At the University of Melbourne’s Careers in Economics event, Cyan Ventures co-founder Fraser Thompson delivered a keynote address to the Economics Student Society of Australia, challenging five pieces of received wisdom that continue to shape-and often misdirect-climate policy.
Climate economics is drowning in ideas that sound sensible and get repeated endlessly in policy circles, but quietly misdirect billions of dollars and decades of effort. Here’s what the evidence actually shows.
Myth 1: Without a carbon price, nothing will happen
Solar PV dropped 99.7% in cost-not because of carbon pricing, but because deployment drove learning curves. A carbon price is useful, but it’s not a prerequisite for transition. Other instruments are emerging: mandates, contracts for difference, sovereign co-investment.
Myth 2: The clean energy transition will be equitable
The transition is currently structurally regressive. About 32% of Australian households rent and can’t access rooftop solar or home batteries. We’ve created a system where renters pay to make their landlords’ electricity bills cheaper.
Myth 3: The lowest-cost country will win on clean energy manufacturing
The market is bifurcating. The US is paying four times the Chinese price for polysilicon produced outside China. Australia doesn’t need to win a race to the bottom-we need to win a different race entirely.
Myth 4: First Nations communities are peripheral to the clean energy transition
43% of the clean energy infrastructure we need by 2060 will be built on First Nations Estate. This isn’t a consultation checkbox-it’s a project delivery constraint.
Myth 5: Australia is doomed to lose the clean energy race
If you designed an athlete for the clean energy transition, you’d design Australia. Enough solar irradiance to power the world one hundred times over. Critical mineral endowments. A stable democracy in an energy-hungry, resource-poor neighbourhood. The question isn’t whether we have the hand to win. It’s whether we’re bold enough to play it.
