Energy politics vs policy
The Federal Opposition leader has pledged to adopt a direct action approach to renewable energy should it take office at the 2019 election. This will see a future Labor government effectively abandon the legislative path to pricing carbon. In his speech, Bill Shorten declared the bipartisan approach to energy policy "dead" in light of the most recent Coalition leadership spill.
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A direct action model would allow a hypothetical Labor government to bypass Parliament. However, it would also bind the fate of energy policy to the political fortunes of the Labor Party. Labor's energy spokesperson Mark Butler made a point of defining direct action as "underwriting" renewable energy projects. Essentially, a Labor government would provide guarantees to select renewable energy projects to encourage new private sector investment.
Mr Butler's response indicates Labor is not prepared to commit to large-scale public financing of renewable energy projects. Again, the moment Labor were to lose office or change leaders this set of policies would be put into jeopardy.
The most expensive part of this policy appears to be the proposed scheme to put "a million batteries" into Australian homes. Labor will offer a rebate of up to $2,000 for households earning less than $180,000 to install residential battery systems.
This policy is designed to be rolled out slowly, and to be scaled back as needed to meet budgetary constraints. The uptake will likely be restricted by the fact most Australians in the above income bracket are either renters or don't have solar systems. The real purpose of Mr Shorten's speech was to remove energy policy as an issue heading into the 2019 election.
Minister for Home Affairs, Peter Dutton compared the policy to the Rudd government’s pink batts scheme, branding it "Pink-batteries". The division of the energy and environment portfolios under the Morrison government is a signal the Coalition is not planning to change course.
Labor hopes the current pace of private sector investment will increase and energy policy will resolve itself. Mr Shorten has committed to winning at energy politics with policy continuing in the back seat for the foreseeable future.
