per megawatt hour in the first quarter of 2015. Across the market, this represents additional expenditure of approximately $170 million.

The AEMC noted also that

… While it is not guaranteed that the changes to the rules will put an immediate stop to the conduct of concern, they are a proportionate response to the issue, and ought to make it easier for the AER compared to the current arrangements to take enforcement action in respect of deliberately late rebidding. At the same time, they should not prevent rebidding in legitimate pursuit of commercial interests.

Did it do so? The AEMC and AER may well have been well pleased to see the initial response to its new rule determination in data such as for January 2016 shown above. However I suspect they will be concerned by the figure below, for January 2017. Essentially it is the mirror image of the January 2015 scenario, seemingly implying QLD1 generators are now initially bidding in capacity into elevated price bands in the early dispatch intervals. Conceivably, they may be rebidd capacity down to more normal values later in the trading interval, though that is moot since whatever the strategy it is achieving an identical outcome to 2015. Even if entirely within the rules, it would seem not in the spirit. The substantive result would appear to be situation normal in Queensland, with a $225 million monopoly rent extraction at the expense of electricity customers for this past January accompanying unprecedented spot price rises.

Notional wholesale markets revenues for 5 minute dispatch intervals for January, 2017. It is notable that it is almost the mirror image of January 2015 shown above, an example of creative compliance by QLD1 generators following AMEC’s Bidding in Good Faith rule amendment of December 2015. Note also the almost doubling of January revenues since 2015.

There is such a lot to be said about this, and hopefully it will be. It is but one, easily illustrated example of the exercise of market power. There are others, as for example described in the notes below. From the perspective of this discussion it is illustrative of significant deficiencies in the current operation of the NEM. Those deficiencies are exacerbating our current energy crisis. A concentration of market power is adding materially to costs especially, but not only, in Queensland.

It is worth noting that the half-hour settlement period is currently under review by AEMC and will likely be scrapped against the wishes of most established operators, or so it would seem judging from their submissions to the review. (As Dylan McConnell has shown, the current rules also seriously disadvantage the economics of a number of emerging technologies such as battery storage, hindering innovation that would serve much needed competitive discipline into the market.)

Whatever is decided by AEMC, the underlying issue of market power cannot be addressed by tinkering with the rules. And it is only getting worse as old power stations such as Northern in South Australia and Hazelwood in Victoria are closed. In the wake of such closures lies an even more concentrated market. For example, following closure of Northern, AGL’s proportion of registered capacity in South Australia increased 4% points, from 35% to 39%, improving its relative market power by more than 10%.

Percentage of registered generation capacity by participant in South Australia (top) and Victoria (bottom), both before and after the closure of the Northern (NPS) and Hazelwood (HPS) Power Stations, respectively. Note that Hazelwood is still operational at the time of writing, but is scheduled to close at end of this month (March, 2017). In both instances AGL’s relative market power has, or will be, substantially improved by these closures, by over 10% in relative market power terms. This increases the likelihood of AGL being a necessary or pivotal supplier, as it’s was in July 7th in the first of the South Australian energy crises of last year as described briefly in note [1]. Only the biggest seven participants in each state are shown.

With AGL in a position of great market power following the closure of Northern, it played its hand ruthlessly across July 2016, during the first of the South Australian energy crises as summarised here and described in more detail here (see Note [1]). With the closure of Hazelwood in a few weeks, AGL will again be the beneficiary of increased market share in Victoria, to a similar margin as it was in South Australia. That will increase the likelihood of AGL being a necessary or pivotal supplier in future high demand events in Victoria. How AGL responds will be a key to how steeply prices rise in Victoria and neighbouring states.

Like with any industry, our electricity generators have shown adeptness at exploiting the opportunities availed by the market rules. In so doing they have contributed to the price outcomes that are helping provoke our current energy crisis. One could only wish they turned such “innovation” to helping drive our energy system to a place we need it to be, that is secure, affordable and with much, much lower emissions. To be so guided, our market rules will have to be radically reshaped to be more aligned to the national interest, explicitly including all three elements of our energy trilemma, and ensuring adequate levels of competition allow the benefits of the deregulated market flow to all participants.

Sadly, as our energy crisis has unfolded, partly in response to the need to address its emissions intensity, emissions have begun to rise again. Just by how much we do not know, as I will discuss in the next piece in this series.

Notes

[1] In our analysis of the July 7th event in South Australia, we analysed the extent to which AGL bid capacity to high price bands (typically the market cap price) for the Torrens Island A Power Station. We also looked at the proportion of capacity that was available below and above $300/MWh. In aggregate, Torrens Island A offered its entire capacity to the market at less than $300/MWh 96.5% of time in 2015. For the remaining 3.5% of the year (or about 300 hours) some capacity was pushed into high price bands. Our analysis shows a correlation between periods of high scheduled demand and Torrens Island A’s bidding of capacity into high price bands. The proportion of time when some capacity was priced above $300/MWh is clearly skewed to times of high scheduled demand. In 2015, for the top 10% of scheduled demand periods, the amount of time some capacity was bid into these high price bands was 16.7%. For the top 1% of scheduled demand periods it increased to 35%. On July 7th 2016, it is clear is that Torrens Island had bid an unusually high volume of capacity at the market price cap, at a time it was needed to ensure supply as a pivotal supplier, consistent with exercising market power. While there is nothing in the rules to prevent this, the lack of appropriate competitive discipline means significant market distortion accumulated.

Disclosure

Mike Sandiford receives funding from ANLEC and the ARC.

Early in the morning and late in the evening is when shorebirds escape disturbance on the beaches on which their survival depends. Arnuchulo

This is the ninth article in our Contested Spaces series. These pieces look at the conflicting uses, expectations and norms that people bring to public spaces, the clashes that result and how we can resolve these.

There’s no doubt about it, Australians love the beach. And why not? Being outdoors makes us happy, and all beaches are public places in Australia.

Head to a beach like Bondi on Christmas Day and you’ll share that space with more than 40,000 people. But we aren’t just jostling with each other for coveted beach space. Scuttling, waddling, hopping or flying away from beachgoers all around Australia are crabs, shorebirds, baby turtles, crocodiles, fairy penguins and even dingoes.

Beaches are home to an incredible array of animals, and sharing this busy space with people is critical to their survival. But, if we find it hard to share our beaches with each other, how can we possibly find space for nature on our beaches?

Beach birds

Here’s a classic example of how hard it is to share our beaches with nature. Head to a busy beach at dawn, before the crowds arrive, and you will most likely see a number of small birds darting about.

You may recognise them from the short movie Piper – they are shorebirds. As the day progresses, swimmers, kite surfers, dog walkers, horse riders, 4x4s and children descend upon the beach en masse, unwittingly disturbing the shorebirds.

We share beaches with an extraordinary array of life, including many shorebirds.

Unlike seabirds, shorebirds do not spend their life at sea. Instead, they specialise on the beach: foraging for their invertebrate prey, avoiding waves, or resting.

However, shorebird numbers in Australia are declining very rapidly. Several species are officially listed as nationally threatened, such as the critically endangered Eastern Curlew.

There are few places you can let your dog run for as long and as far as it pleases, which is one of the reasons beaches appeal to dog owners. But this disturbance results in heavy costs to the birds as they expend energy taking flight and cannot return to favourable feeding areas. Repeated disturbance can cause temporary or permanent abandonment of suitable habitat.

The world’s largest shorebirds, Eastern Curlews are critically endangered – and Australia is home to about 75% of them over summer. Donald Hobern/flickr, CC BY

The fascinating thing about many of these shorebirds is that they are migratory. Beachgoers in Korea, China, Indonesia or New Zealand could observe the same individual bird that we have seen in Australia.

Yet these journeys come at a cost. Shorebirds must undertake gruelling flights of up to 16,000 kilometres twice a year to get from their breeding grounds in Siberia and Alaska to their feeding grounds in Australia and New Zealand. In their pursuit of an endless summer, they arrive in Australia severely weakened by their travels. They must almost double their body weight before they can migrate again.

And these birds must contend with significant daily disruption on their feeding grounds. A recent study in Queensland found an average of 174 people and 72 dogs were present at any one time on the foreshore of Moreton Bay, along Brisbane’s coastline. And 84% of dogs were off the leash – an off-leash dog was sighted every 700 metres – in potential contravention of regulations on dog control.

Managing the menagerie

One conservation approach is to set up nature reserves. This involves trying to keep people out of large areas of the coastal zone to provide a home for nature. Yet this rarely works in practice on beaches, where there are so many overlapping jurisdictions (for example, councils often don’t control the lower areas of the intertidal zone) that protection is rarely joined up.

The beach-nesting Hooded Plover is unique to Australia where it is listed as vulnerable (and critically endangered in NSW). Francesco Veronesi/Wikimedia Commons, CC BY-SA Benjamint444/Wikimedia Commons, CC BY-SA

However, our work at the University of Queensland shows we don’t need conservation reserves in which people are kept out. Quite the reverse. We should be much bolder in opening up areas that are specifically designated as dog off-leash zones, in places where demand for recreation is high.

In the case of Moreton Bay, 97% of foraging migratory shorebirds could be protected from disturbance simply by designating five areas as off-leash recreation zones. Currently, dogs must be kept under close control throughout the intertidal areas of Moreton Bay.

By zoning our beaches carefully, the science tells us that the most intense recreational activities can be located away from critical areas for nature. And there’s no reason why this logic couldn’t be extended to creating peaceful zones for beach users who prefer a quiet day out.

By approaching the problem scientifically, we can meet recreational demand as well as protect nature. Proper enforcement of the boundaries between zones is needed. Such enforcement is effective when carried out in the right places at the right time.

We believe that keeping people and their dogs off beaches to protect nature is neither desirable nor effective. It sends totally the wrong message – successful conservation is about living alongside nature, not separating ourselves from it.

Conservationists and recreationists should be natural allies, both working to safeguard our beautiful coasts. The key is to find ways that people and nature can co-exist on beaches.

You can find other pieces published in the series here.

Madeleine Stigner received funding for the work referred to in this article from Birds Queensland and the Queensland Wader Study Group Nigel Roberts Student Research Fund.

Kiran Dhanjal-Adams received funding for the work referred to in this article from the Centre of Excellence in Environmental Decisions, the Australian Research Council, Queensland Department of Environment and Heritage Protection, the Commonwealth Department of the Environment, the Queensland Wader Study Group, the Port of Brisbane Pty Ltd, the Goodman Foundation and Birdlife Australia’s Stuart Leslie Award.

Richard Fuller received funding for the work referred to in this article from the National Environmental Science Programme's Threatened Species Recovery Hub, the Australian Research Council, Queensland Department of Environment and Heritage Protection, the Commonwealth Department of the Environment, the Queensland Wader Study Group, the Port of Brisbane Pty Ltd, the Goodman Foundation and Birdlife Australia’s Stuart Leslie Award.

South Australia’s government has unveiled its keenly anticipated new energy plan, with the aim of making itself more self-sufficient.

Against the backdrop of repeated crises such as the blackouts of last month and September last year, and a dramatic offer from Tesla founder Elon Musk to fix the state’s energy security problems, the new plan proposes a range of measures to fix what Premier Jay Weatherill has described as the “failures” of national electricity regulation.

Battery storage

First, as almost universally anticipated, there will be a tender for 100 megawatts of battery storage, to be funded from a A$150 million Renewable Technology Fund. The plan document says this project will “modernise South Australia’s energy grid and begin the transformation to the next generation of renewable-energy storage technologies”.

Neither the National Electricity Market rules nor any other federal policy provides any specific mechanism to encourage battery installation. Nor do the existing regulations allow battery operators to be rewarded for other services they could provide, including responding rapidly to price spikes or to sudden drops in voltage on the grid.

Large battery installations, if appropriately configured, would be capable of providing large injections of energy to the grid over short periods, as a way to offset extreme volatility. Both SA and Queensland have been plagued by such volatility in recent months, causing a rash of short-term price spikes indicative of markets without enough competition.

The Australian Energy Market Commission (AEMC) is currently considering a Rule change, termed the 30 minute/5 minute trading interval change, proposed by a large electrolytic zinc smelter in Townsville. The change is ferociously opposed by established generators, but supported by almost everyone else. If and when the AEMC ever gets around to approving the rule change, large battery installations would be able to compete directly with generators, thereby both gaining a new source of revenue and helping to keep wholesale prices within reasonable limits.

Taking back control

The second component of the plan is to introduce legislation that would allow the state government to override the NEM’s market dispatch process for generation in the event of an emergency such as the demand peaks that triggered last month’s blackouts.

This is an obvious response to what is widely seen, at least in SA, as the reluctance of the federal regulator to use its powers to suspend the market. Many observers consider that such reluctance was most evident in the morning of the statewide blackout last September, and believe that earlier intervention could have prevented it, despite the massive storm damage to the state’s transmission infrastructure.

The new proposal could be interpreted as a challenge to the federal government over who controls SA’s electricity.

Energy security

Third, the plan will require all new generators with more than 5MW of capacity to demonstrate how they will contribute to the state’s energy security, by providing what are called ancillary services, such as frequency control, so-called inertia, or short-term storage. This is another clear statement that the state government believes the NEM rules, which establish markets for some frequency control services but not the other services mentioned above, fail to offer the state enough of a guarantee of reliable power supply.

Build a new gas plant

The government plans to become a power station owner, 20 years after the Liberal state government sold off the last publicly owned plant, by building a new open cycle (peaking) gas turbine plant. This decision is most obviously a reaction to the load-shedding blackout amid last month’s heatwave, when the operators of the Pelican Point gas power station were either unable or unwilling to increase output. Had they done so, load shedding could have been avoided.

At A$360 million, this seems a rather expensive way to avoid another load-shedding blackout, presumably justified on the basis of avoided political cost. It could be seen as a missed opportunity to provide more support for a far more innovative (though well proven in other countries) project to integrate solar thermal generation, gas generation and molten salt storage.

Solar thermal generation may gain support from the tender for new generation to supply the government’s own electricity requirements, and possibly some from the Renewable Technology Fund, but that remains to be seen.

Energy security target

Finally, the government will introduce a requirement, called an energy security target, requiring electricity retailers to source a minimum percentage of their wholesale requirements from local generators, rather than from Victorian coal-fired stations.

This will provide a guaranteed amount of revenue to local generators, thus reducing dependence on supply through the interconnectors with Victoria, with their associated security risks.

In a direct, though entirely unsurprising confrontation with the Commonwealth, the plan document states that “South Australia’s energy security target will transition to an EIS or Lower Emissions Target (LET) if or when national policy changes in the future”.

The wider context

In the policy document, Weatherill writes that the NEM is “failing South Australia and the nation”. Taken together, the various elements of the plan can be read as a list of how exactly the SA government considers it to be failing, and what powers the state proposes to assume in order to get it fixed.

Although the plan’s objectives are not stated explicitly, it is clear that they are threefold, and seen of equal priority:

• suppress retail price rises by introducing more competition into the wholesale market

• enhance the physical security of electricity supply

• encourage renewable generation and reduce greenhouse gas emissions.

These priorities neatly match the three components of what the preliminary report of the forthcoming Finkel Review calls the “energy trilemma”, which is the need to “simultaneously provide a high level of energy security and reliability, universal access to affordable energy services, and reduced emissions.”

With the review’s final version set to be delivered to the Commonwealth government in the coming months, it remains to be seen whether federal energy policy will become similarly proactive in the future.

Hugh Saddler is a member of the Board of the Climate Institute.

The keenly awaited new energy policy unveiled today by South Australian Premier Jay Weatherill features a range of headline-grabbing items, such as a plan to spend A$150 million on a 100-megawatt battery storage facility to help stave off the danger of future blackouts.

On page 7 of the policy document, Weatherill explains part of his underlying rationale:

The national market is now widely considered to be failing and in need of urgent reform. The ability of governments to influence the industry requires cooperation within and across state borders and at a Federal level – cooperation that needs to transcend politics and self-interest.

Noble words, but the new policy doesn’t “transcend politics and self-interest”. Quite the contrary – it is a unilateral move by a state government understandably keen to safeguard itself after suffering vicious criticism at a federal level.

There are rules for how SA and the east coast states that make up the National Electricity Market (NEM) are supposed to behave, yet member states seem to be able to flaunt them, systematically undermining the NEM along the way.

Rightly or wrongly, the NEM does not account for schemes such as renewable energy targets or solar feed-in tariffs. This means that when states pursue them, they can distort the market in the process.

There is conjecture about how much blame the Weatherill government should shoulder for the reliability issues that have beset SA’s electricity network. Either way, the decision has been made to fix it with yet more unilateral state government intervention in what is supposed to be a federated electricity market.

As a result, the new policy is likely to cause major headaches for the NEM and its operators. The announcement includes plans to give the state’s energy minister Tom Koutsantonis the power to override the NEM’s operating rules, allowing him to order generators to supply extra power when he deems it necessary.

This might help avert another South Australian blackout, but it will also undermine the role of the Australian Energy Market Operator (AEMO), which is responsible for managing the supply of electricity within the NEM. I will be fascinated to see how the SA government deals with the complex issue of what price they will pay for such power.

If the NEM is experiencing a peak in demand and South Australia is facing a shortage, will the South Australian Minister be able to override AEMO and demand private power generators in SA deliver power at a price determined by the minister? Or will the price be the one dictated at that moment by the market?

It is unlikely that the predominantly Labor-run states that now constitute the NEM will allow any adverse action against South Australia. In fact, the SA Parliament is the body through which rules of the NEM are legislated, so it will be nigh-on impossible to toss SA out of the NEM, lest the whole house of cards collapses.

Going it alone

Two other interesting aspects from the South Australian “energy intervention” is the construction of a new A$360 million gas-fired power plant, courtesy of SA taxpayers, and the A$150 million battery bank.

Presumably the SA government would like this new power plant to be able to sell electricity into the NEM, but to reserve the right to commandeer its output when circumstances dictate. It is not at all clear that the NEM rules allow this.

Consider the circumstances during last month’s heatwave, when both SA and New South Wales were facing power shortages. Under SA’s proposed new rules, NSW would be on its own (unless it develops a similar policy of its own). Hardly an example of cooperation.

The same issue will apply to the battery bank. Will it only be on standby for power shortages in SA, or will it be able to discharge into the NEM to take advantages of peak pricing? Could this result in SA finding its batteries empty when the wind stops blowing?

The SA government is correct to point out the deficiencies in the NEM, and even perhaps to claim that it is failing the nation. But an interstate scheme cannot be fixed by the unilateral actions of one state government – in this case, it is likely to be worsened.

The most worrying prospect of all, as far as the NEM is concerned, is the possibility that this will increase investment uncertainty still further, making it even less likely that the interstate grid will attract the new investment it needs.

If that happens, we might well see a few more states deciding to follow SA’s lead and plan sweeping energy reforms of their own.

Jeffrey Sommerfeld is involved with an energy analytic consultancy he established with two other persons with PhD expertise in energy. He/they are not doing this research on behalf of a client and will receive no direct benefit from it. He was an adviser to former Queensland LNP energy minister Mark McArdle from April 2012 to July 2013.

The energy sector was supposed to be the showcase for privatisation and market deregulation. Yet in 2017, this premise is being sorely tested – no more so than in electricity retailing, where competition has failed to deliver on its promise of lower prices for customers.

The latest Grattan Institute report, Price shock: Is the retail electricity market failing consumers?, provides evidence that in the electricity retail sector, the anticipated price reductions have not happened, and innovation has been very slow in coming.

On the contrary, the markets with the least regulation have the highest prices. Australia’s experience is mirrored in the UK, the United States and Canada, and all are struggling to find solutions.

Mixed success

The privatisation of Australia’s electricity retail markets dates back to the 1993 Hilmer Report on national competition policy. The ensuing decade saw a raft of reforms that initially delivered increases in productivity, lower prices and business innovation. But in the decade after that, this progress became much harder to sustain.

The idea was for states to create regulated monopolies in electricity transmission and distribution (poles and wires), while deregulating the retail side (the supply of gas and electricity to customers).

The competition in electricity generation largely delivered lower wholesale prices through the National Electricity Market (NEM). But a mess has since been created by poor or absent climate policy at a federal level, which failed to match the enthusiasm of (some) states for clean energy. The resulting surge of investment in wind and solar happened without due consideration of the consequences for security and reliability of supply. Generating more renewable energy is essential, but failing to integrate it properly with the NEM was negligent.

Meanwhile, in Victoria – the state with most electricity retailers and the longest history of full competition – retail prices have been increasing without apparent justification and retail margins are higher than they should be. The cost to Victorians could be as much as A$250 million a year.

Lazy customers?

Customers are unhappy, and yet we are not seeing a surge of consumer action to get the best deals. So if it’s just a matter of lazy consumers, why should governments care?

Part of the answer to this conundrum lies with the product and its relationship with consumers. First, electricity is an essential service that underpins our daily lives, and switching off is not a realistic option for most consumers.

Second, the products offered by retailers are often complex and the advertising is confusing, if not downright misleading. It is hardly surprising that consumers feel stuck and eventually give up trying to find the best deal, when all too often an advertised 30% discount on their electricity bill doesn’t necessarily mean their bills will be 30% cheaper.

So far there have been few genuine innovations in electricity pricing – even in Victoria which has had full deregulation since 2009. The most common tactic has been a discount for paying on time or by direct debit, although consumers are often frustrated when they discover that at the end of their contract they lose the discount even if they continue to pay the same way.

Meanwhile, products that offer different prices for electricity use at different times of the day have been slow to appear. These products have the potential to deliver major savings, yet the industry has failed to deliver them in a way that makes them easy for customers to understand and adopt.

What to do

When faced with a market failure, governments should consider action. Yet, as with the Australia’s domestic gas market and South Australia’s power “crisis”, they should proceed with caution.

In Britain, the partial re-regulation of retail electricity competition delivered unexpected and perverse outcomes, such as the removal of the cheapest deals. A move to re-regulate prices here could stifle emerging innovation, and would most likely leave some consumers worse off without the guarantee of a better outcome overall. We seem to be driven to a choice between free markets and central planning. Yet neither is a panacea.

There are government interventions that could fix the worst problems without stifling effective competition. They include requiring clearer and simpler advertising, and more transparent and fairer contracts. Requiring retailers to provide data on their profit margins to an independent agency could also help, and could even be in the best interest of the retailers if it fends off more heavy-handed regulation.

The retail electricity market may be fixable, and the benefits of competition may ultimately exceed its costs. We may yet see fairer prices and real innovation. But if not, governments will have no choice but to return to price regulation. The electricity retailers who are used to the current free market certainly won’t want that.

Tony Wood owns shares in several energy and resources companies through his superannuation fund

One of the worst instances of mangrove forest dieback ever recorded globally struck Australia’s Gulf of Carpentaria in the summer of 2015-16. A combination of extreme temperatures, drought and lowered sea levels likely caused this dieback, according to our investigation published in the journal Marine and Freshwater Research.

The dieback, which coincided with the Great Barrier Reef’s worst ever bleaching event, affected 1,000km of coastline between the Roper River in the Northern Territory and Karumba in Queensland.

Views of mangrove shorelines impacted by dieback event in late 2015, east of Limmen Bight River, Northern Territory (imagery: NC Duke, June 2016).

About 7,400 hectares, or 6%, of the gulf’s mangrove forest had died. Losses were most severe in the NT, where around 5,500ha of mangroves suffered dieback. Some of the gulf’s many catchments, such as the Robinson and McArthur rivers, lost up to 26% of their mangroves.

Views of seaward mangrove fringes showing foreshore sections of minor (left side) and extreme (right side) damage as observed in June 2016 between Limmen and MacArthur rivers, NT. These might effectively also represent before and after scenarios, but together show how some shoreline sections have been left exposed and vulnerable. NC Duke The gulf, a remote but valuable place

The Gulf of Carpentaria is a continuous sweep of wide tidal wetlands fringed by mangroves, meandering estuaries, creeks and beaches. Its size and naturalness makes it globally exceptional.

An apron of broad mudflats and seagrass meadows supports thousands of marine turtles and dugongs. A thriving fishing industry worth at least A$30 million ultimately depends on mangroves.

Dieback of mangroves around Karumba in Queensland, with surviving saltmarsh, October 2016. NC Duke

Mangroves and saltmarsh plants are uniquely adapted to extreme and fickle coastal shoreline ecosystems. They normally cope with salt and daily inundation, having evolved specialised physiological and morphological traits, such as salt excretion and unique breathing roots.

But in early 2016, local tour operators and consultants doing bird surveys alerted authorities to mangroves dying en masse along entire shorelines. They reported skeletonised mangroves over several hundred kilometres, with the trees appearing to have died simultaneously. They sent photos and even tracked down satellite images to confirm their concerns. The NT government supported the first investigative surveys in June 2016.

Areas affected by severe mangrove dieback in late 2015 (grey shaded) along southern shorelines of Australia’s Gulf of Carpentaria from Northern Territory to Queensland. Aerial surveys (red lines) were undertaken on three occasions during 2016 to cover around 600km of the 1000km impacted. NC Duke

In the end, the emails from citizen scientists nailed the timing: “looks like it started maybe December 2015”; the severity: “I’ve seen dieback before, but not like this”; and the cause: “guessing it may be the consequence of the four-year drought”.

Our investigation used satellite imagery dating back to 1972 to confirm that the dieback was an unparalleled event. Further aerial helicopter surveys and mapping during 2016, after the dieback, validated the severity of the event extending across the entire gulf. Mangrove dieback has been recorded in Australia in the past but over decades, not months.

Mangroves losses (red) and surviving mangroves (green) around the shoreline and mouth of the Limmen Bight River, south-western Gulf of Carpentaria, April 2015 to April 2016. NC Duke, J. Kovacs Mysterious patterns in the dieback

We still don’t fully understand what caused the dieback. But we can rule out the usual suspects of chemical or oil spills, or severe storm events. It was also significant that losses occurred simultaneously across a 1,000km front.

There were also a number of tell-tale patterns in the dieback. The worst-impacted locations had more or less complete loss of shoreline-fringing mangroves. This mirrored a general loss of mangroves fringing tidal saltpans and saltmarshes along this semi-arid coast.

Mangroves were unaffected where they kept their feet wet along estuaries and rivers. This, as well as the timing and severity of the event, points to a connection with extreme weather and climate patterns, and particularly the month-long drop of 20cm in local sea levels.

Extreme weather the likely culprit

We believe the dieback is best explained by drought, hot water, hot air and the temporary drop in sea level. Each of these was correlated with the strong 2015-16 El Niño. Let’s take a look at each in turn.

First, the dieback happened at the end of an unusually long period of severe drought conditions, which prevailed for much of 2015 following four years of below-average rainfall. This caused severe moisture stress in mangroves growing alongside saltmarsh and saltpans.

Second, the dieback coincided with hot sea temperatures that also caused coral bleaching along the Great Barrier Reef. While mangroves are known to be relatively heat-tolerant, they have their limits.

The air temperatures recorded at the time of the mangrove dieback, particularly from February to September 2015, were also exceptionally high.

Views of mangrove shorelines impacted by dieback event in late 2015, north of Karumba, Queensland (imagery: NC Duke, Oct 2016).

Third, the sea level dropped by up to 20cm at the time of the dieback when the mangroves were both heat- and moisture-stressed. Sea levels commonly drop in the western Pacific (and rise in the eastern Pacific) during strong El Niño years: and the 2015-2016 El Niño was the third-strongest recorded.

The mangroves appear to have died of thirst. Mangroves may be hardy plants, but when sea levels drop, reducing inundation, coupled with already heat-and-drought-stressed weather conditions, then the plants will die – much like your neglected pot plants.

We don’t yet know what role human-caused climate change played in these particular weather events or El Niño. But the unprecedented extent of the dieback, the confluence of extreme climate events and the coincidence with the bleaching of the Great Barrier Reef mean the role of climate change will be of critical interest in the global response to mangrove decline.

What future for mangroves?

The future for mangroves around the world is mixed. Thanks to climate change, droughts are expected to become hotter and more frequent. If the gulf’s mangroves experience further dieback in the future, this will have serious implications for Australia’s northern fisheries including the iconic prawn fishery, mudcrab and fin fish fisheries. All species are closely associated with healthy mangroves.

We don’t know whether the mangroves will recover or not. But there is now a further risk of shoreline erosion and retreat, particularly if the region is struck by a cyclone – and this may have already begun with recent cyclonic weather and flooding in the gulf. The movement of mangrove sediments will lead to massive releases of carbon uniquely buried among their roots.

Mangroves are among the most carbon-rich forests in the tropics and semi-tropics and much of this carbon could enter the atmosphere.

Aerial view of severe mangrove dieback near Karumba in Queensland, October 2016. NC Duke

Now we urgently need to understand how mangroves died at large and smaller scales (such as river catchments), so we can develop strategies to help them adapt to future change.

Australia’s top specialists and managers will be reviewing the current situation at a dedicated workshop during next week’s Australian Mangrove and Saltmarsh Network annual conference in Hobart.

The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond the academic appointment above.

No matter how hard we dig, the Earth's resources are ultimately finite. Mining image from www.shutterstock.com

Our economy and society ultimately depend on natural resources: land, water, material (such as metals) and energy. But some scientists have recognised that there are hard limits to the amount of these resources we can use. It is our consumption of these resources that is behind environmental problems such as extinction, pollution and climate change.

Even supposedly “green” technologies such as renewable energy require materials, land and solar exposure, and cannot grow indefinitely on this (or any) planet.

Most economic policy around the world is driven by the goal of maximising economic growth (or increase in gross domestic product – GDP). Economic growth usually means using more resources. So if we can’t keep using more and more resources, what does this mean for growth?

Most conventional economists and policymakers now endorse the idea that growth can be “decoupled” from environmental impacts – that the economy can grow, without using more resources and exacerbating environmental problems.

Even the then US president, Barack Obama, in a recent piece in Science argued that the US economy could continue growing without increasing carbon emissions thanks to the rollout of renewable energy.

But there are many problems with this idea. In a recent conference of the Australia-New Zealand Society for Ecological Economics (ANZSEE), we looked at why decoupling may be a delusion.

The decoupling delusion

Given that there are hard limits to the amount of resources we can use, genuine decoupling would be the only thing that could allow GDP to grow indefinitely.

Drawing on evidence from the 600-page Economic Report to the President, Obama referred to trends during the course of his presidency showing that the economy grew by more than 10% despite a 9.5% fall in carbon dioxide emissions from the energy sector. In his words:

…this “decoupling” of energy sector emissions and economic growth should put to rest the argument that combating climate change requires accepting lower growth or a lower standard of living.

Others have pointed out similar trends, including the International Energy Agency which last year – albeit on the basis of just two years of data – argued that global carbon emissions have decoupled from economic growth.

But we would argue that what people are observing (and labelling) as decoupling is only partly due to genuine efficiency gains. The rest is a combination of three illusory effects: substitution, financialisation and cost-shifting.

Substituting the problem

Here’s an example of substitution of energy resources. In the past, the world evidently decoupled GDP growth from buildup of horse manure in city streets, by substituting other forms of transport for horses. We’ve also decoupled our economy from whale oil, by substituting it with fossil fuels. And we can substitute fossil fuels with renewable energy.

These changes result in “partial” decoupling – that is, decoupling from specific environmental impacts (manure, whales, carbon emissions). But substituting carbon-intensive energy with cleaner, or even carbon-neutral, energy does not free our economies of their dependence on finite resources.

Let’s get something straight: Obama’s efforts to support clean energy are commendable. We can – and must – envisage a future powered by 100% renewable energy, which may help break the link between economic activity and climate change. This is especially important now that President Donald Trump threatens to undo even some of these partial successes.

But if you think we have limitless solar energy to fuel limitless clean, green growth, think again. For GDP to keep growing we would need ever-increasing numbers of wind turbines, solar farms, geothermal wells, bioenergy plantations and so on – all requiring ever-increasing amounts of material and land.

Nor is efficiency (getting more economic activity out of each unit of energy and materials) the answer to endless growth. As some of us pointed out in a recent paper, efficiency gains could prolong economic growth and may even look like decoupling (for a while), but we will inevitably reach limits.

Moving money

The economy can also appear to grow without using more resources, through growth in financial activities such as currency trading, credit default swaps and mortgage-backed securities. Such activities don’t consume much in the way of resources, but make up an increasing fraction of GDP.

So if GDP is growing, but this growth is increasingly driven by a ballooning finance sector, that would give the appearance of decoupling.

Meanwhile most people aren’t actually getting any more bang for their buck, as most of the wealth remains in the hands of the few. It’s ephemeral growth at best: ready to burst at the next crisis.

Shifting the cost onto poorer nations

The third way to create the illusion of decoupling is to move resource-intensive modes of production away from the point of consumption. For instance, many goods consumed in Western nations are made in developing nations.

Consuming those goods boosts GDP in the consuming country, but the environmental impact takes place elsewhere (often in a developing economy where it may not even be measured).

In their 2012 paper, Thomas Wiedmann and co-authors comprehensively analysed domestic and imported materials for 186 countries. They showed that rich nations have appeared to decouple their GDP from domestic raw material consumption, but as soon as imported materials are included they observe “no improvements in resource productivity at all”. None at all.

From treating symptoms to finding a cure

One reason why decoupling GDP and its growth from environmental degradation may be harder than conventionally thought is that this development model (growth of GDP) associates value with systematic exploitation of natural systems and also society. As an example, felling and selling old-growth forests increases GDP far more than protecting or replanting them.

Defensive consumption – that is, buying goods and services (such as bottled water, security fences, or private insurance) to protect oneself against environmental degradation and social conflict – is also a crucial contributor to GDP.

Rather than fighting and exploiting the environment, we need to recognise alternative measures of progress. In reality, there is no conflict between human progress and environmental sustainability; well-being is directly and positively connected with a healthy environment.

Many other factors that are not captured by GDP affect well-being. These include the distribution of wealth and income, the health of the global and regional ecosystems (including the climate), the quality of trust and social interactions at multiple scales, the value of parenting, household work and volunteer work. We therefore need to measure human progress by indicators other than just GDP and its growth rate.

The decoupling delusion simply props up GDP growth as an outdated measure of well-being. Instead, we need to recouple the goals of human progress and a healthy environment for a sustainable future.

James Ward works for the University of South Australia. He is also privately affiliated with Sustainable Population Australia.

Keri Chiveralls works for Central Queensland University.

Lorenzo Fioramonti, Paul Sutton, and Robert Costanza do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond the academic appointment above.

“Flabbergas” in Beijing

The Sichuan basin is one of China’s premier shale gas plays, and when it comes to developing Chinese resources, state-owned enterprises like Sinopec have the inside running.

I met with Sinopec geologists earlier this week in Beijing to discuss collaborations and asked how their Sichuan Basin gas plays were shaping up. I was curious, having been told some years back by a senior Shell shale-gas engineer his view was “too deep and too tight”. After some initial interest, in 2016 Shell announced it was getting out of the Sichuan.

Somewhat to my surprise, my Sinopec colleagues were very upbeat claiming their shale gas production was on target. With a production schedule targeting some 8000 terajolues per day I wondered aloud, how long they thought they would need our LNG exports. They must have sensed some concern and quickly said not to worry. The cost of production from their Sichuan plays was well above the price they were paying for our gas. They wouldn’t be leaving us stranded any time soon, they assured me.

I then told them about the domestic prices here in Australia, where spot prices regularly sit at around $12 per petajoule and where future contracts are reputedly now being offered at up to $20 petajoule. Their reaction, in a word, “flabbergasted”. How could it be that we paid more for our own gas than they did to import it? For reference, Henry Hub spot prices in the US are currently settling at around AUD$3.4 per petajoule, just 30% of the Australian price (AUD$11.4) at the time of writing.

And importing our gas, the Chinese are. Back in 2015, BP reported that China imported around 50 million tonnes in barrels of oil equivalent (BOE) in energy terms, representing about 6000 terajolues per day.

Chinese gas production and consumption figures as terms of Million of barrels of oil equivalent per year, until end of 2015. Data from the BP Statistical Review of World Energy, 2016. While production has risen sharply, more than doubling in the last decade, consumption has risen much faster with a separation occurred around 2008. Consumption outstripped production by about 50 million tonnes in 2015, the equivalent of 7000 terajolues per day. Eastern Australian gas exported via the Gladstone ports will make a significant contribution to Chinese imports into the future, because the marginal cost of production in China’s frontier unconventional basins such as the Sichuan is above the price they pay to import.

The Gladstone Port Authority reported a touch under one million tonnes of LNG left Curtis Island in Queensland bound for China last December. That amounts to a daily rate of about 1600 terajolues. In total, Curtis island shipped 1.7 million tonnes in 27 cargoes in December, equating to about 3000 terajolues per day. That represented around 70% of the total production of 4200 terajolues per day from all the gas fields across eastern and southern Australia that are physically connected to the export facilities. The exports outstripped our domestic consumption in the eastern states by a factor of about 2.5.

The point is worth reiterating. In December last year more gas was shipped to China from Queensland than was used locally across the four eastern sea- board states and South Australia. That wouldn’t be a problem if there was enough gas to go round. But there is not, and instead we have entered the “red zone”.

Into the “red zone”

With the first shipments leaving Gladstone just a touch over two years ago, in January 2015, it is hardly surprising that the gas market is causing ructions here in Australia. In fact it shouldn’t surprise anyone as problems were anticipated as far back as 2013, as I discussed in a post mid last year titled “We really must talk about gas”.

And so it would seem we are now really talking about gas.

As illustrated in the figure below, the last few years have witnessed an unprecedented change in our eastern gas market. Production has risen 250% in just two years, from an average of 1800 terajolues per day in the last half of 2014 through to 4600 terajolues per day in last half of 2016.

Total production from the gas fields serving the eastern Australian gas market, coloured by producing region, along with the monthly averaged exports from Gladstone. Production data from AEO, export data from Gladstone Port Authority.

Also shown is exported gas, and the amount of gas used to deliver gas from the producing fields to the export facilities. The amount of additional gas needed for processing is a somewhat uncertain number but is likely to be more than 10%. In the figure above I assume 12%. Finally, I also show the contracted position of our LNG exporters who are ramping up to around 24 million tonnes of LNG exports per year (CLE), with an assumed additional load of almost 3 million tonnes needed to deliver that to the cargo (marked as “CLE+proc”).

So how does the figure above help us understand what has happened to so dramatically upset our gas markets here in Australia.

Firstly, note how our exports have tracked upwards more steeply than the production from our developing coal-seam gas fields in Queensland from the production region of Roma (shown in green). In the last few months the combination of exports plus the new processing load has begun to outstrip the total production from the new CSG-fields. Production from our older, conventional gas fields such as the Gippsland Basin in Victoria (in red) and the Cooper Basin in South Australia (in dark blue) is being partially used to fill the export cargoes. In short, we are short on gas, having entered the “red zone”.

In a previous postI have discussed the recent dynamics of gas pricing and availability in the National electricity market and its impact on prices, showing how quick we have switched from the “ramp-gas phase”. That is the stage when CSG fields were being developed prior to the completion of the export facilities, providing abundant flows of cheap gas for the local market. Now we are in the “scarce-gas” phase, or the “red-zone” as I like to call it. It is one of the key reasons for the recent doubling of spot electricity prices (another is the extra electricity demand from the LNG processing themselves, providing a double whammy for electricity users, as explained here). But scarcity pricing in the gas market is affecting all users, not just electricity generators.

And the reality is that now we are in the “red-zone” scarcity pricing is here to stay. In the medium-term it only seems likely to get worse. If no new production is bought to market, exports rise to meet contracts, and around 12% of additional gas is needed for export processing, then we we will be excising conventional resources to the export market at a rate of about 400 terajolues per day or about 30% of what would otherwise have been available for domestic use. While there remain many “ifs” in that scenario, it is a hugely worrying shift in the balance of demand and supply.

With politicians now scurrying to address the situation it is worth reflecting why has it taken so long to do so. It is not as though it wasn’t predicted. To quote from that earlier piece of mine - developing the new CSG fields at such scale was always going to risk that production would fall short of targets. As much was acknowledged by the 2013 Department of Industry and Bureau of Resources and Energy Economics study into Eastern Australian gas markets

The current development of LNG in eastern Australia and the expected tripling of gas demand are creating conditions that are in stark contrast to those in the previously isolated domestic gas market. The timely development of gas resources will be important to ensure that supply is available for domestic gas users and to meet LNG export commitments. Such is the scale of the LNG projects that even small deviations from the CSG reserve development schedule could result in significant volumes of gas being sourced from traditional domestic market supplies

That was some 2 years before the first LNG exports. Now some four years on and it is patently clear that Eastern Australia is short on gas, given the existing export contracts. While new conventional fields such as Kipper in the Gipplsand Basin are coming on stream (often with a hefty load of CO2 to complicate matters), existing fields are depleting.

To remedy the situation, there will be predictable calls such as for gas reservation (including by myself), and new exploration, including the lifting of on-shore moratoriums. All should be considered from a rational perspective, since the situation is urgent. But it should be eyes-wide-open, as all have problems.

No doubt, new production from unconventional resources such as shale and tight gas might alleviate the scarcity pricing events we are witnessing as we now enter the “red zone”, but it will not return us to the halcyon days to times past. Developing new unconventional gas fields is generally proving expensive. Just ask the Chinese. It is after all why they will continue to import our gas. The exception is the US, and that’s because US shale gas rides on the back of the US shale oil. Unconventional gas with liquids is a whole different ball-game.

Disclosure

Mike Sandiford receives funding from ANLEC and from the ARC.

The Climate Institute, Australia’s first NGO to focus solely on climate change, is to shut down at the end of June after 12 years.

It was born into an era when politicians and voters were finally waking up to the importance of climate policy. But now, its self-described “centrist, pragmatic advocacy” has run out of financial backing.

Early years

It’s easy to forget, given the political theatrics we’ve witnessed over the past decade, just how little attention was being paid to climate policy before the explosion of concern in late 2006. Life was bleak for environmental groups under the four Howard governments from 1996 to 2007, with the partial and controversial exception of WWF.

Climate change was simply not an issue that had traction with the federal government, and the business community had fought itself to a standstill on the topic of whether Australia should ratify the Kyoto Protocol, which John Howard resisted to the end.

Bob Carr, the then premier of New South Wales, had been trying to get carbon trading onto state and federal agendas with limited success.

By 2004 attitudes were shifting, not least because of the ongoing Millennium Drought. In a 2015 interview Clive Hamilton, a climate policy academic and inaugural board chair of the Climate Institute, noted:

In the early 2000s when the environment groups started to get serious about climate change, they adopted their standard tactics, which had run out of steam. The problem for environmentalism in Australia, as well as internationally, is that they had this glorious period of the 1980s and ‘90s, and then they became institutionalised; their tactics became stale. It wasn’t their fault – it’s just the world changed.

Hamilton explained that in 2005, Mark Wootton, director of the Poola Foundation, approached him saying that he had A$5 million and wanted to spend it on something that would “cut through” the stagnant climate change debate. Hamilton thought about it and proposed the Climate Institute, which he put together over the ensuing months. After chairing the board for its first year Hamilton returned to his duties at the Australia Institute.

Launching a tour of rural Australia the following year, Wootton told journalists:

People have to see there is a solution, that there is a way out… It’s about people moving on and not feeling that sense of despair, which I’ve genuinely felt, and that’s why we set this up.

The institute opened its doors in October 2005 and was soon in the headlines. Howard attacked Carr, declaring himself “amazed a former Labor premier should advocate that we should sign up to something that would export the jobs of Australian workers”.

A month later, the Climate Institute returned fire with an attack on the Howard government’s Asia-Pacific Partnership on Clean Development and Climate, widely interpreted as a way for polluting nations to dodge Kyoto.

This pattern of well-timed reports and timely rebuttals has continued over the past 12 years. During this time the Climate Institute has challenged successive governments to do more, to create stronger policy and a more predictable investment environment – something that is sorely lacking to this day.

The institute’s critics will claim it never escaped the neoliberal paradigm – the idea that the market can and will deliver as long as the right policy levers are pulled at the right time. In fairness, though, it never pledged to transcend free-market economics anyway, although it also tried along the way to expand the argument to include moral (and religious) values.

Main achievements

In the reporting on the institute’s demise, its main claims to fame are listed as helping to expand the renewable energy target in 2008, saving the Climate Change Authority from Tony Abbott’s axe in 2014, and building bipartisan support for Australia to ratify the Paris climate agreement in 2016.

But there was much else that the Climate Institute worked on, which is in danger of being forgotten.

It toured rural Australia to listen to farmers’ concerns.

It tried to signal to politicians that voters cared. For example, before the “first climate change election” in November 2007, it commissioned a poll of 877 voters in nine key marginal electorates. It found that 73% of voters thought climate change would have either a strong or a very strong influence on their vote at the election, an increase from 62% in August.

It also played a part in stitching together what political scientists call “advocacy coalitions”. One notable example was its help in producing the Common belief: Australia’s faith communities on climate change report, released in December 2006 with input from 16 Australian communities including Aboriginal Australians, Anglicans, Baptists, Catholics, Evangelicals, Hindus, Jews, Muslims, Sikhs and other denominations.

Why it died and what next?

The institute’s outgoing chief executive, John Connor, told Reneweconomy that the decision ultimately comes down to funding:

We haven’t been able to plug the [funding] gap. Centrist, pragmatic advocacy is not sexy for many people who want to fund the fighters or pour funds into new technology.

As such, the Climate Institute is another victim of the policy paralysis that has exasperated and bewildered commentators.

It is indeed hard to justify the funding of calm, measured policy advice when the mere mention of the most economically tame of notions – an emissions intensity scheme – causes panic and retreat in the federal government.

Climatologist and Climate Council member Will Steffen, interviewed on the ABC, suggested that over the past two or three years many organisations have begun to take climate change on board, and so the institute’s unique role was lessened.

But one piece of the furniture that urgently needs saving is the institute’s Climate of the Nation, the longest trend survey of the attitudes of Australians to climate change and its solutions. Hopefully another organisation (I’m looking at you, Australian Conservation Foundation) will pick this up.

The staff of the Climate Institute will hopefully find new roles within the now smaller ecosystem of environmental policy advice. With the impacts that the institute and others were warning about in 2005 arriving with depressing predictability, Australia desperately needs three things.

It needs community energy programs. It needs effective opposition to plans for yet more fossil fuel extraction. And most relevantly here, it needs a cacophony of well-informed and relentless voices advocating for the most useful policies to get the carbon out of our economy.

There’s a fourth thing, actually: luck. From here on we are going to need an enormous (and undeserved) amount of luck if the lost years of ignoring sensible climate policy advice are not to come back and haunt us.

Marc Hudson does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond the academic appointment above.

Certain traditional owners and conservation groups allied to stand against a planned gas hub in Western Australia's Kimberley region. AAP Image/Tim Gentles

In Australia and across the world, Indigenous people are resisting developments that threaten their lands. Wangan and Jagalingou people stand in opposition to the planned Carmichael coalmine in Queensland, while the Sioux people are holding firm in their struggle against the Dakota Access Pipeline at Standing Rock.

As these contests intensify, they reveal that Indigenous peoples often have limited say over what happens on their country. When pitted against powerful state and corporate actors, Indigenous people may seek assistance from others, such as environmentalists, to protect their interests and further their aspirations.

In Australia, these arrangements have sometimes been called “green-black alliances”. However, as we argue in our new book Unstable Relations, it is misleading to contend that Indigenous people and environmentalists necessarily share (or don’t share) the same ends and motives.

They are neither natural allies nor enemies. Instead, we suggest, close attention to the past and present of “green-black” meetings in Australia reveals that their relationships are surprisingly unstable, and are shaped by shifting legal and social contexts.

To understand how and why these collaborations occur, and how and why they can fall apart, we need a better comprehension of the particular processes and people involved, rather than treating them all as uniform.

Understanding land rights today

Since 1966, governments in Australia have progressively recognised different forms of Indigenous land rights. Perhaps the most well known is “native title”, which was first recognised in the High Court’s 1992 Mabo decision.

Native title applies only to Crown lands and pastoral leases, only authorises limited land use rights, and is proven through condescending tests of cultural “continuity”. Because of the history of colonial dispossession, some groups fail to meet these tests; others refuse to do so. These problems notwithstanding, multiple forms of Indigenous land rights together cover more than a third of the continent, much of it in remote Australia.

As we have recently seen, mining companies and others often greet changes to land rights regimes with dire warnings about economic impacts. The “Mabo madness” of the 1990s proved overblown. By and large, Australia’s various land rights regimes have been highly accommodating to miners and mineral extraction.

In violation of United Nations principles, Australia’s native title laws do not recognise Indigenous peoples’ rights to consent over what happens on their country. Rather, they simply allow a right to be consulted for six months. This gives rise to contractual agreements, such as Indigenous Land Use Agreements, which effectively grant mining companies and others a “social licence to operate” in exchange for a mixture of cash and in-kind benefits.

Indigenous academic Marcia Langton and others have argued that this era of “agreement-making” has the potential to lift Indigenous people in remote areas out of poverty. According to this argument, environmental groups that raise concerns about industrial activity do so at Indigenous peoples’ expense.

A simplified version of this story is often found in the mainstream media, casting environmentalists as out-of-touch urbanites and portraying Indigenous groups who work with them as dupes or somehow illegitimate.

Meanwhile, many Australians seem to accept that extractive developments are both inevitable and beneficial, despite complex evidence to the contrary.

The alternative view is the one depicted in this painting by Garawa artist Jacky Green, in which a road train covered with dollar signs represents “the wealth being taken away from us, from our country”.

Unstable relations

The anthropological and historical research presented in our book highlights that, far from being manipulated, Indigenous people who are opposed to a particular development often seek to enter into strategic partnerships with environmentalists. Crucially, these are not inevitable alliances but negotiated collaborations, which can run into problems if circumstances change.

The controversy that erupted in recent years over Queensland’s Wild Rivers Act was shaped by collaborative relationships established between the Australian Conservation Foundation, The Wilderness Society, and Cape York Land Council and its former chairman Noel Pearson decades earlier. Whereas these groups had formalised an alliance in the mid-1990s, which successfully lobbied for land rights and the return of country to traditional owners in Cape York, they split in the late 2000s over how to regulate planning on that country.

Nonetheless, while a public controversy raged, together these groups continued to privately negotiate further outcomes over jointly managed national parks.

Another quite different example is the campaign against a major liquid-gas processing plant and port at Walmadany (James Price Point) in Western Australia. The ethnographer Stephen Muecke has characterised the relationship between those Goolarabooloo people who sought to halt the project and their green supporters as the most successful such collaboration in Australia’s history.

This was based on long-term personal relationships between some of those involved and, crucially, the media and scientific resources that environmentalists were able to bring to the campaign. “Citizen scientists” took their cue from Goolarabooloo people’s firsthand knowledge of local environs, conducting highly successful surveys of turtle nests and bilbies.

In our book, we and other contributors point to many other productive but nonetheless unstable relationships in South Australia, the Northern Territory, Victoria and elsewhere.

The ‘green-black’ future

Environmentalists often seem oblivious to the contractual landscape in which they are acting. They mistake their relationships with particular Indigenous groups as a natural alliance, based on received ideas of Indigenous connection to country.

But as Yorta Yorta activist Monica Morgan has pointed out, Indigenous people have a holistic relationship with their country, which doesn’t always fit with the specific goals of environmentalists. When green groups assume that Indigenous peoples’ “traditional culture” is necessarily conservationist, this can lead them to denigrate Indigenous people who pursue economic opportunities.

Relationships between Indigenous people and environmental interests continue to change. Both are now landholders of significant conservation areas in remote Australia, while Indigenous people are increasingly employed as rangers through state-funded conservation projects.

Again, specific case studies show how these arrangements are far from simple. At the former pastoral property of Pungalina in Queensland’s Gulf Country, Garawa people return to “Emu Dreaming” places now managed by non-Indigenous conservationists. There they negotiate an ambiguous field of responses to their presence, ranging from interest and respect to anxiety.

In Arnhem Land, Kuninjku people express ambivalence about the problem of the environmentally destructive buffalo in an Indigenous Protected Area. The buffalo are simultaneously recognised as companions, an environmental problem, and a crucial source of meat in hungry times.

As long as Indigenous people have limited capacity to decide what happens on their country, and as long as environmentalists continue to oppose destructive developments, their interests will sometimes intersect. However, as these situations arise and alliances form, we should be careful to avoid essentialising or conflating those involved. “Green-black” alliances will certainly be productive at times, but they will always be unstable.

Timothy Neale receives funding from the Bushfire and Natural Hazards Cooperative Research Centre.

Eve Vincent does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond the academic appointment above.