Having just come back from another trip to Canberra to meet with a number of MPs, I thought I’d offer my take on what we did and where we are up to on the RET issue.
The visit was organised by the tireless team at SolarCitizens who never cease to amaze me. Little more than a year old, SolarCitizens has become a hugely powerful voice of solar owners and businesses across the country and now has more than 60,000 members. If you are in the solar industry, you really should follow what they are doing because they are out there batting for solar, and your solar business, every single day.
The latest SolarCitizens efforts consisted of a two-day training session for a horde of volunteers who represent them around the country. They spent the weekend updating them on market facts, helping them upskill on presenting to politicians and a host of other activities. Following this weekend event, they headed to parliament house and set up a fantastic visual stunt on the lawns out the front and managed to get a number of key MPs, including the likes of Bill Shorten and Christine Milne, to stop by and give them words of support.
Then on Tuesday, they followed up with a series of meetings with key MPs and advisors; with a number of staff, volunteers and solar tragics (like me) tagging along to help out. Our team included Claire who heads up SolarCitizens, Tim, who is an environmental financial analyst, Rhonda, who works for a solar company and Steve who is a solar owner and volunteer. Between us, we covered the activities, economics, employment, ownership, business and market issues facing us all in a series of heartfelt and powerful stories. By the end of the day we had met with around half a dozen MPs and included two group MP briefings which is a great way to get the message across to a larger number of decision makers in one session.
There were some great examples of how just being there can help, too. One volunteer who had come all the way from Queensland bumped into a very “colourful” and well known MP in the cafe and immediately bailed him up to talk solar. The result was a spontaneous invitation to personally meet with him in private and discuss the issues she was concerned about. Gold.
Another long term industry stalwart we bumped into had a bag full of coasters showing how little the RET costs in a simple pie graph, which she was giving to every MP she met. Genius.
I should also highlight that while walking the halls of Parliament for our back-to-back meetings, we bumped into several other groups who were also representing the interests of the solar industry. The upstairs cafe was a bit like a solar industry reunion at times and if you kept your eyes and ears open you could get a high five and a 10-second update from colleagues while working the halls of power. Personally, I reckon this is fantastic because although we are all singing from the same song sheet (i.e. leave the RET alone, it’s working) everyone has their own angle, their own personality and their own story to tell. It adds a rich and diverse depth to the message that MPs are hearing.
It’s rarely obvious how much time and energy individuals spend away from their homes and families, sleeping in cheap hotels and working long days to argue the case for solar and it always blows my mind to find volunteers from around the country too. It’s a huge effort and is often really physically and psychologically draining battling sceptical opinions, misinformation and political gamesmanship over and over again. One thing is for sure, I bet the coal and electricity industry wishes they could muster 60,000 passionate and informed volunteers to make their case.
When you have a moment, pick up the phone or send an email to your favourite solar organisation to thank them, especially the volunteers.
As you would expect we heard a range of views on the challenges around the RET depending on who we met with. We had some fantastic and overwhelmingly positive support from the majority of MPs and advisers we met with on Tuesday, many of whom encouraged us to continue the fight and offered ideas for how they could support the campaign. Even those who were more sceptical couldn’t help but noting many of the positive aspects of what the RET had achieved and, most importantly, the fact that it has a very low relative cost to the community.
Although there are undoubtedly some differing views among MPs, I got the sense that the education campaign from industry and even some parts of the media about the benefits and values of the RET is absolutely working. When you think about how many thousands of meetings have been held, how many data sets have been handed over and how many reports and stories they have been swamped with, it makes sense and is crucial. We have facts, truth and 4 million passionate solar owners on our side.
As one example, compared to my last visit I sensed that there was no longer any chance for the “it’s just a subsidy, a cost and has no value” argument to be used plausibly after even the Warburton Review (among others) agreed that the RET helps reduce wholesale costs. Last week, even the Electricity Networks Association put a value ($130 million per year) on the savings solar delivers to networks adding more power to the community-wide value solar provides. I also picked up a wider and increasingly distinct lack of patience for the increasingly ugly and vitriolic attacks on solar from the electricity industry. I would suggest that the majority of MPs simply aren’t buying their self interested arguments disguised as economic analysis and can see that they are at risk of being “gamed” by those who don’t want anything to change.
Ultimately, if I could sum up the core of all the “robust” discussions we had it comes down to these four key points:
– Removing the RET is not going to solve the issue of high electricity prices. It’s cost is too small (even if values are ignored) and will in almost certainly vanish into “the noise” of the cost of living even if it was cut. I reckon the majority of MPs understand this simple truth now, irrespective of their ideological position.
– The SRES is “under the radar”. Because it supports behind the meter solar, the SRES is all but invisible as a cost and in the energy supply and demand debate. Even in the most wildly optimistic scenario, cutting support for solar on up to 100kW installations will only disenfranchise millions of voters, create political problems and will not save anyone anything material. Any changes to the SRES are all pain and no gain.
– Tweaking the LRET gets you nothing. When you look at ACIL Allen’s analysis for the RET review, it shows that changing from the current 41,000GWh target to, for example, a 26,000GWh target also achieves nothing material in terms of electricity price relief. The target argument is purely about saving face, not real differences.
– There is no viable alternative. One MP most poignantly put it like this: “Let’s face it, there has been almost $20 billion of investment in the RET so far and it’s absurd to consider throwing that investment down the drain. Even if you don’t like it there isn’t another $20 bilolion in the budget to start all over again.” Reading between the lines, it’s apparent that pretty much every single MP is getting very tired of countless delegations, protests, letters, campaigns and distraction on the whole issue. No matter which side of the debate they are on, they would all prefer it if this big fat barnacle was gone and they could focus on other issues. Be under no illusion, our efforts are costing them a huge amount of time and energy.
– Transition is hard. Very hard. When you get down to the crux of it, the RET was designed to accelerate the transition of the energy industry to less carbon intensive fuels. Transition of such a large and complex industry is extremely complex and some pain is inevitable. Originally the RET was part of a suite of measures that complimented each other in this transition and some of them were designed to ease the pain along the way; 'Contracts for Closure' provided a financial exit pathway and the carbon price offered incentives for accelerating the transition (or penalties for sitting on your hands) for example. So, one of the big problems we have now is that in the absence of these complementary measures the RET becomes a bit more blunt and this is making the transition harder. As a result, my view on this is that the RET is not broken; removal of the complementary measures simply and inadvertently made it a bigger stick and the market reacted by reducing demand which magnified the pain to incumbents who didn’t engage in the transition.
So. What to do?
This was a question put to us by some important leaders. I put my response like this:
1) The budget can’t sustain a whole new $20 billion investment, so starting over is not an option.
2) As one of the only remaining emissions reduction measures, you have to use it or inevitably miss your targets in the face of unrelenting pressure to lift targets.
3) We can’t unravel the past or separate the complexities of the electricity industry or the pain of transition. You removed the complementary measures so it’s going to hurt more. Fiddling with the RET won’t stop incumbents complaining as the transition inexorably continues.
4) Changing or axing the RET will not materially change anything and won’t get you any material political mileage.
So, here’s what you do.
1) Accept that while the RET may be imperfect it is functional, is creating transition and is extremely well understood by all stakeholders as a result of all the reviews.
2) Leave it alone and let industry and government get back to what they should be doing instead of wasting time endlessly debating it for absolutely no political mileage and a bucket load of political pain.
Seems like a no brainer to me.
Finally, Parliament will soon break until February and it looks very unlikely that the RET Barnacle is going to be miraculously fixed this week. So as an industry, we need to plough on and sell like crazy until Parliament resumes. Then, we need to ramp up our efforts again get back to Canberra and sustain the education, campaigning and pressure. We are making progress, but it isn’t over yet. Only unrelenting pressure will save the RET.
Nigel Morris is director of Solar Business Services.