Senate Estimates - Environment / archived / read-only

Energy retailers prefer fines to credits SARAH MARTIN

Australia’s energy sector will fall 10 per cent short of meeting its 2016 renewable energy target, after electricity retailers chose to pay penalties to the national regulator instead of buying enough green power.

More than 20 electricity retailers, including large companies ERM Power and Alinta, have chosen to pay more than $130 million in “shortfall” charges for not purchasing renewable energy certificates in line with the country’s RET of 23.5 per cent by 2020.

The 2016 large-scale renewable energy target required 21,431 gigawatt hours of green energy to be produced to meet last year’s 12.75 per cent target, achieved by electricity retailers buying renewable energy certificates from generators.

The Clean Energy Regulator, which administers the RET, released new data yesterday showing a 9.5 per cent shortfall resulting from the failure of the two large retailers to comply with its obligations under the scheme. This meant the overall compliance rate for large- and small-scale energy targets was 94 per cent, a substantial drop from previous years, with more than 99 per cent compliance.

Clean Energy Regulator chairwoman Chloe Munro said the scheme was still effective, but criticised the retailers for paying the charge instead of surrendering renewable certificates.

“The large majority of electricity retailers have done the right thing and met their obligations to surrender certificates,” she said. “It is disappointing that any retailer has chosen to pay the shortfall charge when sufficient certificates are available in the market … payment of the charge does not fulfil the purpose of the legislation.”

The spot price of large-scale renewable energy certificates has more than doubled since 2015, to now being close to $90 each, while the penalty to the regulator for a shortfall is $65 per certificate. However, because the penalty charge is not tax-deductible, it is valued at about $93.

When ERM announced that it would not be meeting its renewable obligations last month, the company said it expected more power companies to follow suit, despite warnings from the regulator that doing so was not in the “spirit of the law”. “This is a traded commodity and it’s trading right up at the ceiling price,” said ERM spokeswoman Michelle Barry.

Ms Munro said the two companies had suggested they would meet their significant shortfall in future years, with the regulator allowing entities to “make good” on their position by surrendering the missing number of certificates at a later date and getting a refund.

“We encourage them to demonstrate their commitment to the renewable energy target by announcing concrete arrangements to source additional certificates in 2017 and future years and redeem their 2016 shortfall,” she said.

ERM’s penalty was the highest, at $123.5m, followed by Alinta Energy, which paid $7.9m.

A handful of smaller retailers did not surrender any certificates, incurring combined penalties of more than $8m.

Kieran Donoghue from the Australian Energy Council questioned the high price of renewable energy certificates: “They (the retailers) have got no interest in wilfully paying the penalty if it was cheaper to buy certificates.”

• All I can find in the PBSs is the RET/RECs

1. An officer of a department of the Commonwealth or of a State shall not be asked to give opinions on matters of policy, and shall be given reasonable opportunity to refer questions asked of the officer to superior officers or to a Minister.

a. without reasonable excuse, refuse to make an oath or affirmation or give similar undertaking to tell the truth when required to do so;

b.without reasonable excuse, refuse to answer any relevant question put to the witness when required to do so; or

c. give any evidence which the witness knows to be false or misleading in a material particular, or which the witness does not believe on reasonable grounds to be true or substantially true in every material particular.

• Do you agree that much of the Strategic Direction of this department is underpinned by the belief that coal fired power stations are not "clean" and that their emitted CO2 will cause catastrophic heating of the planet so they must be replaced by wind and solar power?
• Do you agree that the department's web site contains a myriad of references to money committed assuming this belief but none to any due diligence examining the belief?
  • Australian climate change science: a national framework
  • Australian Climate Change Science Programme | Department of the Environment and Energy
  • Australian Climate Change Science Programme
  • Climate change in the future
  • Intergovernmental Panel on Climate Change Fifth Assessment Report
• If the belief cannot be defended, should the dependent programs be terminated?
• How many of the department's 1700 staff would then lose their jobs?
• Is the department planning any major due diligence work soon?
  • An example of a due diligence workshop American Physical Society Climate Change Statement Review Workshop
• What is the department's policy when responding to allegations that the belief is wrong?
• Can the department show any evidence of having engaged constructively with those who question the belief?
• From The Australian Reef whistleblower censured by James Cook University Professor Ridd was disciplined for breaching principle 1 of JCU’s code of conduct by “not displaying responsibility in respecting the reputations of other colleagues” [link]. Why should any federal funding go to any organisation that rates the reputation of colleagues higher than scientific truth?
• Why should the parliament have any confidence in research from James Cook University?
• Will the department's own officials defend this belief or does the department rely on defence from CSIRO, Bureau of Meteorology and the Chief Scientist?

• The CSIRO empirical evidence and One Nation's response has been tabled and is summarised below. A recording and transcript of the CSIRO/One Nation discussion exists.
  • [OneNation response in bold] Carbon dioxide is a greenhouse gas whose concentrations in the atmosphere have increased possibly from human activities but without leaving any evidence of a SIGNIFICANTLY increased greenhouse effect. The earth has warmed since the Little Ice Age, mostly before human CO2 emissions and it is still cooler than the thriving Roman Warm Period. CSIRO does not assert that danger is looming. When asked specifically about the danger: "That is not our responsibility". Is this summary of CSIRO's empirical evidence a convincing basis for action?
  • One Nation would welcome continued CSIRO or departmental involvement in this discussion.
• The Chief Scientist's empirical evidence and One Nation's response has been tabled and is summarised below.
  • [OneNation response in bold] Human activity contributes to rising atmospheric carbon dioxide levels. This is accepted by OneNation. High concentrations of atmospheric CO2 lead to warming of the oceans and atmosphere. It is the initial low concentrations of CO2 that cause most of the warming, with the concentrations over 300 ppm contributing virtually no warming. The earth is warming. It has been erratically warming since the Little Ice Age. Similar warming lead to the previous prosperous Warm Periods when CO2 levels were much lower. Is this summary of the Chief Scientist's empirical evidence a convincing basis for action?
  • One Nation would welcome continued involvement in this discussion by the Chief Scientist or the department.
• One Nation's distrust of Global Climate Models is well explained by Prof Judy Curry in the tabled paper on which the next questions are based. [link]
  • Why are you relying on GCMs have not been subject to the rigorous verification and validation that is the norm for engineering and regulatory science.
  • Are you not concerned about a fundamental lack of predictability in the complex nonlinear climate system?
  • Why do you believe that climate models are fit for the purpose of identifying with high confidence the proportion of the 20th century warming that was human-caused as opposed to natural?
  • Are you aware that there is growing evidence that climate models predict too much warming from increased atmospheric carbon dioxide.
  • Why do you believe that the climate model simulation results, which do not include key elements of climate variability, are useful as projections for how the 21st century climate will actually evolve?
• One Nation has not had discussions with the Bureau of Meteorology but plans to question them on the accuracy and length of their climate records and the accuracy of their one and three month outlooks.

• Are Australian fossil fuel power generators currently in breach of pollution standards covering particulates and aerosols?
• If they are not being prosecuted are they then "clean" by current standards?
• Is it the emission of CO2 that makes some generators "unclean"?
• Is CO2 as vital to plants as oxygen is to animals?
• Are all animals directly or indirectly dependent of the eating of plants?
• Would an increase in CO2 from 400ppm to 1000ppm significantly increase plant growth?
• How then is coal unclean?

• Can the department defend this belief or is it a matter of government policy handed down by the minister and not to be commented on by the department?
• Is solar power generated at night?
• Are you aware that there were periods of 50 days during which all the grid wind farms barely reached 20% of registered capacity? More worrying were the periods of 1 to 5 days when only 5-10% was achieved. See the tabled chart based on the AEMO 5 minute dispatch data.
• Do you agree that wind and solar can not provide base load power but only make the reliable generators uneconomic?

• How much has been spent in each of the last 5 years by the federal government on anti-CAGW measures? Please include all departments and agencies, all grants, funding of NGOs, departmental and administrated expenses. Include also the imposition of the RET on the economy and all grants and subsidies for household and grid solar and wind power.
• How much of this has gone to Australian Universities and Centres for Climate Studies?
• How much of this has gone to the United Nations and their subsidiary bodies and associated NGOs?
• What is claimed to have been achieved by this expenditure in terms of atmospheric CO2 concentrations and Australian temperatures?
• Has any money gone to the Australian Academy of Science for CAGW related issues?
• if YES: Given the tabled Article in Quadrant concerning the Australian Academy of Science by Tony Thomas: Does the Department consider the AAS to be an unbiased organisation free of ideologies which is capable of giving credible scientific advice on climate change?
• if YES: What parts of the tabled document does the Department dispute?

• Program 1.1: Sustainable Management of Natural Resources and the Environment
  • Delivering biodiversity conservation and natural resource management programs including the Reef Trust, Green Army, 20 Million Trees, and the National Landcare Program
  • Implementing initiatives to improve the health of the Great Barrier Reef including the Reef 2050 Plan and Reef Plan Report Card 2014-15
  • Implementing the Threatened Species Strategy
  • Representing Australia's interests at international forums on biodiversity matters and meeting obligations under international agreements.
    • What obligations have we under international agreements?
    • Do any of these international agreements act against the interests of any Australians?
    • Why can't the Australian Parliament decide what is necessary?
• Program 1.2: Environmental Information and Research
  • Qualitative assessment shows that departmental staff, state governments, business, community groups and others are using research outputs from the National Environmental Science Program to inform management and policy development.
    • What proportion of papers or reports in the National Environmental Science Program have been independently replicated?
    • Are you aware Why Most Published Research Findings Are False
    • Are papers from JCU allowed into NESP given Reef whistleblower censured by James Cook University
• 6.10 pm Program 1.3: Carbon Pollution Reduction – Land Sector Initiatives
  • Why do you (a carbon based life form) consider carbon to be a pollutant?
  • By carbon do you mean carbon dioxide, why are you not using the correct term?
  • How can carbon dioxide be a pollutant when all life on earth depends on it?
  • Do you have some agenda that prevents you from using the correct terms?
  • Increase in extent of native vegetation in project areas.
    • Is any of this being done against the will of the landowner?
  • Amount of carbon that has been sequestered through project investments.
    • How much has the whole world's mitigation programs effected atmospheric CO2 levels?
• Program 1.4: Conservation of Australia's Heritage and Environment
  • Australia meets its obligations under international environmental agreements.
    • How much is spent meeting these international obligations?
    • Why couldn't the Australian Parliament impose any necessary obligations?
• 4.30 pm Program 1.5: Environmental regulation
• 5.35 pm Program 1.6: Management of Hazardous Wastes, Substances and Pollutants
• Program 1.7: Cities and the Built Environment
  • Data and information generated or commissioned by the Department are used by stakeholders and/or support evidence based decision making.
    • How much of this data is independently replicated or audited?
    • How much of this data has come from organisations that rate the reputation of colleagues higher than scientific truth, such as JCU? An audit is needed.

• Reduce Australia’s greenhouse gas emissions, adapt to the impacts of climate change, contribute to effective global action on climate change, and support technological innovation in clean and renewable energy, through developing and implementing a national response to climate change.
• Program 2.1: Reducing Australia's Greenhouse Gas Emissions 2016-17 Budget $46M
  • 8.25 pm Program 2.1: Reducing Australia's Greenhouse Gas Emissions
    • This program has $46M of departmental expenses in 2016-17.
    • Do you agree that, if CO2 will not cause CAGW, this program can be abandoned?
    • Outcome 2 mentioned contributing to effective global action on climate change. Which effective global action do you mean? Given that the increase in atmospheric CO2 levels shows no signs of slowing and new coal fired power stations are being constructed in huge numbers.
    • Water vapour is the major greenhouse gas, are you planning to reduce Australia's water vapour emissions?
    • Would you agree that a more correct title would be "reducing Australia's emissions of a minor greenhouse gas?
    • What is going to be the total cost to the nation for the measures being advanced in this program?
    • What is going to be the benefit to the nation for the measures being advanced in this program?
• Program 2.2: Adapting to Climate Change 2016-17 Budget $5M
  • 9.15 pm Program 2.2: Adapting to Climate Change
  • Do you agree that, if CO2 will not cause CAGW, this program can be abandoned?
  • The departments mitigation expenses are $46M while adaptation expenses are only $4.9M. Is adaptation much cheaper than mitigation?
• Program 2.3: Renewable Energy Technology Development 2016-17 Budget $197M
  • What renewable energy technology was developed with last year's budget of $158M?
  • What renewable energy technology will be developed with this year's budget of $197M?

• 11.00 am Program 3.1: Antarctica: Science, Policy and Presence

• If YES: Is this being caused by human CO2 emissions?
• if YES: How can it be human emissions when the tabled paper shows Arlington Reef pH has varied plus and minus about 0.25 pH units from 1800 to 2000 with no acidification trend?

• If NO: Does the authority understand the importance of independent replication to the scientific method?

• Do the key messages delivered to the tourists and students relate to rising CO2 levels?

• Observations meet accuracy, timeliness, completeness, coverage and accessibility specifications.
  • One Nation's distrust of the Bureau's records is partly based on the tabled paper by Dr Bill Johnston on which the next questions are based.
  • Questions concerning data integrity and site and instrument changes
  • How is it credible that the Bureau adopted an internal policy in 1996 of not databasing (and routinely destroying) thermometer data at sites where thermometers are observed in parallel with automatic weather stations (AWS)?
  • What thermometer data still exist in hard-copy form and why is an effort not made to digitise it and have it accessible in the public domain?
  • If no comparative data exist and no rigorous multi-site comparative study is done; how is it possible to be assured that AWS data is comparable in all respects with the historic thermometer record?
  • How can temperatures measured by a single, rapid-sampling (1 Hz) platinum resistance probe in a small Stevenson screen at an airport be reconciled with data observed using thermometers housed in a large screen whose internal volume is 3.8 times larger, and which was at another location; possibly at a town post office?
  • Why should the Bureau’s recent claims about temperature trends, extremes and trends in extremes be believed as they appear to be poorly researched?
  • Questions concerning the Automatic Weather Station Network
  • At many individual sites, introduction of automatic weather stations, mostly housed in small screens has caused temporal changes, which are mistakenly attributed to the climate. Why are site data not individually checked? Where data are inflated why are they not adjusted DOWN relative to past data before being reported?
  • The first law of thermodynamics underpins most understandings about how the climate behaves and cannot be dismissed lightly. Partitioning of available energy between sensible heat (which manifests as maximum temperature in a Stevenson screen) and evaporative cooling (which is a constant (2.45 MJ) multiplied by rainfall (mm = kg/m2)) is well understood and long accepted in fields such as agriculture, meteorology and climatology. Without re-casting most laws of physics, and many of those related to chemistry and Newtonian mechanics; is it feasible that average maximum temperature can be high or extremely high in years when rainfall is near average or well above average? If so, how can it be?
  • If it is not feasible, how can climate change impact directly on temperature trends, extremes and trends in extremes independently of rainfall, without moving the sun? How can changes in data that are directly attributable to changes at sites (including equipment changes) be ignored?
  • Why is the Bureau’s default position to attribute such changes to the climate when time-lapse satellite photography shows it is not?
  • Through its consistent goading of qualified people who dispel; or sensible people who can see individual trees in the forest of climate-noise; is the Bureau engaged in a nefarious campaign to misinform the community about temperature trends, extremes and trends in extremes?
  • Should the claims of those who are personally engaged (and whose identities are constantly in the public domain) be investigated? If so how, and by whom? What should happen if their claims are shown to miss-represent what is going on with the climate; or are fraudulent?
  • Introduction of AWS and small screens is a major time-synchronous change in the Bureau’s network. Bias resulting from synchronous changes cannot be detected by differencing one dataset with another (for example Kent Town with Adelaide Airport; Sydney Observatory and Sydney Airport). Why does the Bureau use differencing to investigate data inhomogeneties?
  • The Bureau is asked to comment on the following, which is the conclusion drawn by Dr. Johnston after an exhaustive unfunded investigation of almost 200 individual weather station datasets from across Australia. Replacement of large standard screens in use in Australia since reliable climate records commenced around 1900, with small screens; and the change from manually observed data and well maintained sites; to automatic weather stations left largely to their own devices has been a disaster for Australian meteorology. Small screens and sensitive probes; combined with poorly exposed inconsistent sites, which are not well maintained, result in temperature trends, extremes and trends in extremes that have nothing to do with the climate.
  • Questions concerning Homogenisation
  • If the history of sites is poorly known (or ignored); or if changes in site data are not investigated thoroughly; or if changepoints are imposed that don’t align with actual data changes; regardless of how homogenisation is done the process will create spurious outcomes. How is it possible that people who homogenised Sydney Observatory data did not discover that the site moved and changed; that the Cahill Expressway opened or that replacement of the large screen in situ, affected temperature trends, extremes and trends in extremes?
  • Use of cross-correlation to choose comparators for adjusting ACORN-site data will identify sites having parallel faults and is statistically flawed. Furthermore, as comparator-site data are not tested for homogeneity or homogenised and temperature data are not adjusted for rainfall, there is considerable scope for ACORN site data to be contaminated by the process. Faults in Sydney Observatory data potentially migrate across the network as far as Alice Springs (via Tibooburra) for instance. Why does the Bureau persist with homogenisation when it is obviously statistically flawed; and when resulting ACORN datasets are neither independent or homogeneous?
  • The Bureau’s homogenisation process has been peer-reviewed at least twice. Why haven’t the issues raised here been bought to light before? Did peer-review include inspections of weather stations; examinations of data and metadata; has anybody undertaken an independent audit of the Bureau’s assets, capabilities and methodologies from the ground-up?
  • Questions concerning responsibility for consequences
  • What happens when the wheels fall-of the climate-warming, climate-change bandwagon? Does the Bureau have a strategy for dealing with the inevitable community backlash, an anger management strategy perhaps? Or will it just change its name, look somewhare else and pretend nothing happened?
  • Will be people be held to account for making up stories about the climate that are untrue? Can we expect to see hundreds of scientific papers withdrawn by climate scientists who never checked the veracity of the homogenised data they used?
  • What about the immense cost borne by those who have been forced out of employemnt due to their being judged as “dirty”; not just in communities in South Australia, and Victoria; but also in the Murray-Darling Basin; due to “advice” provided by the Bureau and its over-head organisation, CSIRO?
  • What about the cost to households forced to shoulder the burden of increased energy prices and invest in solar systems and the like to “save” the climate, which is not actually imperiled; or the cost of “climate-action”? Who will be responsible – will it be the Bureau?
  • The Bureau is requested to comment on Johnston’s overarching conclusion which is: No Australian weather station data are useful for tracking climate warming. It is simply the case that data are too coarse, sites are inconsistent and the conditions under which they are measured are too variable for small trends (if they exist) to be detected.
  • Is this timely? Floods but no Feb 2017 rain recorded yet by BOM in Perth dam catchments
    • How bizarre is this – heavy rain and floods starting 9/10 Feb – but no Feb 2017 rain recorded yet – while rain is so easy to measure and record. BoM station Mundaring Weir 9031 has no data later than March 2016 [2] BoM station Victoria Dam 9216 is missing March and Jun, Oct to Dec 2016 nothing yet for 2017 [3] BoM station Churchman Brook 9010 has many periods in 2016 where no daily readings were taken – arrows. And no data yet for 2017 [4] BoM station Wungong Dam 9044 has all months for 2016 now and Jan 2017 as well(applause). [5] BoM station Serpentine Main Dam 9115 has nothing after May 2016 – nothing for 2017 yet.
• Forecasts meet accuracy, coverage and timeliness specifications, and are used extensively and satisfy users.
  • How can the Senate be assured that these forecasts be more accurate than the ones which resulted in the DeSal plants?
  • Why do independent checks of BoM 1 and 3 month forecasts show 70+ abject failures? 18 examples are listed below.
    • Another Bureau of Meteorology failed three month temperature Outlook – Autumn 2013
    • BoM 3 month Australian climate prediction Outlooks July to September 2013 – mostly exactly wrong again
    • Recent Bureau of Meteorology 3 month Outlook forecasts embarrassingly irrelevant compared to real world weather
    • The BoM Seasonal Outlooks for September to November – results just as poor as ever
    • A fail for Australian Bureau of Meteorology temperature Outlooks for Autumn 2014
    • Australian Bureau of Meteorology winter temperature Outlooks turned out stunningly wrong again
    • Sydney rain in August contrary to Bureau of Meteorology 3 month Outlooks – which predicted Sydney to be drier than normal
    • Australian Bureau of Meteorology 3 month Outlooks July to September far too hot again
    • Three month temperature Outlook forecasts by Australian Bureau of Meteorology still hopelessly wrong
    • Bureau of Meteorology Outlook for January rain looks sick after 10 days
    • Another useless Bureau of Meteorology Outlook – Australian summer rain shows BoM has not got a clue persevering with failed models
    • The ABC hosts the BoM prattling on about a warmer than average Autumn for Canberra but ignores inconvenient fact that the BoM summer Outlook failed for the ACT region
    • Australian Bureau of Meteorology rain Outlooks – failure looming in March and flip-flop confusion for April
    • Australian Bureau of Meteorology March temperature Outlooks turned out to be laughable failures
    • BoM rain Outlook for Nov 2015 fails comprehensively in six days
    • BoM maximum temperature Outlook for Australian spring an utter and complete fantasy
    • BoM max temperature Outlook for September heading for fails
    • Another failed Bureau of Meteorology daytime temperature Outlook
  • Which climate model is used by the BoM?
  • Why doesn't the BoM switch to using the Russian INM-CM4 which is at least correct on one test?
    • Christy computer model study
  • Are you worried that your forecast quality may have consequences? Given Met Office loses BBC weather forecasting contract - BBC News
  • The Bureau of Meteorology is a partner in the Earth Systems and Climate Change Hub in the National Environmental Science Program.
  • So any research based on BoM forecasts cannot be more credible than the BoM forecasts themselves?
• Warnings meet accuracy, timeliness and coverage specifications, and are effective in influencing responses to impending critical events.
  • Does the statement that yesterday was the hottest day since records began imply the warning that we are all going to fry to death?
  • Should there not be a qualification that records began last Thursday or 1950 or 1910 and so do not include the hotter periods in the 1880s 1890s, Medieval Warm Period or Roman Warm Period?
  • Should there not be a qualification that the new record exceeded the old by only 0.01 deg which is within the margin of error and anyway we have adjusted the new temperature up by 0.3 deg and reduced the old temperature by 0.3 deg?
• Increased accuracy and capacity of the Bureau's products and services, and increased levels of stakeholder satisfaction.
  • Are the Australian taxpayers satisfied with the wasted Billions in desalination costs for not a drop of water

• Can I review the result of your due diligence?

• The Emissions Reduction Fund, established under the Carbon Credits (Carbon Farming Initiative) Act 2011 , provide s incentives for a range of organisations and individuals to adopt new practices and technologies to reduce their emissions, including through the introduction of the safeguard mechanism.
• The National Greenhouse and Energy Reporting Scheme, established by the National Greenhouse and Energy Reporting Act 2007 , which is a single national framework for reporting and disseminating company information about greenhouse gas emissions, energy production, energy consumption and other information specified under the legislation.
• The Renewable Energy Target, established by the Renewable Energy (Electricity) Act 2000, encourages the additional generation of electricity from renewable sources, reduce emissions of greenhouse gases in the electricity sector and ensures that renewable energy sources are ecologically sustainable.
• The Australian National Registry of Emissions Units, established by the Australian National Registry of Emissions Units Act 2011, is a secure electronic registry system. Any organisation or individual that is required to or wishes to hold, transfer, cancel, surrender or relinquish units must have an Australian National Registry of Emissions Units account. The registry is designed to track accurately the location and ownership of emissions units issued under the Kyoto Protocol and Australian carbon credit units issued under the Emissions Reduction Fund.

• Year	Price	Source
  2016	$90	TheAustralian
  2015	$29.38	From CER website
  2014	$35.24	From CER website
  2013	$38.68	From CER website
  2012	$35.24	From CER website