The expert panel appointed by the conservative Liberal-National federal government to decide how much renewable energy Australia will continue to produce has defended itself against conflict of interest claims.
ABC TV’s Lateline program reports solar advocates have claimed economist Dr Brian Fisher should step down from the government review of the Renewable Energy Target (RET), arguing that he previously did work for the oil and gas industry.
Dr Fisher is one of the four experts tasked by Liberal-National Prime Minister Tony Abbott to decide the target’s future.
Former Caltex head Dick Warburton, who has publicly questioned whether carbon emissions cause global warming, heads the review.
The other panellists are Shirley In’t Veld, former head of Western Australia’s biggest coal generator, and the Australian Energy Market Operator’s Matt Zema.
ABC TV reports for 14 years, the oil and gas industry has lobbied for the 20 per cent RET to be dumped.
The panel is reviewing the target and has not ruled out proposing the scrapping of the RET, a move that the renewable energy industry said would halt billions of dollars in new solar and wind projects and potentially bankrupt some large companies.
The Australian Petroleum Production and Exploration Association (APPEA) has submitted its economic modelling to the panel, which shows the legislated target of 20 per cent renewable energy by 2020 makes electricity too expensive while disadvantaging gas-fired generation.
“Here is one government policy which is causing costs to be higher, so it is certainly something which we should review seriously and really be able to test that policy on its merits,” APPEA chief executive David Byers said.
“I think any objective analysis will show that it is going to be a higher-cost policy.”
The modelling used to argue for the target to be scrapped is two-year-old work from BAEconomics, headed by Dr Fisher.
Solar advocates are calling this a serious conflict of interest, pointing to the fact the same modelling was rejected by the last RET review, conducted 18 months ago by the government legislated Climate Change Authority.
ABC TV reports Australian Solar Council’s John Grimes has said Dr Fisher should step down from the review committee.
“He’s been an active player, providing advice that’s been absolutely one-sided in the past, advice that’s still being used,” he said.
Mr Byers has said he does not believe Dr Fisher should rule himself out.
“He’s very well qualified to look at the impacts of a policy such as the RET, just as the other members of the RET panel are equally qualified to do that task,” he said.
In the complex world of modelling, analysts Bloomberg New Energy Finance (BNEF) has said it is crucial to reflect not just the cost of renewable energy, but also the benefits.
BNEF’s submission includes what it says APPEA’s modelling does not, the ability of solar and wind to drive down the wholesale price of electricity when the sun shines and the wind blows.
BNEF analyst Kobad Bhavnagri said that was “essential”.
“You have to look at both the costs and the benefits of the scheme,” he said.
“It’s quite easy to highlight the costs and completely ignore the benefits.”
Miles George, from wind energy company Infigen, said APPEA’s modelling did not stand up to scrutiny.
“In that modelling that was done for APPEA two years ago, there was no attempt to identify or model the wholesale price reduction that’s associated with renewable energy,” he said.
“It’s very outdated because gas prices have gone up a lot since then and gas-fired electricity costs have gone up a lot since then.
“Therefore the conclusions that they drew two years ago are just no longer relevant for this review.”
Dr Fisher referred ABC TV to RET review chairman Mr Warburton for comment.
Mr Warburton said he did not believe Dr Fisher faced a conflict of interest.
