In public discourse, there are those promoting the truth, and those looking to further their agenda. This is most obvious regarding the topic of Climate Change where feelings and ideology are weaponised to not only win the argument, but to scorch the earth of opposing views.

Into this battle swaggers The Australia Institute, a Canberra think tank staffed by Greens-loving activists and commentators. Their Climate Change rhetoric is infused with UN-style anti-human de-growth dogma — a study in green-left ideology dedicated to choking Australia’s economy and future opportunities that forms part of the wider agenda to constrain fossil fuel production.

Throw enough mud and it sticks, and TAI’s partisan analysis of Climate Change and energy leaches into the public debate like toxic sludge. TAI is often quoted by The Guardian Australia, and then regurgitated online in blogs such as Renew Economy, Crikey, The Saturday Paper, and The Conversation.

In March 2022, TAI released Fossil fuel subsidies in Australia asserting that the fossil fuel industry was provided $11.6 billion in subsidies in 2021-22. The exaggerated claims were widely repeated including online by news.com.au.

In other words, for every minute of every day in the 2021-22 budget period these subsidies cost the public $22,139. For context, $11.6 billion is 56 times greater than the $206.8 million budget of the National Recovery and Resilience Agency.

In direct contradiction, the Productivity Commission calculated that 2020-21 assistance to the entire mining industry, not just the fossil fuel industry, was just $476 million.

The mining sector received only 4 per cent of allocatable assistance ($476 million), despite accounting for 11.5 per cent of value added — meaning it was the least assisted sector relative to its size.

This would imply that there has been a significant overstatement in the amount of subsidy from governments to fossil fuel industries by listing the $8 billion diesel fuel rebate — which is neither a subsidy, nor is it specific to the fossil fuel industry. 

The report also claims $200 million of equity in Kurri Kurri Power Station used to firm wind and solar, and $900 million in federal tax concessions for aviation fuel. At a state level, the report incorrectly lists government investments in profit-making state-owned power stations, mines, ports, and railways as fossil fuel subsidies.

In May 2022, TAI penned APPEA members who pay no income tax, which argues for higher taxes on resource companies. The author, widely quoted by The Australian and other news sources, wants us to believe that gas companies get a free ride, based on selectively edited tax data, and without considering costs and deductions. 

The report cherry-picks just five gas companies, but APPEA (Australian Petroleum Production & Exploration Association) represents over sixty full-member companies, making no attempt to convey the huge expenses incurred in developing resources, such as the $100 billion construction cost of Queensland’s three LNG projects.

A more holistic review of the ATO tax data would have revealed that other APPEA member gas companies paid a combined total of $5.4 billion in taxes in the same period, with an additional $7.8 billion in Petroleum Resource Rent Tax.

Furthermore, the report used modelling figures from 2012, suggesting that $85 billion would be collected by government from eight LNG trains. The industry ended up with six trains, and a much smaller estimate of $58 billion in government income over the twenty-five-year life of the projects.

In the August 2022 op-ed, It’s time to tax mining and energy giants properly, TAI executive director Richard Denniss argues for higher taxes on Australian gas companies, citing the $137 billion total revenue of the Norwegian oil and gas sector as an example of a ‘good resources tax system’.

This is a flawed perspective as the Norwegian government sells oil and gas itself, in addition to collecting fees and taxes from private sector petroleum companies. Australian governments derive income from fees, taxes, and royalties, but do not extract and sell oil and gas. As Australian taxpayers do not provide the massive capital required to develop natural resources, and do not sell these resources directly, the comparison is invalid.

Further muddying the waters is the lack of separation of oil production from natural gas production. These commodities have different markets, different benchmark pricing, and furthermore, Australia does not produce significant amounts of oil. How much of Norway’s petroleum income is from oil, and how much from gas? As the saying goes, don’t let the facts get in the way of a good story.

These offerings, however, provide some insight into the mindset of the staff and leadership at The Australia Institute, in direct contradiction to their mission statement.

Our Goal: The Australia Institute provides intellectual and policy leadership. We conduct research that drives the public debate and secures policy outcomes that make Australia better. We are confident that we consistently deliver on the promise of our motto: research that matters

Ben Beattie is an electrical engineer in the gas and power sector.