Australia’s green-energy recession

Despite the global push towards eco-industry, investment in large-scale renewable projects has plummeted 90 percent.

A welder at Eureka's Future factory in Melbourne works on a solar-powered water heater [Jarni Blakkarly/Al Jazeera]
Correction9 Jun 2015
A previous version of this article wrongly named Andrew Snelling as Andrew Earthworker.

Melbourne, Australia – On the industrial fringe, one factory making solar energy hot-water tanks has become a meeting point for the environmental movement and the moribund manufacturing industry.  

While the Eureka’s Future factory looks identical to others lining the street, inside young environmentalists from the inner city and lifelong hardened factory workers from the suburbs are transforming this former private company into a not-for-profit, workers-owned cooperative.

The factory is being helped by Earthworker, a group that focuses on helping start and run cooperatives in the green-energy sector.

Dave Kerin, one of the founders of Earthworker, said the group started with the aim of taking the momentum of the environmental movement beyond protesting and into practical solutions.

“The idea was to take the various green projects and think about ways we might make them happen on the ground, in the belief that meant jobs for Australia, manufacturing jobs, but in the renewables, in the green technology Australia really needs,” he told Al Jazeera.

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Jo Caygil has been in manufacturing his whole life and for 17 years has owned and run the company, which until recently was called Everlast. He said the decision to transform it into a not-for-profit cooperative was partially a decision of practicality.

The federal government used to give financial assistance to households installing solar hot-water systems, fuelling growth in the small-scale green-energy sector. However, when these rebates came to an end in 2012, Caygil said they needed to explore new ideas – or go bust. 

“We went from 50 workers to about 10 in the space of six months. We wouldn’t have survived. The only way we were going to survive was if we mutualised the company and accessed all these markets others weren’t accessing,” Caygil told Al Jazeera.

Jo Caygil [Jarni Blakkarly/Al Jazeera]
Jo Caygil [Jarni Blakkarly/Al Jazeera]

Meeting in the middle

Australia’s manufacturing industry has been in steady decline since the 1990s when tariffs for overseas imports were largely removed. However, both Kerin and Caygil see the not-for-profit model as a way of reviving the industry.

“It won’t be too long in the future when Australians don’t know how to make anything, even if we wanted to. Though we’ve come from politically and industrially different sides of the fence, we’ve met in the middle, we see the same solutions needed for Australia,” Caygil said.

Wednesday mornings at the cooperative start a little different than the usual factory. Workers and their former boss sit around an office table and discuss the business, future projects, planning, and any other issues.

Out on the factory floor, however, it is business as usual. On a break in the middle of a long shift, Geoff Lister and Andrew Snelling take their meals in a cold empty lunch room built to accommodate a much larger workforce.

Lister has been working in manufacturing his whole life and is now past retirement age. He said the idea of owning part of the business as a worker is an appealing new concept.

“It really makes you feel like you’re a part of something. I used to go to work where they didn’t even know my name, I had a number. This makes you want to get up in the morning. We won’t have to work for a boss any more, better working for yourself than for someone else,” he told Al Jazeera.

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In the office at the front of the factory floor, 30-year-old Andrew Reed has come from an entirely different place. After receiving an environmental energy degree, he spent nine months volunteering his time for Eartherworker, until he recently got a paid job managing the cooperative’s sales. He had to buy a car to get to the factory from the inner city every day.

“I’ve always had an interest in co-ops and in green energy. It’s really hard to get a job in the renewable sector so I saw this as a way to get in. I was also keen to be a part of a flat hierarchy,” Reed said.

While the factory and small-scale companies are finding ways to stay on their feet, the large-scale renewable energy sector is an industry under siege. Investment in big renewable energy projects in Australia is down 90 percent from last year, while 2,300 jobs have been lost in the last two years, representing 15 percent of the industry’s workforce.

Russel Marsh, director of policy at the Clean Energy Council that represents the industry, told Al Jazeera the reason behind the investment freeze has been the federal government’s ongoing review into the Emissions Reduction Target.

“When the review was started last year, no one expected we wouldn’t have a resolution 15 months later. It’s no surprise that when a policy that supports your industry is under review, you won’t make an investment. Particularly when going into it, it was very clear the government was looking to use review to reduce the target,” said Marsh.

Climate ‘free-rider’

For the last decade-and-a-half, there has been bipartisan support from the two major political parties on the goal of producing 20 percent of Australia’s energy from renewables by 2020.

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However that came to a halt in 2013 with the election of the conservative Liberal government led by Prime Minister Tony Abbott. Abbott used attacks on the previous government’s carbon-pricing scheme as one of the main election issues, and after winning office he moved to scrap the measure while also placing the 2020 goal under review.  

The 2015 Africa Progress Report headed by former UN secretary-general Kofi Annan recently made a specific note of Australia, saying the country “has gone from leadership to free-rider status in climate diplomacy”. 

Marsh said the uncertainty over the Emissions Reduction Target meant that green-technology companies are now considering whether to stay in Australia. While a few have left, most are trying to hold out till things improve, he said.

“The expectation is in the long run we will only be seeing more renewable energy in Australia, not less. The future is bright for the whole of the sector, however, it’s very clear that where we are heading to now is probably the low point,” he told Al Jazeera.

“It’s frustrating because you look across the globe and every other developed country like Australia is looking to increase its renewable energy rather than reduce it.”

Follow Jarni Blakkarly on Twitter: @jarniBlakkarly

Source: Al Jazeera