James Stevens (Sturt, Liberal Party) Share this | Hansard source

As the seconder of the amendment, it won't surprise people to learn that I rise to speak in favour of the amendment to the second reading moved by my colleague in the chamber yesterday. That's not to say that we don't support this bill; the amendment doesn't seek to stand in the way of the second reading passing. It does raise a concern, which I'll touch on any minute.

Firstly, I do think this bill, the Offshore Electricity Infrastructure Legislation Amendment Bill 2022, will make it easier for more generation to come into the grid—and, God, we desperately need it. So I'm looking forward to seeing something—hopefully with sensible amendments from the coalition—passing, because we are in the middle of an energy and electricity crisis in this nation at the moment, and we desperately need more generation. We saw confirmation in the budget last night. Treasury, who are pretty conservative on most things, are suggesting that over the next two years electricity prices in this country are going to increase by more than 50 per cent, which is just a devastating revelation for families and small businesses in my electorate and across this country. I'm still coming to terms with how seriously that is going to impact people, what businesses will not be able to survive with a 50 per cent increase in their power bill. There will be tens of thousands of businesses that could not possibly survive. I worked in a business in the wool industry where power was our largest input. There's just no way a 50 per cent increase in their electricity prices is sustainable or competitive and that is a frightening outlook for this country.

To hand down a budget and say, 'That's going to happen and I'm not doing anything about it,' is a particular disgrace and something that will be heartbreaking to many people in this country. It is also something that, I think, is going to have spectacular political consequences for the government. If you say to people, 'Your bills are going to go up by 50 per cent, and at the same time as I am telling you that we are also doing nothing about it,' then, in a democracy, you will face a very serious price for that. I'm not happy about that. I don't delight in that. None of us in this place want to see that kind of pain metered out against the people of our country. Whether or not it's got political consequences is irrelevant to the people who have got to get that bill.

There will be families that cancel holidays when they get their next power bill. There will be some where one of the members of that family comes home and says, 'I've lost my job because the business I work at has to cut back because they can't meet that increase in their costs,' and that is a heartbreaking future that is upon them.

I really am very moved and upset about that news last night. Although, regrettably, it wasn't the greatest surprise, because I think everyone else except the government, until last night, has been making these points and giving these warnings. Whether it's the energy companies, the major manufacturers, people in industry, small business people, families and households they make the point that it's tough out there as it is, and that if the electricity prices are going up any further then it will be the question between viability and not in so many cases. But a more than 50 per cent increase is a real kick in the guts.

I'm all for more generation coming into the market. Any new supply could have a minor impact in addressing the challenges that we've got, so that's fine. As I indicated, the coalition, with some sensible amendments, are happy to see this proceed, because we started creating the framework to provide an ability for people to invest with certainty in offshore electricity generation and, of course, it's very important that we have a proper framework of regulation in place.

One of the core issues in our amendment that I want to touch on is one that is really important, which is the mechanism in which decisions are made around financial viability of proponents, and the fact that, quite surprisingly, there's this ministerial discretion being provided in this bill, rather than having a proper impartial agency approach to it. Acting Deputy Speaker, you will know better than me about an example in South Australia off the coast of Carrickalinga where there was a wave generating electricity plant that, unfortunately, came a cropper to some bad weather. At the moment, there is not a long-term resolution to this thing. It's just sitting off the coast of Carrickalinga. It's probably a good example of how important it is that any proponent, any business that is undertaking activities in this space, has a proper ability to take responsibility for the infrastructure that they're installing, and that if, for whatever reason—maybe it's just end of life and end of a successful investment; that's what we hope for with these projects. The Carrickalinga example is a good example of where it's vitally important that we, as a government, are giving permission to undertake these sorts of ventures, and that they are held to full responsibility for any potential adverse consequence—like what has happened there in Carrickalinga.

Our concern in the coalition is that, if the minister is making decisions about the financial viability of these proponents and is not comfortable giving that responsibility to an independent agency, political considerations will come into the mix. When a politician is making decisions, obviously they will. I don't suggest a minister wouldn't follow their legislated requirements and their responsibilities as a minister to make decisions in an appropriate way, but, if the decision rests with the minister, they are perfectly entitled to use objectives of government policy et cetera in their deliberations.

If you're frightened of an independent agency taking responsibility over making that decision, that's because you foresee a circumstance where that agency wouldn't consider the proponent to have appropriate financial security around what they intend to invest in and you'd rather a minister make the decision because you don't want a situation where an independent process chooses not to clear that proponent as being appropriate to bear the financial risk of the investment they're making. You therefore want the minister to make the decision, because that will result in a minister signing off on projects that an independent process wouldn't.

What is that going to lead to? If you're frightened of an independent process in overseeing that element of the approvals that need to be put in place for these sorts of investments, that raises massive concerns for us in the coalition. I don't want to see other situations like Carrickalinga. They could be at a much more significant scale where, for whatever reason, a lower standard is provided to certain proponents of this sort of infrastructure. If we end up in a situation where, because the standard was applied, they do find themselves in financial peril and they are not in a position to take responsibility for all the things they should if they're undertaking these investments, particularly around remediation and removing the footprint of their activities after those activities have ceased, we're going to have poor outcomes and, in particular, we're going to have a situation where the government will be taking that responsibility which rightly should be borne by the people undertaking the investment, who in undertaking that investment intend to be the ones that make money out of these projects.

We've got a situation where a centre-left government doesn't want the private sector to have full responsibility for the investments they're making and wants to set a lower standard when it comes to the responsibility that the private sector should bear for the environmental clean-up and outcome from their activities than what those of us on this side of the chamber are proposing. This is truly bizarre. It's an example of how weird the energy debate has become in this country. We should have fundamental principles around these sorts of things. If it were an oil rig, I would be very confident about what the Labor Party's position would be on holding those sorts of companies to the highest standards when it could comes to determining that they are financially capable of being responsible for all elements of the investment they're undertaking and, in particular, the full remediation of what they do out there in the pristine offshore waters of our nation when they've finished undertaking their economic activity. Why we think a lower standard should be put in place and why a minister should put a political lens over those decisions of financial viability of a proponent to properly and adequately be responsible for the activities they undertake offshore is really bizarre to me and, I think, to all members of my party room.

Our amendment addresses that point in particular. I urge the government to consider what the legacy of this decision could be—it may not be for five or 10 years time, but I really hope that some common sense will prevail over that point because we don't make it to score any political capital. We want to support what you're looking to do here, which is an extension of the things we were doing in government until six months ago. But it's really important that people who are given opportunities to achieve an economic outcome from whatever they might be doing offshore—in this case we're talking about electricity infrastructure—are held to the highest of standards of responsibility, particularly environmentally, for that activity. Having a low standard of financial oversight over their capacity to do that is, I think, a very poor way of approaching that.

More broadly, we support a proper regime for governing offshore electricity opportunities for the private sector to develop. In my opening remarks, I made it clear how frightening the outlook is for the energy and electricity situation in this country. So if anyone out there is looking for other ways to install more generation capacity that feeds into the grid their cost within the market structures that we have then I'm all for it, because I'm desperately frightened about the outlook for households and businesses in this nation based on the revelations in the budget last night. I don't think this will in any way have a significant impact on that frightening outlook, but if it can provide any help at all then that is all well and good.

We continue to make the important points around social licence and about communities that are affected by these projects being properly engaged, listened to and respected. As an extension of the remarks I've just made on the environment, the social licence is equally important. It's vital that we bring communities with us and we take the time to make very sensible, measured decisions about these sorts of activities because they do have acute impacts. Some are good, of course. There are good economic outcomes possible for projects that are happening off the coast of communities, but those communities have to be engaged and they have to be supportive of and want these projects because we shouldn't be riding roughshod over them and their interests either.

So, with those remarks, I commend the amendment to the chamber and also support the principle of the bill with those points we've made in the amendment, which I think will ensure the ability for this investment to proceed with certainty but also make sure that the activities of the companies that are undertaking this are at the highest standard and that companies are taking all the proper responsibility for those investments that they should. I commend the amendment to the House.

See this speech in context