- by Emily Muagututia & Seamus Carey
- The Guardian
- Issue #1963
The federal government’s “gas-fired recovery” plans fly in the face of any reason, be it environmental, economic, the interests of workers, or the rights of the sovereign Indigenous peoples whose lands are being stolen and defiled.
But the government’s ideology and intentions are not a product of chance or stupidity. The only interest behind these policies is that of the giant oil and gas corporations. These corporations are large donors to both the Liberal and Labor parties.
Many gas drilling operations in Australia are not even profitable. These projects only stay afloat through government handouts – these are the true dole bludgers!
The government has allocated $600 million to build a new gas-fired power plant in Kurri Kurri, NSW, via the state-owned Snowy Hydro corporation. The project has already been ridiculed from many angles as utterly unjustifiable. Scott Morrison claims that it is necessary to fill the gap that will be left by the closure of the Liddell coal-fired power station in 2023. Yet, the plans for the gas project show that it is only expected to operate for one or two weeks per year and will only create ten ongoing full-time jobs.
Creating jobs at $60mil a pop is hardly wise budgeting! And it is clear from the projected operating frequency that the need for this plant is non-existent. The NSW state government’s renewable energy plans – as well as the future renewables projects the federal government should be investing in rather than fossil fuels – are already expected to fill the gap left by the closure of Liddell.
The government’s excuse for opening another fossil fuel-burning plant is that it can later be converted to a hydrogen plant. However, this is no environmental get-out-of-jail-free card, as the government’s main plan to generate hydrogen is to use coal! The current emissions-friendly alternatives to produce hydrogen use water instead, but this raises further questions of large-scale viability as Australia faces a worsening water crisis.
Some of the criticism of this project from the right was of the state ownership of the plant. Such commentators opined that the state should not interfere in the market, and the project should be left to the private sector. This puts the Liberal government in the unusual (for them) position of being forced to criticise the private sector for “failing” to deliver this project themselves, as no private company had expressed interest in taking it on. While the obvious reason for the lack of interest from the private sector is that the project is completely economically unviable, the Liberal Party is unable to openly acknowledge this.
Projects like the Kurri Kurri gas plant are an example of the hypocritical ways that neoliberal governments utilise state ownership. While under socialism, state ownership is a means for implementing large-scale rational planning to meet people’s needs, the neoliberal free-market fundamentalists in power will happily use it as a means to siphon taxpayer money into private hands. This gas plant has no purpose other than another promise to gas companies that the state will guarantee them demand, in a world that badly needs to cut this demand to zero.
In the era of modern state-monopoly capitalism, the state operates to an ever-greater extent as an arm of the largest domestic and transnational corporations. State budgeting and economic policy primarily serve the cause of maximising profits for these global super-exploiters.
The demand for ever-greater profits is perpetually facing the problem of the tendency of the rate of profit to decline, as well as the need to expand consumption – no profit can be made without any commodity to sell! But contrary to bourgeois economic theory, people’s desires are not infinite. Furthermore, they are restricted by low wages. This contradiction in the ruling class’ desire for lower wages but higher expenditure is a major structural instability in capitalism and cause of many economic crises.
The struggle to create new commodities to sell also expresses itself in a great reluctance to let go of old commodities, regardless of the economic sense of it. This is reflected in government ideology and policy, and the state steps in to provide an economic rationale in the form of massive, unjustifiable corporate subsidies.
To avert irreversible climate catastrophe, the burning of gas will have to stop at some point. Fossil fuel consumption, including gas, must decline rapidly, and many countries are already taking action to achieve this. Planning decades-long gas projects makes no economic or environmental sense. Who will buy the gas if global environmental targets are met? Reassuring its corporate sponsors, the Australian government answers: we will.
Both Liberal and Labor parties claim that increasing gas usage is a good way to reduce emissions. While it is somewhat cleaner than coal or oil, that is not good enough to achieve the necessary outcomes for the planet. A further important consideration is that gas drilling increasingly takes the form of fracking, which causes devastating environmental and cultural impacts in addition to the emissions.
In the Northern Territory, the fight to stop fracking continues as the NT government struggles with commitments to two conflicting promises. In 2006, NT’s Labor government entered a contract to buy $4 billion worth of gas by 2034, whether or not this gas was delivered. In direct conflict with this, the current Labor government is paying $12 million for a study into reducing gas consumption by government-owned electricity generation companies.
This year’s budget has also allocated $2.8mil to financing solar PV and battery storage for households and businesses and a further $2mil towards delivering renewable energy to remote communities across the NT.
The commencement of new fracking ventures in Australia is a ploy to ensure our continued dependency on fossil fuels for years to come. In a time that emphasises the transition to renewable energy, why are we allowing these kinds of projects to begin? The NT government’s 2018 fracking enquiry revealed that the development of the territory’s oil and gas fields could result in up to 34 billion tonnes of carbon emissions, equivalent to 60 times the total greenhouse gas emissions of all of Australia. Offsetting these emissions could cost more than $4 billion.
The Northern Territory did introduce a moratorium on fracking in 2016. However, just two years later in 2018, the Morrison Liberal government withheld GST funding from NT until they revoked the moratorium. As oil and gas companies now eye off the Beetaloo basin, estimated to be one of the largest gas reserves in the world, once again the Morrison government and fossil fuel lobbyists are pressuring the NT government to remove any environmental and community protections to allow for expansion of the fracking industry.
The Australia Institute’s report “Fracking and Slacking” revealed that Northern Territory taxpayers had paid around $100mil to support the gas industry in the last ten years. Just one day after this report was released, the NT government announced $12 million in subsidies for the fracking industry. This kind of funding could be reallocated to community resources and programs – particularly in Indigenous communities that have been bearing the brunt of the continued desecration of their land.
Indigenous people from the Northern Territory who made submissions to the 2018 fracking inquiry almost unanimously agreed that the fracking industry will do irreparable harm to their communities with no reciprocal benefit. These opinions were based largely on their experiences with previous mining projects in the territory.
Indigenous activist Alice Eather penned a poem “My Story is Your Story” in response to proposed fracking in her home in NT, writing:
“When I see a map of country, I see land, sea and family. When they see a map of country, they see mining fantasies. When I see the seabed, I see sacred sites. When they see the seabed, they see dollar signs. When I see a map of exploration permit 166, I see them trying to reduce my country to three digits… People ask me for my story, but my story is your story.”