David Gillespie (Lyne, National Party) Share this | Hansard source

These bills are another part of the utopian vision of the current Labor dominated government. The Future Made in Australia Bill 2024 is the principal bill. It comes in with the Future Made in Australia (Omnibus Amendments No. 1) Bill 2024. As I said, these bills are quite utopian in their aspirations, because they fail to address the fundamentals that will allow Australia to actually make things competitively again because they support this concept that we can turn the country into a manufacturing powerhouse based on sometimes there and sometimes not there weather-dependent renewable energy turning the whole industrial base into being reliant on the wind and sun. The legislation also picks winners. It is not picking fundamentals that will improve our economy, like a low corporate tax rate or genuine industrial reforms so that businesses can be flexible, adjustable and develop productivity, all the fundamentals that will enable our manufacturing, or value-adding of our minerals, making cheap, nutritious food and value-adding in all the other value chains manufacturing things out of our own commodities.

Just going into the details of these bills, they first of all create the National Interest Framework, which identifies which sectors are potential candidates for support under the Future Made in Australia policy. The legislation also defines this Orwellian concept of 'community benefit principles'. I thought, 'They are going to define a better corporate tax rate so companies look at Australia not as a high-taxing destination to invest in.' I thought: 'Wow! This will finally get rid of all that restrictive green tape that is making investments in minerals almost impossible.' I thought, 'Gee, they are going to bring in legislation that will get rid of green lawfare and vexatious claims that tie up projects for years.' And, as I mentioned, I thought there was the aspiration to get simpler industrial relations to enable productivity growth. But none of that is here.

All the legislation does is turn the Export Finance and Insurance Corporation into Export Finance Australia. So, instead of helping develop markets and underwriting exporters who want to get on with producing products that the world needs, it has none of that. It just gives Export Finance Australia a whole tranche of money. It also changes the ARENA agency from research funding and seed funding for primary renewable products into funding for more renewable energy facilities as if there wasn't enough help already. They have been getting assistance for 20 years or more, and they still have all the in-built advantages of our restrictive electricity market rules, which favour renewable energy.

The aim is to put more money into doing things which are deemed to create lower greenhouse gas emissions, but this doesn't affect the major problem. For the ultimate low-carbon energy, we are proposing we unban it and get involved in it to make our energy clean. The legislation doesn't mention funding highly efficient, low-emission, new ultrasupercritical coal plants that would reduce our coal plants' footprints by 40 per cent. It doesn't allow investment in gas exploration, which the markets are crying out for in the southern and eastern states, where there are gas energy shortcomings identified by all market operators which are making electricity generation and all the things that has gas as a feedstock much more expensive.

It also removes restrictions on staffing in the Renewable Energy Agency and empowers the finance minister to cherry-pick which of these green schemes she is going to put money into. That amount of money is quite considerable—$22.7 billion between the 2025-26 budget year and the 2038-39 budget year. This is not going to do what those proposing it think it will do. We have heard ad infinitum about us becoming a green energy superpower and re-energising the manufacturing sector. But the reality of these renewable energy generation systems is that they make the system very, very expensive. The one-off build costs are cheap—and they would want to be cheap because they only work, on average, 20 to 30 per cent of the time—but they only last for 10 to 15 years. The batteries, concrete and steel—the stuff that goes into renewable energy—is incredibly expensive and has an ultra-short lifespan, whereas you can get 40, 50, 60 or 70 years out of a well-maintained coal plant, and you can get the same out of a nuclear energy plant. The standards of building them mean that they have a design life of at least 40 years. Most around the world are being extended to 60 years, and there are a couple that will be hitting the 80-year mark before they cease working. The new ones are built to an incredibly high standard.

What I would also like to point out is some of the details of this bill. As I mentioned, the Renewable Energy Agency will also be funding manufacturing. There are some technical things that will benefit the economy. There is the National Hydrogen Technology Skills Training Centre and a cooperative research centre. There is the strengthening of approvals for energy projects. I got excited when I saw that. But—hey presto—it's not going to speed up the approvals process for things like a new gas field or a new source of diesel or petrol that runs the country now and for generations to come. No, it's only going to speed up the approval of green processes or green energy systems.

The rapid expansion of renewable energy across country Australia is quite scary at the moment. People are getting approvals in Queensland willy-nilly. People have mapped the footprint of this renewable energy superpower, and it is really quite destructive on the environment. In Queensland there is at least 600,000 hectares of remnant vegetation, or adjacent to national park high country, which is just going to be bulldozed for thousands of kilometres of access roads. It will destroy the flora and fauna in them, turning them into sterile wastelands. Koala habitats, wallabies—all those things that Australians see as our native jewels, both flora and fauna—are going to be excluded from those areas. The wind towers will use huge amounts of materials, and that's why their carbon footprint over their short lifespan makes them not as sustainable or green as they're advertised to be. They're actually quite destructive.

There's funding for green metals. I have just been to Korea and Japan. They are very keen for us to get hydrogen, but what they don't appreciate is us doing it by using renewable energy. We'll only be making it 20 to 35 per cent of the time depending on the vagaries of the weather. That is never going to be economical. If you think that expanding to have five or 10 times more renewable energy projects will guarantee permanent availability of energy, you are sadly misled. That is the whole premise of overbuilding all of these renewable energy projects. Unfortunately they're all highly correlated. That means they all stop at the same time and they all start at the same time, and that is dependent on the weather and the day-night cycle. Having a geographic spread and overbuilding installed capacity, as opposed to looking at what is going to generate cheap, reliable, available energy at the right voltage and frequency 24 hours a day—then we can talk about making green hydrogen or hydrogen economically.

None of this is going to do that. It is very difficult to commercialise hydrogen production unless you have a lot of industrial heat and a lot of electricity. You also need to have a whole lot of water if you want to make it green. The Americans have worked out that the only way they can do that in a green sense is to have electrolysis and high heat coming from nuclear plants and just dedicate them full on to making green hydrogen. But hydrogen has a huge negative energy return on the energy invested. It will remain a critical industrial chemical for lots processes—we'll need it for rockets, missiles and all those sorts of things as well—but it's not going to be a major replacement for internal combustion engines. It will have a place in hydrogen fuel cell vehicles in big cities, where they can be close to sources of cheap hydrogen, but I don't think it's going to replace the internal combustion engine. Putting all our eggs into a weather dependent system that we build from stuff made overseas is not going to re-industrialise the Australian industry base; it will just make our electricity more expensive, and we'll probably de-industrialise more and be left holding all these renewable energy projects with a short lifespan that will end up being abandoned and have to be replaced. In fact, the early windfarms that were put in in South Australia and Victoria are already coming up for replacement.

If we want to make things in Australia again, we need to get those fundamentals going again. That means getting the market rules which restrict our baseload operators from operating efficiently—market reform won't cost a cent; it will just mean that people who have cheap electrons will be able to get their electrons onto the grid so our prices will go down. We need to address this first up. We also need to make sure our coal plants aren't prematurely closed. Some of the 11 or 12 plants in Germany that were fired up as they got rid of their nuclear energy are now keeping their industry afloat, but their grid isn't as clean as it would have been if they'd kept their nuclear plants going. That's what we are doing now. Victoria is subsidising the coal plants because the market rules make them uneconomical. It's not because they need to close; it's just that they're losing money, so they need to be subsidised. It is the same in New South Wales. It's ironic that this allegedly cheapest form of energy has all these inbuilt subsidies. They get preference to get onto the grid. They get paid for the electricity at the top spot price, not their bid price. They also get a large payment for every kilowatt-hour that goes onto the grid. A renewable energy generator gets a large-generator certificate. If it's rooftop solar, they get a small-scale technology certificate. These are second income streams.

By all means, we can make things in Australia again, but we have to address the fundamentals. The thing that made us a manufacturer of aluminium and steel and allowed us to develop a car industry was that we had cheap energy that was available all the time because we utilised our own resources. That's what we should be focusing on. So, if you want to make Australia make things again, I wouldn't be supporting this. Look at things in a rational way. At the moment, a lot of these policies are made by political scientists, not by hard-nosed engineers. That's what we need. We need to bring engineers back, and then we'll get a sensible energy policy.

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