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The joys of capitalism !

Households will be hit by a 56 per cent surge in energy bills in the coming two years according to our Treasurer – this cost impact does not include the petrol or diesel for our vehicles but relates solely to the energy used in our homes and businesses.

On most of mainland Australia we still rely heavily on coal and gas for our domestic energy production. Coal and gas accounted for around 70% of electricity generation in 2021.

Over the last decade, the share of electricity generated by renewable energy in Australia has increased significantly, rising from around 10.5% in 2010 to 29% in 2021.

Tasmania has become the first Australian state to achieve 100 per cent renewable electricity generation largely coming from hydro and wind resources. The recently announced Tasmanian Renewable Energy Target will double renewable energy production and reach 200 per cent of current Tasmanian electricity demand by 2040 : the surplus being sent to the mainland by an undersea cable known as the Marinus Link.

Sun Cable in the Northern Territory is planning to export Australian solar energy to Singapore as part of a US$22-billion infrastructure project which will send electricity more than 3,100 miles (5,000 km) to Singapore, via high-voltage undersea cables. Opening in 2027, it will be the largest solar farm and battery storage facility on the planet and will combine 17-20 gigawatts of peak solar power generation and some 36-42 GWh of battery storage. To give you a sense of scale, that’s nearly 10 times the size of the world’s current largest solar power installation and more than 30 times the energy storage capacity of the world’s biggest battery project.

When it comes to LNG, as of 2022, we will export around 87.6 million metric tons. Australia and Qatar are currently the major exporting countries of LNG , followed by the United States, which has an annual capacity of 73.9 million metric tons. But there is something wrong !

Whilst we export equivalent volumes of gas to those coming out of Qatar their government will receive around $26.6 billion in royalties from the multinational companies exploiting its offshore gasfields, whereas, according to Treasury estimates, Australia will receive just $800 million for the same volume of gas leaving our shores.

When it comes to coal – the source of most of our electricity – The 5 biggest exporters of coal are Australia, Indonesia, Russia, United States and South Africa. Combined, those 5 countries shipped 84.5% of the total value of coal sold on international markets during 2021.

So clearly, there is no shortage of resources in Australia and we know that Russian energy exports are subject to trade embargoes. But why are Australian consumers anticipating fifty percent increases in costs in the next year or so ?
Sadly it comes back to the fundamental capitalist equation which says that resources go to the highest bidder. So, Australia has to bid against international buyers to secure its own resources and the producers – largely foreign owned – laugh all the way to the bank pausing only briefly to ensure that transfer pricing will minimise their taxation obligations in Australia.
Go figure !

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11 comments

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  1. New England Cocky

    Uhm ….. silly question, I know …. but why do we propose to export energy to other countries to power their factories and computer banks when it makes better sense for Australian voters to have the expected users re-locate to within Australian political boundaries so that Australian workers get all the advantages of employment …. like permanent jobs, resulting in housing and disposable income to be spent in Australian retailers & Australian service providers?

  2. Max Gross

    Australia first! (Yeah, ri-iiight)

  3. leefe

    Why, NEC?

    Because capitalism rewards those at the top, and most of those at the top neither are Australian nor care about Australians (or, indeed, anyone but themselves). We’re just cannon fodder in their war of wealth acquisition.

  4. Canguro

    I wonder how many of the current political crop have read Donald Horne’s The Lucky Country? Even more saliently, taken the prescient author’s observations to heart and actually acted out of considered reflection on his insightful analysis of the structural issues benighting this country?

  5. New England Cocky

    @ leefe: Why not? Donald Horne identified the untold wealth of Australian natural resources about 1964 and ever since politicians have ignored the opportunity to have state funded exploitation of those natural resources for the benefit of Australian voters.

    All sorts of excuses have been proffered and ignored the underlying financial fact that Australia is a sovereign country having our own capacity to print money as required. This strategy was first used by King O’Malley to fund the Indian Pacific Railway linking Perth to Adelaide about 1917. It was also used to fund the WWI war effort much to the disgust of the Bank of England. Nowadays it is known a ”Modern Monetary Theory”.

    Why are foreign owned multinational mining corporations allowed to hold Australian mining leases, extract the natural resources, export them overseas for processing and pay no taxation on the profits generated? Now which COALition misgovernment cocked up by establishing that political strategy?

  6. Pete Petrass

    “So, Australia has to bid against international buyers to secure its own resources and the producers – largely foreign owned – laugh all the way to the bank pausing only briefly to ensure that transfer pricing will minimise their taxation obligations in Australia.”
    Not only are we being screwed out of our own resources but local power companies are also manipulating the system to increase pricing, like earlier this year when we had a bunch of “unscheduled maintenance” on some power stations. As we all know less power in the market means higher prices.

  7. Clakka

    MRRT, PRRT, PFFT! Right from the euro-start here we have been designated by euro-aristocrats and their jurist flunkies and lick-spitting drunken emissaries as a place of only worthless animals, an otherwise barren and empty place only suitable for the dumping of euro-excrement. And that excrement would, as humus, give rise to a harsh and wretched mob extending the potential for serfdom, or as needs must, cannon fodder.

    Nothing changed as our pretenders sailed-off to the alma mater seeking enlightenment. There to be re-educated in the finer arts of elitism, racism, and bastardry, and joys of an inculcation of Stockholm syndrome. Goodness! It’s so good, that even as we dutifully pillaged our outpost to the point of decimation, and sent the proceeds back to the deserving, we have, as ignobles, managed to import those finer arts.

    Now, saturated with noblesse oblige, and desperate with aspiration, with a gob full of sophistry, kowtowing under contract and by decree, we continue to feed the wretched and incontinent old harridan in the hope that, despite our being impoverished in our own home, we too may be great one day. And rightly so.

    Can anybody lend me a fiver?

  8. Canguro

    Further to the joys of living in the ‘Lucky Country’, I found this link to this article written by a Communist rural Australian citizen… oh the shock, the horror!

    Would that articles like this get a much wider audience, would that the Australian populace at large digest this kind of sensible commentary and analysis, would that we would have a ground-swell of resistance to the status quo and an upwelling of support for a fairer and more decent society – which was of course the original intention of the international communist movement prior to its derailment by the Russian zealots.

    Perhaps we shall, after the Great Reset, whatever that may be; nuclear holocaust, environmental breakdown per global warming, Jesus back in the ‘hood.. I have no idea as Nostradamus I ain’t, but time brings change and as the Buddha was wont to say, change is the only certainty. Personally, I quite like the Communist way of looking at the issues… fingers crossed for a second coming.

  9. Andrew James Smith

    All those years ago in the noughties when Labor was stymied, inc. by their own side, on sensible carbon emission pricing and transition away from fossil fuels.

    What happened? Already imported US influence went into action a la ZPG (fossil fueled) dog whistling of immigration & population growth deflecting from fossil fuels & carbon pricing, resulting in unstable government and no outcome, still waiting….too easy with a passive population.

  10. Terence Mills

    It has been brought to my notice that we are now the world’s largest LNG exporter having overtaken Qatar in 2021 and that WA thanks to their policy of reserving fifteen percent of gas production for domestic use, will not face the price hikes affecting the rest of the country.

    WA have effectively insulated their consumers, both business and domestic, from the joys of capitalism : they also resisted the rush to privatise their electricity distribution.

    We on the East Coast can learn a lot from WA.

  11. Harry Lime

    Thanks chaps ,some of the best,most accurate and entertaining comments I’ve seen since yesterday.Wonder why we’re fucked?This little ‘ol blog is one of the few remaining reasons to clutch onto the will to live.I no longer feel so alone.And Terence,we might also learn something from our cousins across the ditch,if not their accent.

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