Policy Case Study on Sustainable electricity in Australia


Research Paper (postgraduate), 2018

14 Pages, Grade: 100


Excerpt


INTRODUCTION:

The topic is in line with the white paper submitted by Finkel (2017) to the Commonwealth of Australia Government (COAG). This essay is going to do a policy case study on how evidence has helped influence the results of the electricity policy in Australia; using the Finkel's (2017) report ‘Independent Review into the Future Security of the National Electricity Market: Blueprint for the Future.' The sustainability of the electricity policy in Australia is dependent on how efficient, cost-effective and environmentally friendly. ‘Evidence-Based Policy Making (EBPM)' is dependent on interaction within the ‘policy cycle' that involves problem­solving (Cairney 2016: 13-14).

In order to ensure commitment to ‘evidence,' suggestions have been made for the formation of groups and the use of ‘emotive expression' to draw attention to the evidence (Cairney 2016: 14). The ‘policy cycle entails 1. setting agenda 2. Policy formulation 3. Legitimation 4. Implementation 5. Evaluation 6. Policy maintenance, succession or termination' (Cairney 2016: 18). The essence of the study of public policy is to avail information to the policymakers on subject matters relating to policy. This idea underpin the rationale for public policy making. The set back to evidence policy is the lack of comprehensive knowledge on the policy subject matter (Cairney 2016: 51). The lack of knowledge stems from not conducting adequate research into policy areas to be addressed. Also, not being adequately funded to conduct adequate research into the policy areas to be addressed.

Also in analyzing the role of pragmatism, knowledge and evidence-based policy making in policy problem-solving. Analysts have criticized pragmatism as ‘obnoxious aspects of American industrialism'; another word for pragmatism is Americanism. The school of thought is said to have emanated from the United States (Westbrook 2015: 148). Pragmatism emanated from Cambridge, Massachusetts through the efforts of analyst such as William James, Charles Sanders Pierce and Oliver Wendell Homes Jr on the platform of the Metaphysical Club The school of thought seeks for practical application of thought and beliefs rather than just relying on theory as is the case in ‘European philosophy' Sanderson (2009:708

SET BACK TO EVIDENCE POLICY:

The other areas of the setback to evidence policy stem from ‘timing.' There is the need for the analysts researching to pay attention to time. Some research requires taking the right step at the right time to arrive at the desired result. In order to be efficient analyst must research with adequate skills to achieve the best result from the evidence-based policy. To better appreciate evidence policy there is the need for the analyst to understand the terrain of the issues to resolved (Cairney 2016: 58). The setback identified earlier still applies to policies when dealing with the environment and electricity. The world today is in earnest search for clean energy to generate electricity this is because climate change has become an international concern for all nations of the world. Analysts have identified the gap in knowledge of environment policy (Cairney 2016: 85). Citing Eisenack et al. (2015), Cairney (2016: 86) is of the view that studies are essential to determine the cause of lack of knowledge in addressing climate change. Whereas wicked problems refer to problems that may not be resolved quickly with certainty (Cairney 2016: 93).

ADVANCING EVIDENCE BASED POLICY IN AUSTRALIA ELECTRICITY MARKET:

There have been calls by analysts for more articles for the advancement of evidence-based policy concerning the environment (Cairney 2016: 85). To have an in-depth understanding of evidence-based policy as it affects the environment analyst must agree to the fact that impact on the environment affects the health. Areas of development in the Electricity Market of Australia: Finkel's (2017: 21-28) report made specific recommendations. The ‘recommendations' stem from improved market forecast from the year 2018; improved electricity security obligations, the burden of which falls on the shoulders of the Australian Energy Market Commission (AEMC) as the regulatory body in charge of the electricity market. The need to improve the electricity frequency by acquiring larger and more efficient generators. In order for the newly acquired ‘generators to be approved,' the specification must meet the electricity security standard of reliability as well as environment-friendly. The generators must have reliable ‘capabilities.' There must also be a market-based mechanism to drive the electricity markets.

Also part of the recommendation is that towards the middle of the year 2018, the Australian Energy Market Commission and the Australian Energy Market Operator must synchronize the generators to the acceptable international standard and must be cost-efficient. The recommendation was borne out of the request made to the team (Finkel 2017; report team) by the Commonwealth of Australia Government (COAG) Energy Council to come up with the right report that would address the electricity concerns of Australia in the areas of National Electricity Market security, reliability and cost efficiency.

That by 2020 the COAG Energy Council should come up with a strategic plan that would enhance the reduction of emission to zero by 2050. In achieving zero emission, the idea is to start to reduce the emission by 28 percent in 2030 and then zero emission by 2050. Clean energy will bring about less or zero emissions as well as it being cost efficient (Finkel 2017: 23).In order to accelerate the transition to clean energy, the committee recommends that a three years notice of closure be issued to operators to provide a period for shutting down large generators in line with the ‘Generator Reliability Obligation (GRO) and Energy Security Obligation (ESO).' About GRO capability to penetrate the various regions of Australia is very key to achieving success. The committee further made the recommendations as regards electricity reliability through the combined strategic efforts of the ‘Australian Energy Market Commission (AEMC) and the Australian Energy Market Operator (AEMO)' (Finkel 2017: 23).

The committee also recommended vital factors to consider in meeting low emission as well as promote energy efficiency to include ‘more efficient gas markets, improved system planning, stronger governance, and rewarding consumers' (Finkel 2017: 23-27). Reduce the current three years tenures for directors of the Australian Energy Market Operator from three (3) years to six (6) months (Finkel 2017: 27).

AREAS OF CHALLENGES TO THE NATIONAL ELECTRICITY MARKET:

The major challenge has been in the areas of the changing trends in the electricity market sector (Finkel 2017:18). One of the findings in the Finkel's report is the fact that nations have a national strategic plan to pursue electricity efficiency and cost efficiency. Australia being an economically advanced country cannot be behind. The committee held 120 meetings across Australia with 450 people (professionals and non- professionals alike) in attendance. The outcome of the consultations resulted in the report produced by the Finkel's panel. The report identified areas for reform as well as ‘policy objectives' to ensure electricity stability and affordability.

The efficient governance structure is critical to guarantee sufficient electricity and reduce emissions. Building Strong institutions in line with goal sixteen (16) of the Sustainable Development Goals (SDGs) are the required structure for ‘good governance.' Thus efforts must be made to promote strong institutions in the electricity industry, to achieve this Finkel's report recommends that COAG Energy Council establish a new ‘Energy Security Board' that would ensure effective governance in the electricity sector(Finkel 2017:157). The mandate of the new body would be to drive as well as ensure the implementation of the Finkel's Report to achieve maximum results in the NEM (National Electricity Market). The report also identified requirements for good governance to include establishing effective regulations, institutions, the fairness of operational mode, capacity building to ensure stronger institution (Finkel 2017:158).

The current governance regime is that states have the mandate for policy formulations and implementation whereas the Commonwealth of Australia Government (COAG) have obligations for reduction of emission based on the international affairs powers guaranteed in the constitution as well as the commitments to the United Nations Framework Convention on Climate Change (Finkel 2017:159). By coming together, the Commonwealth, States and Territory government agreed to execute the ‘Australian Energy Market Agreement (AEMA) by passing into law the National Electricity Law (NEL) as well as the National Electricity Rules (the Rules).'

Under the governance regime, the Energy Council sits at the apex to administer the energy market of Australia. The responsibility of the council is to formulate and implement policies in the NEM devoid of direct participation in the electricity market. There are other bodies engaged in the administration of the electricity market namely: AEMC, AEMO, and AEMC respectively. There is also the Energy Consumers Australia that is responsible for protecting the consumers from exploitation (Finkel 2017:160-161).

The structural and strategic plan of COAG Energy Council is pivotal to the future transition of the National Electricity Market (NEM). The strategic plan recommended must be pursued with all vigor and commitment this would put the country at par with countries such as the United States, Denmark, Germany and other European Countries that have resolved to cut down emission by adopting plans for clean energy (Finkel 2017:163).

The role of the new Energy Security Board. It is recommended by the committee that the new Energy Security Board (ESB) must begin functioning as soon as possible pending the allocation of statutory powers by legislation. The ESB must, and members must be independent. According to Bell (2004: 22), evidence-based knowledge is key to good governance.

To build ‘governance capacity' analyst must show knowledge expertise as well as get the right information on the subject matter needing policy reform. There has been growing demand for engagement of the bottom-up approach, due to the challenge to the top-down approach to governance. The bottom-up approach is not devoid of setbacks, are inevitable challenges. Knowledge in the context of policy relates to the ‘guide to the action plan.'

The rationalist approach to Evidence-Based Policy involves practical science approach to public policy problem-solving. The rationalist approach is seen as Western, mainly because it involves scientific analysis to solving policy problems. Nations determine the different capacities to be developed to address policy reforms challenges (Bell 2004: 22).

Similarly, to develop governing capacity, the institution must have coherence. This part of the reasons for which analyst have argued that for ‘capacity,' evidence and knowledge to be developed the environment for which the policy reform is being carried out is important. Citing David Adams, Bell (2004: 23) an element of knowledge is the meaning formed to help policy reform plan. The various views of public policy create the ‘value addition' to public policy reforms. There is the phrase ‘creed of expertise' this is closely associated with rationalist point view in Australia where the public policy analyst opinion reflects in government. Critics of the ‘rationality project' have argued that the combination of Evidence-Based Policy Analysis (EBPA) are irrelevant to enhancing public policy reforms (Bell 2004: 23). Citing Argy (1998:236), Bell (2004: 24) argued that the fact that EBPA entails the engagement of the public (comprising of civil society organizations, various interest groups) when making policy reforms means that there are possibilities for problem­solving.

In order to guarantee the success of public policy reforms, there must be a restructuring of government institutions that are responsible for the running of the affairs of the area of focus (Considine 1993: 59-71). The challenge of redundancy, financial impropriety, farming out of public service responsibilities puts the public service in a bad light as inefficient. In 1986 there was a public sector reform with the intention to cut down the size of government and reduce inefficiency (McCauley 2000: 31, 33). The essence of public policy analysis is to understand issues of public interest (Bell 2004: 24).

The overwhelming influence on the public sector has made service redundant (Stewart 2001:21). The changes in the public sector are believed to be possible on through consensus with relevant bodies that are statutorily responsible for managing public service reforms (Bell 2004: 25).

A good instance is the Finkel's Report that has consulted widely and has come up with relevant agreements that can help the transition of the electricity market in Australia to clean energy. There has also been the call for the bottom-up approach to addressing public policy issues; which entails the engagement of the stakeholders directly impacted by the public service reforms. The merit behind the bottom-up approach to addressing public policy reforms is laudable mainly because this would promote the ‘legitimacy' of the policy to be adopted (Dobuzinskis 1991:643).

In line with the argument of MacCarthaigh (2012: 94) combining problem-solving with research using evidence-based policy making (EBPM) is such a hard job to execute. This statement may be the reasons for continued consistent research on how best to resolve societal problems adequately as well as more efficiently. The Finkel's report is a step in the right direction to promote clean energy in Australia through other modes of providing electricity.

According to Bacchi and Goodwin (2016:57) to better appreciate public policy theorist must examine how policies influence society to create challenges. ‘Policy development' have two approaches ‘comprehensive rationalism' which relates to policy cycle and evidence-based policy making (EBPM) whereas ‘political rationalism' has to deal with ‘interpretivism.' The essence of evidence-based policymaking is to find the solution too societal problems through the lens of the legislature.

Also according to Lasswell (1956) cited by Bacchi and Goodwin (2016: 59), there are four (4) stages to policy formulation to implementation, namely: 1. ‘Agenda­setting 2. Policy formulation 3. Policy implementation and 4. Policy evaluation.' The policy cycle serves as a guide to societal problem-solving. Citing Jann and Wegrich (2007: 45), Bacchi and Goodwin (2016: 59) recognizing policy problems is key to problem-solving in a giving society. That is the purpose of an evidence-based policy­making mechanism.

In the view of the political rationalists, the essence of problem identification is to ‘manage' varying opinions rather than merely observing societal problems (Bacchi and Goodwin 2016: 59). While analyzing policy problems in line with the view of Kingdon (2003), Bacchi and Goodwin (2016: 60) explained that ‘problem-solving as an ongoing process of managing problematic or the governance of problems.' Similarly, the ‘interpretivism' are more concerned about the agenda-setting of policy problems. This approach to policy problem solving discourages attention from being paid to the cause of the problem. A good example is a phrase ‘wicked problems' which is used interchangeably as ‘mainstreaming' (Bacchi and Goodwin 2016: 60).

Furthermore, according to Sanderson (2009: 699) critics of evidence-based policy movement (EBPM) have identified the limits to EBPM, as a result, have subjected same to critical analysis. Sanderson's article elaborated on ‘intelligent policy­making' as against EBPM. The fact remains that policy design, and administration is reliant on the external influence of stakeholders within the societal, political cycle.

Whereas according to Mulgan (2005: 224) there are challenges to the use of ‘knowledge' in public policy one of such is that the application of the technical know-how is not direct. Also, three factors limits evidence-based policy making (EBPM) knowledge application such as 1. ‘Democracy 2. Ambiguity 3. Time'.

Citing Grayson (2007), Sanderson (2009: 699) analyzed policymaking as a ‘craft,' not ‘science'; the ‘art of the possible' not the ‘art of the optimum.'

That notwithstanding, the use of evidence-based knowledge is dependent mainly on the purpose and essence of the policy reforms. Analysts have often questioned whether to retain the EBPM as it is or seek to find a more reliable way of addressing societal challenges. When analyzing EBPM, there are two other factors to be considered such as: '1. Experimentation 2. Pragmatism' (Sanderson 2009: 700). The argument to ‘intelligent policy-making' which in no small extent absolves the complexity of EBPM.

Conversely, Dewey (2011: 109-140) argues for pragmatism as a viable option for problem-solving. Even more pronounced in the argument when analyzing the basis of experience as not the only platform for logical reasoning to public policy reforms. Citing Giddens (1990: 43), Sanderson (2009: 701) is of the view that ‘more knowledge over social life' leads to the control of the fate of humanity. Whereas Giddens' view is only true to the extent that such knowledge applies to the ‘physical world' and not the ‘universe of social events.'

The urgent need for nations of the world including Australia to reduce the depletion by adopting energy policies that can drive the future is now prominent as other advanced nations in Europe, and the United States have also begun a shift for clean energy. Thus this has brought about recommendations that for Australia not to be left behind, the country must adopt a strategic National Electricity Market plan to safeguard clean energy that can enhance the sustainability of the environment.

According to Sanderson (2009: 701) reiterating the argument of Smart (1999:63) that knowledge and evidence-based policy making (EBPM) may not be sufficient to advance societal changes. The reality is that analysts must look beyond the two lenses of knowledge and evidence. Whereas according to Dryzek (2004:72) the relevance of the concept of ‘pragmatism' is that it focuses on the future or continuity of the problems to be solved regardless of the contributions of the analysts to the public policy reforms. In order words, the principle surrounding the concept of pragmatism is that it focuses on resolving the policy challenge for a long-term not just the immediate problem-solving.

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Details

Title
Policy Case Study on Sustainable electricity in Australia
Course
Governance and Public Policy
Grade
100
Author
Year
2018
Pages
14
Catalog Number
V923215
ISBN (eBook)
9783346242785
ISBN (Book)
9783346242792
Language
English
Notes
Promoting cheap, efficient and environment friendly energy is a global challenge that must be resolved soonest to forestall global warming.
Keywords
energy
Quote paper
Nathaniel Stevenson Odusola (Author), 2018, Policy Case Study on Sustainable electricity in Australia, Munich, GRIN Verlag, https://www.grin.com/document/923215

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