Financing Australia's renewables transition isn't picking winners, it's securing our future | Greg Jericho

Llast week Anthony Albanese finally announced the government's master plan for the transition to a renewable energy economy. The Future Made in Australia plan was quickly derided by critics as a winner, on the mistaken view that the market is better at deciding how to deal with climate change and that the market is somehow free or free of distortions.

It is an article of faith among many economists and commentators that governments should not try to pick winners, despite the fact that Australia has a long and glorious tradition of doing so.

like about $141.1 million for carbon capture and storage projects? Not enough? Try $1.5 billion mid wing petrochemical hub in Darwin? Pfft. What about inland rail to nowhere costing $31 billion over 10 years? Now that's real money!

This year the government also spent $17.4 billion on private schools, because many decades ago someone decided to choose that as a winning way to provide education (and win elections).

So spare me your thoughts on government interventions now that they want to provide tax breaks for renewable energy projects. Climate change is the result of the market's failure to appreciate the cost of climate change. To argue that the market will solve it now is ignorant in the extreme.

And the playing field is not level. US government intervention of 1 trillion dollars the absurdly named (but politically astute) Inflation Reduction Act has upended the renewable energy sector across the globe. He showed what government support can do for an industry:

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This is not the free market at work, but a government that finally gets somewhat serious about the level of investment needed to move an economy to net zero.

It has been a long time.

A little over four years ago I wrote that politicians needed to admit that tackling climate change was difficult and expensive. damn, eight years ago I wondered if politicians had the guts to be honest about the problem (that would be no).

In that 2016 article, I noted that NASA had just announced that April of that year was the hottest April on record and was the seventh month in a row that the monthly record had been broken.

Those were good times.

Last Friday, the next day announced the prime minister Future Made in Australia Policy NASA announced that March was the hottest March on record and had now had 10 consecutive months of record monthly temperatures.

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The past year has seen temperatures shatter what is considered normal, let alone hot.

I have now reached a stage where 1998 is half of my life so far. I note this because the highly paid climate change deniers argued that it was when the world hasn't warmed since…

If only. The world has not only warmed since 1998, it has warmed much faster.

The maximum temperature in 1998 was 0.9C above the 1880-1899 average. Terrible, yes, but well below the 1.5C average of the last 12 months. It's been more than 11 years since we've had temperatures below that 1998 peak:

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Sure, give me all your worries about picking winners, but when you're trying to prevent a global catastrophe, business as usual won't cut it.

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My colleagues at the Center for Future Jobs ASSESSMENT if Australia were to match US IRA spending, it would cost between $8.3 billion and $13.8 billion a year.

Too much? Yes, but roughly in line with 11 billion dollars a year the government offers the fossil fuel sector and also the yearly amount it costs Aukus to maybe get a submarine day that the US Navy can let us use if they don't need them.

Australia has large supplies of minerals needed for renewable projects and an abundance of sun and wind. We must not make the mistake of the last mining boom and simply ship rock overseas.

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This time we have to be part of the manufacturing supply chain. Of course, we won't be making electric vehicles, but there's a lot we can do using renewable energy to ensure we're part of a global green manufacturing economy.

And these businesses will require a lot of support from the government.

But the problem is: this is actually the easy part. Who doesn't like to see money coming into your region and hiring workers?

Remember that this is not just about work; it's about preventing climate change by reducing emissions, something we haven't done at all:

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The only way to really reduce emissions is to stop digging and burning fossil fuels.

On Tuesday, reports of the worst coral bleaching on record coincided with Environment Minister Tanya Plibersek announcing she was delaying changes to the Environmental Protection and Biodiversity Conservation Act. These are the laws under which it can approve new coal and gas mines.

Right now, they were approving coal mines using the laws that John Howard put in place and Tony Abbott added. It's not so much picking winners as continuing to allow companies with a losing product to mine fossil fuels under laws designed by long-time climate change deniers.

A generation-sized investment in renewable energy is needed just to ensure that efforts to reduce emissions are politically salable.

But if the government is not prepared to stop releasing greenhouse gas emissions, then no matter how many renewable energy winners they choose, they will be setting the future up for a loss.