The debacle over the removal of single-use plastic bags from supermarkets has been analysed from a range of different perspectives. Supermarkets have been described as breaking a psychological trust contract with their customers and cynically using environmental concerns to reduce their costs and increase their profits. The pushback by Australian shoppers has been the cause of much amusement and bewildered head-shaking.
But there’s one aspect of people’s resistance to this type of change that has major implications for every environmental initiative in the country. Let’s call it the “yeah-but” mentality.
Yeah-buts know when things are bad for the environment. They know about the dangers of throwaway plastic, whether it be bags, straws or bottles. They know that eating farmed meat, leaving the tap running, and driving cars powered by fossil fuels are not good for the world we live in.
They know this situation is not sustainable and that someone must do something about it. They might even be willing to make an occasional donation to an environmental charity. But ask them to take action themselves, especially if that involves even a low level of inconvenience, and the Yeah-buts sound their call.
Yeah-buts know they shouldn’t really drive to work, but then again public transport takes longer and doesn’t go door-to-door.
Yeah-buts know that farmed meat has a large environmental footprint, but they like the taste, and anyway veggies are only really an accompaniment.
This mentality has significant implications for any organisation attempting to address environmental challenges in Australia, or any other democratic society.
Previous research – such as that into the low take-up of electric cars – has found that consumers can be resistant to eco-friendly innovations in products and behaviour where they perceive that the proposed alternative is more expensive and/or less practical.
A requirement for people to actually put in some effort to acquire new behaviour that helps the environment is almost certainly going to encounter resistance.
How to drive behaviour change
Encouraging people to adopt new behaviours – especially those that involve personal inconvenience – is traditionally done through a “standard learning hierarchy approach”. The first step is to provide people with new knowledge and information on a topic or issue, thus increasing their understanding. As a result they will change the way they feel about the topic, and ultimately change their behaviour to reflect this new understanding and feeling.
Research has shown, however, that giving people new knowledge doesn’t necessarily mean they’ll do the right thing.
For years, organisations have been telling us how bad plastic bags are for the environment. As a result, people have been feeling increasingly negative towards the use of plastic bags. But despite some shoppers changing their ways, many didn’t. Until this month, supermarkets were still supplying millions of single-use bags, and thousands of their customers were still using them.
Then came the prospect of a ban, and the yeah-but excuses began to flow. One shopper told A Current Affair:
It’s just one extra thing (to remember) and invariably as I get older my memory gets worse.
Clearly the standard learning hierarchy wasn’t working here. The Yeah-buts persisted because their unwillingness to be inconvenienced by the need to provide their own shopping bags triumphed over their knowledge of the harm that plastic bags do. For these people, the inconvenience of forgetting their bags is acute, whereas the guilt over using unnecessary plastic is more vague. So this is where the government stepped in and removed the option of single-use plastic bags altogether.
Under pressure from environmental groups and concerned individuals, governments introduced a legislated ban on single-use plastic bags. This is a different approach to the standard learning hierarchy, which seeks to change people’s perception first, and then their behaviour. Here, people’s behaviour was forcibly altered in the hope that their knowledge and feelings would catch up.
The idea that people will reject an opportunity to acquire a new habit that will bring positive environmental change because it inconveniences them is one that clearly needs more research. It’s hard to think of another example where this inconvenience has resulted from a government mandating the withdrawal of a legal product to benefit the environment.
The case of the plastic bag ban is still being analysed, but could it provoke copycat behaviour by other environmental agencies – lobbying for legislation to force people to take a particular course of action while waiting for them to realise it’s the “right” thing to do and it makes them feel good? It’s an avenue that has been explored by some over many years, with varying degrees of success.
Only time will tell if the use of legislation makes the Yeah-buts’ resistance over the single-use plastic bag futile. If it does seem to work, watch out for a slew of applications from other environmental agencies and charities for similar levels of strong-arm government support.
But those organisations will have to be prepared to weather a severe storm of backlash and negative public sentiment if they think legislation is the way to go. It’s not the governments that will be held liable: just ask Coles and Woolies!
The Turnbull government is facing fresh trouble over its energy policy ahead of a crucial meeting next week, with Victoria’s Energy Minister Lily D’Ambrosio warning that the state won’t be rushed into signing onto the National Energy Guarantee (NEG).
In a speech to be delivered on Tuesday, D’Ambrosio will play on dissent in the Coalition, saying: “Malcolm Turnbull is trying to get us to sign up to something that hasn’t gone to his own party room – a place full of climate sceptics”.
“Every time we get close to a national energy policy, the Coalition party room shoots it down,” she will tell a clean energy summit in Sydney. An extract from her speech was issued ahead of its delivery.
“How can we have any confidence in what they’re asking from us if it hasn’t been through his party room first?
“We won’t rush into supporting a policy that we’re not certain is in the best interests of Victorians, just to appease to coal ideologues in Canberra.
“We won’t support a scheme that leaves the states in the dark and leaves us all hostage to the extremists in Turnbull’s party room,” D’Ambrosio will say.
Victoria’s shot across the bows on energy comes as Turnbull faces difficult fallout from the government’s disappointing byelection performance on Saturday, especially in the Queensland seat of Longman, where the Liberal National Party’s primary vote plunged by 9 points to just under 30%.
This is fuelling a push from some within the Coalition for the government to abandon its policy for tax cuts for big business if, as expected, a fresh attempt to get the legislation through the Senate fails. Labor successfully exploited the company tax issue in the byelections.
Turnbull’s weakened authority will also embolden party room critics of the energy policy, led by Tony Abbott – although these are in a minority. Abbott on Monday repeated his call for Australia to withdraw from the Paris climate agreement and to cut immigration.
The Guardian reported on Monday that Energy Minister Josh Frydenberg had flagged a two-stage process, as he tries to bed down a deal on the NEG. Under his timetable the NEG mechanism would be agreed on August 10 at the meeting of the Council of Australian Governments energy council. On August 14 the states and territories would get the Commonwealth legislation on the emissions reduction part of the scheme and discuss it in a phone hook up.
The key to this timetable is that it would allow Frydenberg to put the Commonwealth legislation to the Coalition party room on August 14 ahead of it being presented to states and territories. He has previously said the legislation would go to the party room.
Abbott has unsuccessfully pressed for much more party room input before any Commonwealth-state deal is done.
It is not clear whether Victoria will actually try to stall a deal next week, or is just playing politics ahead of the meeting.
D’Ambrosio will say Victoria has “acted in good faith” on the development of the proposed NEG “but it’s no secret that like many other states, we have major concerns about it.”
“We have made it very clear from the beginning – we won’t let any policy get in the way of Victoria achieving our legislated renewable energy targets. Our targets are the only real guarantee to bring down power prices”. Victoria would continue to discuss its concerns ahead of next week’s meeting.
Meanwhile, amid the uncertainty about the company tax cuts’ future, Finance Minister Mathias Cormann strongly defended them. Cormann, who has been the government’s negotiator with the crossbench, is seen as its most committed advocate of the tax plan.
“We are working with the crossbench as we speak to secure the necessary support,” he told the ABC.
Pressed on whether the government would take the policy to the election if it could not win the Senate vote, Cormann said: “That is our position”.
“The bigger businesses around Australia in many ways are most exposed to the pressures of global competition and they employ many millions of Australians directly. Weaker bigger businesses in Australia means less business for smaller and medium-sized businesses.
“It also means lower job security for the people that big business employ directly and lower job security for the many employees in the many small and medium-sized businesses who supply products and services to those bigger businesses,” Cormann said.
Federal Liberal MP Luke Howarth, from Queensland, told Sky that if the measure could not be passed it should be dropped.
Abbott, interviewed on 2GB, said he accepted the economic case for the company tax cuts but there were no votes in them.
Central to the public debate about the National Energy Guarantee (NEG) has been the numerical forecasts of its effects – in particular how much it will reduce power prices. In a democracy whose households pay some of the world’s highest electricity bills, it is obvious why this measure should shape the narrative on energy policy.
But Plato tells us that good decisions are based on knowledge, not numbers. What’s more, electricity markets are incredibly complex, and therefore not amenable to straightforward predictions.
The Energy Security Board has put numbers at the centre of its NEG proposal, but the basis of these numbers is not clear. With 22 colleagues at 10 other Australian universities, we are calling for state and territory ministers to ensure that the ESB’s modelling is available for proper scrutiny. I explain here why I support this request.
On October 17, 2017, the newly created ESB claimed in a letter to federal energy minister Josh Frydenberg that annual household bills would ultimately be A$100-115 lower under the NEG as a result of the NEG being introduced.
The ESB said this calculation was based on its estimate that wholesale electricity prices under the NEG would be 20-25% lower than under business as usual, and 8-10% lower than under the Clean Energy Target proposed by the Finkel Review.
No analysis or modelling was provided to justify these claims. But five weeks later the ESB had altered its forecast, releasing a report claiming that wholesale electricity prices would typically be 35% lower with the NEG than they would be without it. Underlying this claim was the assumption that only 597 megawatts of renewable generation would be developed between 2020 and 2030 if the NEG was not implemented.
Since more renewable generation than this was installed just on the roofs of Australia’s households and businesses in the first five months of 2018, the ESB was effectively suggesting that without the NEG investment in renewable generation would all but dry up.
This stands in stark contrast to the verdicts of other analysts. Bloomberg New Energy Finance predicted that 24,000MW of renewable generation (40 times more than the ESB’s figure) would be built between 2020 and 2030 without the NEG. Bloomberg also predicted less new renewable capacity with the NEG than without it.
Final design on the table
The ESB last week released its final design for the NEG to policymakers, but not the public. It now claims that the policy will reduce household electricity bills by A$150 a year relative to business as usual. It also now says that without the NEG around 8,000MW of new renewable generation will be installed (13 times more investment than it predicted eight months ago).
But the ESB says all of this will be installed behind the meter on the roofs of Australia’s homes and businesses and it persists with the assumption that no new large-scale renewable capacity will be built without the NEG.
But once again this seems to contrast vividly with what others are saying and doing. Several major companies have signed contracts for large-scale renewables, including Telstra, Carlton & United Breweries, Orora, and BlueScope Steel. The ESB’s assumption that all large-scale renewables development will grind to a halt without the NEG is even less plausible now than it was in November 2017.
Others have previously noted that the ESB’s estimate of renewable investment from 2020 to 2030 bears no relation to the estimates from the Australian Energy Market Operator (AEMO) of around 18,000 MW of additional renewable generation between 2020 and 2030, despite the ESB’s claims to the contrary.
However, the ESB’s final design has now helpfully clarified what several other analysts have already pointed out: that meeting the government’s target of reducing the electricity sector’s greenhouse emissions by 26% will require emissions reductions of just 2% between 2020 and 2030 beyond what is already set to be achieved. That is a meagre 0.2% cut per year that the NEG policy will be required to deliver.
I estimate that this will in fact be achieved several times over just with the 8,000MW of new rooftop solar capacity that the ESB predicts will happen even if the NEG is not implemented. To be clear, on the ESB’s numbers, Australia’s electricity sector greenhouse gas emissions will be lower than the government requires them to be, even if the NEG is not implemented. So how then can it be plausible to predict that the NEG will stimulate additional investment in renewable capacity beyond what would happen anyway?
You can’t have your cake and eat it. If a policy is intended to make no difference to what would happen anyway, how can it be expected to drive down household bills by A$150?
And without putting its modelling into the public domain where it can be subjected to wider expert scrutiny, how will we know whether the ESB’s assumptions actually hold water?
The NEG will be a massive administrative change to Australia’s energy market, and a potentially substantive change if future governments set much higher emissions reduction targets. State and territory energy ministers are being asked to accept the ESB’s promise that household electricity bills will decline by 30-40% in the next few years, and that the NEG will account for a fair part of this. Those ministers should scrutinise this rosy projection carefully before accepting it. After all, the public will be looking to them, and not the federal government, to make good on these price pledges.
Beholders of the Australian Energy Market Operator’s (AEMO) Integrated System Plan (ISP) see different futures for coal-fired generation: it’s either on the way out; or it’s going to be needed for decades; or perhaps even new coal plants should be built.
The report does have important implications for the future of all electricity technologies, including coal. But none of these simplistic perspectives captures the full flavour of the plan.
What is the plan?
The Integrated System Plan is a comprehensive, systems-engineering assessment. Its goal is to identify the lowest-cost combination of investments and decisions over the next 20 years, to support Australia’s energy transition to a low-emissions future.
The assessment uses an economic model of the system that includes maintaining reliability, reducing greenhouse gas emissions, closing existing plants when they reach the end of their technical life, and adopting lowest-cost replacement technologies.
AEMO considers two emissions reduction scenarios: the first is based on Australia’s current target under the Paris Agreement (a 26-28% reduction below 2005 level by 2030). The second adopts a target closer to that recommended by the Climate Change Authority and assessed by CSIRO as a fast change scenario (a 52% reduction by 2030).
In both scenarios existing coal-fired power stations close, either on their planned closure date (for those where such a date has been announced), or once they are 50 years old. Around 14 gigawatts (GW) of a total 23GW of coal-fired generation capacity will retire by 2040. As these plants close, a mixture of gas-fired generation, renewable energy, and storage (particularly pumped hydro) is projected to be the lowest-cost way to replace them.
The ISP is not technology-prescriptive, but it doesn’t include new coal-fired generators.
It is hardly surprising that the ISP supports maintaining the existing coal-fired generation facilities up to the end of their technical lives, to minimise costs. Coal-fired power stations represent big up-front capital investments that then produce relatively cheap electricity. But, like all such plants, they become increasingly expensive to operate and unreliable as they age. Keeping them operating beyond their technical life will become more expensive than replacing them with new generation. The ISP is closely aligned with the reliability requirements of the Finkel Blueprint and the National Guarantee to ensure closure is carefully planned.
Unfortunately for new coal investment, what will be more valuable in the future is much greater flexibility to deal with changes in supply and demand. Coal-fired power stations, existing or new, make their best contribution when they operate at very high levels – that is, 80-90% of the time. Upgrading transmission lines between states, can raise the occupancy level and lower the cost of existing power stations.
The NEM needs to transform to support widely distributed renewable generation. Historically, electricity has been generated by centralised, large power stations. New generation is likely to involve a mix of small and large renewable assets over much larger areas. This mix of generation technologies will require investment in the transmission network.
The central recommendation of the ISP is a three-stage development of the transmission network to support the new world of distributed energy and storage. The immediate stage is focused on transmission upgrades to address bottlenecks and connect regional renewable energy plants.
The second phase (2020-30) continues this approach and extends to connecting strategic storage initiatives – Snowy Hydro 2.0 and the Tasmanian Battery of the Nation.
The third stage (2030-40) further augments interstate transmission and included intrastate connections for renewable energy zones (REZ) located in regional Australia.
The ISP provides a hard-nosed engineering and cost assessment of what our energy system needs. It applies neither an accelerator nor a brake to the closure of existing coal-fired power stations. We need more of this approach and less ideology if we really want to see a lowest-cost, reliable and low-emissions future for Australia.
One month after removing free lightweight plastic bags from checkouts, Australian supermarket giant Coles has decided to offer thicker reusable plastics bags for free, indefinitely. This unprecedented move is in response to strong backlash by customers who are struggling to switch to reusable bags.
We know that offering free lightweight plastic bags causes excessive plastic use. We also know that banning lightweight bags can increase the use of heavier plastic bags (such as bin liners). Coles’ decision brings out the worst of both worlds: giving out heavier plastic bags for free.
Free vs. fee
Consumers respond to price changes: if prices go up, demand falls. Increasing the use of reusable bags by introducing a small fee has generally been successful around the world. This includes examples from Canada, Botswana, Portugal and Ireland, where introducing a €0.15 tax on plastic shopping bags reduced usage by over 90%.
An alarming example for Coles is that of South Africa. They removed lightweight plastic bags and introduced a fee of 46 rand cents for thicker plastic bags, later reducing it to 17 cents. The initial high price point almost halved the use of plastic bags, but when the price was lowered the use of plastic bags increased over time.
Behavioural economics suggests that people are more sensitive to loss than gains, so financial disincentives for plastic bags are particularly useful. For example, it has been found that use of single-use bags can decrease substantially when a charge is framed as a tax, compared to a bonus for bringing reusable bags.
A habit of free bags
Cole’s backflip is particularly troubling from a behavioural economics perspective. The thicker reusable plastic bags were meant to cost 15c. Coles are essentially offering a 100% discount on these bags compared to rival supermarkets. This, combined with the “power of free”, means that people may take more bags than they need when shopping – increasing plastic usage.
Switching to reusable bags without an added cost means that they are conceptually very similar to the old single-use bags (but with more plastic content). This replacement will not help people to kick their old single-use habits. In fact, they may develop a new habit of using the reusable bags as single-use products. If consumers continue their old habits, this could lead to even more plastic going to landfill and entering the environment.
Coles is in a difficult situation. Not only has this decision divided shoppers, but if they decide to charge for these bags in the future, they are likely to experience another round of backlash as consumers experience another bout of loss aversion – but this time the loss will be associated with a higher quality product.
Now that the decision is made, it is important that Coles is able to evaluate the impact: How many free bags are being distributed? How many bin liners are being sold? How are the thicker plastic bags being used?
Coles also has a responsibility to take alternative measures to reduce plastic use. Financial disincentives are not always the best option (for example charging for bags can cause additional hardships for low income households). They are also not the only option for reducing our reliance on plastic bags.
A more equitable solution could be to use behavioural science to help consumers break their habits. For example, instead of giving out free plastic bags, Coles could loan their reusable canvas bags for a small fee that is refunded on return. This would encourage reuse while avoiding additional costs for low income households or backlash from customers – everybody wins.