House debates
Thursday, 24 June 2010
Renewable Energy (Electricity) (Charge) Amendment Bill 2010
Consideration of Senate Message
Bill returned from the Senate with amendments.
Ordered that the amendments be considered immediately.
Senate’s amendments—
(1) Clause 3, page 2 (lines 7 to 11), omit the clause, substitute:
3 Schedule(s)
(1) Each Act, and each set of regulations, that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.
(2) The amendment of any regulation under subsection (1) does not prevent the regulation, as so amended, from being amended or repealed by the Governor-General.
(2) Schedule 1, page 3 (after line 15), after item 4, insert:
4A Subsection 5(1)
Insert:
clearing house price has the meaning given by section 30LA.
(3) Schedule 1, page 4 (after line 7), after item 8, insert:
8A Subsection 5(1)
Insert:
GST inclusive clearing house price has the meaning given by section 30LA.
(4) Schedule 1, item 58, page 15 (before line 12), before section 30M, insert:
30LA Clearing house price etc.
(1) The clearing house price is:
(a) subject to paragraph (b)—$40; or
(b) if the Minister, by legislative instrument, specifies a lesser amount as being the clearing house price for the purpose of this subsection—the amount so specified.
(2) The GST inclusive clearing house price is the amount equal to 110% of the clearing house price.
(3) Before making an instrument under paragraph (1)(b), the Minister:
(a) must take into consideration:
(i) whether the total value, in MWh, of small-scale technology certificates created in 2015 exceeded or is expected to exceed 6,000,000; and
(ii) any changes to the costs of small generation units and solar water heaters; and
(iii) the extent to which owners of small generation units and solar water heaters contribute to the costs of small generation units and solar water heaters; and
(iv) the impact of the clearing house price, and the number of small generation units and solar water heaters installed, on the electricity market, including on electricity prices; and
(b) may take into consideration any other matters that the Minister considers relevant.
(4) If the Minister is considering a matter mentioned in paragraph (3)(a), the Minister must obtain, and take into consideration, independent advice about that matter.
(5) An instrument made under paragraph (1)(b) must not be expressed to commence earlier than the first 1 April following the making of the instrument.
(6) If:
(a) an instrument is made under paragraph (1)(b); and
(b) on a particular day (thetabling day), a copy of the instrument is tabled before a House of the Parliament under section 38 of the Legislative Instruments Act 2003;
then, on or as soon as practicable after the tabling day, the Minister must cause to be tabled before that House a written statement setting out the Minister’s reasons for making the instrument.
(5) Schedule 1, item 58, page 15 (line 22), omit “$44”, substitute “the GST inclusive clearing house price”.
(6) Schedule 1, item 58, page 16 (line 15), omit “$44”, substitute “the GST inclusive clearing house price”.
(7) Schedule 1, item 58, page 16 (line 17), omit “$40”, substitute “the clearing house price”.
(8) Schedule 1, item 58, page 17 (line 28), omit “$44”, substitute “the GST inclusive clearing house price”.
(9) Schedule 1, item 58, page 17 (line 31), omit “$40”, substitute “the clearing house price”.
(10) Schedule 1, item 96, page 58 (lines 28 to 30), omit subparagraph 141AA(c)(ii), substitute:
(ii) a statement that the certificate was created in relation to a solar water heater other than an air source heat pump water heater, or that it was created in relation to an air source heat pump water heater, or that it was created in relation to a small generation unit (as appropriate); and
(11) Schedule 1, item 99, page 59 (lines 16 to 21), omit the item, substitute:
99 Section 162
Repeal the section, substitute:
162 Biennial review of operation of renewable energy legislation
(1) The Minister must cause an independent review of the following to be undertaken as soon as practicable after 30 June 2012 and every 2 years after that date:
(a) the operation of this Act and the scheme constituted by this Act;
(b) the operation of the regulations;
(c) the operation of the Renewable Energy (Electricity) (Large-scale Generation Shortfall Charge) Act 2000;
(d) the operation of the Renewable Energy (Electricity) (Small-scale Technology Shortfall Charge) Act 2010;
(e) the diversity of renewable energy access to the scheme constituted by this Act, to be considered with reference to a cost benefit analysis of the environmental and economic impact of that access.
(2) A review must be undertaken by a person who, in the Minister’s opinion, possesses appropriate qualifications to undertake the review.
(3) The person undertaking a review must give the Minister a written report of the review before 31 December in that year.
(4) The Minister must cause a copy of the report to be tabled in each House of the Parliament within 15 sitting days of that House after the day on which the report is given to the Minister.
(5) The report is not a legislative instrument.
(12) Schedule 1, page 60 (after line 2), before item 100, insert:
99A Subsection 5(1)
Insert:
air source heat pump water heater means a device that uses a vapour compression cycle incorporating a compressor, an evaporator that collects energy from the latent and sensible heat of the atmosphere and a condenser that delivers heat either directly or indirectly to a hot water storage container.
(13) Schedule 1, page 62 (after line 26), after item 116, insert:
116A At the end of section 21
Add:
(4) If a solar water heater is an air source heat pump water heater, certificates may only be created for the installation of such an air source heat pump water heater if it has a volumetric capacity of not more than 425 litres.
(14) Schedule 1, page 63 (after line 29), after item 119, insert:
119A After section 23A
Insert:
23AAA Regulations to establish scheme for inspection of new installations of small generation units
(1) The regulations must establish a scheme for the inspection of the installation of small generation units for which certificates have been created.
(2) Without limiting subsection (1), regulations made under that subsection must provide, for small generation units installed after the commencement of this section:
(a) that each year a statistically significant selection of small generation units that were installed during that year must be inspected for conformance with Australian standards and any other standards or requirements relevant to the creation of certificates in relation to that small generation unit;
(b) that an inspection of a small generation unit is to be carried out by a person or organisation who:
(i) is independent of the person or organisation who designed and/or installed that small generation unit; and
(ii) does not have a conflict of interest in relation to that small generation unit or administration of the matters being inspected;
(c) for the transfer of information, about any failures to comply with standards or other requirements relevant to the creation of certificates in relation to small generation units, to State, Territory or Commonwealth bodies with responsibility for the enforcement and administration of those standards or requirements.
(15) Schedule 1, page 63 (after line 29), after item 119, insert:
119B Subsection 23B(2)
After “multiplied by”, insert “a number that does not exceed”.
(16) Schedule 1, page 63 (after line 29), after item 119, insert:
119C Subsection 23B(3)
After “However,”, insert “subject to subsections (3A) and (3C),”.
119D After subsection 23B(3)
Insert:
(3A) However, in the case of an off-grid small generation unit, the regulations must provide for a number of certificates to be multiplied only if the certificates relate to the first 20kW of the rated power output of the unit.
(3B) In subsection (3A):
off-grid small generation unit means:
(a) a small generation unit at least 1 kilometre from the nearest main-grid line; or
(b) in the case of a small generation unit less than 1 kilometre from a main-grid line—the owner has provided written evidence from the local network service provider that the total cost of connecting the unit to the main-grid is more than $30,000, making it uneconomic to connect the unit to the main-grid.
(3C) The regulations must provide that the number of certificates that may be created under subsection (3A) as a result of a multiplier in subsection (2) for a period specified in column 1 of an item in the following table must not exceed the number specified in column 2 of the item.
Maximum number of certificates created under subsection (3A) | ||
Item | Column 1 Period | Column 2 Number |
1 | 1 July 2010 to 30 June 2011 | 250,000 |
2 | 1 July 2011 to 30 June 2012 | 250,000 |
3 | 1 July 2012 to 30 June 2013 | 200,000 |
4 | 1 July 2013 to 30 June 2014 | 150,000 |
5 | 1 July 2014 to 30 June 2015 | 100,000 |
(17) Schedule 1, page 63 (before line 30), before item 120, insert:
119E Subsection 23B(3)
Omit “the first 1.5kW”, substitute “not more than the first 3kW”.
(18) Schedule 1, item 124, page 66 (before line 3), before subsection (2), insert:
Adjustment of targets according to number of valid certificates as at the end of 2010
(1A) If, as at the end of the year 2010, the total value, in GWh, of valid renewable energy certificates exceeds 34,500, the table in subsection (1) has effect in accordance with the following paragraphs:
(a) the number of GWh specified in the table for each of the following years is taken to be increased by half of the excess:
(i) the year 2012;
(ii) the year 2013;
(b) the number of GWh specified in the table for each of the following years is taken to be reduced by one quarter of the excess:
(i) the year 2016;
(ii) the year 2017;
(iii) the year 2018;
(iv) the year 2019.
(1B) As soon as practicable after the end of the year 2010, the Regulator must publish on its website the total value referred to in subsection (1A).
Adjustment of targets if there is a WCMG start day
(19) Schedule 1, item 124, page 66 (line 5), omit “has effect as”, substitute “has effect (after first taking account of subsection (1A))”.
(20) Schedule 1, page 67 (after line 6), after item 124, insert:
124B After Division 2 of Part 4
Insert:
Division 2AA—Emerging renewable energy technologies
40AB Inclusion of emerging renewable energy technologies
The Minister may, by legislative instrument, determine that an emerging renewable energy technology be included as a renewable energy technology for the purpose of the scheme constituted by this Act.
(21) Schedule 1, Part 2, page 80 (after line 4), at the end of the Part, add:
Renewable Energy (Electricity) Regulations 2001
138 Paragraph 22ZA(4)(a)
Repeal the paragraph.
1:44 pm
Greg Combet (Charlton, Australian Labor Party, Minister Assisting the Minister for Climate Change) Share this | Link to this | Hansard source
I move:
That the amendments be agreed to.
Firstly I thank the opposition for ensuring the opportunity to deal with the Renewable Energy (Electricity) Amendment Bill 2010 at this point in time. I indicate to the House that the government proposes that all amendments agreed to by the Senate be agreed to here. I will briefly explain the implications of what the government proposes in this respect.
The Senate has returned to the House the Renewable Energy (Electricity) Amendment Bill 2010 with a series of amendments, as we have heard. The government moved a number of those amendments in the Senate and will obviously be accepting them in this place. The government amendments firstly provide a contingent arrangement whereby the large-scale renewable energy target annual targets can be adjusted should the stock of renewable energy certificates, which are known as RECs, exceed 20 million as at 31 December 2010 net of the February 2011 surrender amount and voluntarily surrendered RECs. Secondly, the amendments strengthen the process for review of the $40 price for RECs in the Small-scale Renewable Energy Scheme to ensure the price remains appropriate over time. Finally, the amendments provide flexibility to deal with changes in the cost of solar panels by enabling the Renewable Energy Regulator to adjust the solar credits multiplier to ensure that it remains well targeted. I indicate to members opposite that these amendments were all agreed to in the Senate when they were debated there and I trust that assists in the consideration of the issues by the opposition in this place.
A number of amendments were also moved by the opposition in the Senate, along with amendments by the Australian Greens and Senator Xenophon. I will indicate now that, in order to ensure the swift passage of this bill, the government will also be accepting these amendments in the House. These amendments include the following provisions: to exclude air sourced heat pumps of over 425 litres capacity from the ability to create renewable energy certificates; to allow for exemptions in respect of emissions-intensive trade-exposed activities for the costs associated with the first 9,500 gigawatt hours of the RET where the price of the renewable energy certificates exceeds $40, which I think was an amendment moved in the Senate by the opposition; to provide a definition of air sourced heat pumps and require the Renewable Energy Regulator to specify on the register of small-scale technology certificates whether each certificate was created for a solar water heater, air sourced heat pump or small generation unit; to enable the minister to prescribe by legislative instrument that an emerging renewable energy technology is to be included in the Renewable Energy Target Scheme; to provide for a review of the scheme every two years, commencing from 30 June 2012; to establish a scheme to inspect small generation unit installations for compliance with Australian standards and other requirements relevant to the creation of RECs; to allow for regulations to be made to specify what multiplier applies under the solar credits regime for systems up to three kilowatts in size up to the level specified in the act; and to increase the capacity limit for which the solar credits multiplier applies in relation to off-grid small generation units up to 20 kilowatts subject to an annual cap on the total number of certificates. That is a concise summation of the amendments that were carried in the Senate. For the assistance of the member for Flinders, the shadow minister who has carriage of this issue in the House on this occasion, they include all of the amendments that were carried by the Senate.
In conclusion, the bill before us today will support the deployment of both major renewable energy projects and household-scale renewable energy systems. The renewable energy target is a key measure in Australia’s climate change policy and these changes will deliver significant and timely sets of enhancements that will put the Australian economy firmly on the pathway to a low-carbon future. The enhanced renewable energy target will drive significant investment, accelerating the deployment of a broad range of renewable energy technologies like wind, solar and geothermal. These changes are designed to ensure that 20 per cent of our electricity supply comes from renewable energy sources by 2020. On behalf of the government I would like to thank leaders and members of the parties in the House and the Senate for their cooperation to secure passage of this important bill in anticipation of that occurring. I think the numbers, when one considers them, speak for themselves. This is a scheme that will help unlock more than $19 billion of investment in the clean energy sector and help create thousands of new clean energy jobs. Its passage reminds us that it is both possible and in our national interest to take strong, long-term and bipartisan action on climate change. I commend the amendments to the House.
1:50 pm
Greg Hunt (Flinders, Liberal Party, Shadow Minister for Climate Action, Environment and Heritage) Share this | Link to this | Hansard source
From the outset let me make it clear that the Renewable Energy (Electricity) Amendment Bill 2010 and this set of amendments should not have been necessary. We warned about the problem created by phantom renewable energy credits back in August. We provided amendments to ensure that the crowding out of large-scale renewable energy generation would not occur. We had an alternative. That alternative was dismissed by the government. That alternative was ignored. We again provided in our direct action policy in February a solution to this problem, which was ignored. Now we have found that the government has recognised that it was a problem and that we had the solution, and they have adopted a variation on that. We are pleased that they have accepted the problem and accepted our basic solution. We are somewhat dismayed that the cause of renewable energy has been set back by almost a year through the government’s failure to consult properly, the government’s failure to manage its business properly and the government’s failure to recognise the consequences of its action. It is part of a pattern of consistent underperformance and consistent chaos in the implementation of basic policies.
Having said that, we are believers in renewable energy. We are proponents of renewable energy. We are advocates of renewable energy. Last year we led the case in the cause to ensure that renewable energy—solar, geothermal, tidal and wave, being the great new energy sources of the future—would not be delayed by having it tacked onto and tied and held hostage to the emissions trading scheme. We won that battle. We brought renewable energy forward. We offered to bring these amendments forward to 1 July of this year but, because of a sad intransigence on behalf of the government, what has occurred is very simple: they have now put back the effective date of implementation until 2011. So it was an unnecessary problem on the first occasion, it was an unnecessary delay, and the effect was that wind, solar, geothermal and tidal—the great new energy sources of the future—were delayed and put at risk and investment was slowed on the path of Australia to being an increasingly clean-energy economy.
I now turn to the amendments. I pay great respect to my colleague Ian Macfarlane, the member for Groom, and Senator Simon Birmingham as they have done a tremendous job in securing most of the coalition’s amendments, particularly Mr Macfarlane in negotiating with the government—and we accept their amendments and we appreciate the fact that they have accepted our amendments. I do note, however, that this bill in its current form represents a death knell for many in the waste coalmine gas sector. I do not believe that is this minister’s fault. I do believe that this government has turned its back on rural jobs in areas such as the electorates of Flynn, Shortland and Newcastle and on regional jobs in the electorate of Macarthur. Many areas of Australia will see the loss of potential jobs in the waste coalmine gas sector—and that is a shame. That was avoidable, that should not have occurred and that is a breach of faith—but we ran that, we lost that and unfortunately there is no prospect in these amendments of pushing it further forward.
I say to the minister that this could all have been avoided. Renewable energy in Australia should have been settled in August last year. The nature, the scope and the problems were all identified. At the very heart of this Labor government is policy chaos. The chaos continues and what we see now is that we have to fix it all up. We saw the problem and we identified the solution. Both the problem and the solution were denied. Now they have been recognised and addressed, so we accept these amendments. We will not oppose these amendments as these are what were negotiated. But I note that the waste coalmine gas sector will be the poorer as a result of the breach of faith by the government. Working people right throughout regional Australia and, sadly, their job prospects will be diminished as a result of the government’s failure to adhere to its previous commitment.
Question agreed to.