Australia’s successful RET emission trading scheme is an Offset Credit Trading Scheme (OCTS) that has been quietly driving investment in utility scale renewable energy since 2001. Best of all, it has been doing this without causing any dramatic increase in power prices or political pain. This quiet success means that few Australian’s have heard of the RET scheme let alone understand what offset credit trading is.
All posts by John Davidson
Energy Storage Using Phase Change Materials
Batteries are not the only way for a house to store energy. This post looks at ways of storing heat and cold directly using phase change materials (PCM’s). They can be more efficient than batteries as a result of storing energy when outside temperatures are closer to target temperatures.
Continue reading Energy Storage Using Phase Change Materials
Climate Action 03
Climate action 03 includes saving water with a floating Solar plant, container housing, high speed rail and using “geothermally” assisted heating and cooling in Victoria.
Climate action 02
Autonomous cars, housing, edible insects, high speed rail and more:
Beware of right wing revolutionaries calling themselves conservatives
Rob Burgess had an interesting post in the May 2 Business Spectator on the commision of audit. He discusses the competing, and very different ideological positions dividing the political right as well as pointing out that “Australia has more to lose from radical change than just about any country in the world.”
The competing ideological divisions within the right wing of Australian politics might be described as:
- The revolutionary neo-liberal position that says that “the system is fundamentally flawed and needs fixing.” Their preferred fix are the radical steps required to remove the the restraints on our economy caused by the “dead hand of government.” Vs
- The conservative liberal position that says we are actually doing quite well and we should limit our efforts to incremental change. They might say something like: “In this situation it doesn’t make sense to be risking our gains by making unnecessarily dramatic changes. If you like: “If it aint broke why fix it?””
There is a similar division on the left of politics between those who want radical change (Think the end of capitalism) and those who favour incremental improvements.
The key question here is whether the current state of the Australian economy really justifies the sort of radical fix advocated by the Audit Commission. A comparison between Australia and other developed countries might be a good start:
- According to The Conversation, Commonwealth net debt “is about 11% of GDP, the third lowest in the OECD (the average is 50%), and low by historical standards” Not a crisis.
- Rob Burgess provided the following:
- Combined federal, state and local tax rates ran at a bit over 30 per cent during the Howard years, dropping to about 27 per cent during the Rudd/Gillard years. (State taxes account for around 4 per cent of GDP, and local taxes (rates) hover around 1 per cent of GDP.) By comparison, Singapore’s total tax-to-GDP ratio is around 14 per cent, the US 27 per cent, Switzerland 29 per cent, and Canada 32 per cent. Not a crisis but it would be interesting to know the reasons behind the low Singaporean rate. It is worth noting that people may actually be better off in a “high taxing” country if the high taxes mean that the state pays for services that other, lower taxing countries make people pay for themselves.
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In terms of GDP corrected for purchasing power parity (PPP) we rank 10th on the World Bank and IMF scales. We could do better. A key factor here is how expensive it is to rent/buy a house in Australia compared with places like the US or Spain where house prices were really hit by the GFC. In our case, the problem really took off when Peter Costello offered negative gearing to people who could afford to borrow money to buy investment properties. His first home buyer schemes also tended to push up the price of houses rather than help first home buyers. However, fixing home prices is no win territory. It is a bit challenging to please existing homeowners and new home buyers at the same time when it comes to prices.
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Australia does much better when we use the ‘human development index’, which factors in longevity (as a proxy for good health), educational attainment, gross national income and, in recent years, measures of inequality. On that scale we jostle for the number one spot with Norway. Not 6th or 10th. Number one. Definitely not a crisis.
- Best news of all is that last year’s Credit Suisse survey showed Australia having the highest median wealth per adult citizen of any nation. Definitely not a crisis although inflated home prices may have helped a bit here.
Conclusion: Australia’s alleged budget crisis is either the product of a fevered imagination or a deliberate attempt by neo-liberals to justify the imposition of their questionable ideas.
None of this mean that there aren’t many things in Australia that would benefit from radical change. However, the case for these radical changes should be justified by fact based, logical conversations about the specific issues. Definitely not based on ideological assertions about the dead hand of governments or private is best.
Climate action 01
Climate action 01 is the first of a series of posts which will be the Climate action equivalent to Climate clippings. This post concentrates on housing, energy efficiency and rooftop solar. Continue reading Climate action 01
The Qld Government’s People’s Budget Planner
I have just completed and submitted my views re what should be done about the Qld budget in the People’s Budget Planner.
The planner allows you to play with various ways of reducing the state budget using a mix of various tax increases, service cuts and asset sales alternatives. If you get below the debt budget target it also allows you to spend the interest savings amongst a range of spending alternatives.
The government obviously hopes that playing with the budget planner will encourage people to support asset sales as a better way to bring the budget back to a sustainable level compared with cutting services or, shock horror, tax increases.
The planner does have some serious limitations. For example, what you get when you click on more details is fairly skimpy. For example, in the case of selling the ports business there is no indication of how much revenue will be lost and/or what effect this will have on costs to port users. The details are a slightly extended explanation, what the sale will yield and a few examples of where this has already been done in Australia.
When it came to spending the interest saving there was nothing to give a feel for how much was already being spent in an area. For example, if you allocated 10% of the total interest saving to improving bike infrastructure you may have been choosing a doubling of the existing budget or something that was barely worth the effort.
Despite its limitations, the planner is useful for helping people understand some of the budget choices and as a mechanism for allowing people to state their preferences.
The interesting thing from my point of view was that the planner showed that the budget could be balanced by simply increasing a range of taxes and charges while doing nothing else. The planner is worth filling in and submitting if, like me, you think that taxes should be set at levels that allow governments to do their job properly.
What Business Spectator thinks of our refugee policy
On Maundy Thursday, the Business Spectator lead story was this telling article on the Rudd/Abbott refugee policy by Rob Burgess. The article starts with:
“As many Australians prepare for a holiday marking the most important Christian festival of year, it’s worth remembering that Jesus of Nazareth began life as a refugee, taken to Egypt to escape King Herod’s slaughter of male infants.
The refugee family eventually went home, so there was no need to transfer the infant to an offshore detention facility – I mean, who’d even think of doing that?”
And ends with:
“While the nation spends a long weekend celebrating the life of the world’s most famous refugee, political leaders might take time to sniff the wind again and realise we’re standing out in our region for all the wrong reasons.As Fraser sums it up: “Whatever else our refugee policy is, it isn’t Christian.”
In the middle there was a well argued article with useful supporting data that included:
“In years to come, people will look back at the Abbott Government’s practice of locking innocent children up on remote Pacific islands and shake their heads with disbelief,” said Hanson-Young on Wednesday.
It may not take years. Other nations, including key trading partners, are already shaking their heads at Australia’s offshore processing regime…….
” At this year’s human rights dialogue between China and Australia, vice-minister of foreign affairs Li Baodong said China had concerns “especially on the protection of refugees and asylum seekers, the right of the children of refugees in education and other rights … We have also asked about whether these refugees will be illegally repatriated to other countries….”
While the Greens have long used moral arguments to condemn Labor’s and the Coalition’s policy, economic and strategic concerns give added weight to opprobrium from our trading partners.
Recent history shows how quickly a latent dislike of Australia can become manifest – the fury on the streets of Indonesia during the recent phone-tapping scandal was fed by negative stereotypes of Australians that stretch back through the 20th century.
Not only are we remembered as the lucky country that ran the white Australia policy, but our political leaders of the past have (often unfairly) been seen as colonialists seeking to impose a Western order on peoples who, from their own domestic perspective, were throwing off the shackles of a colonial past.
Whatever the roots of our negative image within the region, Australia’s national interest lies in the paring away of stereotypes, not augmenting them with stories of babies flown to Pacific Island prisons.”
Think about how those who used to be excluded by the White Australia policy must see us now: Here is a country getting all agitated about 18,111 protection visa applications from boat people in 2012/13 despite having a strong economy and an estimated 2013 net immigration of 234,000. A country that claims to be all about a fair go but thinks its OK to send refugee children to concentration camps in breach of a refugee convention that Australia signed. A country where both Abbott and Rudd are very public, white Christians being nasty to refugees who mostly aren’t Christian and who would have been blocked from entry under the white Australia policy.
Having an Attorney general who has stated that it is “OK to be a bigot” doesn’t help either.
Progress is being made whenever an important, Murdoch owned business blog is saying, in effect, that our refugee policy is not only non-Christian but also bad for business and our relationship with our neighbours.
Enjoy your Easter.
Appendix: Refugee Council of Australia’s data on Australia’s refugee performance compared with the 10 best countries:
COMMENTS ON QCA REPORT ON FEED IN TARIFFS
This post was published previously in PragmatusJ (my reference blog). It explains how the QCA came up with a “fair and reasonable” Qld FIT of 8 cents/kWh and the inherent problems of letting politicians or bureaucrats set the FIT.
The following are some brief comments on the Qld Competition Authority (QCA) report “Estimating a Fair and Reasonable Solar Feed-in Tariff for Queensland” (March 2013) Table numbers are QCA report table numbers. Key findings were:
The report admits that it was only concerned with being fair to the retailers, not rooftop solar PV (RTS) owners, power generation companies or consumers. By implication, the QCA was also committed to defending the payments made to power distributors.
- When calculating the “fair” FIT the QCA managed to find excuses for not including most of the savings associated with the use of RTS. This made an enormous difference. If these savings are included, the FIT would have to be above 100 cents/kWh before RTS stopped reducing the power bills of Qld householders who don’t have RTS. The QCA exclusions reduced this figure to a measly 8 cents/kWh.
- The difference in estimates highlights the problems associated with having bureaucrats or politicians set the feed in tariff. It also highlights the problem of determining the FIT on the basis of the effect on household power bills.
- This post is not advocating that the FIT be raised to $1.00 kWh. It is suggested that auctions or some other market based system be used to set the FIT.
US NAVY PRODUCING FUEL FROM SEAWATER
The US navy has been investigating the production of fuel from seawater using electricity from ship’s nuclear power systems for a number of years. This process would allow aircraft carrier task forces to stay at sea longer without depending on vulnerable fuel tankers to keep the planes flying. The navy has now announced that they have successfully used the fuel from their pilot plant to fly a plane with an internal combustion engine. (Well, OK a model mustang.)
The process used involves electrolysis of sea water to produce CO2 and hydrogen followed by a catalytic reaction to produce hydrocarbons. There is nothing radically new here. Hydrogen has been produced commercially using electrolysis for a long time. There are also well established commercially available processes for converting mixtures of hydrogen and nitrogen or hydrogen and CO2 into a range of useful chemicals and fuels. My guess is that most of the effort taken by the US navy has been focused on developing a process that could fit into a small part of an aircraft carrier.
The potential of these types of development go well beyond the needs of the US navy. Think about it: Unless there is an amazing breakthrough, renewable power plus batteries are not going to be able to deliver 100% renewable transport. Renewable power + batteries is not going be suitable for long distant flights, travel in the Australian outback or long distance sea travel. There is a need for energy intensive transportable fuels to cover these needs.
Bio-fuels are not the answer. Diversion of land to the production of bio-fuels is already causing starvation of people in some countries as well as damage to the environment. (Think jungle clearing for palm oil production.) In addition, the production of bio-fuels is vulnerable to climate change and pests as well as posing potential problems if the organisms used escape into the wild. What is needed are low impact renewable fuels produced by inorganic processes such as the US Navy process mentioned above.