Greg Hunt (Flinders, Liberal Party, Shadow Minister for Climate Change, Environment and Urban Water) Share this | Link to this | Hansard source

In addressing the National Greenhouse and Energy Reporting Amendment Bill 2008 I want to make three broad points. First, this bill makes minor amendments to the regime which the coalition government put in place last year. Second, we have a strong history of practical action to deliver real reductions in emissions, which contrasts with many of the proposals which are currently being put forward. Third, I want to mention the ‘three pillars’ approach which we are taking to the broader issue of emissions reduction in Australia today as part of a global approach and a global way of reducing overall CO2 and equivalent emissions.

Let me be very clear, we support the National Greenhouse and Energy Reporting Amendment Bill 2008 for a simple reason: it makes minor technical amendments, which were foreshadowed prior to the previous election, to the system we put in place to enable an emissions trading scheme. This is a preparatory system which will ultimately assist both in monitoring Australia’s greenhouse emissions and in allowing us to prepare, in the most efficient and least disruptive way, for an emissions trading scheme.

In relation to this particular bill, we note that there are amendments here aimed at three things: firstly, simplifying the regulatory burden and increasing flexibility associated with the registration of corporations under the act; secondly, confirming that the obligation of a registered corporation to comply with an external audit extends also to the corporations group; and, thirdly, clarifying the provisions relating to the reporting of greenhouse gas projects and offsets of emissions. These are consistent with the regime we put in place last year. They are consistent with the intention which we established and they are consistent with the direction which we flagged.

Having said all of that, this then brings us to the broader background of action which the previous coalition government took to prepare Australia for a long-term approach to reducing emissions in a way which did not harm the ability of this generation to maintain our standards of living and our quality of life, and to work in such a way where we have intergenerational equity so that the present generation is not sold out to bear the load in relation to past actions or future actions. In particular, we took a series of major initiatives which led, above all else, to a reduction of between 85 and 87 million tonnes per annum in CO2 or equivalent gases which would otherwise have occurred. Overall, in the last decade we have seen Australia’s emissions reduced by about 170 million tonnes against business as usual. About half of that has come through changes in land clearing. I welcome those changes and that reduction, and I welcome the protection of biological diversity as a result.

The other half of the reduction—and this is often not credited by those on the government benches—has come about largely as a result of a range of specific federal initiatives under the coalition. That is why Australia today is one of only a handful of developed countries to actually be on track to meet our international targets for emissions reduction. We are one of the few countries in the world that are on track to meet their targets under the Kyoto protocol. There is a lot of noise about whether or not a country has put its signature on the table. Many countries have promised but few have actually delivered. We have delivered because of a series of practical initiatives which have had real effect without disrupting and without destroying the capacity of Australians to provide for themselves and their families now and in the future.

The coalition took practical initiatives such as, firstly, the first greenhouse office in the world; secondly, the Low Emissions Technology Demonstration Fund, which was aimed directly at being a world-leading project for major emissions reductions; and, thirdly, the solar homes scheme or, as it is alternatively known, the Photovoltaic Rebate Program. This program has, however, been gutted under the new government, which put in place a means test which means that mums and dads who earn $51,000 or more each are now in large part unable to afford to have solar panels on their homes. They are no longer able to be part of the clean energy revolution; they have been disempowered. This is part of a program which takes away incentives and replaces them with a culture of fear rather than one of hope, empowerment and practical action.

In the Senate, we have seen a whitewash by government members of the impacts of the means test on the solar homes program. Why do I say that? Very simply, the figures have been propped up by the Queensland government’s solar lottery, which means that $185 is all that people have to pay to get solar panels on their roofs. That program will run out soon and, as a Senate inquiry has heard, many small businesses have lost 80 per cent of their orders. This is real. It has an impact on solar businesses, it has an impact on a sunrise industry and it has an impact on the ability of Australian mums, dads and families to make real reductions in emissions savings. We reject, categorically and absolutely, the whitewash by the government members in the Senate committee. They have failed to acknowledge that the only reason the figures are holding up is the Queensland government giveaway and lottery. It is a good program. I do not argue with what the Queensland government is doing to reduce emissions; I argue with what Mr Garrett and the Prime Minister have done in gutting the solar homes project.

We also saw under the previous government, most importantly, the Global Initiative on Forests and Climate, aimed at reducing 10 per cent of the world’s emissions from CO2. Currently 40 billion tonnes of CO2 are put out. This program aims to reduce the eight billion tonnes of CO2 from global deforestation to four billion tonnes in the next five years. That is the single largest and fastest reduction the world can make, and the new government has dropped the ball on protecting against the scourge of global deforestation. It is a real initiative which should be supported and advanced. Other developed world countries are willing to participate: the United States, the UK, Germany and France. If we are serious about making emissions reductions, we should not put all the burden on Australian mums and dads. We should use the capacity of the international system and the developed world to work with the developing world on reductions of global deforestation, and nothing will deliver faster, greater, real results at a cheaper price than working towards halving the rate of deforestation and increasing net reafforestation over the next five years.

This brings me directly to the coalition’s approach to dealing with the objectives of the National Greenhouse and Energy Reporting Amendment Bill 2008. We have a ‘three pillars’ approach to dealing with greenhouse gas reduction. First, we must start at the international level; second, there has to be a clean energy revolution; and, third, there is a role for a carefully crafted, non-destructive emissions trading scheme. But that is not what has been presented by the Rudd government.

Let me look at the first of the three pillars: the international pressure for which we unashamedly advocated. We need to do two things. First, we need to have an approach which says to the great emitters of the world, China, India and the United States: you must be a serious part of a global approach. If they are not part of that approach, then the emissions trading scheme that we adopt must be one with a low and slow commencement price. We are ready to ramp up if the other countries play their part, but we must not play our hand in such a way that we take away the incentive for other countries to act. If we allow them to be free riders, we do nothing for the planet and we do everything to hurt ourselves.

The second thing we must do is to put in place the Global Initiative on Forests and Climate, which we are now referring to as a global rainforest recovery plan. The message to Mr Rudd, Mr Garrett and Senator Wong is very clear: you must not take the pressure off the developing world to protect its forests, to protect its ecology and to make great savings in the reduction of emissions which would otherwise go up over the next five years. You must be part and parcel of a global rainforest recovery program, which can halve the eight billion tonnes, or 20 per cent, of global emissions which come from deforestation. It can do this over the next five years. It can reduce emissions by four billion tonnes, or 10 per cent of global emissions, and nothing can make more of a difference in the next five years than these great savings. Please take this policy up. Do not reject it just because we took the leadership on it. Do not make the mistake of cutting funds from this, because these are real reductions which take the pressure off Australian mums and dads.

The second of the pillars, about which there is enormous excitement in the coalition party room, is the concept of a clean energy revolution. That means a push and drive for Australia to be, amongst other things, a solar continent. We have to have a capacity for mums and dads, families, farmers and individuals to participate in the clean energy revolution through the adoption of solar photovoltaic power in their own homes. And yet we have seen, as I said earlier, the destruction of the very incentive designed to allow mums and dads and farmers and families to have solar panels on their roofs. If you earn more than $51,000 each as a couple, you will no longer have that incentive. The message to the solar industry, the message to Australian families is: we are not serious about this sunrise industry; we are happy for a political point to run it into the ground. That is unacceptable; it must be reversed. We will fight all the way to have it reversed and we stand very clearly for a bright sunrise future rather than a sunset on the solar industry.

At the level of generation of baseload power, we are on the threshold of quite a revolution in terms of clean energy here. What we are advocating and what we are saying to the Rudd government is very clear: we will push for a revolution in solar baseload. In California and Nevada, and in Spain and elsewhere around the world, we are seeing the development of the capacity not only for generating but also for storage. There are two great storage advances: first, the use and conversion of supercritical steam and, second, enormous advances in chemical storage. This is one of those technologies which is advancing faster than the international community had expected, and we want to be at the forefront; we want to see that the solar industry is supported and not discouraged. The message that has gone out to the solar industry has been a very poor one. The Renewable Energy Fund was put back rather than brought forward; the solar homes program was gutted; and I have met with numerous solar industry executives who are dismayed, disheartened and disappointed at the way in which this industry has been treated by the new government. That is where we stand on a clean energy revolution.

The third pillar is an emissions trading scheme, but we support a carefully calibrated, non-destructive, effective emissions trading scheme. There are four criticisms we have about the way in which the government have casually thrown on the table a destructive and ineffective emissions trading scheme. Firstly, they have gutted the clean energy sector. We see that LPG, the cleanest burning of the available automotive fuels at present, is set to be the first and highest taxed fuel under their new scheme. We also see, on the clean energy side, that one tonne of exported LNG—liquid natural gas—when it is transported to China, will lead to four tonnes of CO2 being reduced if it replaces coal-fired power. And yet, as Woodside and others have said—and I have met with executives of Woodside and others—this proposal, on the table right now, threatens the very viability of our industry. In short, the cleanest burning baseload fossil fuel is set to be punished and the world will suffer as a result. Global emissions will go up rather than down, Australian industry will suffer and Australian jobs will go, and that is bad for Australia and bad for people who are concerned about emissions, as I am.

The second of the great criticisms in relation to emissions trading is that it is, in the Rudd government’s scheme, a new petrol tax, but not until after the election. That is an unacceptable concept. Petrol is a largely inelastic good—the economic history around the world is that it is a largely inelastic good. We see a three-year moratorium. Basically, the new tax has been deferred until after the election. We do not accept that there should be a new tax on petrol and we will stand against it.

The third of our criticisms of the emissions trading scheme is that there is a new grocery tax contained within it which will be imposed on groceries seven months after the due date of the next election. How will this work? Very simply, we will see that commercial transport will face a new tax seven months after the election. That commercial transport is the way of passing our groceries around Australia. You cannot substitute for food. It is not as if you can substitute one item for another. Everybody will have to eat. It is a ludicrous proposition that we are going to generically bump up the price of food in the hope that it will somehow change behaviour. This new grocery tax will come in seven months after the due date for the next election. It is absurd; it is ridiculous. It will have an impact on pensioners, low-income families and middle-income Australia and it will have zero impact on emissions.

The fourth of the concerns we have is in relation to timing. We have a concern about the time when submissions are due. Submissions in response to the green paper are due in the next two weeks, before the Treasury modelling is available. That is an absurd situation. Much more importantly, the date for the system has been arbitrarily set as 1 July 2010. That is a political deadline. We know from the Business Council of Australia and from numerous Australian companies that they will face job losses, enormous balance sheet impacts. They are not yet prepared; they are not yet ready. It will not have an impact on emissions but it will have an impact on the balance sheets of Australian companies. There will be job losses; there will be a real impact. We believe the earliest feasible date is 2011—probably 2012—and we say that the government must listen to those people who will be affected. There is a real reason for that: if you want an effective system, you have to give industry a chance to adapt. Let us not drive Australia into an anticompetitive situation which will have no impact on emissions but will have an impact on livelihoods, the cost of living and Australian families.

I make, ultimately, the point that we support this particular bill—the National Greenhouse and Energy Reporting Amendment Bill 2008. It is, in effect, our bill, building on our system as preparation for an effective emissions trading scheme. But we approach the overall greenhouse issue with a three-pillared approach: unashamed support for international pressure; an unashamed belief in a clean energy revolution and direct engagement with supporting a solar continent vision, not the destruction of the solar energy industry as we have seen from this new government; and unashamed strength in looking for an effective emissions trading scheme with real support for clean energy, no petrol tax, no grocery tax and a commencement date starting no earlier than 2011—probably 2012. We do that because we believe in real outcomes for greenhouse reduction, based on hope rather than fear and on the capacity of individuals to have a real role.

Mark Dreyfus (Isaacs, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak in favour of the National Greenhouse and Energy Reporting Amendment Bill 2008, which demonstrates the Rudd Labor government’s commitment to tackling climate change. Greenhouse emissions are clearly changing the world’s climate and we must ensure that scientists and planners have the accurate data and information they need to find efficient and effective solutions. The information that this bill deals with will be critical in facilitating policymaking on greenhouse and energy issues.

The bill seeks to make changes to the National Greenhouse and Energy Reporting Act 2007 by amending the public disclosure provisions that relate to a corporation’s greenhouse emissions. That includes separating direct and indirect emissions and disclosing how these emissions were calculated. The bill will improve the National Greenhouse and Energy Reporting Act to provide transparent, accountable processes and data reporting to the greenhouse energy data officer. This will strengthen the greenhouse and energy reporting system and provide invaluable data to meet Australia’s international reporting requirements as we approach the United Nations Climate Change Conference in Copenhagen.

The Rudd Labor government will also seek to streamline the reporting requirements by reducing the total number of reports that business is required to submit by 2009-10. This government understands that duplicated reporting of these standards is inefficient and highly troublesome, potentially at least, to Australian businesses. The government is actively working with the states and territories through the Council of Australian Governments to ensure a streamlining of reporting processes. This legislation also reflects a commitment to flexibility in the reporting processes. Members on this side of the House understand that Australian businesses value a clear and consistent policy on tackling climate change. I think it is fair to say that despite concerns raised recently by a number of corporations those same corporations and others are working with the government on the development of policy in this area, and there certainly is an understanding of the need for the reporting system that this bill addresses.

The usable and relevant data, the collection of which this bill addresses, will be released publicly to allow Australia’s best thinkers and scientists to find new and innovative solutions to tackling climate change. That data will underpin the government’s Carbon Pollution Reduction Scheme, which is to be introduced in 2010.

This bill is one of the many initiatives that the Rudd Labor government has introduced to tackle climate change. Even prior to the election last year, the Prime Minister—then Leader of the Opposition—showed how serious we are about tackling climate change. From opposition last year the Prime Minister initiated the National Climate Change Summit to explore the critical challenges of climate change in the 21st century. The summit explored environmental and economic impacts that are likely to result from climate change.

In April last year this government, in opposition, and every state Labor government commissioned Professor Ross Garnaut’s climate change review. The review sought to examine the impacts, challenges and opportunities of climate change for Commonwealth, state and territory governments. The draft report released by Professor Garnaut in July 2008 is correctly described as the first comprehensive national climate change review in this country.

The member for Flinders has reminded us of the first executive act by this government, which was to ratify the Kyoto protocol. It is worth remembering that the Prime Minister’s first foreign trip was to attend the International Climate Change Conference in Bali, Indonesia. It is striking that the member for Flinders chose, a few moments ago, to describe that very significant act of signing the Kyoto protocol as ‘a lot of noise’. That demonstrates just how much members opposite have failed to understand the significance of signing the protocol, the significance of being seen to take action and, indeed, the significance of bringing Australia back to the table of the councils of the world that are concerned that there should be international global action to deal with the damaging effects of climate change.

Perhaps the member for Flinders was not looking at the television coverage of the attendance of the Prime Minister and his ministerial colleagues at the conference in Bali in December last year. Had he been looking he would have seen the warmth of the welcome the Australian delegation received because its attendance represented Australia’s return to the table. Australia is seen as having a significant voice and as a country that can make a very significant contribution to world efforts to combat climate change. Even now, in his role as shadow spokesman on the environment, the member for Flinders is demonstrating his failure to understand the significance of the signing of the Kyoto protocol and Australia’s return to a real role in working with other countries. It is a role we can take up only by signing the Kyoto protocol.

The government released a green paper on the Carbon Pollution Reduction Scheme in July 2008. Again, the opposition have failed to understand the significance of this green paper. The member for Flinders, the opposition spokesman on the environment, chooses to describe it as something ‘casually thrown on the table’. The government is engaged here in carefully using a green paper process followed by very extensive, wide-ranging, national consultation and nothing could be a less accurate description of that process than the words chosen by the member for Flinders, that this was something ‘casually thrown on the table’.

The Rudd Labor government is serious about tackling climate change. We understand that it is one of the greatest economic and environmental challenges facing our country and indeed the globe. Again we heard from the member for Flinders the usual confused and carping kinds of complaints that we have become accustomed to hearing from the opposition. An example of this is the complaint from the member for Flinders about the timing of submissions in response to the green paper on the Carbon Pollution Reduction Scheme. There were complaints from the member for Flinders not merely about the alleged shortness of time for submissions on the green paper but also suggesting that the whole scheme for emissions trading should be delayed until 2012. Perhaps next week we will get a suggestion that it should be delayed until 2013.

These sorts of comments about insufficient time for submissions or perhaps that it is better to delay the emissions trading scheme for a few more years are reflective of the lack of understanding by those opposite of the pressing urgency of doing something about climate change to both lessen the damaging effects and adapt our nation to the effects that are already inevitable. The urgency is that much more pressing because of the inaction by those opposite for nearly 12 years while they were in government. Had they attended to the importance of grappling with climate change, perhaps the country would not have needed to move with the speed we now need to move with—the speed with which the Rudd Labor government are moving. The Rudd government are committed to reducing our greenhouse gas emissions. We are committed to adapting effectively to the unavoidable consequences of climate change and committed to being an active partner in the international process to find a global solution.

The government set a mandatory renewable energy target of 20 per cent by 2020. The government is establishing the expanded national renewable energy target scheme, and that scheme will increase the existing mandatory renewable energy target by more than four times to 45,000 gigawatt hours in 2020. The scheme will contribute to meeting Australia’s targets for the reduction of greenhouse gas emissions. It will provide a market incentive to accelerate the uptake of Australia’s abundant renewable energy sources such as geothermal, solar and wind. The government is also looking to reduce red tape by bringing existing state based targets into a unitary national scheme.

The Rudd Labor government is committed also to research and development of low-emission technologies. It understands that researching these technologies will bring about greater energy efficiency and lower emissions. In the budget, the government invested $500 million in a Renewable Energy Fund, another $500 million for a National Clean Coal Fund and another $500 million for the Green Car Innovation Fund. These initiatives, particularly the green car fund, will put Australia at the forefront of technology in this area. The government has also committed $240 million to the Clean Business Australia initiative to work with businesses to deliver energy and water efficient projects focused on productivity and innovation.

Meanwhile, those opposite seem stuck in what you could fairly describe as a petty partisan struggle about climate change. We heard some more of it today from the member for Flinders with his suggestion that went something like this: ‘Don’t put all the burden on Australia’s mums and dads; work on global deforestation,’ alleging at one point in his speech that the new government had dropped the ball on global deforestation. Again, the member for Flinders, the opposition spokesman on environmental matters, has demonstrated his failure to understand just how the Rudd Labor government is engaging with the world, why it is that having signed the Kyoto protocol it is now sitting at the table with those other countries that are committed to doing something about climate change and how on all subjects connected with climate change, in particular global deforestation, Australia is now in a position to do something about these matters, now in a position to engage with other countries in the world. Even on the juxtaposition that the member for Flinders chose to make by allegedly putting all the burden on Australia’s mums and dads against some effort being made on global deforestation, I would again ask: what was the former government doing for its nearly 12 years in office in respect of global deforestation?

We have had extraordinary statements from the Leader of the Opposition on an emissions trading scheme. I will quote one, though it is a little bit hard to read through because it is a little muddled. It went like this:

The fact of it is that if we go—as we will, as we must, as we will and we will pay a price as a nation as we should for a genuinely global response—one of the consequences of that will be an increase in the price of energy, electricity bills for households and petrol and fuels that we use.

That statement, so far as it can be understood, sums up the opposition’s attitude towards climate change. Those opposite failed to realise that the issue is serious enough to require a sustained, coherent policy, and that is what those opposite failed to come up with. The Leader of the Opposition’s statement is typical of a government that sat on its hands and did virtually nothing about climate change for 11½ years—whatever the propositions advanced here today by the member for Flinders. The proposition of the member for Flinders that Australia is on track to meet its international obligations under the Kyoto protocol simply begs the question as to why the former government did not wish to ratify the Kyoto protocol. It was the government in office in this country before 1996—a Labor government—that negotiated the primary provisions of the Kyoto protocol and, in particular, included in the Kyoto protocol some important provisions that recognised Australia’s potential for reductions in carbon emissions through reductions of large-scale deforestation or land-clearing operations, particularly in South-East Queensland.

Why was it that the Howard government did not feel able to ratify the Kyoto protocol? Those opposite have failed to deliver any substantial policy on climate change, either while they were in government or, for the last nine months, while they have been in opposition. In truth, those opposite failed this nation on climate change. It might be thought that it is about time those opposite came to their senses in relation to climate change, that despite the full-throated denials that we were still getting from those opposite up to the election last year, we might hear from those opposite that it is now time to work together to deal with the effects of climate change. But it would appear that the Leader of the Opposition has proven once again that he does not have the leadership to stare down those in his party room who wish to continue to deny that climate change is happening, who wish to continue to deny that it is urgent and that something should be done. Instead, we have the Leader of the Opposition and, indeed, the opposition spokesman on the environment playing politics with climate change.

The opposition supports an emissions trading scheme, we are told repeatedly—the member for Flinders said it again here this morning—but not before 2011 and perhaps in 2012. I would expect if this continues that we are going to be hearing dates from those opposite like 2013 or 2014 or perhaps some years hence—anything rather than engage as they should with the urgency of doing something about climate change. It would seem that those opposite are simply not interested in doing what is required. The Leader of the Opposition particularly does not seem interested in doing what is required. Perhaps one should not be surprised about this because there remain, it would appear, serious climate change deniers within the Liberal party room. That is the same party room where the Leader of the Opposition is staving off either the return of the member for Higgins or the elevation of the member for Wentworth.

The member for Tangney in July of this year wrote the following in the Australian:

Any real climate change in the past century has been at a glacial pace (that is, the speed of a glacier that is not melting because of the globe’s supposedly soaring temperatures). Far greater periods of environmental change have been recorded in history without any human intervention. The Ice Ages, anybody?

Glib comments like this simply confirm that many in the coalition are simply not serious about climate change. It is the case that only a Rudd Labor government can deliver a comprehensive plan to tackle climate change. This bill is part of that comprehensive plan. I commend the bill to the House.

Ian Macfarlane (Groom, Liberal Party, Shadow Minister for Trade) Share this | Link to this | Hansard source

I rise in support of the National Greenhouse and Energy Reporting Amendment Bill 2008 and the amendments that go with it. The relationship between being able to accurately measure greenhouse gas emissions and therefore put in place an effective trading scheme is crucial. I think at times we underestimate just how difficult it will be. I had the opportunity to present the Julius Kruttschnitt lecture to AusIMM, and today, as part of expressing my concerns about the implementation of the Rudd-Wong ETS—as distinct from a properly designed emissions trading scheme—I will quote quite extensively from that speech. The Rudd-Wong ETS is seriously flawed. It needs to be accepted that just signing Kyoto and implementing an ETS are not by themselves climate change silver bullets. The Rudd government have yet to explain how signing Kyoto and implementing their ETS can lower greenhouse gas emissions without there being in place the emission-lowering technology to generate enough clean energy to keep Australia’s economy growing. No matter how controversial coal may be now, or how out of favour with the green movement and celebrity Labor frontbenchers like the member for Kingsford Smith, the simple truth is that the development driven by our reserves of both black and brown coal has provided this nation with the basis for steady and, in recent years, spectacular growth.

Australia also has other energy resources, with reasonable supplies of high-quality oil combined with abundant natural gas. We also cannot forget uranium. It is just as unpopular as coal with the Greens and with Labor politicians but, if you believe British economist Sir Nicholas Stern, it is an energy resource that will save mankind and the earth. We have more of it than any other country, yet we use it the least. Along with literally powering a nation, Australia’s energy resources are now an economic powerhouse for the world. We are a critical part of the global supply chain for energy and resources, particularly in the Asia-Pacific region. Most importantly, with new technology Australia’s efficient production of our resources wealth gives us the potential to be a global supplier of clean energy and clean energy technology, improving the global environment and lifting the living standards of billions of people. But, in doing so, there is no room for ideology or hypocrisy. For example, there is Labor’s hypocrisy in allowing sales of uranium all over the world to fire nuclear power stations that save, just from Australian uranium, 395 million tonnes of CO2 a year relative to black coal, yet it is still refusing to consider nuclear power in Australia under any circumstances. How can you ignore evidence that the cumulative carbon savings from nuclear power over the three decades to 2030 will exceed 25 billion tonnes? Yet they still claim that they are credible on an emissions reduction policy.

On the trade front, Labor’s hypocrisy of allowing sales of our uranium to China but not to India on the same terms is a foreign affairs disaster that is costing Australians jobs and exports and causing strains on the growing trade relationship with this huge potential market. It also brings into question how Australia can call on rapidly developing nations like India to lower their emissions yet thwart their efforts to move away from coal fired electricity. The Rudd government is fond of trumpeting that the ETS will be the most comprehensive in the world, but on present form it is also the most scant-on-details scheme in the world. The potential economic impact of this scheme not only on the resources and energy sector but across all facets of the economy simply cannot be overstated. The interests of Australia, its businesses, its export industries and its residents will be best served by a rational and reasonable approach to addressing climate change in Australia and the world’s carbon emissions. We need to bring some rationality and natural caution to this debate. Rationality and caution have not been there so far.

The carbon debate has been emotional, sometimes irrational, but always political. Carbon dioxide is a colourless, odourless, non-toxic inert gas that makes up less than 0.05 per cent of the world’s atmosphere. According to experts, any significant increase will cause more floods, more droughts and the end of civilisation in some parts of the world. Anyone who dares question this prediction is immediately branded a sceptic and subjected to scorn and ridicule by political opponents, sections of the media and self-professed experts of all types and backgrounds. I know because those opposite, the Labor Party, were quick to brand me a climate change sceptic. For the record, I am not a climate change sceptic, nor have I ever been. As a former farmer, the son of a farmer and a scientist, and the grandson of a geologist, I have always followed the evolution of the world’s climate very closely. You do not have to sift through too much information to see a clear pattern of ups and downs in the global temperature over the course of the history of our planet.

Our planet’s climate is changing and warming and has been doing so since the last ice age more than 10,000 years ago. I am a pragmatist who accepts that, based on the weight of scientific evidence, combined with the democratic view of the vast majority of Australians, we cannot take the risk that CO2 is not causing the earth to warm more rapidly. We have heard from the Prime Minister predictions of droughts every one or two years, rising sea levels, flooding homes and the destruction of natural assets such as the Murray-Darling system, Kakadu and the Great Barrier Reef. It is a disaster scenario just short of helpings of fire and brimstone. Former Queensland Premier Peter Beattie was even reported as saying that tsunamis were caused by global warming; of course, they are caused by movements in tectonic plates.

In this emotion charged environment, it seems that, unless you are prepared to offer full-blown acceptance of every single new claim presented by climate change alarmists, you are nothing short of a lunatic, a heretic or, as the member for Isaacs made the point, a denier. These attacks on free speech are unscrupulous and deceitful. Yes, Australia should take climate change seriously. I certainly do. But the question must be asked: whose interests are served by running a ruthless scare campaign that depicts scenarios of doom and destruction and attacks people in such a derogatory and personal way?

The Australian public are asking for more information. This was highlighted recently in an article by Dennis Shanahan. He highlighted the fact that a Newspoll survey had shown that 40 per cent of those surveyed between the ages of 18 and 34 were unaware of climate changes before human existence or of the dramatic changes—that is, ice ages—since humans were but a pinprick on the earth’s surface. Not even Al Gore suggests that humans are entirely responsible for climate change, yet the Rudd government is planning the most momentous reform of the Australian economy with one-third of the voting and taxpaying population completely misinformed. If we are to go forward with the most effective least-risk path, we need to put this angry and divisive debate behind us and start focusing on the science and common-sense solutions. Away from the cameras and opinion polls, this relentless attack on fact and the debate on climate change are beginning to be questioned. The unavoidable truth is that an emissions trading scheme has the potential to hit our economy very hard and not just at the top end of town. It will impact on every family and every household—on electricity bills, petrol bills, water bills and grocery bills from Toorak to Townsville, from Brisbane to Broome. It will impact on all industries and all businesses, from BHP Billiton to the corner store.

An ETS must also be put into the context of the compounding massive risk posed by the Rudd Labor government’s other emission-lowering policy, the 20 per cent MRET, the same policy that was described by the AiG chief, Heather Ridout, as:

… an ill-advised and risky policy proposal that is likely to significantly increase the cost of greenhouse gas abatement in Australia.

Furthermore, she said that it would have an adverse impact on households and businesses throughout the economy. The Business Council of Australia has also painted an alarming picture of life under a Rudd-Wong ETS, which would see trade exposed industries shut or be sent offshore. President Greig Gailey will say in his speech tonight:

Australia would lose valuable export earners. Jobs and investment will be lost.

I might also add that a number of these industries are located in regional centres where the opportunities for alternative employment will be limited and the effect on working families could be devastating.

Against this backdrop of far-reaching consequences, Australians are starting to put into context what will happen in terms of a carbon trading scheme and what Australia can actually do when we make up only 1.4 per cent of global emissions. We are now realising that, whatever we do, no matter how severe our cuts to carbon and the economy are, our attempts to slow global warming will have no effect at all if they are not embraced by the vast proportion of the rest of the world. This point is driven home by the fact that China and the US emit more in a month than Australia does in a year.

The ETS will have a greater impact on Australia than any other economic reform in our history. There is growing unease in the community about where to go from here and the capacity of the Rudd government to manage this process safely. It is little wonder that, with rising interest rates and plummeting business and consumer confidence, the Australian public is getting jittery. That all begs the question: what confidence can the community, business and industry groups have that the outcome will be any different on the emissions trading scheme than what we have already seen with solutions to rising petrol prices and the Murray-Darling? In fact, we have to wonder what the outcome will be when this debate is being driven by weather forecasters, economists and politicians. We know how accurate weather forecasters are, and economists were just put here to look good. Perhaps in this place I should not comment too much on politicians—I will leave it to those listening to this broadcast to decide.

We have already seen what happened to the EU carbon trading scheme when those three groups got together: the carbon price became uncontrollably volatile. That is the very reason it is imperative that this across-the-board reform is managed carefully and pragmatically and based on technology, not spin. The ETS must be rigorous and meticulous in its design, and all options need to be examined and all groups listened to. It is obvious that there are glaring inadequacies in what is being proposed by the Prime Minister and Senator Wong.

Australia deploys the world’s best technology in building steel plants, aluminium refineries, paper plants and cement plants, and so the list goes on. In short, we give the world the best products it needs, at the lowest carbon intensity. Yet what is being proposed by the Rudd government will take no account of that and in fact will cause what is commonly named carbon leakage, where industries close down here in Australia and are rebuilt overseas with no reduction in carbon or, in the worst-case scenario—but probably the most likely scenario—with higher emissions than they would have had here. The end result will be an ETS that lowers Australia’s carbon footprint, perhaps, but increases the global footprint.

Concerns are coming from everywhere, and not just from the business sector. We saw Paul Howes from the AWU express concerns about how jobs will be lost in Australia if there is no consideration of how to address export exposed or trade exposed industries, particularly energy-intensive trade exposed industries. We have also seen the comments from the member for Isaacs, who said that the Howard government did nothing about emissions trading. For the record can I briefly say what the Howard government did do. We laid out an expenditure program of $3.5 billion to address climate change and lower emissions. Key elements of the program included clean coal; renewable energy technology; energy efficiency programs, including the one we are talking on today; a mandatory renewable energy target, which will see $5½ billion invested in zero-emission technology; a subsequent mandatory clean energy target; and the introduction of an emissions trading scheme that would protect our economy and the jobs of Australians.

We did realise that there had to be collaboration, but the legacy left by the Howard government is not that of the irresponsible carbon polluter that some in the Green movement tried to make out Australia as being. Between 1990 and 2005, the economy grew by 61 per cent but emissions only grew by two per cent. Emissions per head of population and percentage of GDP also fell. Praise came from all over the world, including from Sir Nicholas Stern, who said that Australia under the Howard government was leading the world on zero-emission technology for coal, on solar and on non-volcanic geothermal. Even Ross Garnaut, in his recent speech at the Press Club, said Australia has ‘been punching above our weight on climate change for the last seven years’—seven years! The real effect of the Howard government’s programs is that by 2010 we will be emitting 87 million tonnes fewer per annum of carbon dioxide.

The prudent approach to lowering greenhouse gas emissions is to incorporate a level of risk management into our attempts to reduce carbon emissions, thus ensuring we do not senselessly grind our economy into the ground while the rest of the world watches with a curious smile. In other words, if we are going to take a visionary lead and show the way, it would be reckless not to take out some insurance in case the Rudd-Wong ETS goes to ashes—literally. If we are serious about pursuing clean energy options and not just interested in symbolism and endless manipulation of public perception, we must look long and hard at all the options, and they include renewable energy. They include clean coal, though I note the Minister for Resources and Energy recently said that clean coal was at least a decade away, probably 15 to 20 years away, and he still has no idea of what it may cost or what zero will actually be. In fact, indications are that it will be as much as 500 kilograms per megawatt hour of electricity produced. The cost of zero-emission coal is something that we will need to come to terms with, just as we need to come to terms with what technologies will be able to be installed in the next two years before the introduction of the Rudd-Wong emissions trading scheme.

I have very grave concerns about Australia’s ability to generate enough clean energy from the technology that is currently available. Based on the progress we have seen in those technologies over the last 10 years, I have very grave concerns that we will be able to implement a program that will reduce greenhouse gas emissions from electricity production enough to stop the Rudd-Wong emissions trading scheme from basically sending our economy into a nosedive. I have grave concerns, as someone who has studied engineering, who understands mechanics and who has watched innovation and been involved in innovation. Can I just say that if we continue helter-skelter down this path, without the reality of what is actually physically achievable in low-emission technology, then I think that there is a real chance that not only will the lights go out but so too will the job prospects for many Australians in the future.

Gary Gray (Brand, Australian Labor Party, Parliamentary Secretary for Regional Development and Northern Australia) Share this | Link to this | Hansard source

I rise to speak on the National Greenhouse and Energy Reporting Amendment Bill 2008. Speaking on greenhouse measures may seem a little odd for me—after all, I did describe climate science as ‘pop science’ in the 1990s. I wish I had not said that. Climate change is real. Greenhouse measures are serious and they have serious implications—implications that will affect how we create wealth, how we travel and how we work. At all times our greenhouse measures must enhance our national capacity to create wealth, because it is wealth which allows us to improve living standards; it allows us to protect our environment. Without wealth creation we will suffer lower living standards. Without wealth creation we will suffer a degraded environment. And without wealth creation our ability to respond to climate change will be reduced. For these reasons, the government must get emissions trading schemes right.

This bill amends the original 2007 legislation passed through this place by the Howard government exactly 12 months ago. The 2007 legislation provided the first plank of what is now becoming a comprehensive emissions trading scheme. I looked over the 2007 debate in Hansard. The current Minister for the Environment, Heritage and the Arts, the member for Kingsford Smith, was scathing of the Howard government’s ‘sloppy bill’. He acknowledged the urgent need for progress but lamented the poor process and lack of consultation.

After reading the Hansard, I looked at other parliamentary reports. According to the Senate Standing Committee on Environment, Communications, Information Technology and the Arts investigation into this legislation, it was found that the department did not consult with stakeholders during the drafting stage. The committee’s report found that stakeholders did support the intent of the legislation. It also found that, in its original form, there were various problems with this legislation.

I noted with some interest the speakers list from the passage of the original legislation. In 2007, the member for Wentworth was, of course, appropriately, lead speaker for the Howard government on this legislation. He was followed by my Western Australian colleague, the member for O’Connor—a great champion of the environment—and the member for Pearce, as well as the member for Ryan and the former member for Deakin. It is surprising that the current member for Calare, the then Assistant Minister for the Environment and Water Resources, did not speak. It is also surprising that the member for Higgins did not speak. The member for Groom, who has just spoken, did not speak at that time. The member for Flinders, the current shadow minister, did not speak. If, as the member for Wentworth then claimed, the legislation demonstrated the Australian government’s commitment to an effective climate change response, the lack of coalition speakers in this place for their legislation was, at least, revealing. I am still unclear as to the current position—or maybe that should be ‘positions’—of the members opposite.

What is clear is that the Rudd government is responding to deep-seated calls from the community, business and industry to address carbon emissions. Indeed, by many public measures, carbon emissions are the most important environmental issue. It is clear that the people of Australia gave the Rudd government a mandate to implement practical and fair measures to reduce Australia’s carbon footprint. And it is clear that this amendment bill that we are debating today will strengthen the National Greenhouse and Energy Reporting Scheme.

Cutting carbon emissions will have costs: prices will rise; industry will change. It will not be easy; there will be pain. Australians often have an inconsistent attitude to the environment—proffering great concern but not always living up to their high ideals. According to a Newspoll published last year, nine out of 10 Australians believe that a quarter of Australia’s energy should come from renewable sources by 2020. But, according to this year’s National Green Power Accreditation Program’s March Quarterly status report, only 9.1 per cent of Australian households are buying their power from a green energy provider.

Green energy is also an option for Australian companies trying to reduce their greenhouse gas emissions. And Australian companies are world leaders in cutting their emissions. But what has been missing is a nationally consistent, internationally recognised and coherent measuring system. An article in the Australian Financial Review of 19 September 2007 regarding the passage of the 2007 original Howard government legislation reported:

The investment community finds emissions data hard to use because the figures can’t be compared. There’s no consistency in the items factored into reports, there’s variation in the ways companies calculate emissions and occasionally companies don’t even explain what they’re actually measuring.

The Howard government’s National Greenhouse and Energy Reporting Act 2007—introduced by the member for Wentworth exactly a year ago—laid the foundation for an Australian emissions trading scheme. The robust data that, as we speak, is being collated because of this 2007 legislation will form the basis of future emissions liabilities under emissions trading. Importantly, that data will also inform the Rudd government’s decision-making process during the establishment of any emissions trading system. The 2007 legislation established that from 1 July 2008 companies would need to report their emissions and abatements under a single national framework. Before the Howard government scheme was introduced, hundreds of Australian companies were already providing the same or at least similar data to various voluntary state, territory, national and international greenhouse reporting programs. Each program had been developed in isolation and, in some cases, companies were preparing numerous differing reports to be submitted to different programs.

This amendment bill will amend the National Greenhouse and Energy Reporting Act 2007 to make changes to the public disclosure provisions and to clarify matters of administrative detail. It also addresses some of the complexity of reporting requirements and, at the same time, adds in obligations to differentiate and quantify direct as well as indirect emissions. It will allow the minister to specify conditions for methods of measuring greenhouse gas emissions and to specify a rating system for such methods. It will provide greater clarity for the public and investors with the publication of the methods of measurement.

Currently, there are approximately 450 companies reporting under the National Greenhouse and Energy Reporting Scheme. By 2011 this number is expected to increase to around 700 companies. There is significant business support for this action. The business community has been calling for an emissions trading scheme and it is the business community which began to work out how to develop one. Ten companies operating in Australia, with a total market capitalisation of around $600 billion, say they want this. I will now go through the stories of BHP Billiton, Rio Tinto, Woodside, AGL, Santos, Alcoa, Origin Energy, Westpac, Wesfarmers and BP. Why do they say they want it? That question can really only be answered by them. They have run the numbers. These firms have factored in carbon prices, their business planning demands that they do it, analysts and stakeholders demand it and shareholders expect it. A position on carbon has often helped define the reputation and public standing of companies—Origin Energy comes to mind.

When the previous government decided to investigate the possibilities of emissions trading, Prime Minister Howard established a prime ministerial task group to advise on the nature and design of an emissions trading system. A Canberra Times article, dated 26 March 2007, summarised the submissions made by Australia’s top firms and found:

Australia’s most important resource companies including BHP Billiton, Rio Tinto, Woodside, AGL and Alcoa have come out in support of a national carbon emissions trading system to fight global warming.

The article went on to say that, of the almost 200 submissions posted on the task group’s website, almost all called for emissions trading. The big Australian, BHP Billiton, on page 3 of their submission, stated:

It is clear that an effective, sustained global response to the threat of climate change is required.

In the near term it is recognised that linked national emissions trading systems—ETSs—are more likely than a single global system. BHP Billiton stated:

BHP Billiton supports the development of a global, market-based mechanism for valuing and trading emissions entitlements and reductions, on the basis that it is broadly-based … efficient, and phased in such a way that industry and the economy have sufficient time to adjust.

On page 5 of their submission, BHP Billiton further stated:

Australia is vulnerable to climate change, as are many of the nations in this region. Acting alone, Australia can do little to mitigate the growth in global emissions.

However, BHP Billiton continued:

Australia can play a leadership role in encouraging an effective, efficient and equitable global scheme taking advantage of its resources and skill endowments and accepting its share of global efforts to mitigate greenhouse gas emissions.

BHP Billiton have had a climate change policy since 2002 and they further revised it in 2007. Not only are companies such as BHP Billiton supporting moves to establish an ETS; they are actually committing to voluntary reductions of their emissions. In 1995 BHP Billiton took part in the Australian greenhouse challenge, a program that encouraged reductions in greenhouse gas emissions.

Even earlier, in 1993, BHP Billiton started measuring greenhouse gas emissions and have publicly reported their resulting data since then. As to an emissions trading scheme, BHP Billiton have already identified emissions trading as an area of opportunity.

BP are a global company with a market capitalisation of US$232 billion—that is, a quarter of the size of the Australian economy. They have almost 100,000 direct employees, with significant oil and gas production and refining capacity in the global marketplace. Their submission to the Prime Minister’s task group advocated the need for a global carbon price and a well-designed emissions trading scheme. Under the heading of ‘The reality of how global carbon markets will be built’, BP argue:

There is a real possibility that an effective global market will develop through the convergence and linking up of a number of regional, national and sub-national carbon markets (i.e. a ‘bottom-up’ approach to developing a global market).

BP go on:

This seems much more likely than following the ‘top- down’ approach of designing a global market from scratch.

On their website, BP state their support for:

… precautionary action to limit greenhouse gas emissions and works to combat climate change in several ways, even though aspects of the science are still the subject of expert debate.

I am a Western Australian, and a great Western Australian icon, Wesfarmers Ltd, are also very supportive of an ETS. On page 1 of their submission to the previous government, Wesfarmers stated they:

… have no doubt about the desirability of actions aimed at reducing greenhouse gas emissions because of the likely adverse effects this build-up will have on life on earth.

Wesfarmers are a major Australian public company which began in 1914 as a farmers cooperative and was listed on the ASX in 1984. Wesfarmers operate the chemical and fertiliser business, CSBP, in Kwinana, which is in my electorate, so I take a keen interest in their policies and activities. On the second page of their submission, Wesfarmers state:

While a trading system is more complex to design and administer than a straight out tax, and while it is subject to demand variations, the cap and trade schemes most often canvassed have a strong appeal in terms of certainty of achieving environmental objectives.

Personally, I, like Jeffrey Sachs, am drawn to a carbon tax, but businesses want an emissions trading scheme and that is what our government have said they will get. Wesfarmers have for several years disclosed their greenhouse emissions through a sustainability reporting process and are well placed to meet the reporting requirements set up by this bill.

Rio Tinto, another major company operating in Australia, accepts the concept of an emissions trading scheme as one part of a comprehensive climate change policy. On page 3 of Rio Tinto’s submission, the company warns of the possible negative consequences of an ETS but concedes that early action by Australia, with others, may help shape future international policy.

Santos is a major Australian oil and gas exploration and production company. It also expressed its support for an ETS. In the summary of its submission Santos states its support for:

… the introduction of an emissions trading scheme on a national basis, recognising that a well-designed scheme will be a key component of a portfolio of initiatives to reduce Australia’s greenhouse gas emissions.

In Santos Ltd’s greenhouse policy statement of September 2004 the company commits itself to actively pursue an emissions intensity reduction target of 20 per cent during the period from 2002 to 2008 using a portfolio approach, and to measure and report progress against this emission reduction target.

Australia’s largest energy provider, AGL, also expressed support for an ETS in their executive summary, found on page 2 of their submission to the Howard government’s inquiry. They said:

AGL accepts the scientific consensus that greenhouse gases in our atmosphere need to be stabilised … AGL supports appropriate early action taken by Australia to reduce emissions. Taking action now to cost effectively transition the economy towards a lower emissions profile will reduce future costs associated with action taken at the international level.

Origin Energy is yet another major energy company that supports the introduction of an emissions trading scheme. On page 20 of its submission, Origin states its support for a ‘cap-and-trade emissions trading scheme’. Origin says it wants:

... a national scheme administered by the Australian government as the preference over a States-based scheme.

It further goes on to say it wants:

… a start date as early as 2010, but no later than 2013.

These companies are not a bunch of greenies at the bottom of the garden. Origin Energy is a publicly listed company with a market capitalisation of over US$14 billion, and it supplies energy to more than 3.6 million homes and businesses across the country. It is also a major employer, with more than 3,400 employees in Australia, New Zealand and the Pacific.

A company I once worked for, Woodside Energy, is Australia’s largest publicly listed independent oil and gas exploration and production company. Woodside supports efforts to design a workable global emissions trading system, including the domestic prerequisites that would help prepare for this system. On page 3 of its four-page submission Woodside states:

Given the long timeframes for which oil and gas projects are built and therefore financially exposed to, Woodside sees the provision of long term certainty to these investments is of paramount importance, and needs to underpin any considerations regarding permit issue/allocation and secondary carbon markets, if these are to be effective.

Business is not alone in calling for certainty in this area. In the introduction to its submission, Westpac acknowledges that:

Business is also facing increased pressure from institutional investors, calling for greater clarity on how companies are strategically and tactically managing their response to the implications of, and exposure to, climate change.

Westpac is another example of an Australian company that has sought to win community acceptability through strong measures that cut its greenhouse gas emissions. According to page 2 of its submission, Westpac has reduced its greenhouse gas emissions by over 45 per cent since 1996.

I note the fact that the previous government was not interested in this issue at the time. But that did not stop corporate Australia from taking its own steps and creating its own expectations. The conveniently timed release last week of the Business Council of Australia’s paper Modelling success: designing an ETS that works was widely reported as a time bomb for the Rudd government. Well, I disagree—this is exactly the kind of dialogue the Rudd government welcomes. Business has to be confident, and it has to be certain that the government will commit to an efficient and equitable emissions trading scheme and will actually follow through on that commitment.

Unlike the process committed to by the previous government—noted for its lack of consultation—the Rudd government has entered into a comprehensive policy development process that involves genuine consultation. The Minister for Climate Change and Water and her cabinet colleagues are regularly meeting with key stakeholders as part of this process. In yesterday’s Australian Financial Review the member for Batman and Minister for Resources and Energy stated that meetings with business executives ‘constitute a very important component of the policy development process’. He went on to say:

The government knows it is vital to get the scheme right for Australian industry, jobs, exports and investment … The government is committed to a process of genuine consultation, and Minister Ferguson will work closely with both industry and cabinet colleagues to ensure the government gets the scheme right.

More formally, Ross Garnaut’s climate change review, the Carbon Pollution Reduction Scheme green paper and an eventual white paper are all important steps that will encourage dialogue and ensure that we get the scheme right.

This is a complex issue, and this bill seeks to clarify the important issue of measuring and recording emissions. Personally, I think that too often the issue of climate change and policy options like emissions trading schemes are not widely understood by the general public. It is incumbent upon this gov-ern-ment, and indeed this place, to do all it can to inform the public and enter into a dialogue with the community and with business so that diverse perspectives can better inform policy and the processes for making sound policy can be put in place.

I have been labelled as a climate change sceptic or—if the attacker is particularly belligerent—a climate change denier. I am neither of those things. Science, as an abstract concept, should not have believers and deniers. Science should enable us, as policymakers, to make better informed policy decisions. It is hard to do this with people who view science as no longer an objective testing of hypotheses but as a belief structure more closely linked with faith. That is why I am supportive of the government’s decision to seek a viable and responsible solution to a conundrum roundly identified and accepted by our community and by industry. I also think that it is important to invest in science to test these theories and to have the courage to pursue scientific method. I commend this bill to the House, and I encourage the members opposite to clarify their position on this issue.

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

I will start by congratulating the member for Brand for his speech on the National Greenhouse and Energy Reporting Amendment Bill 2008, particularly his comments about aspects of corporate Australia. I guess some of them were a little bit selective; nonetheless, they did, in my view, reflect quite significantly some of the views of many of our major corporations in relation to emissions trading and greenhouse gas emissions generally.

If there were ever an issue where this House and the Senate needed to come to a united approach, it is this issue. On both sides of the parliament we are at risk of losing what the great majority of Australians would like to see in leadership at the federal level. I believe, and I believe most Australians believe, that something needs to be done, that human habitation has created an accelerated problem in relation to greenhouse gases. The government went to an election with an approach based partly on embracing this particular policy initiative and has embarked upon a process of developing an emissions trading scheme. There are currently documents out there that people can comment on, with a view to developing legislation. I think there is a feeling in the community that the government may well have already developed what it is going to put before the parliament. If that is the case, I believe that would be a mistake. The member for Brand made the point a moment ago that this is a very complex issue; I do not understand it and I am sure many of us in here do not. For this to be successful, the Australian community has really got to understand, or have a knowledge of or a degree of trust in, the process that is developing. So it has to be a very transparent process.

It also has to be a process, in my view, where the government and the opposition come together and formulate a united approach. This is too easy an issue to politicise because of its inherent complications. It is so easy to bomb it out, in a political sense—to go to the populace and comment simplistically on the cost increases that are going to occur in the early years or the later years and how they are going to destroy family budgets et cetera. It is too easy to concentrate opinion on the negative in this particular issue. The government has to make a decision as to whether it is really serious about embarking on a process that will make a meaningful difference. If it compromises itself at the start it may as well not start. If it compromises itself because it believes the opposition will score some political points in terms of electricity prices or in the debate— and we had one a few months back—about the impact of a trading scheme on the price of fuel et cetera, the general public will see that. So there has to be a seriousness of intent to actually do something about the problem.

There is an easy answer. The member for Groom and others quite legitimately have raised this issue: if we do something here and the rest of the globe does not do anything we will just incur some pain economically and the rest of the world will laugh at us. There are a number of issues there that really need to be addressed. One is leadership. If we are serious, and if we are in a position to do something we should be doing it; we should be displaying a degree of leadership. That highlights the significance of a united approach at a government level. If we are not serious let us forget about it. Let us just go back and carry on as normal, as if nothing is happening; let us deny the problem. We can design some political agenda that says there is not a problem and the scientists got it all wrong.

I believe there is a problem and, as a member of parliament, I would rather this parliament did more than enough rather than not enough. I would hate to be in a situation where my family and others look back in 50 years time and say, ‘Why didn’t they do something about that?’ I would rather err on the side of doing more than enough rather than too little, and if, in doing more than enough, it were proven in 50 years time that we did not have to go that far, I think that would be an excellent outcome. But if doing nothing or too little now were proven in 50 years time to have been part of an irreversible process that should have been addressed, I would see that as an indictment of my performance and the performance of many others in this building.

So I think that both sides of this parliament have got to make a decision. Is this a problem? Do we have a problem? If we have a problem we should agree on what the problem is and then develop a process where there is a united approach to solving it. The member for Brand mentioned many big companies and the language that they have used. I know there is jockeying and positioning going on as to who pays and who gets compensated and who is who in the zoo in this at the moment. But it seems to me that the smart businesses are recognising that long term this is a global issue, it is a global problem that could have massive ramifications economically if it is allowed to go on into the future and there needs to be a degree of leadership. I think it is all too easy for all of us to say, ‘China and India—if they don’t do anything, the world burns.’ Things change through leadership. If anybody does not understand how little things and little people actually change political history, they should have a look at the initiatives that took place in South Africa that people had thought would never take place, in situations which they had thought were irreversible.

I made the comment earlier that I hope that the government has not made a concrete agreement on what it is going to be doing before it takes advice through the consultative process. As I said, I think that we need to take the Australian public with us on this issue rather than impose something on them that they do not understand and that can be so easily politicised. Obviously, the way to stop that politicisation is to have the opposition and the government work together on a common scheme for the greater good of the community, even though there will be costs and winners and losers. That would be the ideal, so I suggest to the government that they try to get to that rather than just return to the Howard sceptics’ approach of accusing the opposition of being sceptical. Some of them may be; most of them, in my view, are probably not. Most of them would rather see something done, but they want to see something that they believe can be achievable and can be embraced.

One of the other areas I have suggested the government take on board is global reafforestation—and the shadow Treasurer made the point on a number of occasions that it can be a significant contributor to solving the problem of climate change. I did not hear all of his speech because I had a meeting to go to, but I do not think he mentioned Australian or global soils—in particular, the humus and organic matter in the soil profile—as a potential natural sequester for carbon. I am sure you would recognise, Mr Deputy Speaker Scott, that in some parts of your electorate there have been massive changes in cropping techniques and some pasture techniques, and one of the spin-offs has been much healthier soil. People have been doing that not because they have suddenly become concerned about greenhouse gases and the carbon debate; they have moved into those technologies because they make more money out of them. One of the consequences is that in many areas our carbon-depleted soils are now accumulating carbon at quite a rapid rate.

This is a debate we are living through at the moment. I have spoken to the Prime Minister and the Minister for Agriculture, Fisheries and Forestry about this. I know that they have set aside some money to look at what is happening with our soils and whether they can be part of the solution to the problem. But, rather than just planting trees—and not cutting them down—for carbon sinks and natural sequesters, we should also be looking very seriously at the potential of our soils to be part of the solution. We should not rush headlong into an emissions trading arrangement which does not fully embrace the debate.

In many parts of Australia there have been significant soil test results that indicate that organic matter and humus in the soil can sequester carbon. I know there is a degree of argument about measurement and the release of carbon in times of extreme drought et cetera, but in my view there are various techniques that could help with that particular issue. I would encourage the government to make sure that that area is covered. It embraces the potential of our soil to be part of the solution—a natural solution rather than a costly one. In fact, there are benefits all around. Our soils will be healthier and they will be drought proofed to a certain degree. There are a whole range of positives, one of which is natural sequestration of carbon.

I think far too much attention has been paid to that area by those who would like to make money out of it, those who like to include the accumulation of humus and organic matter in our soils as part of an emissions trading system. As you would recognise, Mr Deputy Speaker, there is currently a difficulty with the measurement of carbon in our soils. We have the same difficulty with the measurement of carbon in our trees, or any vegetation, but we seem to be able to develop carbon trade in some global circumstances with trees in particular. Those measurement issues can be overcome. But, even if they cannot, there are other areas of government policy—for instance, drought policy—which can encourage better soil management and more healthy soils. Even if carbon trading is not a part of an emissions trading system, these soils can be part of the solution to the basic problem—that is, not only carbon dioxide but also the methane and nitrous oxide that make up the great majority of the greenhouse gas problem. I suggest to the government that they once again have a much closer look at that before they develop a hard and fast emissions trading scheme, because over a relatively short time there could be some natural solutions to these problems.

There is another issue I would like to raise. I know this is a little outside the bill, but I think this is an opportune time to raise this issue. There is currently a lot of talk about climate change in the Murray-Darling system. We have just had the Prime Minister and the minister at the lower lakes of the Murray talking about the difficulties that are currently there. I think we all recognise those difficulties, though people have different views on how we solve some of them. One of the things both the Prime Minister and the minister said while they were there—I am verballing them a little bit, but this was the intent of their words—was that there had been mistakes in previous government policy—meaning the overallocation of water and the lack of recognition of what parts of our landscape could sustain in terms of land clearing and the application of water—which had led to this crisis in the Murray. They also said that the drought and climate change have been part of the problem in the Murray-Darling.

There are a couple of issues I would like to raise here, and one of them is pertinent to my electorate at the moment. We currently have exploration licences being issued to major companies—BHP is one of them, and a Chinese company is another one—to explore for coal on the Liverpool Plains, which is part of my electorate. Most people would be aware that the Liverpool Plains is probably some of the most productive land in the world, not just Australia. I guess people can buy and sell land and do what they like with it, but that land is underpinned by something like 20 interconnected groundwater systems that have a relationship which we are not certain of with the river system, which happens to be the Murray-Darling system.

We currently have a planning process for developing a coalmine that is state based and very much centred on localised impact. I am not opposed to coalmines; I have one literally next door to me. There is a coalmine within a kilometre of my bedroom window. But for the Prime Minister and the Minister for Climate Change and Water to say, at the bottom end of the Murray system, that past policy mistakes have caused a crisis in the Murray-Darling and then to refuse an independent study of the potential impacts of longwall coalmining—not only in highly productive food-producing areas but in areas underpinned by interconnected groundwater systems that we have no knowledge of—is hypocritical. To allow the states to maintain that sort of mentality is, in my view, hypocritical. It is totally hypocritical to blame previous policy for a problem and then allow an existing policy potentially to exacerbate the same problem. There is no knowledge—whether it be in BHP, China or the United States—of what would happen to the Murray-Darling system if you slashed the artery of a longwall mine and interfered with the hydraulics of the interconnected groundwater systems that relate to it. Some would say: ‘You can give up just one valley. The Namoi Valley is only 250 kilometres long; who cares?’ There are six valleys in New South Wales and there are groundwater systems in the other states as well. They are something that we need to know about before governments allow exploration or mining in these areas.

BHP recently said, ‘We are going to shrink the area we are looking at mining in so that we do not incorporate those groundwater systems or the flat, black Liverpool Plains soils.’ That is all very well for them to say, but that does not stop them making application in the future to mine in those areas. I call on the Prime Minister and the Minister for the Environment, Heritage and the Arts to take a stand and not to leave it to the New South Wales government. It might be that all the government is interested in is getting some cash for the exploration licences but, if we are serious about the Murray-Darling, climate change, coalmining into the future and sustainability of food bowls and production, we have to have more knowledge of these groundwater systems and their interconnectivity; otherwise, we run the risk of looking back in 50 years time and saying: ‘Why didn’t they do something about that issue? Why, when they recognised at the time that there was a crisis in the Murray-Darling system, did they take the short-term cash option and destroy an interrelated system of highly productive groundwater aquifers?’ I support the legislation.

Richard Marles (Corio, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak in support of the National Greenhouse and Energy Reporting Amendment Bill 2008, which seeks to amend the National Greenhouse and Energy Reporting Act 2007. The purpose of this bill is to make amendments to the public disclosure provisions in that act and to clarify the administrative processes in relation to it. The measures in this bill are designed to underpin this nation’s introduction of and transition to a carbon pollution reduction scheme and subsequent emissions trading scheme. As well, the bill will assist the government in ensuring that our nation meets its international reporting requirements when it comes to carbon emissions.

The government’s green paper in relation to the Carbon Pollution Reduction Scheme has outlined initial objectives, guidelines, transitional arrangements and time frames. It represents a clear policy direction on the part of the Rudd government to fulfil the mandate it was given by the people of Australia at the last election to introduce an emissions trading scheme in this country and to act on the issue of climate change. This is a very clear and deliberate path that is being put in place, not one that is being rushed. The government has a green paper in place which puts on the record the direction in which the government is going but which, at the same time, seeks to consult with all the stakeholders in the lead-up to the announcement of government policy through the white paper at the end of this year and then through legislation in this parliament. This is a very clear direction and a very clear path, which we are proceeding upon in a very deliberate and careful way.

This stands in contrast with what we have seen on the other side of this House and what we saw on the part of the Howard government prior to November last year. When we have probably the single most critical issue facing our globe and our nation, we have seen on the other side of the House nothing but a gaggle of shadow ministers desperately seeking to outdo each other via the latest media sound bite. What we have on that side of the House is nothing but politicking. The Liberal Party sees the panacea for reducing the financial burden of households in this country as a 5c reduction in the petrol excise, without breathing a word of how that tax relates to the issue of climate change in this country. As late as last week we saw the shadow resources minister and the Deputy Leader of the Opposition trying covertly to push onto the Australian electorate the idea of nuclear energy, when that idea was comprehensively rejected by the Australian people at the election last November. We have a Leader of the Opposition who cannot tell the electorate when he would like to see a carbon pollution reduction scheme put in place in this country.

We have on this side of the House the culmination of a series of actions which give us policy chaos. If business and the stakeholders in this country were trying to get an indication of where the country was going from the utterances which we have seen from the conservative parties in this parliament, they would have absolutely no idea. When it comes to this vitally important issue for the future of this country, we have seen from the coalition nothing but politicking. In contrast to that, we see on our side of the House a very clear direction, carefully and deliberately prosecuted, with consultation of all the stakeholders and taking us down the path that this country and our globe must go down to deal with the great issue of our age.

As you know, I represent people in the city of Geelong. I am sure everyone feels the issue of climate change and the potential effects of an emissions trading scheme in their own way, but I think it is fair to say that Geelong is really on the front line of the whole issue. We are on the front line, in a sense, on both sides of the equation. Geelong absolutely stands to feel the consequences of climate change. We are a seaside city which exists in one of the unusual parts of the world where scientists predict that climate change will give rise to a reduction in rainfall. Indeed, we have already seen that. Geelong has been under a variety of water restrictions for the better part of a decade now. We are a water stressed city—much more so than Melbourne, in fact—so we are already experiencing the effects of climate change in Geelong. Of course, being a seaside city, our town and its economy is inevitably intimately connected with the foreshore and with the sea. Much of our great industry in Geelong—Shell, Alcoa and Pivot, a large fertiliser plant—is located along the foreshore. Were there to be rising sea levels as a result of climate change, each of those industries and those plants would feel it significantly.

A bit further down the road from Geelong we have the Great Ocean Road, which is one of our country’s great tourist attractions and which is itself the basis of an emerging and very large industry for our region: tourism. Tourism on the Great Ocean Road is defined by the shape of our coastline. Were we to see climate change giving rise to rises in sea levels, we would see that coastline change and our tourism enormously affected. On the side of the equation which is the consequences of climate change, Geelong is very much on the front line. We are already experiencing the consequences of it.

On the other side of the equation, we are predominantly a manufacturing and industrial town. Almost half of those employed in Geelong are employed in connection with industry and manufacturing. That industry and manufacturing is exclusively fuelled by carbon based fuels. Indeed, at least two of the large multinationals that are based in Geelong produce that carbon based fuel. We absolutely feel the issue of climate change and the potential of an emissions trading scheme from the point of view of bearing the responsibility of putting that emissions trading scheme in place. I think experiencing this from both sides of the equation certainly clarifies it, if it does not give a unique perspective on the issue. It is a very stark perspective that we have in Geelong: we need to be acting on this issue right now. I want to take the House through that.

As I said, we have a number of high emitters who are based in Geelong. There is perhaps no issue being dealt with by this government which will have a greater impact on the people of Geelong than climate change and a future emissions trading scheme. It is critical for the people of Geelong that the government get this policy right. That is why it is so important and so good that we are proceeding down the path that we are, in the careful and deliberate manner that we are, so that we will get this policy right.

Last week, Ford announced further job cuts in Geelong in tandem with the job cuts which were announced last year with the closure of the Ford engine-stamping plant. This closure is due to occur in 2010. The consequences are that 600 jobs will be lost in the lead-up to that. In tandem with that, Ford has also announced that it will be producing the Ford Focus locally in Australia at its Broadmeadows plant. I think I am right in saying that it will become the first locally produced four-cylinder car in Australia—or the only one produced at the moment. It is a significant decision being made by Ford, and it bears some examination because there are important lessons to be learned, both for our country and for an industrial region like Geelong, in the context of climate change. Whilst Ford has made this decision to manufacture the Focus in Australia, it is no thanks to the former government, which showed a distinct lack of support for the automotive industry in this country.

The former government also showed a distinct lack of foresight on this issue of climate change, did very little, as I stated earlier, to provide the kind of policy indicators for business to move down a more carbon neutral path and did very little to help them in the transition to that. It is good for me to be able to report here that the Bracks review into the automotive industry has recommended significant increases of funding for the automotive industry. We have on the table now a policy in relation to climate change, of which this bill is certainly a part, which is giving very clear direction to business.

Having made that point, we see in the shift of Ford to producing a four-cylinder vehicle in Australia a response which I think is indicative of a move towards more carbon neutral and carbon friendly products and manufacturing processes across industry and manufacturing on a global scale. That is largely driven by consumers. It is also driven, to a lesser but increasing extent, by government regulation around the world through emissions trading schemes. It is true to say that part of that consumer choice is driven by an increase in petrol prices, but in a sense that only adds to the argument that we are moving into a world which is going to be much more carbon neutral and much less desirous of using carbon-consuming energy. What is important here is that our industry in Australia actually gets ahead of this curve. If we are going to have sustainable industry in Australia, in a world which is moving to more carbon neutral technology, then it is essential that that technology is developed in Australia and that that forms the direction that industry is moving to in Australia. Of course, there can be no guarantees about what industry will face as we move forward into a carbon pollution reduction scheme, but I think the one thing we can be sure of is that if we lag behind the rest of the world—if we are the last to move on this issue, if we are the last country to stay holding on for dear life to carbon intensive industries—that is a guarantee of job losses into the future. The smartest thing we can do for industry in this country to ensure the future growth of jobs in manufacturing and industry in Australia is to make sure that our industry is embracing carbon neutral technology or more carbon friendly technology.

There is a stereotype in all of this which says that if we put in place an emissions trading scheme ahead of the rest of the world—and of course that in itself is not quite right, given that 27 other countries have preceded us—we will lose industries who will continue to do their polluting in other countries, and that represents a danger. It is articulated in the green paper and it is very important that we take account of that and that appropriate transitional arrangements are put in place. The government is clearly working very carefully on it. But there is another form of leakage of industry that we will experience if we do not embrace this, and that is watching industry leave our country to go to places which have more carbon friendly and more carbon neutral technology in place. That is the real long-term danger we face if we do not start orientating our industry to a more carbon friendly and more carbon neutral path. That is why it is so important that as a government we put the indicators out there to encourage business down that path. It is the morally right thing to do. It is also the pragmatic and smart thing to do to ensure that we promote jobs in our country.

On 11 August, I held a forum in the electorate of Corio on the whole issue of the emissions trading scheme and greenhouse gas emissions. Whilst not wanting to go into detail about what each of the participants from industry in that forum said, I think there was an acknowledgement, firstly, that human caused climate change is actually occurring and that something needs to be done about it and, secondly, that an emissions trading scheme is the way to go. I think there is an appreciation for what the government is trying to do. I think there is also a real appreciation for the fact that the government is engaging with them and participating in a consultative process by its green paper/white paper process. This is a critical issue for Geelong, as it is for our country, as it is or our globe. The amendments that we are debating today form an important part of the suite of measures that we are talking about to underpin a future emissions trading scheme.

In the time that I have left I want to briefly describe what is being put in place here under this bill in the additional reporting requirements which provide, as I say, for an underpinning of a future emissions trading scheme. This bill will expand the suite of issues which are required to be published by a company in relation to greenhouse gas emissions and energy use. It will require the separate reporting of direct carbon emissions—that is, direct emissions that the company itself causes. It will also require the reporting of indirect emissions—that is, emissions that might be caused by a separate company which provides energy, and causes emissions as a result of that, which the first company then uses. It provides for the disclosure of the methods which are going to be utilised by these companies in calculating their emissions. It provides an ability for companies to report carbon offsets that they are putting in place, which may in fact be done in a different place or by a different business unit within the corporation. It provides for the disclosure of information, not the specific amount of carbon emissions which are occurring but rather reporting the range between two levels of carbon emissions. The importance of that is that that will then enable commercially sensitive information, which might otherwise be disclosed by providing a precise measurement, to be maintained by the company. To that end, there is also a provision for a company to apply to withhold its emissions information on the basis that that would disclose a secret.

In addition, there is a range of other administrative measures in the bill which will assist in the reporting regime. For example, the minister can specify, as part of this, the conditions and methods by which the measurement of greenhouse gas emissions occurs. There is a simplification, for example, for the process of corporations registering under this system. There is a clarification that the term ‘penalty units’ will have the same meaning in this act as it does in the Crimes Act and so forth. So this actually undertakes a number of cleaning-up mechanisms, if you like, in the whole reporting regime. The information which is collected under these provisions will assist in the refinement of the policy in relation to greenhouse gas emissions and energy issues. Importantly, these amendments will not provide any further regulatory burden on business beyond the original intention of the act, and there will be very little impact on the public purse. As I indicated, these measures will provide for a robust system which will underpin a future emissions trading scheme and provide for clear and transparent sources of information to the public as well as assisting in Australia’s obligations to report internationally.

As I have stated, there has been an enormous amount of consultation in relation to this bill, separate from that in relation to the emissions trading scheme generally. A policy paper was released in February of this year. Many of the affected industry representatives have been spoken to about these changes, as have the state and territory governments, and they are broadly supportive of them.

The implementation in this country of the Carbon Pollution Reduction Scheme and of the subsequent emissions trading scheme is as important an issue as we will face in this term of government. It is the great issue of our globe. It is the great issue of our nation. And, speaking as a representative of Geelong, it is very clearly the great issue of Geelong as well. For all those reasons, this being a bill which is an important building block for that suite of changes, I very much commend it to the House.

Michael Johnson (Ryan, Liberal Party) Share this | Link to this | Hansard source

I am pleased to speak in the House of Representatives as the member for Ryan and to speak on this important bill, because it also touches on issues of energy supply, energy security, environmental protection, our lifestyle and the way we will be able to enjoy a certain standard of living in the years and decades ahead. Fundamentally, the National Greenhouse and Energy Reporting Amendment Bill 2008 is a technical bill. I will just allude to that before I make some wider remarks.

The bill makes mandatory the separate disclosure of direct and indirect greenhouse gas emissions. It allows the minister to specify conditions, rating systems and the particular rating for the use of alternative methods which have been determined by the minister to measure greenhouse gas emissions. It allows for the publication of information relating to those methods of measurement, where the use of those methods satisfies the conditions. It amends the National Greenhouse and Energy Reporting Act to extend the obligations to comply with an external audit to members of a registered corporations group and amends the provisions relating to reporting requirements generally. The act was passed in September 2007, establishing a national mandatory corporate reporting system for the dissemination of information related to greenhouse gas emissions, energy consumption and production. The reporting obligations under the legislation are intended to lay the foundation for the proposed national emissions trading scheme, or ETS, due to be introduced by the Rudd government, as we understand, in 2010.

The coalition passed the National Greenhouse and Energy Reporting Act in 2007 when it was in government. This legislation aimed at establishing a single national framework for reporting greenhouse gas emissions, energy use and production. The coalition’s act had a focus that was to lay the foundation for its emissions trading system and aimed to reduce the red tape and duplication caused by the patchwork of state, territory and national programs. The Howard government wanted to try and minimise and reduce as much as possible all those additional bureaucratic and red-tape consequences that would flow from that overlap and duplication. The act also, for the first time, provided for the public disclosure of company-level greenhouse gas emissions and energy production and use.

On 14 July 2006, COAG agreed that a single streamlined greenhouse and energy reporting system that imposed the least cost and red-tape burden was a good thing and had to be worked on by its stakeholders. On 13 April 2007, COAG agreed to establish a mandatory national greenhouse gas emissions and energy reporting system, with the detailed design to be settled after the Prime Ministerial Task Group on Emissions Trading reported at the end of May 2007.

As I just alluded to in my opening remarks, this is not a controversial bill. It deals essentially with administrative and technical matters to do with reporting under the National Greenhouse and Energy Reporting Act 2007. Of interest and relevance is the minister’s second reading speech, where he says:

The bill will ensure the public and investors have access to information on both a corporation’s scope 1 (direct) and scope 2 (indirect) greenhouse gas emissions. This distinction has been added following public consultation. Corporations will benefit from a greater public understanding of how their emissions profile is composed, rather than from the publication of a single total. In some sectors, scope 2 (indirect emissions) can compose a significant share of a corporation’s total greenhouse gas emissions footprint.

There has been some criticism by the National Generators Forum of this proposal to include the reporting of indirect emissions from electricity, saying that it will only add to the red tape in the system without actually assisting emissions trading. In the same report, other business groups have warned that they will face significant compliance costs associated with their indirect emissions.

Of course, the people of Ryan, whom I represent, in the western suburbs of Brisbane, have a very great interest in how this government, the opposition and all members of parliament are going to develop this ETS, because they are fully aware that the proposed ETS promises to be one of the most significant reforms made to the Australian economy. Some 1,000 companies are expected to be affected, and these companies are producing more than 25,000 tonnes of carbon emissions, so it is quite significant. Therefore it has to be implemented properly. It must be implemented carefully. The ETS must be implemented effectively.

The government cannot afford to get this wrong. The government cannot afford to be reckless on this because, if they get it wrong, the Australian economy, the Australian people’s standards of living and certainly the standard of living in the western suburbs of Brisbane, in the Ryan electorate, will take a king hit. That is something that I certainly will not accept, and I will not endorse any policy that affects the economic standards in the western suburbs and in the Ryan electorate. Basically, if Australian companies, Australian industries, are no longer viable and no longer profitable, they are not going to be employing people. They are not going to generate the wealth and the prosperity that is so essential to where Australia ranks in the table of countries for its prosperity and lifestyle.

I want to refer the parliament to remarks made by Business Council of Australia President Greig Gailey, who is not some lightweight in our corporate community; he is a significant corporate figure. He has made his thoughts and, I think, the thoughts of the Business Council of Australia very clear—that is, that the ETS is essential and critical to tackling the greenhouse gas emissions that we have in our country but that, at the same time, we cannot do this with a view to damaging the economic architecture of our country. A country whose economy is in free-fall, a country that does not have economic stability or economic prosperity, is not going to be able to do much to reduce its own greenhouse gases and contribute to a wider global solution. We should not forget that climate change is a global challenge. No single country on its own will be able to make an impact; we all need to work together to try to come up with solutions. Certainly Australia, with some 1.8 per cent of global emissions will not of itself make an impact. But where we can make an impact is in our symbolic leadership and perhaps the brilliance of our engineers, scientists and policymakers to come up with a mechanism that can get the balance right between tackling greenhouse gases and maintaining an economic structure that delivers jobs and standards of living that really are the envy of the world.

Getting back to Mr Greig Gailey, because the people of Ryan probably have not had the opportunity to read the remarks of this very significant businessman and corporate leader—whose words are very much heavyweight words and words that members of the government and members of the parliament should be aware of—I want to let them know what Mr Greig Gailey said on 21 August 2008. He said:

The BCA fully supports adopting a comprehensive emissions trading scheme as the best way to reduce emissions, but getting the design detail right is critical.

Further, he went on to say:

We agree with the government that you must assist emissions-intensive, trade-exposed (EITE) businesses to avoid carbon leakage. The question is how to do that in a way which reduces global emissions without damaging the Australian economy.

Our research provides the first hard data on what will happen to real companies in Australia unless some modifications are made to the current proposals.

He is of course referring there to the government’s green paper on this issue. The green paper may perhaps be a first step in developing a workable and comprehensive ETS but, in its current form, it is full of flaws and full of holes. It is like a bucket with a hole in it—it is not going to contain water. So we have to improve it. Certainly, Greig Gailey asked the government to revisit this and look at it. Unless some modifications are made to the current proposals, it is not going to be something that is sustainable in the long term. It is no good coming up with a solution that is only going to be workable in the short term; we must come up with a mechanism and an architecture that will be long term and will actually make an impact in this country.

The BCA paper, which I am sure everybody would now be aware of, reflects some concerns. Fourteen major companies in the BCA membership were examined by a pretty successful and eminent consulting company, Port Jackson Partners. Their conclusion was that, if the current thinking in the government were to become reflected in policy, the impact on the businesses they examined, and most likely companies similar to them, would be profoundly detrimental—the bottom line being that further jobs would go. We have already seen in the Rudd-Swan budget that jobs have been cut. That is very regrettable, considering that, under the Howard government, 30-year lows in unemployment were achieved and, within a few months of being in government, the Rudd government has people exiting the door of companies throughout the length and breadth of this country. We do not want more people losing their jobs because of short-sightedness and political expediency on the part of the Rudd government.

I will touch on the points made by Port Jackson Partners in the BCA report. The BCA submitted 14 of its companies to Port Jackson Partners to explore the consequences for those companies and industries and to report back on how they would square up with the government’s current policy thinking. Anybody who read the weekend’s papers would have clearly seen that the report was quite devastating and significant. I know that the hardheads in the government—those with some intellectual and political capacity—will be fully aware that the article by Paul Kelly and the comments by Greig Gailey would not have gone unnoticed. There are some very fine minds in the government—not too many but a couple—and I am sure that they will be very aware of the views of Greig Gailey.

The companies explored some annual revenues ranging from $90 million to more than $3 billion and covering sectors from cement, manufacturing, petroleum refining, steelmaking, sugar milling, and zinc and nickel refining. So these are not insignificant industries in our economic structure. From what I understand, on average the ETS would reduce their pre-tax earnings by almost a quarter, with the worst affected in fact suffering a 136 per cent reduction. That is not something that is conducive to economic survival in the marketplace. These companies will basically go broke. And the ones that do not go broke will probably have to ship their industries overseas. I understand that the union movement is fully aware of this and is not too keen on it. We do not want Australian jobs going overseas simply because of a reckless policy initiative by the government.

Of the 14 companies, the report reveals that three will shut immediately and four will have to fundamentally review their operations just to remain viable, after losing between 32 per cent and 63 per cent of their pre-tax earnings. The rest will have to take immediate action to reduce their costs and many potential investments will not take place. The bottom line is that this country needs investment if we are going to provide jobs and if we are going to provide technology that will take this country forward in the years and decades ahead. I want to quote an important statement again from Mr Greig Gailey:

While these case studies have focused on 14 businesses there can be no doubt these outcomes would also apply more broadly across the relevant industry sectors.

That is quite an insight from one of the most significant businessmen in this country, someone who ought to be listened to by the government—and I am sure that he will be listened to. He and I certainly acknowledge that climate change is a very significant challenge for the world. Whilst there may be some debate about the causes of climate change, I am very much of the view that we have to do something about this. The question is: how do we go about addressing this issue? How do we go about getting the balance right between tackling the consequences of climate change and at the same time ensuring that we have a certain level of living standards that we all aspire to? I tell you what: one thing that can be said is that we will not be able to make any impact at all, in any policy area at all—let alone this profoundly important one—if everybody starts losing their job, companies start closing and industries get shipped overseas. That will not be to the advantage of any single Australian. I think the smart people around this place, and the smart people around the bureaucracy, are fully aware of that.

This is a global problem. I want to touch on that because, as I said before, Australia’s global emissions are less than two per cent, at 1.8 per cent. Without getting China on board, without getting Russia on board, without getting the US on board then very little, in a very substantial and meaningful sense, will be achieved. I think the big challenge for this government and the leading players in this government is to try to develop an alliance, a mechanism or a system in which we can get on board the big emitters of the world—the Americas, the Chinas, the Russias and the developing economies.

I want to have it on the record that I am very sympathetic to the place of developing economies. If a lot of the emissions are caused by modern industries in developed economies and are certainly not the fault of developing economies, then there is a place for the wealthy nations of the world to make a contribution to tackling the serious environmental problems in countries like China and in the countries of Africa. I am very sympathetic to that view. We have the technology and we have the smart people who can work together. We have brilliant people in this country and we want to be able to give them options and the mechanisms to support them in ensuring that their technology goes to practical use in those countries where it is most needed.

So for my part I certainly support the introduction and the implementation of an ETS. I know that the people of Ryan support that. There is no question about that. What we do want to say is that the government must get this right. The government must not be reckless in this. If they can get it right, they will earn more brownie points. If they get it wrong, they will earn the wrath of the Australian people, just as the Australian people and the people of Ryan have certainly rebuked the government, and the Treasurer in particular—I should not say ‘in particular’; I think the people of Ryan have rebuked the government collectively—for the way they introduced a policy that affected rebates for solar panels in the Ryan electorate. (Time expired)

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

I rise in support of the National Greenhouse and Energy Reporting Amendment Bill 2008. At the end of this speech you will clearly understand my position on this bill, unlike the last 20 minutes where we saw someone dance around a topic and not actually say at any one time what he believed. The member for Ryan’s electorate is just across the other side of the river from me, a nice two-iron away—a well-hit two-iron away, perhaps—but there is a giant chasm between us in terms of what we actually agree on. I am not sure what he believes in terms of a greenhouse strategy. Perhaps his contribution to not adding to greenhouse gas might have been to avoid that speech rather than waste our time. I did not understand what he believed in by the end of the speech any more than I did at the start of the speech.

This bill is another step along the way to achieving an effective carbon pollution reduction scheme. It makes some minor amendments to the National Greenhouse and Energy Reporting Act 2007 to improve the administration of the reporting process. Under the act companies are required to report their greenhouse gas emissions if their facilities emit 25 kilotonnes—25,000 tonnes—or more of greenhouse gases or produce or consume 100 terajoules or more of energy, or their corporate groups emit 125 kilotonnes or more of greenhouse gases or produce or consume 500 terajoules or more of energy.

Like the member for Ryan, I do spend a bit of time going to schools. It is always a good idea to listen to the children, because they will certainly teach me lots of things and I also try to educate them where possible. I am going to touch on one education thing—having been a teacher—and that is to explain what a terajoule is. One joule is the energy required to lift a small apple one metre straight up or the energy released if the same apple were to fall a metre. A megajoule is 10 to the sixth, a gigajoule is 10 to the ninth and a terajoule is 10 to the 12th. That is a ‘1’ with 12 zeros after it, or a million million apples. So think of lifting a million million apples. We often use these terms, so I thought I would unpack that particular bit of information for the information of the students up above in the gallery. This bill, more than any other bill today, is about the future of the students up above—rather than some of the other people in the House.

Currently, around 450 companies are required to report; however, lower thresholds will gradually be phased in from 2010 and the number of companies involved will be increased to more than 700. This amendment will simplify the emissions reporting requirements for companies and will help to give us a clearer picture about the emissions that companies produce. And that is a good thing. At the same time, the bill will increase the number of matters which may be published by the Greenhouse and Energy Data Officer to improve public access to information on corporate use of energy and greenhouse gas emissions. To quote the rock singer Ben Lee, ‘We are all in this together,’ both individuals and companies.

Perhaps the most significant amendment in the legislation is the mandatory requirement for the separate public disclosure of direct and indirect greenhouse gas emissions. Direct greenhouse gas emissions are those owned or controlled by a company, while indirect emissions are those produced by third parties using a product. The most obvious example is electricity consumption. This new reporting process will give consumers and investors a much more realistic idea about emissions, as some sectors contribute to significant indirect emissions.

The government will simplify the reporting process by setting up an online emissions calculator. This is a problem for the future, so we are using future technology. With the online emissions calculator we are avoiding red tape and avoiding any significant increase in the reporting burdens that will be faced by business. Business well understands the challenges that are upon us when we actually put a real value on carbon. This bill will also give the minister power to determine the methods for measuring emissions, energy production and energy consumption. The minister will set out how emissions, reduction, removal, offsets, production and consumption are to be measured. Registered corporations and members of a corporation’s group must also comply with an external audit process.

I remain very optimistic that Australians, both individually and at the corporate level, can achieve significant changes in the way we use carbon and other greenhouse gas emissions. This is not just a blind hope or youthful enthusiasm—or maybe I should say ‘middle-aged enthusiasm’. I turn to the example provided by South-East Queensland, and I do so especially for the benefit of the member for Ryan. When we were faced with the worst drought in 100 years in South-East Queensland, residents and businesses completely changed the way we approach water use. We installed water-efficient tap fittings and shower roses, we covered our pools, we mulched our gardens, we turned off our sprinklers, we changed the way we washed our cars and we shortened our showers. Nearly every shower in South-East Queensland now has a little blue egg timer in it. In fact, I have got one up in my office. I am so used to having four-minute showers now; I thought I would do the same thing in Canberra. In short, we learned to value every drop of water. In fact, we slashed our water consumption from almost 300 litres per person per day, before the drought, to as low as 112 litres per person per day in July this year. This is despite quite a cold winter—for Brisbane, I would stress—where a warm shower might be something that people cling to.

Through education and a change of attitude we can do the same thing with carbon emissions. We can effectively put a shower timer on every light and on everything that we use. That is basically what the Rudd government is trying to do. We must do the same thing with our carbon emissions. In fact, some of us already are doing the same with our carbon emissions. Many schools, businesses and community groups in Moreton are already doing what they can to implement energy-saving initiatives.

A very common topic during my visits to schools in my electorate is the initiatives they are undertaking. I will just digress for a second. I was doing a talk on politics at one of the schools—St Sebastian’s at Yeronga—and I had a strange question from one of the students who was doing a research topic. They asked lots of questions, but one of them was quite interesting. He asked, ‘Do you know David Elder?’ His job was to find out about the Serjeant-at-Arms. I was able to say, ‘Yes, I do.’

I will return to the topic at hand: examples of schools in my electorate and the energy-saving initiatives they have taken. Wellers Hill State School, up in Tarragindi, have a gardening club that meets every week. They plant trees and teach the students about sustainability. The school recently won an Ergon Energy Switch Award for their efforts to cut energy use.

At Robertson State School, right in the middle of a very multicultural part of my electorate, all the kids are getting together with the teachers and parents, and they are playing their part by installing rainwater tanks. Even though it is a large school with a large oval, the school informs me that soon they will be totally reliant on rainwater. They have also set up an EcoKids committee, getting every kid involved as much as possible, to raise awareness about environmental issues. One of their ideas was a ‘no rubbish day’ when all the students brought their lunch in reusable containers. I assume the opposition would be interested in a ‘no rubbish day’. It is certainly something I will be telling my other schools as well, because I think it is a great initiative to have no rubbish created on that day by those people.

There is also Sherwood State School. They are installing water tanks and they have integrated environmental education into the school curriculum from go to whoa so that at every occasion, be it maths or English or whatever, people are learning about how to do the right thing by the planet. At Junction Park State School, which is technically in the Prime Minister’s electorate—it is just across the road but I have friends and constituents who send their children there so I will refer to what they are doing—they have installed water tanks for their oval and pool and a solar heating system for the pool. Each class maintains its own section of the school garden. These children will go home and teach their parents and their grandparents about what can be done. It is not enough to say, ‘Australia produces only 1.8 per cent of the global emissions.’ That is not the right attitude at all, but it seems to be the white flag that is being raised from the other side of the room. What can we do? Well, we can all do our little bit.

But it is not just schools. Local companies are also changing their ways for the good of our environment. Hastings Deering, a big company based in Archerfield—they are also technically in Oxley, just across the road—supply Caterpillar heavy equipment to the mining, construction and forestry industries. They have a great apprenticeship scheme as well and they have introduced a fuel efficiency training program to help users reduce fuel burn. This program has the potential to achieve significant fuel savings, so everyone benefits. Another company doing their part are Toll, a major freight and transport company with a warehousing and distribution centre in Moreton. They have already introduced improved waste management systems and now they are working on other ways to address greenhouse gas emissions. For example, they are developing a better emissions reporting process and providing advice to costumers about the most environmentally friendly transport options available. Good environmental practices normally make good business sense. These are just some of the starts that the companies in my electorate are making and no doubt there are lots of others with even better initiatives that I hope to hear from over the months ahead.

As you can see, people in my electorate, the electorate of Moreton, have a completely different view from the opposition when it comes to climate change—a completely different view from the people on the other side of the river in the electorate of Ryan, or maybe the member for Ryan has a strange connection with his electorate. At a street stall in Graceville on the weekend lots of people came along to talk to me about the Carbon Pollution Reduction Scheme. In fact, some of them were having a laugh because, at a fundraising dinner I went to a few weeks ago for the victims of the Chinese earthquakes, a signed copy of the green paper was raffled for $200. That is how interested people were—that a green paper could go for $200. I did say that I could have given it to them for free, but they thought it was a good cause. People understand that, unfortunately, we will all have to experience some short-term pain before we get the long-term gains. We need to do this if we are serious about addressing climate change into the future.

I said at the start of this speech that you would know my position on this bill clearly by the end, because I am proud to be part of a government that is serious about tackling the causes of climate change. I can look my son and the schoolchildren I meet in the eye and talk about practical hope—not just hope, but practical hope, the things that we can do. Unfortunately—and children need to understand this—usually fear will trump hope in politics. Fear usually trumps hope. Unfortunately, in this card game, we are playing for the future of our planet, not just for a brief boost in the opinion polls or a bit of media attention. This is too important. So I am proud to support these amendments which help lay the foundation for the Carbon Pollution Reduction Scheme and which will be introduced by the Rudd government in 2010. I commend the bill to the House.

Scott Morrison (Cook, Liberal Party) Share this | Link to this | Hansard source

The National Greenhouse and Energy Reporting Amendment Bill 2008 is to amend an act established by the former government to provide a critical component for the establishment of an emissions trading scheme. The reason I note this is that November 2007 did not mark ground zero in this country’s efforts to address the issue of reducing carbon emissions. Those opposite would have you believe that there was a new ground zero in November 2007 and that all that had gone before was of no consequence—nothing happened and there was no movement forward on any matters. They would deny that Australia was the first to establish a greenhouse office; that there was a reduction of 85 million tonnes of CO2, allowing Australia to meet its Kyoto targets; that leadership and funding for a global initiative on forests and climate had been put in place; and that there was the introduction of a renewable energy development fund to support emerging technologies. They would deny that there was support for individuals and community groups taking action through programs such as the solar rebate—something which is very dear to the hearts of those who are trying to get access to a solar rebate but no longer can as a result of the government’s decision to means test—solar cities; solar hot water rebates; community water grants, which have been reduced under this government; and green vouchers for schools initiatives. There is a record of practical measures that the previous government could be very proud of. One thing that the government have sought to highlight in putting forward the myth of there being a ground zero once the Rudd government was elected is that somehow it was the religious ferocity with which he pursued these matters that was the measure of their serious intent, rather than the things that they actually did.

It is interesting to review this bill, because it was introduced to amend an act introduced by the previous government to provide the framework—the basis—of a national reporting system to support the introduction of an emissions trading scheme. So work was underway under the previous government to establish an emissions trading scheme and there was a clear commitment to do that. There was not just a commitment; there were bills and acts that came through this place to make sure that we move towards that objective.

This bill seeks to enhance those arrangements introduced by the previous government to underpin the introduction of an ETS by mandating separate disclosure of direct and indirect emissions, addressing methodological issues, addressing publication and reporting requirements and dealing with some external audit matters. These are matters to be supported, and they are supported by the coalition. In particular, the bill enhances the purpose of the act to establish a single national reporting system. The object of a single national system highlights the need for us to consider further areas of national uniformity more generally, when it comes to our energy sector and, I would argue more broadly, in relation to our utilities sector. At a state level for far too long we have had the conflict of governments acting both as a regulator and a commercial beneficiary of the operation of the entities they regulate in the utilities sector—in particular energy and water. This conflict has led to what can only be described as chronic dividend stripping that has failed our community by blocking progress and investment by state government instrumentalities in the development of next generation infrastructure and services.

We hear a lot from those opposite about infrastructure. But the investments that have not been made in infrastructure, particularly in the energy and water utilities sectors, have been the responsibility of state government instrumentalities that have had their dividends stripped by state governments to fuel ill-founded programs that have run their states into chronic debt once again. Whether it is the promotion of water recycling or investment in renewable energy sources, all of these constitute a direct threat to the commercial return from state-owned public water and energy utilities. That is something we need to address in looking at national uniformity in these measures. We should start separating the regulator from the commercial beneficiary, and all of this occurs at a state level.

As we advance to a national emissions trading scheme—a national reporting system—it is worth considering how we can further the harmonisation agenda in relation to energy and water. As this bill addresses the foundation stones of an ETS, it is important to reflect on the scheme and the climate change debate. I contrast the climate change debate we have seen in the past 12 months with what we will hopefully see in the next 12 months. Hopefully we are past the Hollywood rock star phase of the debate, past the sloganeering, the rallies and the populism. We are now dealing with the detail of issues such as emissions trading schemes and all sorts of measures that are designed to further enhance our efforts to reduce carbon emissions.

This is a much trickier agenda for members opposite to engage in, because it is easy to buy armbands, to go to rock concerts and to issue slogans, but it is a lot harder to get the details of an emissions trading scheme right and to take the community with you on those issues. It is a lot harder to debate the government’s system line by line in the Senate than simply to try to bludgeon those sitting opposite into providing a blank cheque for the scheme. I want to see the Prime Minister and his ministers argue every single line of their system. I want to understand every single thing they are proposing and the impact on people in my electorate of Cook. That is how one debates change in this country, that is what John Howard did and that is what the member for Higgins, Peter Costello, did with the introduction of tax reform. They did not sloganeer; they debated every line and got their changes through with some compromises. That is the nature of this process.

Since the election, the Australian community has seen the flip side of the climate change coin. We are now starting to understand the costs and the true sacrifices that will need to be made to move forward. The debate is not about belief, faith, moral challenges, heresies or any other religiously loaded terms, which I would argue should never have been part of the debate in the first place. I am genuinely surprised that members opposite—the great defenders of the intelligentsia—would condone the use of such terms as ‘heresy’ in the context of scientific debates. We do not need that religious fervour to understand or believe in the need to reduce carbon emissions. It is obvious to any of us who turned on our televisions in the past few weeks and saw the situation in Beijing and who have seen it in many other cities around the world. That is why we must move forward, and the coalition is keen to do so.

With the release of the green paper, the imminent release of a white paper and the introduction of a bill, we are now at the details stage of the debate. Both the coalition and government are at one in agreeing with the decision to proceed with an emissions trading scheme. Where we differ is when—that is, when it is reasonable and prudent to introduce such a scheme. We have already seen design flaws during the debate on the green paper. The LNG sector falls below the emissions revenue threshold and as a result will miss out on the free permit system—the 80 per cent all-or-nothing line in the sand. As a result it will be disadvantaged, particularly in terms of trying to provide liquid natural gas to some of our biggest trading partners, in particular China, and to provide clean-burning fuel to what will be the world’s largest emitter of carbon.

Businesses have noted that the government’s plan to auction 80 per cent is well in advance of the European Union model. Prior to the election, we heard about all the virtues of the EU model and how Europe was moving forward on this great crusade. However, in debating the detail we have learnt that the EU will not introduce 60 per cent auctions until 2012—and we are considering introducing 80 per cent auctions in 2010. That gives us a sense of where we are sitting as the world moves forward. The EU is also yet to definitively nominate the full list of activities that will be unable to pass on the cost of their emissions and where they will sit in the trading scheme post 2010. A lot of work is still to be done in the EU system, and those who hold it out as being light years ahead of this country either have not read the information or are gilding the lily. The clean-driving LPG sector, to which excise does not apply, will not benefit from any compensating rebate as proposed for other fuels. It is common knowledge that the solar sector is reeling following the imposition of the government’s means test. The government has confused climate change policy with old-fashioned wealth punishment.

More generally, a Business Council of Australia study of 14 companies highlighted the cost of getting it wrong. An article by Lenore Taylor in the Australian of 22 August reads:

A “real world” analysis of the impact of the Government’s plans—based on 14 companies that opened their books for the Business Council of Australia—revealed that even with the Government’s proposed compensation, three firms would face a carbon cost so high they would close.

…         …         …

… on average, the companies’ pre-tax earnings would be cut by 22 per cent. The worst affected would suffer a 136 per cent reduction in earnings.

BCA president Greig Gailey is quoted in the article:

“Our research tells us the Government’s plans would have significant and—

and he is generous here, I note—

unintended consequences for business … we don’t believe the Government intended to design a scheme to achieve the outcome of businesses and jobs moving offshore—

I certainly hope not—

… but that would be the outcome of the Government’s plans ...”

All of this highlights the reason to proceed with caution and to proceed on the basis of sound research and evidence based policy to make sure we get this program right. The government would have us believe that if an ETS is not up and running by 2010—and you would have seen the ads that say this; it would be pretty hard to miss them—our reef will bleach, our rivers will dry up and our coasts will submerge. Those ads are not talking about whether or not we introduce an ETS, because both the coalition and the government have the same policy about going forward with an ETS. Two years is the difference between us on this matter. In fact, in parliament yesterday the Prime Minister even had the temerity to imply that the mere release of the green paper somehow had a material impact on the Murray. With due respect to bureaucrats, I think that only bureaucrats could possibly conceive that the existence of a committee or a report could have such a magical influence.

What matters is that we are committed to an ETS. The global issues are significant and if they are not addressed then we will not be able to save the Murray, we will not be able to stop the reef from bleaching and we will not be able to avoid the impacts of climate change. It requires global action and the commitment to go forward with an ETS as a signal of intent that genuinely allows us to put pressure on other countries and other economies around the world to move forward and secure a meaningful, comprehensive global agreement. The collapse of the Doha Round, I think, highlights the challenge that is before us with something like climate change. But that is the main game in addressing a global problem. We must do what we need to do and as we have been doing. Unless we can achieve that global agreement then the prophecies, if you like, may come true. Unless China, India and Brazil, in particular, and the like are part of the solution then we will make insufficient progress. I am not saying we will not make progress, but we will make insufficient progress to avert what Professor Garnaut has described as diabolical consequences. We still must proceed on an adjusted path, if that is the case. The world, I believe, will wake up on this issue at some point. At that time, I believe we must be the world leaders in the technology, services and expertise that will then be in high demand. So we must move forward on developing all of these areas and we must move forward regardless of what other economies do but on a sensible trajectory.

The reason I appreciate an ETS is that it is a market based system. It puts a price on carbon to change the investment fundamentals and to redirect capital where it must be placed to secure advances in technology and in other developments that we need in order to move to a low-emissions future. An ETS is all about balancing economic and environmental interests. It is not a punitive measure. It is not an ‘I told you so’ tax, which is the impression I get from reading the commentary from some who say that this system ‘cannot let these people get away with it’. It is not about that; it is about balancing economic and environmental interests to get an outcome in the nation’s best interests. There should be no talk of pernicious and retributive punishments on industry. They have done business under a system and a set of regulations that have allowed them to operate this way. We should look closer to home at what we need to change to ensure that we can move towards a better system.

The coalition wish to address climate change in hope not fear. The earlier speaker made mention of the importance of fear. The only fear I see being peddled on this issue is the fear of destruction—the fear that it is all going to come to a grisly end and the fear that is used to bludgeon people into decisions. I am far more hopeful about the future. We want to work with and for our community to help us make the changes that are needed. We need an optimistic view so we can face and meet the technological challenges. There are some who believe we must crash our economy and depopulate to find a new balance. I do not share this view. The environment is not the only legacy I wish to leave to my daughter and future generations.

In that context, we must deal with the elephant in the room—that is, coal. Discovering the answer that provides a low-emissions future for coal will enable us to both meet our commitments and lock in Australia’s resource advantage in the global marketplace. We must address the use of coal. You simply cannot ignore it as an inconvenient alternative. The issue of coal in our future requires us to rethink in the national interest the concept of exclusively renewable energy targets. Given the importance of coal to Australian jobs and to our economic advantage, we must seek to include in our goals not just renewable energy but what the shadow minister for the environment calls clean energy.

There is also the need to reward those who are opting to invest in the next best currently available alternatives. In advance of better technologies coming, we should give them the support and assistance they need to make those decisions. With an ETS we must ensure that it is at the centre of our new universe of regulation. All these other measures that have existed before now need to be reconsidered in the context of an ETS. The ETS is the centrepiece and whether it is mandatory renewable energy targets, systems of buying back solar energy from residential homes to go into the grid or cogeneration and generators in the bottoms of buildings, all the regulation and the issues must sit around and complement the operations of an ETS. We cannot allow this to be another accretive form of regulation that clogs up our economy and fails to meet its environmental objectives.

We need to move forward with a range of these measures. There is a need to reward those who are opting to invest, as I said, in the next best technologies. There is a need to have incentives for investment in solar, wind, geothermal and tidal and all of these sorts of things. For the record, I am not one who believes that nuclear energy will provide Australia with the answer. I believe there are other alternatives that should fill our agenda to the brim before anything of that nature should ever be considered in this country.

We must ensure that the mandatory targets do not confound our ETS and we must ensure that the balance of measures is always tipped towards incentives—for example, by supporting developing countries to retain their forest and establish viable economies. It is about harmonising our state laws to ensure an effective national approach on everything from standards of new homes and buildings to ensuring that there are sufficient incentives to retrofit the 300 million square metres of existing commercial space and the 8½ million existing homes that are out there. This is an approach that is all about hope, not fear—believing that we can have a lower emissions future without crashing the car and causing the destruction to jobs and economies. I guarantee you that if we crash this economy in an attempt to satisfy some zealous objective and in the process fail to even meet that objective then all we will have as a result will be wrecked families and wrecked communities as a result of a wrecked economy. That is not something that any of us in this place can sensibly embark upon. My thoughts on this bill are simple: it provides the next step in a path already commenced by the previous government, and we will work together to find the solution to an ETS that works, that protects our economy, that protects jobs and that protects the future of our environment for all Australians.

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

I am very pleased to speak to the National Greenhouse and Energy Reporting Amendment Bill 2008, which is another important step in the Rudd Labor government’s program to address climate change. This bill is another example of our determination to tackle this issue. This step is important in itself, but it is also an indicator that we are now getting on with the job of tackling the issue of climate change.

Thankfully, we are now well past the days of inaction and scepticism of the previous coalition government. We are now moving into an age where greenhouse gas emissions have to be recorded and reported on and this information made public. This is another important day for the future of our planet. For me, this gives a real feeling of relief—a feeling that we are now finally getting somewhere on this important matter. I cannot easily describe my feelings of frustration with the previous government. They continued to deny climate change was a matter of urgency. Pretending to believe in human induced climate change but doing nothing to seriously collect information on it, let alone doing something to address it, leaves the consequences, of course, for the next generation. The enormous social and economic consequences would be significant. When the whole scientific world was crying out for them to do something, in my mind that was the greatest act of irresponsibility of any federal Liberal government since Federation. Theirs was a government that said: ‘Who cares about the future? Hang the consequences; we just want to get elected.’

This bill starts to put in place an emissions disclosure and reporting system that has real integrity. With this bill, today is a good day for us. But there is another more important day approaching—31 October 2009. That day will see the first corporate reports by industry on their emissions. That will be another milestone day for Australia’s climate change response. I hope that the media gives it the attention it deserves. It is the first national emissions knowledge day—a very important step. It will show that we are indeed finally really getting somewhere in addressing this great challenge of our generation and what will be an even greater challenge for future generations. Under these climate change initiatives, corporations that go over agreed emissions thresholds must have registered by 31 August 2009 and they must provide information about their emissions and energy use for the 2008-09 financial year.

This bill improves a number of aspects in the administration of the National Greenhouse and Energy Reporting Act 2007. It ensures that the National Greenhouse and Energy Reporting System will collect robust comparable data across the Australian economy. This information is absolutely critical for two reasons. Firstly, it will underpin the emissions trading scheme, which is essential to systematically address climate change. Secondly, it will provide better information to the public. Obviously the first point is intrinsically important. To operate an emissions trading scheme, we need a detailed and comprehensive emissions reporting system, industry by industry and company by company. But the second point is also important. I believe that the public are crying out for information about the world’s emitters. The Australian public are crying out for real data and information on the big Australian emitters. I certainly want to know more. Public knowledge is actually critical in informing a consumer market. Public disclosure is an area where this bill does go beyond existing policy. The impact of these amendments will see an increase in the amount of information collected and publicly disclosed. I believe this important public knowledge will inform consumer behaviour on product purchasing and as such will have a positive effect on addressing climate change. Once the public know who the big emitters are, and consequently what products create the most emissions, I believe the public will make more judicious purchasing decisions. They will buy fewer products that create more emissions. That, I believe, will be the natural outcome.

There is another important area affected by increased public disclosure: it affects investor behaviour. As we know, investor behaviour can have a clear impact on the future of any industry. This bill makes sure that the public and investors get better access to information on greenhouse gas emissions. We should not underestimate the impact that this will have in improving our climate change outcomes. I think, in fact, that it will be profound.

I would not be the first to say that knowledge is power. In this case knowledge about emitters is power to influence the consequences of climate change, power to make more informed decisions. This bill will expand the number of items which can be published relating to a corporation’s greenhouse gas emissions and energy use, including separate public disclosure of both direct and indirect emissions and disclosure of information about the methods used to calculate emissions. This bill will also provide some clarification about what can be publicly disclosed. It will allow publication of data according to a corporation’s business units and will confirm that totals may be published as falling between a specific range of values in cases to avoid revealing trade secrets or commercially sensitive information. Allowing publication of information relating to offsets is very important. It is also important to say that this bill allows corporations to apply to have information withheld from publication if it reveals trade secrets or commercially sensitive information. This will be expanded to cover the new matters which are subject to publication.

I would like to add a warning here: it is very important that we monitor this area closely. Whilst not intended to do so, these sorts of clauses can be used to withhold information under the guise of commercial confidentiality. Whilst most companies do the right thing and most company directors are aware of their corporate governance responsibilities, there are always a few who cut corners, particularly if it is in their commercial interest—even more so if they work in an industry that is under significant pressure. Clearly, some industries will come under great pressure as we have to adapt to climate change. We have no choice. This is part and parcel of the process we are currently undergoing of the great change to new industries. Those companies that are very heavy emitters must change their ways. They must have help and assistance and the transition must be known and measured, but they must change their ways. There is no alternative.

The Iron Lady once said—and I hate to quote her but it is very apt here—for the future of our planet ‘there is no alternative’. It is vital for both public confidence and public awareness that the public knows who the heavy emitters are. So, we have to keep a very close eye on the reporting system to make sure it is working and that corporations are complying fully. I am confident that the government is aware of this and will monitor trends in this area very closely.

As I have already said, knowledge is very important in this issue. On this issue, I would like to suggest a glimpse of a future world, a world where managing greenhouse gas emissions is an even bigger imperative than it is today. One day I would like to see a product market with a lot more information on emissions. One day in the future I believe we will have a system in place where, alongside the ingredients and documented nutritional values of products, we will also have a rating for emissions units for each and every product. In the future, we will have the bar of soap or the jar of Vegemite which has on the packaging the calculation for the emissions trading units. Or perhaps it will be just on the jar, because I am sure the pressure to do away with a lot of packaging will build intensely in the coming years. But that is at a stage in the future hopefully not too distant.

Another important aspect of this bill is that it allows the minister to specify conditions for methods of measuring greenhouse gas emissions and energy—to specify a rating system for such methods. Any reports made in the future will need to meet any such conditions. The bill will allow offsets to be reported separately from the greenhouse gas projects. Currently, the act only allows offsets to be reported if they arise from a project carried out by the corporation. Importantly, this would exclude the possibility of reporting offsets created by the activities of different corporations. The regulations on offsets are still under development. But, as is already the case for greenhouse gas projects, information about offsets may be published. This bill also ensures that a contractor to a member of a controlling corporation’s group may report their emissions directly to the government, and ensures that public disclosure of a corporation’s data according to business units has been included following consultation with industry. Several leading industry players have requested this option.

The Australian government are committed to reducing greenhouse emissions. We are absolutely committed to securing robust, accurate and reliable data to build an emissions reduction scheme based on science and with real integrity. The government are working cooperatively and sensibly with Australian business and state and territory governments to implement the National Greenhouse and Energy Reporting System. Unlike the previous government—today’s opposition—we are totally committed to taking the necessary steps, in a measured way, towards addressing climate change. The conservative parties throughout history have always been characterised by an ideology that relegates our environment to second place. They have always taken the view, ‘If there is an industry that pollutes, she’ll be right. We’ll fix that up some time later.’ Well, today there is no ‘some time later’. The chooks have come home to roost. The opposition are all under their benches, hiding, on this issue. And their fearless leader? What a joke.

Honourable Members:

Honourable members interjecting—

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

Apologies for any offence! The fact is that, in their hearts, they do not believe it. In my mind it is important that we address emissions trading. It is important that we have access to strong information on this matter. We have not seen a consistent position adopted by those on the other side. They continue to flip-flop from one position to another, constantly changing their position as the argument evolves. We on this side have a very clear position. We know we must take steps to address this issue—

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! It being 2 pm, the debate is interrupted in accordance with standing order 97. The debate may be resumed at a later hour and the member will have leave to continue speaking when the debate is resumed.