THE sun beats down upon the necks and arms of 200 people facing a brick building by the banks of Melbourne’s Yarra River. The rays don’t seem to worry the onlookers. The sun’s power is, after all, the reason they’re here.
The building houses Solar Systems, a company that was, until recently, developing a way to put sunlight to good use. A world leader in its field, the renewable energy start-up spent 15 years and $150 million designing and demonstrating a 154-megawatt solar farm in Mildura that would have produced electricity for 45,000 homes.
Then the dark day came.
Short of funds to keep afloat, Solar Systems sank into receivership on 7 September. Now more than 100 jobs are gone and intellectual property decades in the making is at risk. So engineers and environmentalists have come to show support, the sun on their necks a reminder of what they stand to lose.
The protestors say the government is letting Solar Systems slip away — and with it the chance of a home-grown renewables sector. Energy and Resources Minister Peter Bachelor has distanced himself from the collapsed company. A spokesperson for his office told New Matilda that ‘the Government supports the demonstration of technology, but is not in the business of giving loans to private companies with taxpayers’ money’.
History begs to differ. Several federal and state governments have rescued large projects left floundering in financial straits.
In 2001, when the Australian Magnesium Corporation failed to raise enough equity for a $1.7 billion magnesium mine and smelter, the Federal Government agreed to guarantee a $100 million loan. The Queensland Government then launched its own lifeline, offering $100 million to secure dividend payments for investors.
Two years later the smelter had been dogged by cost blow-outs and was on the verge of collapse. Queensland’s premier at the time, Peter Beattie, clung to his vision, saying ‘this project is worth fighting for’.
Despite the cooler climes, southern politicians display the same hot-headed stubbornness to pursue a pet project. In June this year, the $3.5 to $4 billion Wonthaggi desalination plant stalled because the two bidding consortiums had trouble securing funds during the financial crisis.
When the new consortium AquaSure was announced, the government offered to be ‘lender of last resort’, effectively guaranteeing the plant’s construction. Victorian Premier John Brumby had such faith in the project he hazarded the biggest public private partnership since the financial crisis.
More recently, Peter Bachelor trumpeted the construction of a ‘Dual Gas’ power station in Morwell. Closer inspection revealed it was actually a brown coal power station that fell through due to lack of investment, among other things. The Energy and Resources Minister had attempted to resurrect a failed project under a new name.
And let’s not forget the Federal Government’s madcap scheme to supplement the big four banks with a big fifth. The nicknamed ‘Rudd bank’ had a specific purpose: to finance commercial property projects, which is very much ‘the business of giving loans to private companies with taxpayers’ money’.
Solar Systems is not just a private company in need of funds, it’s an important infrastructure project — a perfect candidate for a public private partnership. The technology is further along than that of the magnesium smelter or ‘Dual Gas’ power station, and the estimated cost of the solar farm is about an eighth of the desalination plant.
So why isn’t it receiving the same financial guarantees and government support as these other ventures?
Solar was never really on the Victorian Government’s agenda. A 2004 position paper titled ‘The Greenhouse Challenge for Energy’ states that ‘To achieve its objectives [of reducing emissions], the Government will pursue policies which … ensure the Latrobe Valley’s long-term future’.
In other words, any green energy solution in Victoria must integrate coal.
Recent revelations in The Age back this theory. Premier Brumby is pressuring the Federal Government to secure extra emissions-trading compensation for Victoria’s brown coal power stations. A consultant said, ‘I think Brumby and a couple of his ministers do more lobbying than the industry’.
Brumby’s plan to pay out big polluters will receive a friendly reception in Canberra. The Federal Government already hands the coal industry billions in taxpayer subsidies each year. In 2008 Australian Conservation Foundation executive director Don Henry said government-controlled funds were ‘investing $47 in fossil fuels and uranium for every dollar they invest in renewable energy’.
Nowhere is this bias more apparent than in the Howard Government’s Low Emissions Technology Demonstration Fund. Established to ‘deliver long-term large-scale’ greenhouse gas reductions, the fund now supports only fossil fuel technologies. Four of the five projects involve coal or gas, including a retrofit of the notoriously polluting Hazelwood power station. The fifth project is the Mildura solar farm, now likely to be shelved. Solar Systems was promised $125 million from state and federal governments but only received $500,000.
Our politicians suffer from a sort of carbon-induced myopia. Their obsession with digging up fossilised carbon blinds them to our nation’s other abundant energy resource: sunlight.
It’s no surprise that our ‘sunburnt country’ has some of the best conditions for solar power in the world. At the Solar Systems protest, that power is evident everywhere. It bounces off the building’s empty windows. It glints on a locked metal gate. It rebounds off the roller doors, shut for the foreseeable future.
There’s hope in those flashes. But while this building lies dormant, the sunlight outside — and the technology inside — is going to waste.