Tony Smith (Speaker) Share this | Link to this | Hansard source

I have received a letter from the member for Port Adelaide proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The Government's failure to address the national energy crisis.

I call upon those honourable members who approve of the proposed discussion to rise in their places.

More than the number of members required by the standing orders having risen in their places—

Mark Butler (Port Adelaide, Australian Labor Party, Shadow Minister for Environment, Climate Change and Water) Share this | Link to this | Hansard source

As we heard from the member for Paterson earlier in question time, last Friday power was cut in load shedding arrangements to the Tomago Aluminium smelter. This is a smelter that uses 10 to 12 per cent of New South Wales' power—equivalent to around a million households. Power was also cut on that day—not in load shedding arrangements—to households in the electorates that I mentioned in question time and also in my personal explanation.

It is important to point out that this is not a jurisdiction even connected directly to South Australia. This is a jurisdiction with one of the highest penetrations of coal fired power in the nation, if not the world—well over 80 per cent—and one of the lowest penetrations of renewable energy in the country. It has vast interconnection capacity with Queensland and, to the south, with Victoria. On the same Friday, more than 1,000 megawatts of power was imported from Queensland, hundreds of megawatts of power was imported from Victoria to New South Wales, but still Tomago had to shut down. The CEO of Tomago, as the member for Paterson pointed out earlier today, said:

It's fair to say the way the energy system is working at the moment, it is dysfunctional. What we saw on Friday was a genuine system security risk ...

The Prime Minister would have Australians understand that every problem in the energy system—whether it is load shedding to the biggest aluminium smelter in the country, power cuts in one part of the country or price spikes in Queensland that are several times more frequent than in South Australia—is because of wind farms in South Australia. This fatuous, mendacious approach to energy policy—which, to be fair to the minister, way predates his time in this portfolio—jumped the shark last week when the Treasurer of one of the biggest economies in the world thought it was a good idea to bring a big lump of coal into question time.

The fact is that there is a crisis in energy policy. There is a crisis and it is national and it is touching every element of our electricity system. As The Australian very helpfully pointed out yesterday, there have been massive price increases in electricity over the last 10 years. The Australian also pointed out that the biggest price increases over that period of a decade have taken place, in order: in Queensland by 135 per cent, in Victoria by 117 per cent, and in New South Wales by 108 per cent—again, the three states in the national electricity market with the highest penetrations of coal fired power and the lowest penetrations of renewable energy.

The Leader of the Opposition also pointed to the price spikes, the extreme price events we have seen over the course of 2016 in Queensland. There were 23 times the number of extreme price events we have seen in South Australia. In New South Wales there were several times the number of extreme price events we have seen in South Australia. Again, those jurisdictions have very high levels of coal and very low levels of renewable energy. The market rules, everyone agrees, are simply not fit for purpose.

Tony Wood from the Grattan Institute—often a very deep critic of Labor policy—has said that either the rules are not working or AEMO, the federal regulator, is misinterpreting them. We saw that over the course of last week in a very stark way. AEMO decided, wrongly—I think it admitted at the Senate inquiry that it got the demand projections wrong for Wednesday afternoon in South Australia—not to order Pelican Point to turn its second unit on. If it had, there would have been no need for load shedding. There would have been more than sufficient capacity from fossil fuel generation, gas fired generation, in that state to cover what was a record level of demand in South Australia during that extreme heat event on Wednesday.

Pollution is going up. That is not a matter often alluded to by the minister for the environment, but under this government, after coming down by several percentage points under the Labor government, pollution, unsurprisingly, has started to rise again across the economy, but particularly in the electricity sector. All of this is happening while the electricity industry tells us that as much as three quarters of our existing generators are operating beyond their design life and are shutting. Whether or not this minister likes it, whether or not state ministers like it, these privatised companies are taking decisions to shut their generators and investors are paralysed by a lack of energy policy on the part of this government to be able to build replacement plant.

The minister on Lateline last night was asked, reasonably: 'What's the government's plan?' That is quite reasonable given that this government is now well into its fourth year in power, and he could say nothing. All he could do is outline the elements of Labor policy that he is opposed to. He is opposed to a framework around the way in which those old plants close. Instead, he wants to continue a situation where the nation waits for an announcement by a board of directors, usually on the other side of the world—multinational companies that are operating this essential electricity infrastructure—to tell us, 'No, we're done. We're going to close the plant'—no planning or arrangements for the impact on the electricity system; no planning for the impact on the local economies, the workers in the communities. But when AGL, for example, says, 'We want to plan a framework for the closure of ageing assets so that it is an orderly replacement process, not a disorderly process,' the minister says, 'Labor supports that, so we can't.' There is no plan for an alternative way of approaching closure, but they are opposed.

They oppose a price signal to underpin the investment—the renewal of our electricity infrastructure. This is perhaps the sorriest episode because, to his credit, the minister had done the work to develop an emissions intensity scheme proposal for COAG at its meeting in December. He went out on the Monday morning and said, 'Of course we'd consider it,' because everyone in the industry wanted it. It was an Energy Market Commission model supported by the CSIRO; supported by the Climate Change Authority; supported by the Chief Scientist; supported by the electricity industry, from the renewable sector to the coal fired sector; supported by state governments, Labor and Liberal alike; but not supported by Senator Cory Bernardi. So when Senator Cory Bernardi came out—

Honourable Members:

Honourable members interjecting—

Mark Butler (Port Adelaide, Australian Labor Party, Shadow Minister for Environment, Climate Change and Water) Share this | Link to this | Hansard source

Yes, that was a great judgement on the Prime Minister's part. Let's placate Senator Bernardi and everything will be fine. How did that work out for you? Danny Price, the Prime Minister's old energy adviser, said that decision alone has made the Liberal Party 'the party of increasing electricity prices and reduced energy security'. Of course, they are opposed to all of those things and they are opposed to renewable energy. They have no policy beyond 2020. There will not be a project built beyond 2020 under this government's policy framework. They have this pathological thing about renewable energy. They are happy to come in and stroke a black rock, but have a pathological hatred of renewable energy. They have not yet started talking about the health impacts that the former Prime Minister was so worried about when he rode past that wind farm on Rottnest Island, but I would not be surprised anymore if this Prime Minister started talking about those things as well.

They run the prices scare campaign. In spite of the fact that the Warburton panel—a panel certainly led by climate sceptics—said that the expansion of renewable energy puts downward pressure on wholesale prices and in spite of modelling across the world that increasingly says that new solar and new wind are the cheapest forms of new generation, they still run this. They do not care about the jobs impact. There were 3,000 jobs lost in renewable energy since this government came to power. If we had kept pace with jobs growth around the world in this industry, we would be 11,000 jobs better off in this industry than we are under the Liberal government. As I said, and it is a small point: renewable energy is the only way we are going to achieve the Paris targets that the Prime Minister signed us up to.

They do have one policy of course—the only policy they have come up with in more than three years in government—and that is to build new coal generators. To be fair, it is not the Prime Minister's policy; it is the member for Warringah's policy. No-one had talked about this for years until the member for Warringah penned an op-ed a few weeks ago. Then, lo and behold, playing the Prime Minister like a violin, it ends up as the centrepiece of the National Press Club speech from this Prime Minister. Never mind that the industry says, put simply: 'You cannot finance coal.' Never mind that the Climate Institute says it would require at least $26 billion in taxpayer subsidies. Never mind that the Clean Energy Finance Corporation, a government owned corporation—which is apparently going to underwrite this—said they would not support that and that it would be massively risky for taxpayers. But he has placated Senator Bernardi and he has placated the member for Warringah—and that, apparently, is the only driver for energy policy at a time of crisis for this government.

This government is presiding over a crisis that is spreading across the nation. Well into its fourth year in power, this government still has no answers to the question: how do you deliver affordable, reliable supply that will start to cut our pollution? This minister unfortunately is very long on opposition but utterly bereft of an answer to deal with this crisis.

Josh Frydenberg (Kooyong, Liberal Party, Minister for the Environment and Energy) Share this | Link to this | Hansard source

The only reason we are dealing with this MPI today is that the member for Port Adelaide thinks the best form of defence is offence, because, if you had the record Labor has on energy policy, you would not have the gall to come to this dispatch box. When Labor were last in government electricity prices increased by more than 100 per cent. We had the dreaded $15 billion carbon tax, which Australians did not want and did not need. We had more than a dozen different policies. Who could forget the citizens assembly, cash for clunkers, the emissions trading scheme or the carbon tax? The list went on and on. They were very poor policies.

Now, from opposition, they have a quadrella of policies which are only going to send electricity prices higher and undermine the stability of the system. First and foremost, they have a 50 per cent renewable energy target by 2030. When they put that in their policy document they said there would be no details released until October 2017. Then, when the Leader of the Opposition fronted up to the Press Club the other day, it was the issue that did not get spoken of other than a single reference to renewables, with no detail about his policy.

They have a 45 per cent emissions reduction target by 2030, nearly double what we have taken to Paris—a target which will cost hundreds of billions of dollars to meet. They have an emissions intensity scheme, which Penny Wong, the Leader of the Opposition in the Senate, when she was climate change minister in 2009, described as a 'mongrel of a policy'. She described it as a smokescreen and as being no credible alternative. Then of course they have a policy to close Australia's 24 coal-fired power stations. They come up in question time today and ask about the Tomago aluminium smelter, but the Tomago aluminium smelter and others like it would not survive if we did not have coal-fired power. What about the member for Shortland? He is a shadow assistant minister, and he has a policy, which he has to defend, that includes the forced closure of Vales Point, which is in his own electorate.

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

No, it doesn't. Don't mislead the House.

Josh Frydenberg (Kooyong, Liberal Party, Minister for the Environment and Energy) Share this | Link to this | Hansard source

It does. The Australian Energy Market Commission modelled the forced closure policy, and then the member for Port Adelaide has referred to that. I can tell you that the many hundreds of workers at Vales Point would not be too happy with the member for Shortland. As Graham Richardson said, Labor are trying to 'out-green the Greens', they have a farce of a policy on 'a wing, a hope and a prayer' and it is going to sell out pensioners and blue-collar workers—the blue-collar workers you are expected to defend.

Let us get the record straight as to what occurred in South Australia. We have had four blackouts in nearly as many months. Last September, 1.7 million people lost power. We had blackouts in December, January and now in February. Embarrassingly and humiliatingly, the member for Port Adelaide described those blackouts as 'mere hiccups'. If I was working for one of those companies or was one of those 3,000 workers at Olympic Dam, owned by BHP, in South Australia, I would not call that a hiccup. If I was one of the 1,500 workers at Arrium in Whyalla or one of the hundreds of workers at the Port Pirie smelter, owned by Nyrstar—if I was one of those hundreds of workers or thousands of workers affected—I would not be describing that as a mere hiccup. If I was one of those people stuck in an elevator or imprisoned in their homes or stuck in the gridlock of the streets when the lights went out, I would not be describing this as a hiccup. Nor would I be describing the fact that South Australia pays electricity prices which are more than 40 per cent above the average across the national electricity market as a headache.

The Labor Party's policies have effectively led to these blackouts, because they have left the South Australian system a lot more vulnerable. In fact, since the closure of the Northern power station last May, which the Labor Party say has nothing to do with renewables—which was absolutely disagreed with by Alinta in their statement at the time—we have seen nearly a doubling of the reliance on the interconnector, ironically, supplying brown coal-fired power from the Latrobe Valley into South Australia.

South Australia has become a lot more vulnerable. The intermittent power that South Australia is now relying on for more than 40 per cent of supply does not always have predictable levels of supply. The quality as well as the quantity is different from baseload generation, particularly coal but also gas and hydro. It does not have the same characteristics of FCAS and inertia that you get from a spinning turbine and the consistent 50 hertz voltage that you get with baseload power.

One day, in the June-July period of last year, wind supplied 80 per cent of South Australia's power, but on another day it supplied just one per cent of its power. When the lights went out last Wednesday, it fell to supplying just two and a half per cent of the South Australia's power. That was a 95 per cent drop on the power that was being supplied by the wind farms earlier in that day. And it is that level of volatility, without the necessary storage, which this reliance on intermittent power creates.

We are taking very seriously our responsibilities to get more stability into the system. That is why we have tasked Chief Scientist Alan Finkel to produce a report, and that is why we are investing record amounts in storage—battery storage, and, as the Prime Minister talked about, pumped hydro. Some of the programs include: the virtual power plant in Adelaide, connecting 1,000 businesses and homes with batteries and solar PV; the work we are doing on a copper mine in Western Australia in order to take out diesel from that operation and replace it with solar; and the work we are doing in pumped hydro with the Kidston goldmine in Queensland. More than $150 million worth of projects have been invested in by ARENA and CFC with battery technology.

Of course, we want to push the states to lift the moratoriums and the bans on gas development because we think this is vital as a transition fuel, with about half the emissions of coal. And we need to get more gas out of the ground—for example, in the Northern Territory, where the Labor government has a moratorium in place. The Northern Territory has about 180 years' worth of supply to meet Australia's domestic gas needs. Imagine if we could get that out of the ground.

The other target we are taking on is the Labor states' high renewable energy targets, which not only are leading to bad investment outcomes but also will not improve the environment: a 50 per cent target in South Australia; a 50 per cent target in Queensland, remarkably, with only 4½ per cent of their power today coming from renewables; and a 40 per cent target in Victoria. I am very pleased to say at this dispatch box that our Victorian, South Australian and Queensland Liberal and Nationals colleagues have banded together to reject those targets once they get into government.

We take our emissions reduction targets very seriously, and those on the other side of the House need to know: when they were in government, they were projected to miss their 2020 target by more than 700 million tonnes. We, according to the last projections, will beat our 2020 target by more than 220 million tonnes. Whether it is energy productivity, or whether it is our Emissions Reduction Fund, which has been able to achieve 178 million tonnes of abatement at just over $11 on average, or whether it is what we are doing in other parts of the portfolio with the renewable energy target and the work of the Clean Energy Finance Corporation and ARENA, we are doing a lot in a lot of areas to meet our emissions targets, and we will beat our 2030 targets, as well as beating our 2020 targets.

I just want to finish by saying that the member for Port Adelaide has been playing a very dangerous game in the last week. He—unfortunately, because he is a very endearing bloke and means well—has got wrong and misunderstood the role of AEMO. Secondly, he has misunderstood the true powers of the states to direct AEMO, and the lack of power of the Commonwealth to direct AEMO. Thirdly, he has also sought to blame the government for not saying that the South Australian blackout last September had anything to do with the severe storms. We were up-front at the time. And today at the dispatch box he also sought to imply that there was load-shedding for residential customers. That is not correct, and he knows the truth.

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

I am glad the minister is here because I have got a simple question for him: does he even turn up to cabinet anymore, after his last disastrous foray into an emissions intensity scheme which lasted 24 hours before he was rolled by the true powerhouse of this government, the Deputy Prime Minister? Seriously!

Jenny Macklin (Jagajaga, Australian Labor Party, Shadow Minister for Families and Payments) Share this | Link to this | Hansard source

And the member for Warringah!

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

And the member for Warringah, and Senator Bernardi. Seriously, I have had flights that have lasted longer than his policy proposals have lasted in this government! And that is truly tragic for this nation. It is tragic for this nation because the events of last week have demonstrated that we need a serious discussion about energy policy and this mob is incapable of providing it. We saw AEMO's failure in South Australia to direct the turning on of the Pelican Point second unit, which would have avoided load-shedding. We saw AEMO force curtailment of the Tomago aluminium smelter—a smelter that uses the equivalent of one million homes' worth of electricity—endangering the jobs of 1,000 workers. My friend the member for Paterson will talk about this later, but I spoke to the CEO on Friday afternoon, and he was gravely worried about the future of that smelter because of the lack of energy policy by this government.

This is how serious this debate is. We have 14 groups calling for a genuine policy discussion in this area, including the Aluminium Council, the Energy Council, AiG and BCA. But all we get from that side is bringing lumps of coal into question time, and inaudible guff from the Deputy Prime Minister. We do not get a serious policy debate because all they care about is petty politics.

We, on the other side, have a well-thought-out, reasoned policy around an emissions intensity scheme—a policy backed by the Australian Energy Market Commission, AEMO, CSIRO, the chief scientist, state governments, AiG, AGL, Origin, the big energy users, Danny Price and the Grattan Institute. Who supports their policy of building new coal-fired power stations with public subsidies? Well, I have got six names: the MCA, the DLP, the IPA, Ray Hadley, Tim Blair, and Malcolm Roberts and the tin-foil-hat brigade! Oh, and The Australian newspaper. Those are the sum supporters of this mob's awful policy. And the tragedy is: not a single commercial player will invest in coal-fired power stations in this country because it is uneconomical; it is a dud investment that will not last.

What is the result of this policy uncertainty? What does Danny Price say in modelling commissioned by the Australian Energy Market Commission, the AEMC—a government body commissioning modelling from the government's own favoured energy sector modeller? He found that their policy would cost $15 billion more for consumers—$15 billion more! And when we saw the minister's policy backflip after 24 hours, after being rolled by the Deputy Prime Minister, he said: 'This shows a lack of spine.' He means that they, the Liberal Party, are the party of increasing electricity prices and reduced energy security. And that is the great tragedy of this mob. By playing petty politics, by not being serious about this, all we have is higher energy prices and greater uncertainty. And the fact is: not another power station will be built in this country.

Mr Butler interjecting—

And the shadow minister reminds me that their great white hope is now storage technology through ARENA. This mob spent the last three years trying to abolish ARENA, and now it is their great white hope. All they do now is call out individual members on this side as somehow betraying workers. I will not be lectured by this mob on support for workers. I will not be lectured by the Liberal Party on how to support workers and their jobs. This mob are a fraud.

I am proud to represent a region that was built on coal. My neighbours are coalminers—I can see the biggest coal-fired power station in this country from my home—and they know change is coming. I talk to workers in the energy sector every week, and they know that not a single new coal-fired power station will be built in this country, and that is why we need policy certainty.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

Build more coal!

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

That is why we need sensible policy discussion, where we look after workers and communities. All we get over there is empty rhetoric from climate change fossils like the member for Hughes, who does not accept climate change is coming. In the end, who will suffer? It will be the workers and communities of this country who will suffer because of this policy malaise. They are the ones who will see greater blackouts because the government, led by a shell of a man, will not engage in a serious economic policy debate about energy policy in this country. Sadly, our country will be poorer for it.

Rowan Ramsey (Grey, Liberal Party) Share this | Link to this | Hansard source

It gives me no pleasure at all to stand here today and proclaim myself as a modern-day Cassandra, but I can say, 'I told you so.' I have been saying for quite some time—in fact, for over four years; I have checked my records—what would happen to the South Australian electricity grid if we ignored the signals that were clearly on show for us.

I began meeting with Alinta right back in 2012, and they told me that their power station was beginning to lose money. It was not because the price of energy in South Australia was being driven down by cheap energy coming from the wind farms; it was because it was being driven down by oversupply. Basically, we were building new power stations, new wind farms, in South Australia that were oversupplying the market. Of course, at the times of high wind, the Alinta operation became worse than non-profitable. In fact, they were paying very high fees to unload electricity, which they could not stop generating.

The South Australian government has made an art form out of attracting wind energy into South Australia. The figures are worth visiting. More than 50 per cent of Australia's capacity in wind farms is situated in South Australia. Around 60 per cent of that generation capacity is situated in my electorate of Grey. The national target that both sides of politics agreed to sign off on—actually, that is probably not quite true. Anyway, the national target, which we set only 12 months ago in this place, is 23 per cent. South Australia is already at 41 per cent—way in front of the recognised limit. It is worth noting that Denmark are held up as a great paragon of this transformation of electricity, and they have set their wind limit at 23 per cent. In South Australia, we have gone to 41 per cent.

In the three years to 2015, I met with Alinta repeatedly. They said that, if we kept building more wind capacity in South Australia, they would withdraw from the market. They were meeting, of course, with the South Australian government at the same time. This was a clearly telegraphed message coming from Alinta. They did not give a date; they had hoped to stay there longer. They bought an asset that they believed would survive longer.

What I call on the South Australian government to do, and what I have been calling on them to do for some time, is to approve no more renewable energy in South Australia, no more new projects, unless they include storage. This is a very important message. There is nothing wrong with renewable energy at all, and, in fact, I am a great supporter of it. I have been trying very hard to get two projects attracted into Port Augusta—both with solar thermal storage. But, at this stage, the South Australian government continues to sign off on new wind farms without storage, which will further disrupt the market. It is as if they are the three wise monkeys: they are sitting there and they do not want to hear any evil, they do not want to see any evil and they are not going to speak any evil. 'We'll just keep approving the wind farms; it'll be all right.' It will not be all right.

South Australian industries are being severely damaged. Some of the major employers in my electorate have been mentioned in this debate. BHP at Roxby Downs is estimated to have lost somewhere near $100 million in the power outage in September, and Arrium, severely damaged, had around $10 million worth of damage. Nyrstar, which is investing close to $500 million in Port Pirie, is absolutely horrified by what has happened to the electricity market. Reliability is one thing—and it is very important—but the price of electricity in South Australia is crucifying their industries. I had an abalone farm in Port Lincoln which was intending to invest in a major expansion, but its electricity bill has gone from $700,000 to $1.33 million in 12 months. That is a 90 per cent increase. I was talking to some McDonald's franchisees—three separate outlets, employing 290 people between them. Their electricity bills have risen by close to 100 per cent across the board in the last 12 months. These are the people who are employing our kids. There are 290 employees in these three McDonald's franchises, and they are facing electricity rises of 90 per cent. (Time expired)

Mark Coulton (Parkes, Deputy-Speaker) Share this | Link to this | Hansard source

Could I ask the ministers and shadow ministers at the table to be a little quieter. It is interfering with the other speeches.

Meryl Swanson (Paterson, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak on the government's failure to address the national energy crisis. During question time, the Prime Minister claimed that I want to close down the Hunter region's electricity generators. This is not true. The fact is that they are reaching the end of their commercial life, and this government have no plans—no plans for regions like mine. I was absolutely galled as they handed around the piece of coal last week. I tell you, I have more knowledge of coal in my little finger than the whole collective of this government. None of them would have been down a coalmine. None of them would have fired a shot in an open cut. None of them would have any understanding of what it is like to go underground to earn a living out of coal. You clearly have no clue, and you have no clue about the energy requirements of this nation either. I stand as a representative of people who work in pits, whose families are supported by pits. I support them, as I support my aluminium workers.

I want to thank the workers of Tomago Aluminium, in my electorate of Paterson, who pushed on through blistering heat on Friday and Saturday to minimise the danger of damage to the pot lines forced by a power shutdown. They are still working to return to normal operations, which could take up to a week. The Tomago aluminium smelter is one of Australia's biggest manufacturers. It supplies 25 per cent of Australia's primary aluminium and supports 1,000 families in my electorate. As that dreadful heatwave hit the eastern states of Australia on Friday, it had no choice but to curtail its production by 300 megawatts, or 30 per cent. Tomago is contractually bound to do what its energy provider, AGL Energy, asks it to do. It has no choice. AGL Energy CEO, Andy Vesey, told me in a conversation on Friday that his company had been asked by the Australian Energy Market Operator to reduce power demand because of the record heatwave conditions and that a shutdown of Tomago was considered the best course of action.

Tomago draws 12 per cent of the state's power, so on face value it seemed like a pragmatic and sensible choice. But shutting down pot lines—if you know anything about aluminium smelting—can cause irreparable damage. AGL argued that with proper notice Tomago could put procedures in place that would protect the pot lines and prevent the kind of catastrophe we saw in Victoria last year. But that decision had ramifications in that smelter in my electorate of Paterson. It required workers to work through blistering heat. It required precarious decision-making on the part of smelter CEO, Matt Howell. It also required a bit of faith—faith that there would be sufficient power to get the pot lines back up to speed and that no damage would be done through aluminium solidifying; faith that in such precarious market conditions the owners of the Tomago smelter, Rio Tinto, CSR, Alcan Australia and Hydro Aluminium, would not decide to shut up shop altogether if this state and country could not guarantee a secure energy source. That is what we are facing.

Mr Craig Kelly interjecting—

You cannot get your act together, so manufacturers like Tomago are put at risk. We have seen one aluminium smelter in my electorate close, and I do not want to see another go. Our local economy and our local families rely on Tomago. Kurri Kurri, my home town, is still reeling from the closure of the Hydro Aluminium smelter in 2012, and our region can ill afford the closing of another smelter.

From the bottom of my heart I thank Matt Howell and his team at Tomago for their incredible efforts but—and it is a big but—why, in Australia in 2017, are we being asked to make a choice between cutting off the power to a major Australian manufacturer and cutting off the power to 300,000 homes? Why are we not able to keep the fridges going, the lights on or the air conditioning running during a heatwave? Think of the elderly people and the young families. What sort of a choice is that? And why should we be making it? It is because you have no plans. You have no clue how to transition. Was it a forced decision? Did AGL have no choice but to shut down Tomago? Was it directed to do so? Was it a commercial decision by AGL to choose this course of action to make a tidy profit? Who is calling the shots when it comes to keeping the lights on and the power on for industries in this country? When will this government sort this mess out?

Last week those guys passed around that piece of coal. We know that that coal was just a sham, and that is what this government is. It is a power sham.

Tony Pasin (Barker, Liberal Party) Share this | Link to this | Hansard source

What we need to see in energy policy is two things: we need energy security and we need energy affordability. It is not that much to ask. It is what the people of Australia expect to achieve. I come from a state which has endured four blackouts in five months. One of those blackouts went for as long as 24 hours in some places. They were statewide, not in small segments of the community. I could spend some time talking about energy security, but I do not think I need to.

What I would like to talk about is energy affordability—and this is the real smokey here right now. Do you know that last Wednesday in Victoria the member for Dunkley's constituents purchased energy at $135.80 per megawatt hour, while the member for Boothby and I have constituents who, on the same day, over the course of a 24-hour period, paid—wait for it—$2,099 for the very same product at the very same time? The member for Dunkley and I are good friends, but we are also rivals. There is a strong rivalry between South Australia and Victoria. We are 'frenemies', though I am pretty sure the member for Port Adelaide would not want Port Adelaide giving Melbourne a 10-goal head start leading into a grand final. He would not want that, but that is what we are doing with energy.

Let's talk about the South Australian experience. Let's talk about the South Australian experiment. Let's talk about this failed experiment. It is little wonder that South Australia leads the nation in terms of unemployment. It has the highest rate of unemployment in the nation. I am not proud to be here as a South Australian talking about that, but after almost 15 years of SA Labor that is what you get. South Australia also suffers from another ill, and that is that we have the shallowest rate of inward investment of any state or territory in the nation. Do you know why? If you are an investor and you have got a footloose investment that would like to place somewhere, you are not going to place it in South Australia, because you will pay an electricity rate that sometimes is 40 times what a Victorian pays.

Do not take my word for it. Ian McDonnell runs a successful sawmill in Mt Gambier. He said recently in the local paper: 'It presents another challenge for business. It's a serious impediment for existing companies and anyone looking to move their businesses to our state. It's certainly concerning for South Australia.' There is a South Australian businessman telling you what the issue is. I could sit here and talk about South Australian irrigators who cannot lift water from the river. I told the party room about six months ago that the Central Irrigation Trust have renegotiated their contract and that this year it is $1.3 million more than it was last year. They have told their irrigators, 'We'll deal with the increase this year, but next year you will be facing a price increase of between 15 and 30 per cent.'

But it is not just businesses. I posted recently on Facebook about this, and a constituent in my electorate, who is not known to me, wrote the following, 'I nearly die when I read my electricity bill. Despite being super careful, I pay more than $1,100 a quarter. Sometimes I pay up to $1,400 a quarter, and I am a single person living in a household alone. This is beyond reasonable. No wonder poverty is normal.' Well, poverty is normal in South Australia, because these prices, as we heard, are beyond reasonable.

Now, if those opposite do not think this is having an effect on jobs, recently in my electorate there was an article titled, 'Power bill pressure'. John Forster, the operations manager of a business in my electorate, South East Pine, a mill, said:

… the business had suffered due to "massive" electricity price rises and had been forced to make cutbacks.

"The price we pay for megawatts per hour has tripled in the past two years," Mr Forster said.

He said that they had been forced to make cutbacks and to find savings elsewhere because they need electricity to operate. He said, 'We have lost two wages as a result of that.'

That means two people in my electorate had to go home to their families and tell them, 'I've been laid off today. I've been laid off today because the mill I work for can't afford the electricity bill.' If those opposite genuinely cared about Australian workers, they would work with us to resolve this. The intermittency of renewables has wrecked this system, and that is what is killing South Australians and their employment prospects.

Josh Wilson (Fremantle, Australian Labor Party) Share this | Link to this | Hansard source

Energy policy and the proper administration of our electricity system are critical to this nation's future. The last thing we need is for energy policy to become a blackout blame game, and for it to turn into an exercise in bringing your pet rock into question time.

The member for Barker said that energy policy needs to deliver two things, and that is right. It needs to deliver secure and affordable energy, that is No. 1, and we also need a safe and stable climate—that is No. 2. We need to ensure that global warming stays below two degrees Celsius, and the only way to do that is to seriously reduce carbon emissions.

The development of renewable energy, energy efficiency and storage technology is the clearest path to doing both of those things. The greatest fraud—the greatest dereliction of responsibility—in this place is for people to manufacture a conflict between secure and affordable electricity and renewable power. That is a fraud. It is a false dichotomy, it is dishonest and it is dangerous.

What is the reality? Last year, carbon dioxide concentrations measured at the aptly named Cape Grim passed 400 parts per million for the first time. And 2016 was the hottest year on record. The hottest year before that was 2015 and the hottest year before that was 2014. The world needs to respond, and it is responding. On the positive side of the ledger, The Financial Times reported last October that renewables have now actually overtaken coal as the largest source of power capacity on the planet. But as the world surges towards renewables we are going backwards.

In 2013 we were in the top four nations for renewable energy investment; now we are well outside the top 10. In 2014, while global investment in large-scale renewables grew by 16 per cent, in Australia it went backwards by 88 per cent. We literally fell off a cliff when it came to investment in large-scale renewables. We lost 3,000 jobs. If we had maintained the trajectory that the Labor government was on we would not have lost those 3,000 jobs, we would have added an additional 7,600 jobs.

We know that Australia's future has to include a mix of energy sources. We know, if we are honest with ourselves and if we consider the science, that that mix will include more and more renewable energy as time passes. The science tells us that; it tells us we need to make the transition sooner and more comprehensively. Our commitment under the Paris agreement requires us to make that transition more quickly and more comprehensively. And the evidence of the Department of Climate Change and Energy to the Joint Standing Committee on Treaties acknowledged that our existing policies will not get us to our current inadequate targets.

So we can argue about how fast and how far that transition will go. There are plenty of expert and not-so-expert views. I happen to like this formulation that was put forward in 2010, that Australia needs to move to, 'A situation where all, or almost all, of our energy comes from zero- or very near zero-emission sources.' That same public intellectual said, 'I promise you, you cannot achieve that cut without getting to a point by mid-century where all or almost all of our stationary energy from power stations and big factories and so forth comes from zero-emission sources.

The person went on to say, 'The zero-emission future is absolutely essential if we are to leave a safe planet to our children and the generations that come after them.' In 2010 those were the views of the member for Wentworth, the current Prime Minister. In recent days he suggested that 50 per cent is a bridge too far. His colleagues think that 20 per cent is a bridge too far. Now we are hearing about new coal-fired power stations and so-called 'clean coal', when the business community says that the former is uninvestable and scientists say that the latter is a fantasy.

The reality is that the crises we have seen this summer are not from a mix of renewables and non-renewables; they are from inadequate management of electricity supply. Even though my state of Western Australia is not subject to the vagaries of the national grid or the national regulator, we are at risk because we face the prospect of the privatisation of Western Power. We are at risk of seeing the price rises, job losses and instability of supply that comes with the privatisation of our power system. All that will be put at risk because of the $40 billion of debt that Colin Barnett has racked up. He has squandered the boom, he has run down the strongest economy in the nation and now he needs to sell the farm.

He said he would run surpluses. He promised he would build a railway line to Ellenbrook and introduce MAX light rail. He promised he would never sell Western Power. Western Australia cannot bear any more broken promises. There is only one way to protect our public assets, jobs and power prices; it is time to switch off the Colin Barnett government.

Nicolle Flint (Boothby, Liberal Party) Share this | Link to this | Hansard source

It is quite extraordinary that I am rising again to speak on another Labor government failure. It is the second matter of public importance they have put up in relation to our alleged failures when in fact, once again, it is their failure. The only failure here is of the federal Labor Party, those opposite, and of course, once again, the South Australian Wetherill Labor government.

I note that I cannot see, apart from the member for Port Adelaide, any South Australian members of parliament sitting opposite. I would like to know where they are to argue that, allegedly, we have failed when we have not. The South Australian Labor government has failed, and those opposite have failed, on power for my home state. You and the state Labor government have created this energy crisis and you are attempting to make it worse. That is the most extraordinary part of this.

In my home state of South Australia we do not have secure, reliable or affordable power. In my home state, in my electorate of Boothby, residents and businesses are paying more than 40 per cent more for their power than the rest of Australia. In my home state, residents and businesses do not have secure or reliable power and they live in fear of more blackouts. We have had blackout after blackout, starting last September when our entire state lost power. Apart from the member for Port Adelaide, none of you here in the chamber experienced that unless you were visiting my fine state at the time. It was a really scary experience: 1.7 million people did not have power that day. Businesses were without power and my residents were without power. They were very dangerous conditions. I want to make mention of our incredible police, who did a wonderful job that day getting everybody home in peak-hour traffic—in a storm and with no traffic lights—and our emergency services volunteers, who helped people who had trees and other things down around their houses. They helped residents in need.

Flinders public hospital, which is in my electorate of Boothby, lost power, and its generator did not work either. People in intensive care had to be transferred to Flinders Private Hospital, which thankfully still had power through its generator. It is a miracle that nobody died. This is what happens when you have a failed electricity policy, as the Labor government does in South Australia—and a complete inability to manage our hospitals, as it turns out, which I recently spoke about.

It was not just the hospital, though; it was a range of businesses, and I want to talk about some of them. One of my local McDonald's, for example, which operates 24 hours a day, lost power for some time and lost a lot of stock. They employ a lot of young people, who did not get their hours that day. It cost $7,000 to fix their air-conditioner. They have now bought a generator to protect themselves from this happening again. Their power bill, like those of so many other businesses, is set to rise by tens of thousands of dollars in the near future.

Ben, my wonderful local newsagent, in his first day of trading after the Christmas holiday period and public holidays, completely lost power at his businesses. He was unable to open his cafe, and his newsagency was closed for most of the day. He still had to pay his staff wages for 12 hours, even though he was not making any money. The increase in the cost of electricity to his business is something in the order of 20 per cent this year. His December trade went really well but he lost all of that because of his lost income on the day we had the blackout.

I want to talk about Premier Jay Weatherill and the way he described—

Pat Conroy (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

You are in the federal parliament!

Mark Coulton (Parkes, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Shortland has had his turn.

Nicolle Flint (Boothby, Liberal Party) Share this | Link to this | Hansard source

what he is doing to our power situation in South Australia, where we now have reliance on renewables of 40 per cent of our overall power supply. The Premier said:

We are running a big international experiment right now … We have got a long, skinny transmission system and we will soon have 50 per cent renewable energy, including a lot of wind and some solar … We want to get as close to 100 per cent renewable power as possible … We know there are challenges here. But with big risks, go big opportunities.

We know the result of this big experiment. It has been an absolute disaster for our state. It is a disaster for my residents and a disaster for my businesses. I call on those opposite to abandon their 50 per cent renewable energy target, which is going to put my residents and businesses in even more danger.

I note the member for Port Adelaide, who put up this matter of public importance for discussion, has described blackout after blackout as 'hiccups'. Quite frankly, that is a disgraceful thing to say when my businesses and residents are at risk and suffering in so many ways.

Anne Aly (Cowan, Australian Labor Party) Share this | Link to this | Hansard source

There was a time when I lived in a place where there were regular blackouts and power outages. I found it particularly difficult because we lived on the 13th floor back then and when the elevators went out I got quite a bit of exercise. But that was in a Third World country and it was well over 20 years ago; in fact, closer to 30 years ago.

Fast forward to Australia in 2017, and under this Liberal-National government we are a developed nation facing a national energy crisis. We cannot allow power cuts in South Australia, New South Wales and elsewhere to become part of the new norm because this government ignore recommendations from the AEMC, the CSIRO, the electricity generation industry and others by rejecting an emissions intensity scheme. Instead, what do they do? They continue to attack renewables and falsely blame blackouts on renewables in a shameful misrepresentation to the Australian people, right here in this parliament. Instead, they bring in lumps of coal—I suspect it was really the minister's well-deserved Christmas present—and play politics while families, pensioners and businesses suffer under their right-wing-led approach, denying that climate change even exists and following the climate change deniers and conspiracy theorists down the path of ruin.

The member for Barker spoke about energy security and affordability and said that it was so simple. Why aren't they doing anything about it if it is so, so simple? The member for Barker chose to wax lyrical about affordability and lamented soaring electricity prices in South Australia: electricity prices that are soaring because their government privatised the market—just like the WA Liberals want to privatise Western Power when they get in. That seems to be the modus operandi of this LNP government: run it into the ground then sell it off without a single thought for the people who will suffer most—the mums and dads, the pensioners and those on low incomes, who will all be burdened with high energy costs.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

Hear, hear!

Anne Aly (Cowan, Australian Labor Party) Share this | Link to this | Hansard source

Thank you.

Meryl Swanson (Paterson, Australian Labor Party) Share this | Link to this | Hansard source

That is your privatisation.

Anne Aly (Cowan, Australian Labor Party) Share this | Link to this | Hansard source

That is your privatisation doing that. At the last election, I think I must have heard the slogan Jobs and growth more times than I would like to remember, but this government continues to fail Australians on both counts, because to achieve jobs and growth—let me give you a little lesson here: jobs and growth 101—you need to diversify markets and attract investment and you need energy security.

Let me start with the first point. The whole world is moving towards clean energy. There is no doubt about that. The whole world is moving towards it, and Australia has an enormous opportunity. But those on the other side cannot see it, because they are too blinkered by their right-wing ideology and their tinfoil hats. Our climate, especially in Western Australia, with its arid conditions, has generated innovation in alternative and renewable energy sources. I have been in a very privileged position to look at some of this innovation. It is innovation that has attracted the attention of investors in other parts of the world and in countries with similar climatic conditions who are also concerned about their energy security. Countries like Qatar, for example, who are currently preparing for the World Cup in 2020, are looking to Australia for renewable energy to run the massive number of air conditioners that they are going to need to be able to provide for the number of tourists coming to the 2020 World Cup.

Despite this unique advantage we have slipped behind the rest of the world in energy investment under this government, the government of 'jobs and growth; growth and jobs'. They have no policy to drive investment in renewables beyond 2020. In contrast, Labor's election policy of 50 per cent renewable energy by 2030, supported by an emissions intensity scheme, provides certainty to support new investments to the tune of $48 billion across the country. (Time expired).

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

I have seen some confused and muddle headed thinking from Labor members of parliament in my time, but today, I think, just about takes the cake for complete and utter confusion. But I would like to congratulate the member for Newcastle for her contribution to this MPI, because she is right to be concerned about those jobs at Tomago.

The main theme of this debate, that we have an energy crisis in this country, is correct. Why do we have the crisis? It goes back to when good old Kevin 07 decided that he would have a 20 per cent renewable energy target by 2020. There was nothing that was economically sensible about that, other than that it rhymed: 20 per cent by 2020. The entire problem is that when you have wind turbines, which are the lowest costing renewable energy, but cost more than coal, and the wind does not blow the power does not flow. An example from today, we have around 2,000 wind turbines in this nation, if they were all working at maximum capacity they would generate around 3,900 megawatts. At 12 o'clock today they were working at less than two per cent capacity. That means you have to have the backup of fossil fuels. That is why it was so good for the member for Newcastle to talk about the importance of coal fired power. Because without coal fired power, places like Tomago will close down. All those workers in her electorate will lose their jobs. Yet it is the Labor Party that has a plan to kick-start—they said it, kick-start—the closure of coal fired power station's in their policy. I say to the member for Newcastle about the coal fired power station that the workers in Tomago rely on, it is the policy of the Labor Party and the Greens to close those power coal fired power stations down.

Opposition Members:

Opposition members interjecting—

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

Now you are all keen for coal fired power, is that right? You are all keen. You all like coal, is that right? Are you all for it? Well you have to be, because whatever you have in wind has to be backed up by some form of fossil fuel.

The problem is, as I think the member for Shortland said, no-one will finance a new coal fired power station in this nation. That is true, and the reason for that is because that mob on the other side have this mad insanity of a 50 per cent renewable energy target. Anyone that is going to invest knows that they will have to get a return on that coal fired power station over 30 or 40 years. They know that there is a political risk. The political risk is that the reckless incompetents on that side of the House may actually come to government one time in the next 30 or 40 years and inflict their policies of closing down coal fired power in this nation. That is why we are not getting the investment and that is why we have an energy crisis in this country. If we have a crisis today, what about next year? Next year we are closing down—with the cheers of all the Labor members and the Greens—Hazelwood power station in Victoria. It is being closed down. I know that most of you secretly cheer that. That is 20 per cent of Victoria's—

Opposition members interjecting—

Well stand up in this parliament and say you support Hazelwood being kept open. Come on, stand up in this parliament and say, 'Keep Hazelwood open.' No, they will not say it. They want to see it close down. They will be cheering when it closes down. That is 20 per cent of Victoria's power. What will happen next year if we have similar weather conditions to those we have had this year? We will not just have the population that we have today, we will have to find power for another 330,000 people in this nation to have air conditioning, refrigeration and stoves to cook on. They will need power. So the power demands in this nation will be higher and we will have less power. We have got to get more coal fired power stations. I call on all members: if you are really concerned about jobs, if you are really concerned about prosperity then abandon that 50 per cent renewable energy target. Because that is what is needed if we are going to bring stability back to the electricity supplies of this country. (Time expired)

Mark Coulton (Parkes, Deputy-Speaker) Share this | Link to this | Hansard source

Order! The time for the debate has expired.