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By Jo Nova

At the top of the Faraway Tree, the cheapest form of energy need more subsidies. Just keep pouring the money…

The Australian Energy Market Commission (AMEC) has finally quietly admitted that they’ve given up on wind and solar power becoming cheaper than coal. Instead, renewables are so uncompetitive they will need another ten years of subsidies, or however long it takes until the last coal plant shuts off.

It’s so revealing. Once upon a time they might have thought (or at least pretended) that subsidies were there to get the unreliable generators ‘over the development hump’ so they could compete in a free market. But after 20 years of subsidies, there are no new economies of scale left to wait for. We got to the bottom of the cost efficiency curve and we’re going up the other side. Costs are now rising as the new projects have to go to far flung fields and wait for impossible transmission towers to appear. Windmills kept getting bigger until there was a nasty surprise in the maintenance bills that wiped 36% off Siemens shares in a single day.

AMEC opine about getting back to a free market once the coal plants are forced off the grid by the Big Government subsidies. They might as well be telling the world that wind and solar will never be as cheap as coal is.

How could the new unfree market, post coal, possibly be cheaper than the old one?

Green energy subsidies here until nation exits coal, says Australian Energy Market Commission

Perry Williams, The Australian

Australia’s official energy policy adviser says government subsidies for renewables will likely be kept in place for as long as coal-fired power generation keeps operating, locking in underwriting schemes for at least another decade.

It’s not renewables fault, it’s because we need “an orderly transition” (to a forced, fixed, and unfree market):

The Australian Energy Market Commission said underwriting mechanisms were needed to ensure there was an orderly transition to green energy as coal generation exited the nation’s power grid.

Sorry, did we say the subsidies would end?

“Are we going to get past this at some point when we won’t have governments underwriting new capacity. Maybe once we’ve seen coal exit and we’ve built out this phase of the transition,” AEMC commissioner Tim Jordan told the Citi Australia and New Zealand Investment Conference on Tuesday.

All the talk of free markets is just an illusion:

“We can then return to a more market-led approach where underlying demand growth will determine whether new capacity enters.”

Mr Jordan said the industry and government should aim for “market principles to take over again” once the transition from coal to renewables was complete.

What do we call a free market when the cheapest competitor is banned?

If the green subsidies can’t end until coal power is gone, it looks more like their primary goal was not to help renewables so much as to destroy coal…