Business is leading the transition to renewables while politicians dither.

<!–[if IE 9]><![endif]–>Wind at the Bluff Point windfarm in Woolnorth, Tasmania




In its quest for zero net emissions, Monash University this year put out Australia’s largest corporate tender to build a 55GWh solar or windfarm.
Photograph: Bloomberg via Getty Images

It is a volatile time for energy politics. Last week the US president, Donald Trump, rocked the world by following through on his pledge to pull the US out of the Paris climate agreement.

Considering even North Korea is party to the accord, this leaves the US marooned and alone as a rogue climate nation while the rest of the world has recommitted to climate change action.

In Australia, the Finkel report will be delivered this Friday and there are questions whether any credible low-carbon energy policy can pass the rocky shoals of the Coalition backbench. The timing couldn’t be worse, with government members using Trump’s move to pressure Australia to leave the global agreement.

This political impasse is frustrating business leaders around the globe – and right here at home. Following Trump’s announcement, Goldman Sachs’ chief executive, Lloyd Blankfein, used his first ever tweet to lampoon Trump, while even fossil fuel companies such as Exxon said leaving was a stupid idea.

In Australia, where a catastrophic failure of public policy has seen wholesale electricity prices double since the price on carbon was repealed, businesses and organisations are taking their own steps to hedge against increasing energy costs and market volatility.

They are doing this by taking advantage of the falling cost of renewable energy and making direct investments in new projects, bypassing the major energy retailers and government.

Last week, a senior executive at BlackRock, one of the world’s largest investment firms with US$54tn under management, declared “coal is dead” and that Australia was “denying gravity” by continuing to encourage coal investments when renewable energy is both cheaper and a better investment.

The absurdity of the Australian government’s insistence on encouraging investment in coal was ridiculed along with support for the A$16.5bn Adani Carmichael coalmine, which he said was unlikely to provide “long-term potential” for Australia.

Fortunately, business is moving on anyway. In May, Origin Energy announced a long-term power purchase agreement for the 530MW Stockyard Hill windfarm in Victoria at a price so low – in the range of $50/MWh – that it has stunned the energy sector.

Last week Telstra – which uses 1% of the energy in the National Energy Market – announced it would be entering into a long-term power purchase agreement to develop a new solar farm in Emerald in regional Queensland.

This project will provide 200 jobs and will create enough electricity to power 35,000 homes. Telstra has underwritten this $100m project by entering into a long-term solar power purchase agreement (PPA), where Telstra’s contract will guarantee the viability of the new Emerald farm.

This marks a new direction for Telstra and the executive director of Telstra energy said “the Emerald project is part of Telstra becoming a more active participant in the energy market to reduce costs, while at the same time building resilience in our network and contributing to a more stable energy system”.

RES, the company building this new plant, says this is likely to be just the beginning of corporate PPAs in Australia due to rapidly accelerating electricity and gas prices.

While Telstra announced its new renewable project, the Turnbull government flagged its intention to change the law so the Clean Energy Finance Corporation – a government body set up to reduce emissions in the most economically competitive ways possible – can invest in carbon capture for coal plants.

Despite these mixed messages from the government about the future of low-carbon technology, businesses are increasingly turning to renewables for their energy.

Queensland zinc refiner Sun Metals is currently building the largest solar plant in Australia to supply power directly to its factory in Townsville. When it is built, the solar farm will meet one third of the energy needs of the factory at about half the cost of wholesale electricity in the state.

This project is particularly notable because it shows that renewable generation and manufacturing can partner seamlessly together. Although this is the first project of its kind in Australia, major players in the US like Apple and Google have started similar build-outs to source 100% of their electricity need through renewable energy.

And it is not just private companies that are directly investing in renewables in an effort to drive the transition and keep power costs down. In its quest for zero net emissions, Monash University this year put out Australia’s largest corporate tender to build a 55GWh solar or windfarm.

Monash’s tender followed a move last year by Melbourne city council, Zoos Victoria, the Melbourne Convention and Exhibition Centre, Bank Australia and other local councils to put in a group tender for a new renewable energy farm. This amount of renewable energy built would save up to 138,600 tonnes of CO2 each year – the equivalent of planting more than 160,000 new trees – and is enough energy to power 28,475 Melbourne households.

We are currently undergoing the biggest shift since the industrial revolution and the writing’s on the wall for coal and fossil fuels. And in the shifting sands of energy policy, the business pariahs who, a decade ago, were blocking the transition are now leading it while national governments in Australia and the US dither.

While our elected leaders bury their heads in the sand, businesses are investing heavily in new clean technology. This can only go so far. Eventually we are going to need a comprehensive national energy transition plan that can encourage a coordinated move to clean energy and that will support communities impacted by the move from coal and gas.

As the old adage goes, we can do this the hard way or the easy way. Let’s hope sanity prevails this Friday as Finkel hands down his report on the energy sector, allowing business and government to get on with the job of transitioning.