Mark Coulton (Parkes, National Party) Share this | Link to this | Hansard source

The Parkes electorate is an ideal place for the generation of solar energy. It has been identified as having the ideal amount of sunshine as a location for this. Indeed, a good number of my constituents have taken to the concept of solar energy and renewable energy with a great amount of enthusiasm. They understand the intention of what is trying to be achieved by the Small-scale Renewable Energy Scheme and in many cases have put considerable resources into the construction of this. Some of these installations are quite large. They are not just the small ones on rooftops. Indeed, some of them are freestanding and cost many tens of thousands of dollars.

But, unfortunately, this attempt to be involved in renewable energy has not worked out for some of my constituents. One of the problems is that, as with many things that are new, this scheme has attracted the attention of some less than honourable companies that have less than honourable management styles. Unfortunately, we have had two major collapses of companies in this area in my electorate, which have been well publicised. The companies were Well Being Green and Solar & Bamboo Direct. Some of my constituents who had been dealing with Solar & Bamboo Direct had very poor service. What was to be a six-week installation time went on for upward of two years. They had poor installation, poor quality of insulation, and insulation that did not work. Indeed, some of these people did not get their installation completed before the company went into liquidation. Having expended upwards of $60,000, they now have insulation that is not working, for a variety of reasons. Some of the tracking devices were not working correctly. Some of them have blown fuses. Some of the insulation just was not installed correctly and so has become loose on its mountings. This has been a very expensive and long nightmare. There has been poor communication. Even when these companies had been dealing with some of these customers for 18 months worth of problems with their insulation, they were still claiming that there was a six-week installation process. It has gone on and on. The big issue is that a lot of these problems are unresolved.

The Well Being Green collapse has been slightly different. It has mainly affected my constituents in relation to the renewable energy certificates. Indeed, I know one individual is still owed $11,800 by nonpayment of some renewable energy certificates that were purchased by Well Being Green. One installer who was working in conjunction with Well Being Green is out of pocket by $98,000. For a small business operator, that is a nearly insurmountable loss.

So, why this motion? And why am I being critical of the government? One of the problems is that these businesses were listed on a government website as being registered agents. They were listed on the website of the renewable energy regulator. That sent a signal to members of the community that they would be dealing with someone with a close association with the government. That is the issue. This scheme originally predates this government, but if the government is going to put its arm around a program and allow websites to be advertisements—places for businesses to go and gain business—there needs to be a higher level of scrutiny. As a result of dealing with builders in my electorate who are owed hundreds of thousands of dollars because of collapsed companies associated with the BER, I have found that there is an assumption that a program like this has some form of government oversight and government protection and that it should be relatively safe.

That is why I bring this motion to the notice of the House tonight. I have made quite a few representations to the government—the New South Wales Fair Trading office, the Office of the Renewable Energy Regulator and the ministers involved. I have had a less-than-adequate response on behalf of my constituents. If you have spent $60,000 on something that you are hoping will be an investment in a clean energy future, and it appears that it has the backing and is under the umbrella of a government regulator, you would assume that there would be a degree of safety in taking part in this program—that it would be a relatively safe investment, even though it is quite a large one.

Unfortunately, the unravelling of these companies on the fringe of this program has led to an enormous amount of grief for the reputable companies—the companies that have been involved in solar energy for years and were in there before it was as popular as it has been in the last couple of years. They are really struggling now, because a degree of confidence has been lost in the entire solar installation and trading scheme. If we as a country are going to contribute and produce a certain amount of renewable energy, it is going to be incredibly difficult when the wider population has lost confidence in the industry and in the government's ability to oversee this industry.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

I want to pick up a number of points that the member for Parkes raised. I have also experienced situations where people and small businesses have been affected in the way that has been mentioned, but there are also a lot of other businesses that operate across the economy that will be affected through their transactions with others. But we do not use that as a basis on which to cast aspersions or to effectively denigrate the value of the sector. I am not necessarily saying that this is the case with the member for Parkes, but I have to say as someone on this side of the chamber that there has been a pattern of raising concerns, particularly in relation to anyone that is associated with the renewables sector. The reason I say that is that I have also participated in other debates where we have had those opposite raise concerns—actually, they have been quite long rants—about the wind turbine sector and what has been happening in other parts of the country. As I said in that debate—and I repeat it here, and I do not necessarily liken it to what the member for Parkes has said—I liken it to people saying that, because they drive down the Hume Highway and they might run into a kangaroo, we should take cars off the road. That type of logic does not work.

In this case, the issue of what has happened in the matters that have been raised by the member for Parkes reflects a design flaw in the legislation that sat there for years—a design flaw that was recently addressed by this government but had been introduced by the Howard government. Again, I have to say that these flaws were never addressed by those opposite when they had the opportunity to do so, yet there would be others that use it as a chance to undermine important work that is being done in fostering our renewables sector, a sector that will create up to 1.6 million new jobs.

The way I look at it, the reliance on renewable energy is not just an environmental benefit but an economic benefit as well, and not just because of the industry it creates. The fact of the matter is that it is economically smart to preserve our finite resources as much as we can and find other ways of generating energy and meeting growing energy needs within this country. From my perspective, I see this in rather strong terms as an attempt to basically trash an industry which is valuable to our economy and which has enjoyed bipartisan support since the middle years of the Howard government. It is just as amusing as what we saw today when the Leader of the National Party declared that the coalition would oppose Labor's historic shipping reforms despite their being part of its own platform.

Mr Neumann interjecting—

In fact, as the member for Blair rightly points out, it is their policy. The Leader of the Opposition took this policy to reform Australia's shipping industry to the last election, and it all serves to highlight the game plan of playing the politics of obstructionism. We have reached the spot of ridiculousness—that is, they do not just say no to us; they say no to their own policies. I am certain that the more they play this card the more we will see people waking up to what the member for Warringah is doing.

Let me look at this resolution in particular and put it in the context of my previous remarks. The renewable energy target itself has maintained bipartisan support since it was introduced in 2001. It was a scheme designed to deliver on the government's commitment that the equivalent of at least 20 per cent of Australia's electricity would come from renewable sources by 2020. In June 2010 the government, with the support of the coalition and the Greens, amended the RET scheme to separate it into one that would provide a large-scale renewable energy target and the Small-scale Renewable Energy Scheme from 1 January 2011, which we are discussing in part tonight. This separation split the pre-existing renewable energy certificates market into two markets—namely, the large-scale and the small technology certificates market. The STCs were created from eligible installations of small scale renewable energy systems, like solar water heaters, heat pumps, photovoltaic panels, micro hydro and micro wind systems, with each STC representing one megawatt hour of renewable energy. The scheme came into effect last year on the back of the support of both coalition parties.

As well as highlighting the politics of obstructionism, the motion emphasises deep divisions, I would say, in coalition ranks as to the RET and to climate change itself. The coalition has inconsistently argued against the generosity of the solar credit arrangements and the safety of the industry. On the one hand it has criticised the sector, and on the other it supports a $1,000 solar subsidy to achieve an additional one million solar roofs by 2020. In the direct action plan the member for Warringah took to the last election, he stated:

Our goal is for one million additional solar energy roofs on homes by 2020, including either solar power or solar water heating systems.

To achieve the goal of one million additional solar energy roofs by 2020, the Coalition will provide an extra $1000 rebate for either solar panels or solar hot water systems. The program would be capped at 100,000 rebates per year and would therefore be capped at a total cost of $100 million per year.

So you have a situation where you have a major political party taking to the election a promise to further stimulate the sector but we have heard nothing of the type of regulatory response that is being called for here or dealing with it. The simple reason is that the design flaw in the system was introduced by those opposite and went on for years without them correcting it until we fixed it in this parliament.

In the spirit of the Leader of the Opposition's caravan of doom, the member for Parkes has come into this place tonight talking down the Australian solar industry and discrediting it as being shonky. He ought to be ashamed of himself, because Australia's solar industry is strongly regulated. State and territory governments have clear responsibility for regulating workplace health and electrical safety standards in relation to solar voltaic systems—

Mr Bruce Scott interjecting —

How come you never stop other people interrupting me but you are interrupting me now? You are getting me worked up.

Kirsten Livermore (Capricornia, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member for Chifley will address the chair.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

Australia's solar industry is strongly regulated and it has regulations in place to oversight workplace health and electrical safety standards in relation to solar voltaic systems. To be eligible to receive support under RET, small-scale systems have to meet stringent safety standards, including adherence to relevant Australian standards and all relevant Commonwealth, state, territory and local government laws and regulations. In particular, in the case of Well Being Green, which was referenced by the member for Parkes, it was not that the work was substandard; it was an issue where one company was not honouring its arrangements with its partners. This is not something that would be isolated insofar as there would be situations in all spheres of commerce where there would be parties that do not seek to honour what their partners do and the law needs to step in. That is what we have effectively sought to fix up in the reforms that are being brought on by the minister for climate change.

The regulator has inspected and finalised reports for over 3,000 installations, reinforcing the point I just made, and passed on issues of noncompliance to the Clean Energy Council and state and territory agencies for further enforcement. I note that public inspection results indicate that only about four per cent of systems were considered unsafe, hardly suggesting a widespread problem with compliance as has been suggested. My problem with the coalition is that they have gone out of their way to highlight a problem and claim they have got an affinity for the industry, but when it comes to helping out they are nowhere to be seen. There is $500 million ripped out of industry assistance under their plan. They never voted for the steel transformation plan. They sneer at efforts to protect auto workers. They move motions against wind turbines and the sector that is supporting them. And now we have this.

The member for Parkes can talk about financial stress. The only thing that is causing stress is this constant campaign of fear and negativity that is being played by those opposite in trying to undermine confidence in certain sectors across the economy. From my point of view, they have a vested interest in the failure of these industries and the loss of jobs that follows it. The RET has been highly successful in helping households, small businesses and community groups to address or play a part in addressing climate change. Over 500,000 rooftop solar panel systems and over 200,000 solar heat pump water heaters have received support under the scheme since it has been expanded.

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

I join this debate in support of my colleague the member for Parkes and to acknowledge the government's mismanagement of the solar panel program and the Small-scale Renewable Energy Scheme—the RETs. Since late last year to early this year and in the last few days people have started to come to me. I think there was probably a spark ignited by the proposed introduction on 1 July of a carbon tax. They are looking at their power bills all the time. They want to see that these installations that have been put in place are, first, actually working and, second, will deliver a renewable energy certificate. But they have found that they are getting cases of dodgy operators and people seem to have no recourse to get their money back and the Clean Energy Council does not seem to want to do anything about it.

Let me describe a situation of a constituent near Stanthorpe. They put an order in and the system was installed on 14 May, very recently. It is meant to be able to deliver some 10 kilowatts per day. They were told if there was a problem to get back in touch with the company. We have all had heard that story—'Get back in touch with us.' They are not having any success at all. They were also told that it would probably deliver some $300 a quarter in savings in the electricity bill because of the renewable energy certificate. They have started to ring around to try and get to the end of this saga. They have been in touch with the company in Brisbane which I understand is the importer or supplier of these solar panels. The phone number is a 1300 number and goes to a mobile phone of someone in a car. So they have gone a little bit further to see whether this company, Clean Solar Pty Ltd, are in fact properly regulated. They went to the company and they found that they do not hold a Queensland BSA licence, so they may also be operating illegally.

This couple have paid their money in good faith, thinking that this will be a way of saving money and particularly offsetting some of the impact of the carbon tax, but they are certainly not getting anywhere down that path at the moment. But it goes further. They have looked at the warranty on the solar panels and if there is a faulty panel or part under warranty it says, 'Return the defective parts to China.' There is not even any service available for these solar panels if they are dodgy. I have yet to see them personally but it appears to me that they could be dodgy. We have got to do something about it. That is the whole context of the motion that the member for Parkes has before the Federation Chamber this evening.

They then rang Ergon Energy to see if the rebate that would be due to them if the equipment worked correctly could be stopped while they had the equipment checked out to see that they were operating legally with a solar panel that would do the job. Ergon gave them the phone number for the Clean Energy Regulator, because they wanted to see if they could stop any RECs being paid, because they thought it was a dodgy installation. The Clean Energy Regulator said no, they could not stop it, because the paperwork had already been signed. I think anyone who is overpaid with a Centrelink payment is required to pay the money back. That is what my constituent wants to see. He feels that this is ripping off the taxpayers. It is taxpayers' money. He supports the principles of the scheme but not the way it is operating. It just seems to be another pink batts scheme that is operating in some parts of Australia with the rollout of this solar panel scheme.

I had another case, from someone very near Kingaroy. This really got to me. This person got in touch with my office and said the panels had been installed but simply do not work. He has paid his deposit and extra money. paid the subcontractor an additional amount of money because of the height of the roof, and yet the installer did not have any safety equipment when he went up there onto the roof. This person also noted that, when the installer was putting the panels in place, he was using the light of a mobile phone to do the connections. Is it any wonder they do not work?

I am calling on the government to immediately stop payment to fraudsters who are ripping off taxpayers. If they are dodgy, they should be stopped. Clean up this whole scheme. The government needs to screen disreputable operators from the program. The minister must stop these payments to ensure that this does not continue along these lines. (Time expired)

Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

I accept the sincerity of the member for Parkes in bringing these matters to the attention of the House in his motion on the Small-scale Renewable Energy Scheme, but I do not accept that the responsibility for the concerns which he raises rests with the federal government at all. The renewable energy target has been very successful in assisting households, small businesses and community groups to install small-scale renewable energy systems on their premises. We heard from the member for Chifley how over 500,000 rooftop solar panel systems and over 200,000 heat-pump water heaters have received support under the Renewable Energy Target scheme since the government expanded the renewable energy target in 2010.

I would have thought that the member for Parkes would be supportive of that program, given his own party's policy in respect of this matter. I will not repeat it word for word, but the member for Chifley quite properly referred to the coalition's policy on this issue when he referred to their direct action statement about trying to achieve a million additional solar energy roofs by 2020. He went on to talk about the $1,000 rebate in their policy and how much money they would commit to it. That is exactly what the government is in fact already doing, so therefore I would have thought that the policy itself is something that the member for Parkes would have supported, especially given that, to date, it has assisted 700,000 premises across Australia.

These installations have not only assisted Australia achieving its renewable energy target; they have actually assisted households, businesses and community organisations with their ongoing power costs. Once you have a solar panel system or a solar hot-water system installed, it is there for many, many years, providing you with the benefit of the investment that both the government and the owner of the premises have made. I think that everyone would agree that that is a good thing.

I also remind the member for Parkes that it was in fact the coalition government that introduced the renewable energy target in 2001, and the coalition have supported every scheme amendment since that time. It was also effectively the Howard government that brought in the very standards that have been applied for the rollout of this program. The fact is that the regulation of this industry lies with the states and territories. It was not until this government came to office and continued to roll out this program that the federal government even got involved in trying to assist with the management of the rollout and lifting the very standards which I think the member for Parkes would like to see improved. As a result of the Clean Energy Regulator coming into effect, there has been a much tougher regime with respect to the compliance, auditing and enforcement standards that currently apply across the country.

So, on one hand, it is my view that the rollout has been a good thing because it has done a lot of good things. Amongst those good things that it has done, it has brought to the attention of governments across Australia that we need to lift our standards with respect to those who install these systems into different homes, business premises and the like. As a result of that, the government has in fact acted through the Clean Energy Regulator.

Renewable energy certificates are a matter that I too have had brought to my attention by people in my electorate. On each occasion when they have raised the matter with me, I have said to them, 'Was it made clear to you from the outset what the terms and conditions would be?' I have to say that in all cases they said: 'Yes, it was. Whilst we would like to be paid the $40 that we might get through the clearing house, the reality is that, yes, it was made clear that that is not guaranteed and that, if we want our money more quickly, we can trade on the open market.' I raise that to make this point: it was a choice made by people as to what they would do with their renewable energy certificates. Provided that that choice is theirs and made clear to them, again, I do not believe that the government is in any way at fault.

Finally I say this. As a result of the 700,000 different systems that have been put into homes, it is not unusual that we have had some problems with them, but it is good to see that the government has responded to those problems through the Clean Energy Council.

Nola Marino (Forrest, Liberal Party) Share this | Link to this | Hansard source

I rise to support the motion by the member for Parkes. His issue is with the government's mismanagement. There are many failings of this Labor government that could be debated here today—we are pretty spoilt for choice—however, it is the handling of the Small-scale Renewable Energy Scheme that provides us with the latest example of the government's incompetence. The scheme targeted the household level consumer and was designed in effect to get more solar panels on roofs. It subsidises the installation of small-scale renewable energy systems, including solar power photovoltaic, or PV, systems, wind power systems and hydro power systems. It also subsidises the installation of solar hot water systems or heat pump hot water systems.

It has been managed by the creation of small-scale technology certificates under the SRES for each Australian state and territory. One STC is equivalent to one megawatt hour of renewable electricity generated and has been valued in a range from $25 to $30 over the past year. However, few people have used the system to claim annual credits. Most have ceded those credits to the installer in exchange for a cheaper purchase price. The scheme incorporated a solar credits multiplier, which increased the value of the credits in its early years, with a peak multiplied price in 2010 of around $43. However, by 2013, in the middle of the year, the multiplier falls to one and has no effect, so prices will stabilise.

Naturally, this market distortion has contributed to the usual government mismanagement. Dodgy operators were attracted to the subsidised scheme, undermining real installers and the industry as a whole. It has caused a great deal of hurt out there. Just as the Labor Party did with its pink batts program, it completely failed to ensure that the process was open, accountable and honest. Instead, it again bogged down with Labor values, with the result that, once again, it failed the competency test. Once again, the result is hurting genuine Australian businesses and families. Like most of the government's clean energy deception, the outcomes reflect the Labor government's repeated failure to deliver programs. The Office of the Renewable Energy Regulator set up a clearing house to help facilitate the trade of these STCs. If the market is in surplus the STCs are worth less than $40; if in deficit, they are worth more. The crux of the problem for the government is that they have established a system which last year had a total of 5,411,596 STCs in surplus. It is worth noting that these STCs can be traded at market value, which at, for example, $25 per STC is a total of is $135 million worth of credits in surplus. Credits in excess of $200 million owned by individuals, families and small businesses are sitting waiting to be traded in a system established by the government. However, since August last year, there has been an increase of 824,447 STCs for a new total of 6,236,043 available for purchase by emitters. This is a new total of $156 million worth. The government has created a system where there are renewable energy certificates, but they are in surplus, which can only push the price down. The end result, unfortunately, will be a bit like Europe printing more money to pay its debts and represents another failure by the government.

I support the member for Parkes in this motion because of the businesses, particularly the small businesses, affected by this—those in my electorate and, as we have heard today, those in electorates all around Australia. There have been people going out of business, people this has cost thousands of dollars. The amount of worry and the amount of additional pressure this has put on individual small business owners has been extraordinary. I think that is the crux of this issue. All the time what we have seen for small business operators around Australia is additional pressure, additional red tape and additional challenges, and the mismanagement of this scheme simply proves that this is another instance of that.

I am really pleased to support the motion by the member for Parkes. He referred to:

(1) failure of the Government to screen disreputable operators …

a major failing—

(2) failure to warn the Australian public regarding the risks associated with solar installation companies operating with questionable practices, despite indication that this was necessary; and

(3) fundamental design flaws—

I have explained them here—

of the SRES program which have caused a glut of Renewable Energy Certificates in the clearing of houses, leading to deep financial stress …

(Time expired)

Julie Owens (Parramatta, Australian Labor Party) Share this | Link to this | Hansard source

Once again it is one of those moments in the House when members opposite have just spent a considerable amount of time criticising their own policy. In fact, we heard from the shadow minister recently that he plans to expand this program extensively—using just this program, using the same system—to deliver one million solar panels for hot water systems onto Australian roofs by 2020. Again we have the negativity of this opposition laid bare. This was John Howard's program—the renewable energy target. It was John Howard that set up the link between the eligibility of certificates and the accreditation. That was actually put in by John Howard, and they thought it was good. Even the member for Flinders thought it was good. Just recently, back in March, he said:

… I even negotiated … the 20 per cent renewable energy target. There are those who are critical of it—

and we have heard some; I presume they will go and try to convince the leader to change his policy—

I am guilty as sin of supporting it. But it was not about finding the highest cost for renewable energy; it was about finding the lowest cost for renewable energy. If we are moving into that space, we need to do it on the lowest cost basis.

And John Howard set the target, he set up the scheme, he set up the system and it was good.

We came along. There were some problems with it—exactly the problems that you are describing. So we strengthened the assessment process. Anybody who has followed this knows that it is actually the state and territory governments that have the responsibility for regulating workplace health and electrical safety standards—the states have that responsibility. I am sure you are going to get up and bag them tomorrow in parliament. I am sure you are going to get up and bag all those Liberal state governments that have not dealt with this. But the federal government moved to set up our own assessment process where, when we find installations that do not demonstrate competence, we inform the state governments of those problems so that the state governments can take the actions needed to get them fixed. By the way, at the moment the inspections show that four per cent of the systems are considered unsafe. You are quite right: it is too high. You should get onto your state government colleagues and make sure that they improve their systems, because they are responsible for safety and workplace standards in relation to this.

Let's move on to the Leader the Opposition and his promise that one million homes will have solar by 2020. I point out that the figures do not add up. This is what you would expect, actually. I am surprised that no-one has noticed that, at 100,000 rebates a year, to get to one million by 2020 you would have to have started in 2010. I think maybe someone on the other side should work out that it would actually cost $166,666,000 every year between the next possible opposition budget, if they actually win—heaven forbid, with these sorts of figures—and 2020. It would be $166,666,000, not $100 million. So the direct action plan is profoundly flawed. You cannot reach one million homes by 2020 capping it at 100,000 a year. We do not have that many years left between now and then. So let us not take this plan particularly seriously.

Let us look at what Mr Abbott had to say on the need to encourage more solar initiatives on top of current programs:

Well, we think it can and what we're proposing to do is to add $1,000 to whatever other assistance measures there are for solar roofs. Now, we think it's important that we encourage the use of renewable energy. We think that moving from electric to solar hot water is a very practical and constructive way for Australian households to reduce their emissions.

Later, he said:

Well, again, it will operate in the same way that government programmes operate.

Until you guys get to your caucus meeting tomorrow. I am sure you will convince Mr Abbott that this is not a wise thing to do. Mr Abbott said:

This is $1,000 on top of existing incentive payments. So the existing incentive payments will continue and there will be $1,000 on top of that.

He said further:

Well, as I said, it will be run as an addition to existing programmes, so it would use existing programmes. The sort of safeguards that are built into existing programmes would simply carry over to our additional $1,000 incentive.

This is your policy. You have just spent the last half an hour or 40 minutes criticising your own policy. When it is John Howard's program it is good; when it is ours it is bad. Then it will be yours again and it will be good. This is negativity gone mad. You do it and it is good, we do it and it is bad and then you do it again and it is good, only you do it on a larger scale—except your figures do not add up. You cannot deliver what you are promising to deliver on the money you have put on the table.

Amanda Rishworth (Kingston, Australian Labor Party) Share this | Link to this | Hansard source

Surprise, surprise!

Julie Owens (Parramatta, Australian Labor Party) Share this | Link to this | Hansard source

Exactly! Goodness me, this is negativity gone mad.

Debate adjourned.