Australians are rightfully concerned about cost-of-living pressures. What many people don’t realise is how food and energy affordability are inextricably linked.
Food needs energy. The milk in your coffee used significant amounts of electricity to irrigate feed for cows, heat and pressurise water, power machinery for milking, and refrigerate the milk. All of this energy is used before the milk has even left the farm.
Prior to this energy crisis, a large dairy farmer would spend $100,000-$150,000 on electricity annually. This number is edging towards $250,000 for a contract negotiated today. For every dollar spent on electricity on farm there is a dollar spent in the processing plant – this adds up and is just one pressure making food more expensive.
This conversation needs to include our transition to renewable energy, which will almost wholly be housed in our rural communities and on our agricultural lands.
This transition requires mind-boggling investments in new generation and thousands of kilometres of new transmission lines on farming country. These projects must work in a way that benefits agriculture, rather than creating new challenges and headaches for farmers. Importantly, they must not get in the way of food production.
This isn’t about pouring cold water on your morning cup of Joe, it’s about realising now is the perfect time for a sensible, long-term plan for these two kitchen table issues. Without it we will lock Australian households into years of needless cost-of-living pressures.
The solution to affordable electricity for food production is to focus on energy solutions for the bush, and Dr Helen Haines’ 2020 Local Power Plan has already provided a blueprint to achieve this. The plan focuses on promoting small and community scale renewable generation to provide affordable and reliable energy to local communities and businesses, including farmers, not just generating electricity to ship to our urban centres.
The plan requires the Clean Energy Finance Corporation and the Australian Renewable Energy Agency to shift their misguided attention from innovation and instead focus on funding regional and rural projects – noting there is no technological barrier for renewables, rather the handbrake is social and economic.
Farmers learn from other farmers, and funding farm projects that demonstrate the practical and economic case for on-farm renewables would do a lot more for agriculture’s transition to net-zero than focusing on the next big thing in renewable technologies.
We need a plan for the energy transition that does not solve the electricity problem at the expense of food production and regional and rural communities. Massive development of large-scale renewables and transmission lines are changing the landscape and make up of our rural communities. Unfortunately, these communities are often the last to hear about these developments and have little to no say as to how they will proceed.
This is why the National Farmers’ Federation, with the Energy Charter, developed the Landholder & Community Better Practice Engagement Guide for early engagement and fair compensation for landowners from electricity infrastructure operators. We expect the guide to dictate the minimum standards for engagement and compensation, and welcome the federal government’s endorsement of the guide.
We also expect electricity market regulators such as AEMO to treat regional communities with the same respect as the electricity industry and consumers when drawing grand plans for thousands of kilometres of transmission lines and renewable energy zones. AEMO has set up standing panels for the electricity industry and consumers to consult on these plans at every step, yet the local communities and landowners are left in the dark.
If you are worried about food prices, make sure farmers have access to affordable electricity. If you want affordable electricity, make sure your energy companies work with farmers, not against them, in shaping the future of electricity generation and networks.