Q.C.L.
NEW YEAR RESOLUTIONS
Australia has throughout its history been a significant producer of food and fibre because of
the ingenuity of its farmers and their ability to make the most out of a sometimes
unforgiving climate. The return from this endeavour though has been increasingly put at risk
by costs from other sectors of our economy and society including from government.
As I alluded to last week in this column these unnecessary cost burdens Australian Farmers
are forced to carry, especially when compared to farmers in most other developed
countries, are major issues state and federal governments must address with urgency. Top
of this list is the cost of energy particularly electricity and where the sustainable production
cost path of this input goes in future.
As we all have seen there have been significant movements in recent months including the
Copenhagen Summit to pick up momentum in tackling and reducing carbon emissions
around the world. Whatever some might individually believe regarding climate change it is
clear that the Australian economy needs to change to meet international expectations and
in fact safe guard local industry. While mining and exporting high quality coal to overseas
countries for uses such as steel production will continue for some time the use of coal in our
domestic power generation industry will obviously need to be considerably reduced with
some haste.
Clearly all ongoing and future investment in power generation whether new plants or
refurbishment of current plants needs to be in more carbon friendly technology. From a
power users point of view this in itself should not cause any great concern at all as overseas
industries in places such as the west coast of North America have replaced most of their
coal fired generation with large efficient renewable energy plants that are more than
competitive with coal. These power stations are mostly solar with significant wind and
hydro generating systems plugged into the grid as well.
The real issue is that this power is in fact delivered to the power consumer in places like
California through their power grid at a small fraction of the cost impost that electricity is
for homes and industry in Queensland. In Queensland the power cost problem chiefly
descends from the various Government policies and decisions relating to the actual power
grid that delivers the electricity to consumers including the incentives for off grid production
that increases the per unit cost of distributing electricity through the grid.
Obviously the more people who follow previous government incentives and go off grid the
more the ‘per unit’ cost will be left for those still on the grid to pay. Now while QDO, like
QFF and some other industry organisations have been assisting their members reduce cost
including finding and accessing alternative sources of power, what we all still appreciate is
that if more people drop off the grid supply then those remaining on the grid will pay more
for their power thus increasing their incentive to go off grid. A situation some now call the
solar panel death spiral.
What we really need to see the government show resolve to rethink and revamp the whole
electricity production and supply system so that Queensland can have world class cost
competitive low carbon renewable power delivered through the existing grid to Queensland
consumers within five years.