James Stevens (Sturt, Liberal Party, Shadow Assistant Minister for Government Waste Reduction) Share this | Hansard source

I would like to start by commending my colleague the member for Nicholls, who has made an exceptional contribution on this bill, the Future Made in Australia (Guarantee of Origin) Bill 2024. In fact, I fear I am at risk of repeating many of his fine arguments in my own contribution. I rise to speak in favour of the member for Fairfax's second reading amendment. As has been made very clear, we in the coalition do not support this Labor version of the guarantee of origin. When we were in government, we had a very different scheme that we hoped to be supporting through this parliament, but, regrettably, what has been brought forward by the government is vastly different to what we intended to do when we were in government. That is regrettable because a proper guarantee-of-origin scheme would be an excellent thing for this country. What is being proposed in this bill is a lost opportunity to give that certainty and that opportunity to so many industries that would be looking for the system that we intended to legislate for.

I would like to start by giving a shoutout to the HILT CRC, coordinated by the University of Adelaide. I have had a lot to do with them over the years. I met with them when they were applying for and, happily, were successful under the previous government through the CRC funds at getting support. 'HILT CRC' stands for the Heavy Industry Low-carbon Transition Cooperative Research Centre. They are doing work on trying to crack some of the challenges that are in place when it comes to industrial chemistry and commercially viable technology to undertake some of those very high-emitting heavy industry processes.

We know that getting the energy that's generated and zapped down the transmission lines of this country to net zero through zero emissions technology is nowhere near enough to address the totality of emissions. One of the big ones that's probably got one of the most challenges is those industrial processes and heavy industries that emit a lot. It is very difficult to replicate those processes from the 240-volt power connections. I think this figure is still accurate, but it's certainly been the case for a long period of time that seven per cent of total emissions comes from steel alone. I think cement is about five per cent. The really important industries for the planet but particularly our country like steel, cement and aluminium at the moment are high in emissions. We have to come up with commercially viable solutions to address how they can become carbon neutral.

In my home state of South Australia, the state government are putting a large amount of state government funds into building a hydrogen plant in the iron triangle. I wish them well, but there are some very concerning early signs about how that project is tracking and where it is going to end up, particularly from a cost point of view and whether or not the markets that were believed to potentially be accessible to that plant once it is constructed will exist in the form that was envisaged by Labor when they developed this scheme. It now seems that the timelines that were promised—they can't be concealed from the public; you know if you are or are not successfully building a hydrogen electrolyser plant—on that commitment are running dramatically late. But what isn't known in the public domain is just where the financial situation, the cost of that plant, has landed. Around half a billion dollars, I think, was initially earmarked by the Labor government in South Australia to build that plant.

I have deep concern and I think any reasonable observer would have deep concern that not only the delays to that but also the likely cost blowouts for building that plant seem likely to be quite significant. If they weren't, you would think there'd be a lot more transparency around what is happening with that project from the state government's point of view than there currently is. In fact there were attempts, I believe, to establish a select committee in the legislative council to look into that project, and they were blocked. So the transparency around what's happening there is extremely concerning. I think the dreams of what might be possible and when for hydrogen at that plant that the South Australian government is building are pretty well replicated across all of the hoped-for hydrogen developments across this country and really across the world.

There was a lot of early hype around what and where hydrogen might lead to, but regrettably a lot of boardrooms are making a lot of decisions to cancel a lot of investments in hydrogen projects and infrastructure around hydrogen because it seems to be that the sort of market that some believed might develop in a certain timeframe is not eventuating. Some of the major partners, particularly in Japan and South Korea, who seemed to be very enthusiastic around hydrogen produced in Australia for their markets, are not quite as enthusiastic as they have been in the past. Here we have before us a bill that we're discussing that could be very different to what the government's brought to us, and that's regrettable because the huge focus that they've got on green hydrogen through this is not panning out to have the same likelihood of significant success that some believed it would in previous years.

As the member for Fairfax points out in the amendment to the second reading, we have significant criticism around the fact that this is not a technology-agnostic proposal. We have obviously made a decision in the coalition that there is no prospect of getting to a 'net zero by 2050' circumstance in this country without nuclear—reliable base-load generation which is obviously also emissions free. As the member for Nicholls pointed out, as we see the retirement of coal generation, that reliable base-load generation which completely underpinned the industrial development of this country for many, many decades, we want to see that replaced by an equally reliable base-load generation, being nuclear power. Not only can nuclear be a huge part of generating electricity to go through our electricity market and power our homes and businesses but nuclear has enormous applications across the other elements and challenges of getting to net zero.

The heat produced from nuclear is a big opportunity for certain industrial processes. The heat that can be created out of nuclear is very superior to what you can create from three-phase electricity powered heat capability. Even with nuclear heat, there are heat requirements in certain industrial chemistry and certain heavy industries that not even nuclear can create, and those are challenges that need to be cracked. People like the HILT CRC are working on exactly that, because at the moment there is no real commercially viable non-carbon-emitting alternative.

That's why we recognise that there'll be some processes that will always emit carbon and we need to accommodate the need to offset emissions. Net zero isn't absolute zero. Net zero is net zero, and there will undoubtedly be processes in certain industrial transformations from which the emissions will need to be offset, because there's no solution other than continuing to undertake chemical reactions that release carbon. None of that is accommodated in this bill.

I have my friend the member for Braddon here; he is a proud Tasmanian. One of the most egregious things in this bill is that legacy hydropower generation capacity, which is resplendent throughout the great island of Tasmania, is for some bizarre reason excluded from being eligible for this scheme. Now, that surely is an oversight. I can't possibly imagine why hydropower is excluded. I concede that the government have got an ideological objection to nuclear, but I've not identified that they've got an ideological objection to hydropower—certainly not in the modern era. I know there was a time when dams in Tasmania had a degree of controversy, for different reasons to emissions reduction, but the fact that existing hydro-powered plants that have serviced Tasmania and, in fact, export that great clean energy across Bass Strait to Victoria are excluded from this scheme is just nonsensical. Hopefully that's something that the government recognises. If they're not prepared to consider other points, at least don't do this to the poor people of Tasmania.

Obviously, the other thing that we think is very odd and where we need as much international interoperability as possible—because getting to net zero is a global effort that is also going to involve a lot of cooperation and collaboration between economies—is that we've got a situation where our scheme doesn't align with the one that's been designed for the EU and the UK. So our Guarantee of Origin scheme, if it passes this parliament, won't be compatible with the schemes in the EU and the UK. That's greatly disappointing, because that's an enormous opportunity lost for Australian businesses that could see an export opportunity, potentially, if we had a scheme that was aligned with the EU and UK one and accredited to that. There would be businesses that would be operating under our scheme that would also have an opportunity to access markets in the EU and UK with that accreditation through our Guarantee of Origin scheme, if it were properly aligned with those overseas ones, and the proposal here from the government does not do that. So that, of course, concerns us.

Most importantly, we have a very credible concern that this is the beginning of creating something akin to the previous carbon tax regime that the Gillard government introduced, Certainly, this bill heads down that path. It provides a mechanism for putting a price on carbon again, and that is something that the Australian people have spoken very comprehensively on. Indeed, if the government believe that that would now be popular, they're very welcome to take that to an election and have it as their central campaign position. But to bring, through this legislation, a mechanism that could well open the government up to putting a price back on carbon by stealth again is something we bell the cat on very much in this debate. That is what the member for Fairfax is doing through the second reading amendment.

It is regrettable that this is a lost opportunity to have a bipartisan bill that would have been able to continue on from the work we did in our last term, would create something that would provide certainty for Australian industry and, of course, would be agnostic in relation to the great opportunities around technologies like nuclear that we look forward to presenting to the people of Australia at the upcoming election. It is very regrettable that, again, the government are not open to the people having their say on a matter like that through this legislation. So, indeed, I support the second reading amendment from the member for Fairfax. We don't support this bill for all the reasons outlined. I commend the member for Fairfax's amendment to the House.

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