Katie Allen (Higgins, Liberal Party) Share this | Hansard source

The world economy is transitioning to a zero net carbon future in a bid to protect future generations from the effects of climate change. Countries with the strongest ambitions in this transition are relying on more renewables and other emerging technologies, such as hydrogen, to get there. As many of us know, Australia has a long and complicated energy history, but it is now emerging at the forefront of renewable technology investment under the leadership of the Morrison government.

Alongside its commitment to renewable energy, the Morrison government is committed to encouraging investment to support the reliability of the electricity grid and improve affordability for energy users. On 30 October 2019, the Morrison government announced the introduction of a new $1 billion Grid Reliability Fund. This fund, to be administered by the Clean Energy Finance Corporation, will support investments in new energy generation, storage and transmission, and investments in infrastructure, including eligible projects short-listed under the Underwriting New Generation Investments program.

The Grid Reliability Fund will unlock private sector investment for clean energy projects. The fund will draw on the energy and financial markets' expertise of the CEFC to make further investments in reliable, clean energy technologies. The benefits of the Clean Energy Finance Corporation Amendment (Grid Reliability Fund) Bill 2020 are, ultimately, threefold. Firstly, it will secure the reliability of the grid. A reliable electricity supply that keeps the lights on is essential for Australian households and businesses. With an anticipated doubling of demand in our electricity sector, our energy mix will require an increase in energy generation that can deliver when customers need it. Providing the Clean Energy Finance Corporation with an additional $1 billion will benefit energy market participants by providing a trusted counterparty for grid reliability investments, allowing the government to crowd in private sector involvement and to leverage its finance.

Secondly, this bill will put downward pressure on prices. It is not enough just to keep the lights on; these lights must also be affordable. This can be achieved by shaking up the energy market and making way for new players. As Liberals, we know that competition is good for consumers. Projects supported by the CEFC and the new generation investment program will also address the concentration of energy generation asset ownership by improving access for new and smaller participants in the market. The Australian Competition and Consumer Commission found that these small players often struggle to secure necessary finance due to large customers being unwilling to enter long-term offtake agreements. Additional support for these businesses will put downward pressure on wholesale electricity prices by increasing competition amongst generators. This is great news for Australian businesses and for Australian households.

Thirdly, this bill supports Australia's growing appetite for renewable energy. In 2019, Australia's investment per person in renewable energy was greater than countries such as the United States, Japan and Britain. That's no surprise. We are a large continent with lots of resources, when it comes to wind and sun. Consumers in Australia have got behind this. More than 2.2 million Australians have rooftop solar panels—the highest uptake anywhere in the world. This is, indeed, good news.

As a smart country with a willing citizenry, we are poised to identify new economic challenges and opportunities, particularly for technologies that provide storage and backup to the electricity, industry and transport sectors. This bill supports just that. The Grid Reliability Fund will also support the government's commitment to the Underwriting New Generation Investments program to support eligible and viable projects that are within the CEFC's investment mandate. The bill will not change the CEFC's ability to make individual investment decisions independent of government.

Gradually, coal-fired generators will leave the market to make way for new and innovative sources of energy generation. Many major energy companies are already making this energy transition. They will look to new flexible and dispatchable resources, such as pumped hydro and large-scale battery storage. However, as this transition takes place, gas will remain critical in its role in stabilising the grid, as has been identified by Australia's former Chief Scientist and chair of the Independent Review into the Future Security of the National Electricity Market, Dr Alan Finkel, a constituent of Higgins. This will allow the integration of renewable energies without compromising reliability and cost. In fact, in Dr Finkel's address to the National Press Club in February last year as Chief Scientist, he outlined the orderly transition to the 'electric planet', as he calls it, and that natural gas will play a critical role in that transition.

Around the globe, many nations are using national gas as a stable, cheap and low-emission electricity supply. Indeed, on home turf, South Australia has shifted from coal to an energy mix of solar and wind that sits at around 51 per cent. But, as we all know, when the wind isn't blowing and the sun isn't shining, natural gas supply stabilises the electricity supply in South Australia. We truly are at the dawn of a new and thriving industry, and, with government support from the Clean Energy Finance Corporation, we will unlock these industries and support existing companies to shift to more renewable products and practices and to help new and emerging companies to enter the market.

Last year, I joined some of my parliamentary colleagues and visited the Australian Renewable Energy Agency, often referred to as ARENA. Through ARENA, ActewAGL has received $2.4 million in funding to demonstrate vehicle-to-grid services in Australia. This is very exciting technology. It's still in the research phase but vehicle-to-grid technology is, basically, a battery on wheels that allows electric vehicles to discharge electricity back to the grid or even provide services to improve grid security. If this is to come to fruition, this project will be the first time that a fleet of vehicles using bidirectional charges will supply the grid. It's hard to imagine, but it's talking about converting our fleet of cars on the road to a virtual power plant on the move. This, essentially, means that, in the future, every time we get behind the wheel of an electric vehicle, we'll be adding power back into the grid. This means lower emissions and better electricity security. This is certainly just one step on the journey to creating an emissions-free country, but this is an example of Australian home-grown technology leading the way and something that we as a country should be enormously proud of.

The Morrison government understands that to reach future targets and reduce overall emissions we need to set out a clear pathway for business to thrive, and we are doing this through innovation and technology, not taxes. This is being done through the national Technology Investment Roadmap, a landmark paper that will drive investment in low-emission technology to strengthen our economy and support jobs and businesses. This will become more and more important as we start on the road to economic recovery from COVID-19. This road map will prioritise Australian government investments in new and developing technologies. Deploying the right technology when and where it is needed will allow Australian industry to capture these new opportunities. The road map will focus on some key points. These include developing technologies to support job growth, backing new industries to help regional communities and local economies to prosper, putting Australia at the forefront of research and development, and maintaining our strong track record of reducing global emissions.

Australia's climate action agenda is practical and it's clear-sighted, but it's driven by science and technology. It's driven by a clear understanding that science has come to our aid at many other times in a crisis and it will come to our aid again. There is enormous potential in technologies like hydrogen, carbon capture and storage, soil carbon sequestration, biofuels and resources and energy exports to reduce emissions whilst strengthening our economy. We will focus on technologies where we have a competitive advantage, in partnership with the private sector and like-minded countries.

The Morrison government knows that a shift from our reliance on coal will not happen overnight. The road map outlines key technology opportunities for Australia in the short, medium and long term. In the short term, investment will be key. This will set a strong foundation for a future of lower emissions. In the medium term, energy storage and infrastructure will mean we are set for the future. A shift to electric vehicles will also become tangible, as costs come down as more competitors enter the market. This is about a free-market approach to the EV. Finally, in the long term, we will reach a stage where we are global players in low-emission resource exporting. As Dr Alan Finkel said in his National Press Club speech, and is often prone to say, it's about shipping sunshine as an export.

Business and industry will be poised to move operations like manufacturing to more carbon-neutral practices—there's even a possibility of investing in the development of small modular reactors or molten salt reactors. Indeed, small modular nuclear reactors, at half the construction cost of today's reactors, have been identified as a focus for US president Joe Biden's new climate tech R&D agency, ARPA-C. In contrast, those opposite have dismissed nuclear energy as a fantasy. If we are going to get to a zero net carbon future, why have one arm tied behind our back?

Last year the government released its first annual Low Emissions Technology Statement, and this is a key milestone of the road-map process—it's the first in Australia's history. It identified the following priority stretch goals, and these are important because they provide a pragmatic way to understand how technology will underpin the transition. The first of those five stretch goals is clean hydrogen at under $2 per kilogram. The second is energy storage electricity for firming at under $100 per megawatt hour. The third is low-carbon materials, including low-emission steel production at under $900 per tonne and low-emission aluminium at under $2,700 per tonne. The fourth is carbon dioxide compression, hubs transport and storage at under $20 per tonne of CO2, and the fifth, which is great for farmers, is soil carbon measurement at under $3 per hectare per year. These are all pragmatic ambitions for our country to drive jobs, help our economy and get us to a clean and green future.

It's an incredibly exciting time to witness and be part of the new generation of energy production in Australia. The Clean Energy Finance Corporation will continue to be at the forefront of encouraging investment innovation and bravery within the renewables space. As a scientist who believes in technology and innovation, I commend this bill to the House.

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