Paul Murray: Libs pull plug on debate about absurd energy costs and Labor’s deeply flawed energy policy

Who — or what — is going to save Australia from itself as deeply-embedded net zero delusions drag down the national economy and divide the country along an inner-city versus the rest fault line? It’s unlikely to be the Liberal Party, despite finally agreeing this week to oppose Labor’s net zero by 2050 policy. Giving primacy to energy affordability and reliability over Labor’s rapid emissions reductions at-any-cost creates a fundamental distinction for the Liberals — and a glimmer of hope for the nation. But arriving at a sensible position is just one step for the Liberals. Convincing Australians that it is the right way forward requires a giant leap. Frankly, the Federal Liberals are so diminished as a political force, so internally riven by factional differences, so lacking in leadership and with such a dodgy track record on this issue, that the policy will be relentlessly attacked — principally for their weakness, not its. The devil will be in the detail. How does the coalition intend to make credible emissions reductions to prove it is “serious” about climate change? But even with a cohesive strategy, who among them is capable of selling it? That’s the critical flaw. Whether the public realised or not, the Liberals backed net zero at the past two Federal elections. The campaigns were that hopeless. Labor’s net zero policy is so obviously failing — not only in reaching its own excessive targets but in measurably damaging households and businesses with crippling energy cost increases — that taking an opposing stance should be easy. Australians should be pleading with the Liberals to find a way out of the despairing rabbit hole Labor has dug for the national economy. They’re not. They laugh at them. The majority of Australians remains wedded to the fearful idea that unless we lead the world in cutting carbon emissions we will perish in an over-heated climate. It is a demonstrably illogical proposition, but unfortunately that’s the view of people who have been emotionally swayed by history’s most successful scare campaign. Much of the rest of world is reconsidering, if not quietly abandoning net zero by 2050. No G20 country is on track to meet their 2030 targets. And the scales have fallen from the eyes of former leading alarmists like of Bill Gates and Tony Blair. Our own Chief Scientist has said cutting Australia’s emissions to zero would have negligible effect on the climate, but the true believers still say they are led by science. Labor’s policy can’t save the planet — but it is harming Australia. However, unless the all-powerful Anthony Albanese personally repudiates the quest for net zero by 2050 in a Damascene conversion in the next few years, Labor’s very bad idea will roll on. Consequently, the delivery of our national salvation — if we get one – is not going to be a matter of “who” but “what”. Nagging at the persistent cry that renewables are the cheapest forms of power is the clear evidence of what we all pay for electricity. As Energy Minister Chris Bowen refuses to acknowledge, abundant power at midday is irrelevant and a smokescreen. The ability to meet peak demands with affordable electricity is the true measure of an energy policy. Labor has left behind the promise of $275 power bill cuts that got it elected in 2022 and now treats the Opposition with derision when asked about it. And while the focus of that political fight is households, the real burden of soaring power prices is borne by businesses. They didn’t get the rebates because they don’t cast a vote and have had to bear the full brunt. Everyone complains about higher prices, but very few connect them to the pernicious effect of the rush to “renewables only” power which works its way into every crevice in the economy. It is embedded in every product you buy, every service you demand. This effect can no longer be hidden. The Reserve Bank’s statement on monetary policy this month said the biggest contributor to the surge in inflation was “higher electricity prices following the partial unwinding of household rebates.” The Australian Bureau of Statistics’ consumer price index released in July showed a “surge” in inflation was driven by a 13.1 per cent increase in power charges, four times the average across all sectors. The Liberals need to join those dots into a winning argument against Labor’s overly-ambitious, renewables-only policy. But can they withstand relentless attacks in the left-leaning media? Blind Freddy knew the inflation monster wasn’t beaten before the last election — as Treasurer Jim Chalmers claimed — because it was masked by Labor’s Federal and State power bill subsidies. This column repeatedly made that point. The “what” moment in this conundrum will be the eventual public realisation that Labor’s net zero program equals higher power prices and continuing declining prosperity. The fall in living standards — already the biggest in our history — will be slow, but relentless. In the meantime, Labor will drag new green dreams before the public to keep their eyes on the future rather than the increasingly-unaffordable present. Consider, for instance, the different treatment given to the Liberals’ push for a credible energy policy and Premier Roger Cook’s latest distracting bauble — a “green steel” industry plan for WA. Cook rolled out his policy at Labor’s State conference last weekend with the government as the purported first customer based on “Made in WA” procurement measures. It took just one day for Cook’s claim that WA-made green steel would be used to build the newly-announced hospital extensions to blow up in his face. One day. “Fledgling local industries sometimes need a bit of support from government, a foundation from which to grow,” Cook said. “Soon, we will be seeking proposals from suppliers of local green steel to go into major government projects.” When exactly is “soon”? No-one in WA has put a spade in the ground for a green iron or steel project or even for a green hydrogen plant which supposedly would drive them. Strangely, there was not one mention of the elusive gas in Cook’s official statement outlining his new steel plan. It was the local boss of iron giant BHP who blew up Cook’s posturing by noting that the sector-leading Kwinana pilot plant his company is involved in would not produce green steel until after the hospital projects began construction. Cook was quoted saying that using the “power of government procurement” would “explicitly preference WA-made green steel”. That promise is regardless of the retail cost of the end product or the dazzling amount of taxpayer subsidies to get these projects off the ground. An International Energy Agency report this year found that green steel production is between 50-140 per cent more expensive than traditional processes. Imagine the inflationary consequences. The Premier obviously hasn’t been watching his Labor counterparts in South Australia who have just gone belly-up on their hydrogen-based $1 billion green iron plan for the Whyalla steelworks. SA faces around $500 million in taxpayer losses and the government disbanded its Office of Hydrogen Power in an act of contrition. The closest WA appears to be to any form of green steel is a government-subsidised project at Collie which proposes to use renewable energy to melt scrap steel. A commendable piece of recycling, but hardly an innovative new green steel industry. And still with lots of carbon emissions. Originally slated to be producing next year, construction has not started with the company saying in March that “government ministers had noble intentions but industry development was complex and some practicalities remained unsolved.” Steel production is a 24/7 process which means huge quantities of consistently reliable power are required when the wind isn’t blowing and the sun isn’t shining. Countries embarking on green steel projects characteristically have access to nuclear or hydro power to provide reliable baseload power. Labor’s plan will need to unlock a way of making steel which ultimately relies on battery power. One overseas green steel project — at Salzgitter in Germany — is attempting this method. It is testing the concept charged from a 150MW solar array to drive hydrogen electrolysis and an electric arc furnace with projected production in 2033. Until it makes enough hydrogen, it will use natural gas as a transition fuel to convert an existing steelworks from coal. WA Greens take note — this is the real world. But fine print shows that solar array can produce only 9000 tonnes of hydrogen annually and the process requires 150,000 tonnes. The rest is expected to come from purchased wind power fed into batteries. “The idea behind so-called green lead markets is a concept developed by the German government to stimulate demand for CO₂ reduced steel, which is currently significantly more expensive than conventional steel,” the German company says. So, just like Labor’s net zero ambitions, nothing in green steel is quite as it seems — and so much is up in the air.