Carbon Trading Power Game page 1

Power Games in Australia

by Ally Hauptmann-Gurski 3rd December 2009
It is time to look at the underlying power structures of the power game.
In all the excitement about personalities, old leaders, new leaders and
ideologies of political parties, we have been distracted from the real
power games that are played backstage. The wrangling between con-
servative and progressive forces about CO2 emissions amounts to shuf-
fling the deckchairs on the Titanic. In order to move forward we must
understand the games which are hidden from our view.
For the summer holidays, the Emissions Trading Scheme (ETS) is
hibernating. We can all take a step back and ponder the ways of the
world, the Liberal Party’s power in Australian lawmaking, but more
particularly the real power games.
Had the freshly elected opposition leader Tony Abbott not pulled
the nuclear option out of his sleeve again, I would not be writing this.
We have already heard from his side of politics that there is really no
need to reduce emissions, not if it costs money that is. More than
6,000,000,000 people on this planet produce emissions with everything
they do, and it does not matter. The market will fix it, just like the mar-
ket fixed the GFC. Maybe praying will fix it. Go right ahead if you be-
lieve that. Go right ahead, and don’t waste your time reading on.
I believe there is a hidden agenda here, i.e. keep electricity gen-
eration in the hands of big business. With coal and nuclear, the big
business structures remain intact, as opposed to transferring a signifi-
cant share of electricity generation into the wider population through
solar panels on dwellings and wind turbines in farmers’ paddocks.
Whenever a technology emerges that eats into the turnover of the big
electricity companies there is resistance.
The first time I came across this issue was in about 1980, when
(in Germany) I read about a gas fired central heating unit which also
produced electricity. While it heated water for radiators, about 40%
of the gas input created updraft that could be used to generate elec-
 Carbon Trading Power Game page 2
tricity, but the machine was verboten. A home owner could not be
turned into an electricity supplier, the argument went and landlords
(most people lived in apartments) could not become electricity retail-
ers for their tenants. We were already aware of excessive air pollu-
tion, especially in cities, and could not find the logic in that unless we
saw the explanation in electricity co-generation being in competition
to the almighty power companies.
In the abstract, that means all power generation outside the es-
tablished suppliers is eating into the profitability of big business. This
applies to all new technology which is used in the general population.
For the record, it needs to be said that the machine was taken off the
verboten list in Germany in the 90s. Business, however, had gained
about 15 years of profit at the expense of millions of consumers, and
the unnecessarily produced emissions are still up there.
Because diversification disturbs the proven business models of
big business, the focus always returns to the non-diversification struc-
ture which requires big business, i.e. coal, nuclear, and gas. The ex-
perts say time and time again that clean coal is too far into the future
to make a dent in emissions; it may even turn out to be cloudcookoland,
and yet, clean coal keeps popping up like a bad smell.
What are we to think of that? The way we are going, due to dec-
ades of research and testing, carbon sequestration looks like becom-
ing so expensive that coal generated electricity would be unaffordable.
Those 20 or more years of research and testing will have to be paid for
by future electricity users. This may make the Australian States very
happy, because higher GST on high electricity prices would end up in
their coffers.
This reminds me of what I used to say jokingly: “They don’t like
wind and solar power because it is more difficult to put up prices! Or
could they argue, that the wind and sun went up 10% last year - so we
have to pass on these price increases?” Jokes aside, this is a serious
aspect because if electricity prices could not be raised with inflation
 Carbon Trading Power Game page 3
over a decade or two, that would definitely eat into GST revenue while
schools and soldiers, prisoners and police still need to be funded. This
opposite effect of bracket creep would be a delight for the low taxes
ideologues, and the electricity consumer, but demonstrates that there
is a limit to lowering taxes, unless you want police passing their hats
around for a donation next time you need their help. Between exces-
sive electricity prices through carbon sequestration and such low prices
that we have to close prisons and schools, there has to be rational
middle ground. The conflict is that the planet would need transferral
of electricity generation to private homes, but big business would miss
out on profits and the reduction in tax revenue would require other
taxes to be raised.
There is indeed a huge conflict of interest of Marxian proportions
here. If electricity generation is kept in the hands of big business, and
assuming there will definitely be a tax/levy on their carbon emssions,
the population will also pay for the pollution which falls on the elec-
tricity lost in transmisson lines. Losses vary according to technology
but losses there are. It is insulting that the consumer, private and busi-
ness alike,should pay for 100 % of the emissions while he is receiving
only a portion in electricity. It follows that all electricity generation at
the point of usage has less emissions per kW/h. While that is highly
desirable for the planet and the consumer, it is not desirable for law-
makers and their political parties. Big business funds political parties
and has jobs for former politicians. Households make only small dona-
tions to political parties, if any, and cannot offer well paid jobs to former
ministers. There is no carrot for lawmakers to tilt legislation in favour
of the planet, i.e. electricity generation at the point of use.
Hot rocks seems to be the only emission free power generation
that does not lend itself to transferral into the population. No prob-
lem, the issue is not ideological, the issue is reducing emissions.
Let’s put the cat among the pigeons: Ideally, we should take all
coal fired power stations out of service, but we cannot do that as quickly
as needed. Carbon sequestration in 25 years or nuclear power sta-
 Carbon Trading Power Game page 4
tions in 20 years will not cut the mustard.
The lament about the possible death of the coal industry is propa-
ganda and scare mongering. Peak oil is already behind us they say, but
the plastics and chemical industries will not simply shut down, just
because they can no longer obtain oil. Coal is the raw material that
will be transformed into fuel, polyesters and all the rest of it. Sasolburg
did it more than 30 years ago, and so did the Germans more than 60
years ago!
There will always be demand for coal because we cannot supply
6 or 7 billion people with everyday goods from natural materials. Aus-
tralia will remain a major supplier as we have all year open cut mines
in political stability (knock on wood).
Now, this is an inconvenient truth: If we want to achieve emis-
sion reductions, keeping the world’s coal fired power stations in serv-
ice is not an option.
Current structures between government, business, and rating
agencies work against what we must do for the planet. The Australian
State of New South Wales (NSW) was told/planned to sell their elec-
tricity assetts. While California is on its path to phase out coal gener-
ated electricity, NSW wanted to sell it. The price tag was billions, so it
is clear that the purchaser was not to be John Citizen.
It would be naive to assume, the seller (NSW government) would
not have to put a solid guarantee with penalties in the contract that
government will abstain from any activities that could impact adversely
on the business of their customer.
Through regulations and building codes the NSW government
would then slow down all electricity generation outside their custom-
ers/big producers.
For over ten years, the NSW unions have been able to prevent
the sale of these coal fired power stations which have ‘shut down’
written all over them. If big business buys them, upgrades them and
puts billions into carbon sequestration research, it will be intolerable
 Carbon Trading Power Game page 5
that households produce some of their own power and the sale con-
tract would have to reflect that.
Now that the NSW sale looks like being on the back burner again,
big business has eyed the power generators a bit further north, in the
State of Queensland (QLD). And the politicians associated with big
business already support that.
There are many new technologies, like oil production through al-
gae from seawater, CO2, and sunlight (Adelaide project), hydrogen pro-
duction through seawater and sunlight (University of NSW) but this
writer cannot ascertain their suitabilities or viabilities.
It is extremely annoying, however, that nearly all innovations are
crowded out so easily when the politicians continually return to power
from big business. It feels like they are deliberately snuffed out. There
was a new electric motor that used only half the power (Adelaide bi-
cycle) and an electrician’s car which went on one battery charge from
Adelaide to Sydney. Surely they could not all have been concocted?
Innovations that eat into big business revenue seem to vanish
into outer space so often that there must be a pattern. Banks protect
their loans to old technology by not supporting innovators which rein-
forces the lawmakers’ strategies to ensure big business does not lose
a millimeter, even if that is at the expense of the planet and ultimately
humankind.
One really has to wonder if protecting big business structures is
more important to them than reducing emissions. Tony Abbott’s re-
hashing the nuclear suggestion clearly looks like that. Weren’t there
some Liberal donors in Melbourne who had bought licenses from
Westinghouse, or am I mixing this up with tomatoe sauce?
Have a happy holiday season and I hope you have some time to
reflect on the power games of power.
This scribble was originally intended for upload to the Australian Broadcasting Corpora-
tion’s ABC Unleashed segment. But I was unsure if I should apply to be a regular contributor
or what guidelines they have. It may get a wider audience here on scribd, too. I am not affiliated with
a political or environmental movement, party or group.
Please use the comments box for your applause or criticism.