Pat Conroy (Charlton, Australian Labor Party) Share this | Hansard source

I rise to discuss the Renewable Energy (Electricity) Amendment Bill 2015. Before I go to the substance of my address, I want to address some of the wild contradictions that the last speaker presented, because they are contradictions that are inherent in the entire approach of the coalition to this policy area, an approach that represents a reckless disregard for a very important industry and a very important arm in combating climate change and developing a new industry.

On one hand, those opposite argue that the Small-scale Renewable Energy Scheme is wildly inefficient. But, on the other hand, they took to the election a policy of one million solar roofs, a policy they have slashed to save money. But they have contradicted themselves on that. On the one hand, they attack the cost of abatement under the RET as being too high, yet their expensive and completely reckless Direct Action policy has a much higher cost of abatement. I just want to correct the myth propagated by the member for Lyne, which will probably be continued by the member for Hinkler when he has his go a bit later. The cost of the carbon price was $23 a tonne. On 1 July 2015, if that scheme still exists, we would have linked with the European carbon price and the cost of abating emissions under an emissions trading scheme would have been around $8 per tonne.

Under their dog of a scheme, where they cannot find a single economist to support the carbon price, the equivalent carbon price is $66 a tonne because two-thirds of their first auction results were for projects that would have existed anyway, that were funded under the carbon price, under the Carbon Farming Initiative, and that would have failed the additionality test. So once they were excluded, they purchased 10 million tonnes of abatement, at a cost of $660 million. That is a carbon price of $66 a tonne versus $8 a tonne under Labor's emissions trading scheme. So they cannot have it both ways. They cannot attack the cost of abatement under the RET and then defend their dog of a scheme with its $66 carbon price.

Let me return to the substance of the debate here. Why are we debating this bill? We are debating this bill because of the broken promise of those opposite, who, before the election said they would maintain the RET unchanged. They broke that promise because of their ideological hatred of clean energy, because their party room and their support base is made up of conspiracy therapists—not all of them, but Maurice Newman, their chief business adviser, sees climate change as some UN global conspiracy with world banks to dominate and take sovereignty away from sovereign nations. Their chief business adviser thinks climate change is a UN conspiracy to destroy the sovereignty of nations! The Treasurer is a man who thinks wind turbines are offensive, a blight on the landscape. We heard a sterling contribution from the member for Dawson. His understanding of clean energy is probably on par with his understanding of multiculturalism—and his contribution to both public debates is negligible; in fact, it is counterproductive. We also had a weird contribution from the member for Lyne saying we need to cut the RET because we are in danger of hitting the penalty price, we need to cut the RET because the penalty price will be hit and that will destroy industry.

The only reason anyone in industry started talking about the penalty price was the investment strike caused by the government's meddling, their ideological attacks on the RET and their constant reviewing. Because of the intervention, because of their broken promise, because of their ideological agenda, because of their appointment of Maurice Newman to conduct a review, what we saw was a complete investment strike by the global clean energy industry. They could not make investments in 2014 because of the mass uncertainty caused by the coalition government. The result of this was that we saw investment in the industry fall from $2.7 billion in $2013 to $240 million in 2014, an 88 per cent fall in investment in the clean energy industry because of the uncertainty caused by the vandals on the other side. We saw our global reputation damaged, we saw Australia's attractiveness for clean energy investment fall from fourth in the world to 10th in the world, and we saw 21,000 jobs in peril by their reckless approach.

We should contrast that with Labor's achievements in this area when in government. Under Labor, the number of solar PV systems on Australian roofs went from 7,000 to 1.2 million. There was a tripling of jobs in the clean industry, to 24,000, at the time we left office and we saw $18 billion invested in clean energy industry over. This move was matched around the world. Last year, we saw a 14 per cent increase in global investment in clean energy and a 33 per cent growth in China. Contrast that with the 88 per cent fall in clean energy investment caused by this government's ideological attack on renewable energy.

So we had the Newman report commissioned by the Prime Minister, a self-confessed weathervane on climate change, a self-confessed climate change sceptic who questions the science with rather pejorative terms. He commissioned Maurice Newman, 'Mr UN Conspiracy', to conduct the review. They then commissioned modelling with some of the most problematic assumptions ever seen in modelling. We often see modelling with dodgy assumptions and there will be argy-bargy on both sides about modelling—I understand that—but their modelling was so flawed that it was universally condemned for the assumptions underpinning it. Those assumptions included that the cost of base load coal fired power in 2030 would be exactly the same as it is now, that there would be no global carbon price and that there would be no price on carbon emitted from coal that would impact on the cost of production. It was incredibly flawed. But even this jury rigged, book cooked modelling—and let me emphasise this—still found that the 41,000 gigawatt hour Renewable Energy Target actually suppressed retail prices. Let me repeat that. The government's own modelling that was based on incredibly heroic assumptions to attack renewable energy found that the RET as legislated was suppressing retail prices, driving investment and increasing jobs in the industry. It found that, if you reduce the RET, jobs would go, emissions would rise and retail electricity prices would actually increase.

That is what those on the other side are actually arguing for when they argue for a huge cut in the RET, which is really what they want to do. This compromise is not where they want to land. They want to have either a RET with a two in front of it—in terms of 20,000 gigawatt hours—or no RET at all. What they are arguing for is an increase in electricity prices, not a reduction. That is based on the government's own modelling.

The government was pursuing this agenda and Labor had a choice. We could engage in empty political grandstanding and say that the RET as legislated was our policy, that we were going to help them keep their promise at the election—a broken promise like so many other broken promises. We could grandstand—and what would happen? The renewable energy industry would die. We would see the investment strike continue and 21,000 jobs in danger. We refused to do that because that is the response of a party that puts political interest above the national interest. Frankly, that is the response of the Greens.

The Greens were very happy to carp on the sidelines, to play no constructive role in this debate, to pursue an ideological agenda as narrow, fixed and opportunistic as the coalition and not contribute to the national interest. Instead, they chose to attack the Labor Party, who worked with NGOs and the clean energy industry to achieve the best possible compromise and rescue the government from a problem of their own making. Yet again, the Greens indicated that they would put their cheapjack political interests above the national interest. Labor will not do that. Labor, negotiated with the government and came down with a compromise that results in a Renewable Energy Target that, while unsatisfactory, is still unacceptable. That is why we are supporting this bill.

There are two important breakthroughs in this bill. Firstly, it ends the endless cycle of reviews that are constantly undermining certainty in the industry. That is a very important achievement that those on the other side tried to oppose and up-end at the last minute through the Minister for Industry. Secondly, it grants the full exemption to emissions-intensive and trade-exposed industries. This is an important initiative. This is a move that correct a massive flaw in the original mandatory renewable energy target as legislated by John Howard. Those on the other side can talk about protecting the industries that rely on cheap energy, but this flaw began under Prime Minister Howard. The 2009 amendments by Labor to produce a 20 per cent renewable energy target provided a substantial shielding for industries—we provided 90 or 60 per cent exemptions, unlike the original Howard MRET, which had zero exemptions for EITE industries. So I support that change to the renewable energy target to provide shielding to exporting industries that are emissions-intensive.

The result of all this is that, according to the industry's projections, we will see $10 billion of additional investment in the clean energy industry, 6½ thousand additional jobs and an additional 6,000 megawatts of capacity. This is very important. As important will be Labor's policies that will build on this. We have committed that the future Labor government will top up the renewable energy target's 2020 target to provide more space for large-scale solar and, secondly, that we will have a more ambitious 2030 RET target that we will bring into place. That is really important—to continue the development of this industry—because all this debate, all this heat and light, all this sound and fury, is about a choice. And the choice in this country is: do we want to develop a clean energy industry that will allow us to compete in the 21st century, or do we want to be a rust-belt, rust-bucket economy? Do we want an economy driven by fossil fuels that inevitably must have a carbon price somewhere in their production, and an economy where we are competing against the rest of the world that is investing in clean energy industries while we stick our heads in the sand? This is the choice in this debate. The renewable energy target is about carbon abatement. It is not the cheapest form of reducing emissions—that is an emissions trading scheme, and the RET works best when combined with an ETS.

But the main purpose of a renewable energy target is to develop an industry so that it has a mature stance and can compete against the rest of the world. That is really what we are talking about here. The nation that developed the technologies of steam and textiles production dominated the 18th century—that was the United Kingdom through the first Industrial Revolution. The economies that developed steel and chemicals dominated economically in the 19th century—that was the United States, the United Kingdom and, later on, Germany. The economies that had technological dominance in electronics through the transistor revolution dominated the 20th century—that is Japan and the United States. Just as these did, it will be the economies that invest and dominate in clean energy technologies in the 21st century that will be the most dominant economies in the world.

That is a dominance that Australia needs to be part of. We used to lead the world in solar technologies. Unfortunately the cutting edge solar technologies were sold off to Germany because of the lack of support here and the more production-ready technologies went to China. We have an opportunity to still participate in this industrial revolution, and we must. If we want to give our kids the best possible future and the best possible jobs, we must have good technologies in this area. We must be commercialising and productionising these technologies so that our jobs have these great, great opportunities. Our kids really need to have this opportunity, and this is what this debate is about.

Those on the other side with their real agenda of cutting the RET—and destroying it, eventually, if they get their way against the massive tide of public opinion—would have us as a rust-belt economy in the Pacific. We would be the laughing stock of the Asia Pacific. We would be an economy still built on very emissions-intensive energy production when the rest of the world had moved to clean energy. That is a future that is bleak. It is a future that is very short-sighted. And it is a future we must avoid. That is why I am proud to be part of a party that achieved a compromise on the renewable energy target in order to maintain it. It is a compromise that on some levels is unsatisfactory, but we must accept it so we can get that investment flowing through to the renewable energy industry. It is an investment that is vital not just for the future of that industry but for the future of the nation. I need to be able to look my children, and other people's children, in the eye and say: 'I supported Australia transitioning to a clean energy future—a future where we could compete with the rest of the world on the basis of clean energy production and low emissions-intensity production of manufacturing and other industries.' I commend the bill to the House.

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