Peter Garrett (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Reconciliation and the Arts) Share this | Link to this | Hansard source

On 14 August, the Prime Minister made a ministerial statement on energy initiatives in quick response to the rise in petrol prices that had broken out right around Australia. The Prime Minister’s assumption was that oil could drift to $75 a barrel. The Prime Minister mentioned that Hurricane Katrina and the impact of the damage that Hurricane Katrina had caused on oil facilities in New Orleans had led to increased price rises. The Prime Minister pointed out to the House that Australia was a net importer of oil and thus very vulnerable to supply constraints not only as a consequence of a natural calamity such as  Hurricane Katrina but also because of the tightening of political conditions in the Middle East. The Prime Minister referred to the energy white paper released earlier by the government as an indication of the government’s bona fides in relation to energy.

What was compellingly absent from the Prime Minister’s ministerial statement on energy, and what remains compellingly absent in terms of the government’s vision for Australian energy, was a commitment to Australia’s self-sufficiency through significant support and increased funding for the development of a renewables industry—an industry which, in my view, could make and should make a substantial contribution to our energy needs.

The extra funding for Geoscience Australia identified in the Prime Minister’s energy initiative was welcome, as was the $123.5 million of extra funding for the Renewable Remote Power Generation Program—although I note that that program was already vastly underspent and there are questions as to whether or not it is working effectively. More importantly, an area that has been identified as critical went virtually unremarked on in the Prime Minister’s statement, and that is the need for us to pursue with some vigour both feasibility and start-up studies into gas to liquids. Certainly the funding for research is welcomed, but it is the direction of the research that is important.

There is no doubt that the government’s policy seems to be—and we were reminded of this when we heard the Prime Minister speak in the House today—that the answer is really all about nuclear. The amounts that are provided for renewable energy research are relatively small, but it seems as though the Prime Minister holds up the prospect of nuclear power as the magic bullet to solve our increasingly difficult energy needs.

Additionally, the Prime Minister announced a tax-free grant of some $2,000 for LPG conversion; $1,000 went for new LPG vehicles. Whilst some concerns have been raised on this side of the House about the way in which people would have access to and take up those LPG offers, particularly the tax-free grant, I did note not too long ago that in fact the uptake had been very good. There is no doubt that we are now starting to see a greater number of vehicles operating on LPG, and that seems to be an entirely natural and inevitable consequence of the fact that we actually have supplies of this gas. In fact, taxi services in Sydney, Melbourne, Brisbane and, I suspect, in other capital cities have been running on LPG gas for quite some time, and it remains something of a mystery as to why more of the fleet, including the Commonwealth fleet, which clearly is something that Labor would like to see, does not run on LPG. It is cheaper. It provides much less by way of greenhouse gas emissions. Of course, the more vehicles that are carrying LPG, the less petrol will be consumed by other vehicles.

It is important to point out that Labor has had an alternative fuels blueprint, which was released on 19 October last year, well before the Prime Minister’s energy initiative. It dealt specifically with the issue of Australia’s dependence particularly on Middle East oil and the likely impacts on our economy and on the pockets and the purses of Australians when the price of fuel goes up. In particular, a Beazley Labor government would look at the depreciation regime for gas production infrastructure and it would make alternative fuels tariff-free, cutting up to $2,000 off the price of current hybrid cars. A Beazley Labor government would work with state and local governments to give city traffic and parking advantages for those hybrid vehicles. A Beazley Labor government, importantly, would encourage a sustainable ethanol industry, ease regulations for biodiesel production on farms—and I note that some National Party members have talked about that matter very recently—and, additionally, examine a new infrastructure investment allowance for investment in Australian gas to liquids infrastructure.

The point that needs to be made is that it is focusing your public policy initiatives and the allocations from the budget to enhance your natural advantages that actually addresses in a serious way the question of dependency on Middle East oil. It is a matter of some concern to me that the government continues to fail to move rigorously and vigorously to develop a sustainable energies industry. I wonder, having regard to particular areas—and one thinks immediately of solar energy—when we are going to finally wake up to the fact that we have the capacity to build a world-class solar industry in this country which would generate significant amounts of power, which would employ significant numbers of Australians and which, having regard to our leading the world in the past in terms of technology, research and development, would mean that we could actually put that research and development into place.

There is some irony in the fact that the wealthiest person to emerge in the renewable energies sector—and I think he may be the fourth wealthiest person in China—Zhengrong Shi, actually learned and studied solar technology at the University of New South Wales—in the electorate of Kingsford Smith, as I am always proud to note.

Mr Zhengrong Shi and his company, Suntech, are now exporting a significant amount of solar panels and solar technology—technology that was originally developed in Australia—from China, particularly into Europe. Mr Shi is properly observing the requirements for the protection of intellectual property—and there is no suggestion, now that we understand fully how his company is operating, that he is doing anything other than that. The fact is that this is an industry that we could have built in Australia.

You have to ask yourself why it is, at a time when climate change is clearly growing in importance as a threshold issue, when we have rigours imposed on us by the availability of Middle East fuel and the likelihood of price increases over time and, of course with peak oil literally on the landscape in front of us, why we are not taking up those necessary renewable options that are already there, that are already proven and that can already work.

One of the reasons why we are neither building a potent and significant renewable energy industry nor moving to deal with the question of our energy dependency is that is the Howard government is deficient in policy on these issues. By relying on the nuclear solution, the Prime Minister seems to be ignoring the fact that we are in the midst of a global clean energy boom. That is what we have at this point in time around the world. That is where the trends are going, that is where the investment is, and that is where the young scientists and graduates coming out of research institutions and universities are directing their attention. Clean energy technologies such as wind, solar, biofuels, geothermal and hydro power had a global market value of about $74 billion in 2005, and it is predicted to increase in quantum terms over the coming decade. This will be the energy industry of the future, because it will not only be driven by the necessity to produce clean energy and green energy; it will also be driven by the fact that this is an industry which employs and uses innovation and talent.

We can see that there are emerging markets, particularly in places like China and India—as well as in Europe. China’s clean energy investment last year was $A90.2 billion; America ranked second and India ranked fifth on the Ernst and Young renewables investment index. Why aren’t we concentrating our efforts, our energy and our attention in that area in a significant way? What is it that we need if we are actually going to build a true sustainable energy industry?

The things we are going to need include a decent mandatory renewable energy target. The target certainly needs to be increased by about 21,000 gigawatts by 2010, which would be about a five per cent increase in market share. But the government’s ideological obsession sees it sitting down at two per cent and, as a consequence of that, we actually have alternative energy industries going offshore or finding that they have to close down, which means that jobs are lost—as we heard today, with 100 jobs being lost from wind energy projects in Tasmania.

We need to extend the Photovoltaic Rebate Program, which provides rebates for people who put PV panels on their homes. That is absolutely critical, because it is due to run out of funds. The government extended it for a period of time, but it will still run out. As people face up to the cost of energy and recognise that they live on one of the sunniest continents that there is, they will realise that we need to have the PVRP program and to continue it, because it has been very successful and it has seen significant industry development along the way. The fact that the government will not address itself to that—in fact, the Prime Minister mentioned it not at all in his energy initiatives statement—is hugely regrettable. We need to regulate for minimum energy performance, including having a national target for energy efficiency.

Today, a number of groups gathered in front of the parliament to argue strongly and to push leaders in this parliament to reach the Millennium Development Goals that have been set by the United Nations to try to halt the terrible poverty that afflicts the world.

The fact is we do have a number of significant global challenges that face us: poverty is one and climate change is another. It is absolutely critical that governments, if they are going to be serious about climate change at all, set time lines and targets. They also have to make the necessary investment both in policies—in public policy particularly—and in industries that can address those issues. In respect of poverty, it is making sure that we have a significant proportion of our aid budget properly focused and directed. I notice that the shadow minister for overseas aid and Pacific island affairs is sitting in the Main Committee; he has already done some very good work on that.

Finally, we should ratify Kyoto. It is not either/or in the debate about Kyoto, but it is certainly not about simply viewing Kyoto as a slogan, as the Minister for Industry, Tourism and Resources in the Howard government does. Sustainable energy will probably be the most important source of new clean energy and, critically, it is a source of energy that is available to us now. We do not have any long start-ups. There are not the requirements for mass capitalisation as there would be with stand-alone high-end entities like nuclear power. Additionally, we do not increase the risk: either investor risk—which will be an important issue and probably one of the most critical issues that nuclear power faces—or the risk to populations in terms of the safe storage of waste, particularly into the longer term.

We also need to look at energy policy in terms of the way in which we now subsidise oil consumption. We need to have a healthier debate both in the parliament and out in the community about the fringe benefits tax and salary packaging rules and the way they operate for cars. It is a nonsense that you have to drive your car further in some instances to qualify for those packages. That is actually producing more pollution, using more fuel and spending more time needlessly. It is very important that we have tax advantages for fuel efficient and hybrid cars, and Labor has already announced strong policy there. It is important that we look much more seriously at the kinds of energy efficient measures that can operate not only across the grid but also in the home and in businesses. It is high time that we had a sustainable energy industry in this country, and not the unclear option the Prime Minister has developed in his energy initiative statement. (Time expired)

Debate (on motion by Mr Neville) adjourned.