Australian and New Zealand ESG Update

Chair of Energy Security Board says no future for coal power plants

Australia has a fleet of coal-fired power generators which are all underperforming profitwise, and becoming less reliable, says the chair of the Federal Government’s Energy Security Board, Kerry Schott. The Smart Energy Conference held recently saw Schott speaking, saying there was no need to worry about coal-fired power plants in the electricity market because they would be pushed out of the market soon enough.

Schott explained that the coal generators are going broke and at the very least commercially speaking, coal is passé and will burn itself out. The cheapest forms of energy are now wind and solar, with their fuel costs of the high and mighty zero. Coal power plants require the purchase of coal at $40 per tonne being burnt 24/7.

Sun Cable CEO predicts Australian solar exports to provide major opportunities, plans to build submarine power cables to Asia

The chief executive of the Sun Cable project, David Griffin, is predicting that carbon border adjustment taxes from European, Asian and American governments will turbocharge the demand for clean power in Southeast Asia, and in the process offer big opportunities to Australia’s solar industry.

Southeast Asia relies heavily on fossil fuels for energy production, which makes it expensive even before border taxes. CO2 emissions in products are very high, thus attracting higher carbon border charges, which may result in being priced out of some major markets.

Southeast Asian manufacturers may soon be very interested in affordable, clean energy. Griffin is looking to build more submarine transmission cables to carry Australian solar to Southeast Asia. The Sun Cable project plans to build 14 gigawatts of solar energy capacity in the Northern Territory with 30-gigawatt hours of battery storage, then transmit the energy to Singapore via a 3,750km submarine cable. The cable is aiming to meet around 15 per cent of Singapore’s total electricity requirements.

Victorian Government supports gig economy recommendations

The Victorian Government has wholly or partially supported all 20 recommendations handed down by a landmark inquiry into the gig economy. The inquiry was set up to examine the employment status of gig economy workers, and determine minimum standards and entitlements that platforms should offer. Unfortunately, most of the changes will need to come from the Federal Government.

The Inquiry into the Victorian On-Demand Workforce said the ‘unresolved’ employment status of gig economy workers, such as food delivery drivers and rideshare workers, has influenced a lack of workplace standards. The discussion was regarding whether gig economy workers should qualify for basic entitlements such as minimum wage, superannuation and sick leave.

The issue is that the new way of working doesn’t fit neatly into any existing category of employee, self-employed contractors, or a new industry award is required. So far, only Menulog has committed to voluntarily improving entitlements for workers, running a trial in which Sydney CBD workers are considered full employees.

Ultimately, these changes will increase the cost of doing business for those companies that rely on gig economy workers on low wages without any protections.

Greenpeace v AGL: AGL accused of being ‘biggest climate polluter’

Greenpeace has openly accused AGL of being ‘the biggest climate polluter’ in Australia, a claim that has landed the two organisations in court, but not for the reasons you might think. AGL has sought an injunction from the Federal Court to remove its branding from Greenpeace’s campaign materials, however, this request was denied, so the pair will be back in court soon.

AGL is alleged by Greenpeace to be ‘currently using its position and power to slow the transition to a low carbon economy which is jeopardising both human and planetary health’. Greenpeace’s latest campaign contains accusations that the energy giant is Australia’s biggest domestic contributor to climate change. Greenpeace’s senior campaigner, Glenn Walker, says the legal action is an attempt to quiet campaigners who are accusing AGL of having a public image of being an environmentally friendly energy generator but who in reality are just the opposite. AGL publishes material with images of wind turbines and solar panels, but just 10 per cent of its operations is in renewable energy and is not increasing much over time.

Walker says the evidence is in 2019-2020, AGL emitted over 42 million tonnes of greenhouse gas emissions - more than 8 per cent of Australia’s total emissions and twice the amount of the next largest emitter. AGL owns three old coal-fired power plants.

At the core of this court case is not the accusations by Greenpeace, but the presence of AGL branding on the publications by Greenpeace. Greenpeace says it wants AGL to become a leader in sustainably produced energy, rather than the biggest polluter in the country.

Sustainable Investment Institute launched by First Sentier Investors and MUFG

A leading global investment manager and its shareholder bank have launched the First Sentier MUFG Sustainable Investment Institute to commission and publish high-quality research into sustainable investments, market trends and best practice. The Institute is to promote a better understanding of sustainable investments and long-term investment performance.

The Institute was set up by First Sentier Investors and Mitsubishi UFJ Trust and Banking Corporation, a subsidiary of Mitsubishi UFJ Financial Group Inc (MUFG). The Institute’s first report is Microplastic Pollution: Causes, Consequences and Issues for Investors. The paper was authored by Chronos Sustainability and explores the growing microplastics issue.