Alan Finkel urges Turnbull to adopt clean energy target before states act.

Chief scientist says conflicting targets at different levels of government could strangle investment and worsen power supply problems

<!–[if IE 9]><![endif]–>Australia’s chief scientist Alan Finkel

Australia’s chief scientist, Alan Finkel, says he does not care whether coal remains part of the energy mix, as long as emissions keep heading down.
Photograph: Dean Lewins/AAP

Alan Finkel urges Turnbull to adopt clean energy target before states act

Chief scientist says conflicting targets at different levels of government could strangle investment and worsen power supply problems

Alan Finkel has urged the Australian government to swiftly commit to the final recommendation of his energy review, warning the longer that commitment takes, the more likely states and territories are to set up conflicting emissions reduction schemes.

Speaking at the Melbourne economic forum at Victoria university on Monday, Finkel, Australia’s chief scientist, said that a failure to establish a clean energy target would create more uncertainty for investors, who would have to navigate various state policies.

The Victorian government announced two days after the review had been released that it was prepared to implement its own clean energy target if the federal government didn’t commit.

“Every day that goes by until there’s agreement on integrating emissions and energy policy there’s more opportunity for interventions at the state and federal level, which means more uncertainty to persuade investors from making decisions that they would otherwise make,” Finkel said.

The Turnbull government accepted 49 of the 50 recommendations made in the June review, which was commissioned after a storm brought down 23 transmission towers and caused widespread power outages in South Australia last September.

The final recommendation outlines an orderly transition to a cleaner energy market, which would involve the federal government agreeing with state and territory governments to an emissions reduction trajectory; establishing a clean energy target; and instituting a requirement for all large generators to provide three years’ notice before shutting down so the loss can be accommodated.

Finkel said it was disappointing that media attention had focused on the one recommendation the government had not yet accepted, rather than the 49 it did, but also said the final recommendation was necessary to provide long-term policy certainty.

“The longer and longer it takes to get final agreement the more likely it is that the states will commit themselves to new schemes and new targets that it will be hard for them to walk away from, and that aren’t harmoniously connected to what the orderly transition will be,” he said. “All we can do is offer them the carrot of an attractive scheme.”

The clean energy target proposed in the Finkel review would keep the current target of a 28% emissions reduction by 2030 and extend it out to zero emissions by 2070. It has been criticised as too weak by environment groups and Greens MPs and too ambitious by some Coalition MPs.

Fairfax Media reported last week that the government was working on a major redesign of the proposed clean energy target.

Finkel said the target as proposed was “modest,” and would be able to coexist with coal-fired power stations provided emissions continued to trend downward.

“There are two types of people in the world, those who hate coal and those who love coal,” he said. “I am the only person in the world who doesn’t mind.”

Finkel said that even if the government enacted energy policies that supported coal-fired power stations they would still not be backed by investors because the market no longer supported those options.

“So the people who say just go back to coal and you’ll solve all the problems are not recognising the complexity of the issue,” he said. “The world has moved on.

“If you had a magic wand and said: ‘Abracadabra! There is no more climate change,’ you would still have the problem that we have today because we are in a moment of disruption.”

He said that those who argued there was a simple solution to Australia’s energy market, or that the entire energy structure could be changed in 10 years, did not understand the complexity of the issue.

“Electricity is a bit like education: everyone has an opinion,” he said.

Finkel said Australia’s electricity market was “a single, 5,000km long machine” that was beholden to the laws of physics and stuck between government and the market. All three elements: the infrastructure, the market, and policy and regulations, required work.