Lisa Chesters (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

I move:

That this House:

(1) notes:

(a) the Hazelwood power station is scheduled to close on 26 March 2017;

(b) its closure will affect 750 direct jobs in Gippsland;

(c) unemployment is already at 8.1 per cent in the Latrobe Valley;

(d) the Victorian Government has created a $266 million transition package for workers affected by the Hazelwood closure; and

(e) the Australian Government has only contributed $43 million to this transition package;

(2) acknowledges that government plays an important role in creating policy settings to attract new investment and jobs, both in the Latrobe Valley and across regional Australia in general;

(3) condemns the Australian Government's:

(a) inaction in not meeting with affected workers; and

(b) failure to act in setting policies that give business the confidence to invest and create jobs; and

(4) calls on Australian Government Ministers to meet with affected workers and their unions and to start investing in industry and jobs across regional Australia in the upcoming federal budget.

This week is a tough week for the Latrobe Valley, there is no denying that. This week we will see the Hazelwood Power Station close on 26 March. Affected at the core of this decision are 750 direct jobs in Gippsland, in a region where unemployment is already at 8.1 per cent. These are the first lines of this motion. When the government—this week and in previous weeks—has sought to politicise this closure and use every question time that they can to go the state Labor government and to make as much political mileage out of this issue as they can, it is important to remember that at the core of it are 750 workers who are going through transition. We on this side talk about it as a just transition—the need for governments to work with local communities and with industry to ensure that these workers have jobs to transition to. We have heard a lot of rhetoric from the government, particularly the Prime Minister, yelling at Labor and its unions: 'What are you doing about blue-collar jobs?' I will tell you what the Victorian state Labor government is doing about blue-collar jobs: it has created a $266 million transition package to support the workers and the communities affected by the Hazelwood closure. You would think, given the government's rhetoric, that they had matched this contribution but they have not. This federal government have only put $43 million into the transition package. Whilst we acknowledge it is a significant contribution, it is well short of the state Labor government's contribution—the very government that they continue to politicise and have a go at over this closure.

A bit of history about Hazelwood which members of the government seem to forget: it was first opened in 1964. It was privatised by a Liberal government, Jeff Kennett's, in 1996 and sold for $2.35 billion. That money has since been spent. This is why communities, Labor governments and Labor oppositions continue to oppose privatisation. What happens when an asset like a generator is privatised is that you lose control over what happens. I acknowledge that some members of the government have said that the overseas owners of the Hazelwood Power Station have made a commercial decision to close this facility. When it is no longer state-owned, it is no longer in our control. That is the very problem with privatisation. I also want to acknowledge how unhelpful the comments by the former Prime Minister, the member for Warringah, have been in offering false hope to those workers, saying that a state Labor government or a federal government should just step in and buy this asset. That is not helpful at this time. He should withdraw those comments and apologise to those workers. The closure was originally scheduled for 2005, so it does not come as a surprise to anybody in this community that this particular generator and asset is closing down. However, there is frustration from the community that it has taken this government so long to get on board with the plan. In other countries—like Germany, for example—they start planning shutdowns of coal-fired power stations 10 to 20 years out. That is not what we have seen in this case.

In the time I have remaining, I want to outline what some of the state Labor contribution is going towards. Money is going towards transition—that is, transfer partnerships which create vacancies by offering redundancies to people working in other electricity agencies. Over 150 jobs have been saved by helping people transition into other jobs. An economic growth zone has been created. The Latrobe Valley Authority has been created. Money has gone to worker and business support, a transition centre, and to support to help business and encourage business to move to the Latrobe Valley. To share a quote from one of the workers involved, a third-generation electricity worker, Bill Simpson, is 'pleasantly surprised' by the Victorian government's Latrobe Valley Worker Transfer Partnership Agreement, as he says he 'can hopefully stay in the industry'. These are the words of the workers. It is disappointing that this government, despite all their rhetoric, have not met with the workers to work out how they can support them. I ask the government to drop the politics, increase the funding and support these workers.

Lucy Wicks (Robertson, Liberal Party) Share this | Link to this | Hansard source

Is there a seconder for this motion?

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I second the motion and reserve my right to speak.

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

What a pack of crocodile tears we just heard then! Hazelwood is closing for one reason: it has been driven out of town by the state Labor government that has tripled the royalties on coal—that is the input cost for Hazelwood, and it tripled the royalties—and by the federal Labor Party, which has a 50 per cent Renewable Energy Target. Of course Hazelwood is uncompetitive and cannot continue under such circumstances.

I appreciate that this is going to cost jobs, but it is not only the jobs at Hazelwood that it is going to cost. I would like the Labor Party to think about the increased cost of electricity that we have seen because of closing Hazelwood. How many other jobs will that cost throughout the economy? You must have competitive electricity prices and competitive energy costs, otherwise you do not have an economy. You do not know or understand the damage that you are doing to our nation's prosperity and our nation's ability to create wealth with your misguided green policies, and that is what we see.

It actually gets worse. Not only have we had these price increases, but the real question that I would like to know the answer to is: what is going to happen to the reliability of supply? We have heard the AEMO say that there is no problem, but I would like to have a quick look at the numbers. We know that last year Victoria's peak electricity demand was 9,523 megawatts. That was last year. What will they need next year and the year after? I would suggest, at a minimum, Victoria needs—to make sure they are safe from blackouts—an availability of 10,000 megawatts. Let us go through where those 10,000 megawatts could possibly come from. Before Hazelwood, they had 9,655 megawatts of fossil fuel generating capacity. Knock out the 1,600 megawatts from Hazelwood, and we come back to 8,000 megawatts from fossil fuels. Where is that extra 2,000 megawatts of electricity going to come from on a hot day in summer? Victoria has wind energy of 1,485 megawatts but, as we know, that is as useful as tits on a bull in a crisis—because when the wind does not blow, the power does not flow. It is completely and utterly useless. We know the peak demand for electricity often occurs late in the evening, around 6 pm, and solar does absolutely nothing to help there. Victoria has hydro energy of 356 megawatts. So where will this shortfall come from? The only possibility is hydro energy from Tasmania—relying on the extension cord across Bass Strait to stop Victoria from blacking out.

What about South Australia and New South Wales—

Opposition Member:

An opposition member interjecting—

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

That is exactly right! That is a very good question. I hear the member over there, and I am sure that he would be very concerned, because we know that South Australia relies on an extension cord—the interconnectors through to those brown-coal power stations—to suck about 700 megawatts of electricity to keep the lights on in South Australia. What will happen now that Victoria is becoming a net importer of electricity? South Australia is going to flick the switch to Victoria and there will be no power there. The lights will go out again! This is where we see the insanity of this Renewable Energy Target, because whatever we build in wind or solar we have to back up 100 per cent in fossil fuels.

The Renewable Energy Target undermines all of the business case for that fossil fuel generating capacity—the baseload capacity that we need to keep the lights on. The RET drives the power stations out and it makes them uncompetitive. You need to run these things 24/7, and when you have to turn them on and off to let the wind come in and out of the grid, they become inefficient to run and they become uneconomic to run. No-one is going to invest in them simply because of the RET. We are undermining the economic viability of our nation. We need to have a complete revision of where we are up to in energy generation facilities in this nation. We cannot continue to keep building wind turbine after wind turbine and closing down our fossil fuel generating facilities, because it drives the prices up, it drives people out of business and it makes our nation uncompetitive.

This is all about the economy. There are so many things that we, as members of parliament, want to spend our money on. There are so many things we want to invest in, from schools to aged care to education to hospitals. But we need to create wealth in this nation. If we wipe out our coal-fired power stations, we wipe out the best wealth creation facilities— (Time expired)

Lucy Wicks (Robertson, Liberal Party) Share this | Link to this | Hansard source

Before I call the member for Wakefield, could I remind all members present here of the importance of using appropriate parliamentary language.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

I will not be repeating the language used by the member for Hughes. He always gets himself a bit overexcited in these debates, and in the flurry of facts out comes a bit of language. Interestingly enough, at the end of it he admitted what he is really on about—that is, getting rid of the Renewable Energy Target. I look forward to seeing him out there on top of his constituents' roofs, tearing off solar panel after solar panel, chucking them on the road. That is what he will be doing. He is against renewable energy. That is what he is against. Let's make no mistake about it—and I see him exiting the chamber.

The motion sponsored here by the member for Bendigo is a sensible motion. It talks about the challenges that are before us in taking what were a series of state-run monopolies that have been bolted together into a national market where generation has been privatised and then disaggregated. The poles and wires are largely now a system of privately run monopolies. That is essentially what has happened. We had, I guess, a system that worked pretty well before this, but now we are approaching a system that, in my view, does not really work for anybody.

We are facing some very serious situations in relation to many of these brown coal assets. I will talk about the one in South Australia at Port Augusta, with its mine at Leigh Creek. The only reason that was put there in the first place was that Sir Thomas Playford got sick of the deliveries of black coal from New South Wales. They often would not arrive, for one reason or another, particularly during the war years—but even in the postwar years. So South Australian needed its own generation capacity. We are now seeing that happen again. We are now seeing a Premier with a plan. We have had to reassert control over our state's energy market, and that is what Premier Weatherill has been doing.

You might ask yourself: why? It is because we have a complete absence of national leadership in this country—a complete absence of national leadership. What we have at the moment in the Prime Minister is a national commentator. He wants to commentate on things. He is there every day in question time talking about South Australia, talking about Victoria and Hazelwood, and, bizarrely, talking about New South Wales. New South Wales has a high level of coal dependency and a Liberal state government but still had to have load shedding this summer. It still had to effectively turn the nation's largest aluminium smelter off—and we all know what the company said about that.

We have the national commentator, who, whenever he is presented with a problem, is a bit like a mirror: he is looking into it. In the absence of a national energy plan, in the absence of national action, we get the photo opportunities out the front of the Snowy Mountains. Then we have the alternative Prime Minister in the government providing us with his views. The member for Warringah is all for action. He is in the Herald Sun giving a lot of false hope to workers, but at least he has an idea—not like the Prime Minister, who is looking into things. There is a complete absence of action.

South Australia has a plan and is asserting control over its—

Government Member:

A government member interjecting—

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

The honourable member might laugh, but there is not much going on in New South Wales; there is not much going on nationally. We hear laughter and complaints from those opposite. But you are in government. It is your job. The Labor Party has a national gas reservation plan. We have not heard those opposite talk about that. In case the member is wondering, I was talking about that in 2013. These problems have been a long time coming, and there has been every opportunity for the government to act. But, instead, what we have is a Prime Minister who is looking into things. He is a mirror. We have a national commentator. We have a government that wants to assert that there are all these problems. If only there were someone there to fix them. Well that is what national governments should do: they should look down the track and make sure there is a national energy market that is operating.

We all know we have to manage this change. We have old assets needing to be retired. We have to get into renewable energy in a way that provides regular suppliable power. We have to protect the Australian gas market against the export price. These are all challenges for a national government, and only a Labor government will do it.

Damian Drum (Murray, National Party) Share this | Link to this | Hansard source

I find it quite incredible that we have this motion put before the House this afternoon, given the fact that the member for Bendigo, who has put this up, simply has not got her facts straight on where the truth is in relation to the motion put forward. It is incredible that a Labor member of this House would highlight the damage to regional jobs that her own party and colleagues have in fact caused.

We all understand very clearly that, when it comes to these Hazelwood power stations and the way they have been closed, the Labor Party has its own policy that is all structured around its contract for closure scheme. Here is the policy that is now coming home to roost. We have Daniel Andrews, the Premier of Victoria, who effectively at the start of last year decided he was going to triple the tax and the royalties payable on brown coal in Gippsland. You would not believe how much money he has raised out of these power stations: he has raised $255 million. He has put an extra tax on the operators to the tune of $255 million, and now that it is closing down he is going to offer the workers $266 million. Talk about taking with one hand and giving with the other. I cannot believe his audacity, and here we have the member for Bendigo wanting to highlight this.

She wants to put it out there and sing from the rafters what a horrible thing this is that these people have lost their jobs—effectively, caused by Labor Party increases in taxes associated with brown coal. But don't take our word for it; the spokesperson for the Hazelwood power station Loy Yang B said that, when this tax was introduced, it would inevitably have a detrimental impact on the region's energy sector. They said they had not been consulted on this decision. Their other comment was that this government decision takes $20 million straight out of the Hazelwood business.

It has simply been Labor policy to close Hazelwood since 2010 and, now that it is closing, they are trying to turn around and offer a support package, a rescue package. This should not surprise anybody in Gippsland, when you consider what they are also doing to Heyfield timber and Australia's sustainable hardwoods. Daniel Andrews is doing his utmost to shut down the timber mill at Heyfield, to the extent where we have had thousands of CFMEU workers marching on the Victorian parliament only last week, expressing their utter disdain for Premier Andrews. He has halved the available timber for the timber mill to effectively use in order to maintain its viability. Obviously, they cannot. If you are given half the amount of timber to harvest that you were previously working with, you cannot remain viable. And now that they are not going to remain viable, Daniel Andrews is saying, 'Maybe the federal government should buy it' or 'Maybe the federal government should walk in now and fix this up.' This mess was created by the state government and, all of a sudden, they expect the federal government to come in and fix it up.

Right now, the Hazelwood Power Station is generating 22 per cent of Victoria's energy demands, and how we are expected to fill that gap, once they start turning the generators off, is anybody's guess. The workers at Hazelwood are exceptionally proud of their jobs and they have been in constant contact.

There is another part of this motion that says the affected workers have not met with the government. If the member for Bendigo had bothered to do a little bit of research, she would have realised that the management of the CFMEU were in Canberra last November. The Facebook page of the member for Gippsland, Darren Chester, would suggest that he has been constantly meeting with the workers from Hazelwood. If those opposite had bothered to do their research, they would also be aware that the federal government has been meeting not just with the union but also with workers from the Hazelwood plant. There are a whole range of inaccuracies and untruths associated with this motion.

Here we have the Labor Party, who have taken $255 million with one hand, refusing to hand back the same amount of money now that Hazelwood is closing.

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

I am going to start my contribution by talking about the real reasons why Hazelwood closed down, because we heard utter rot and rubbish from the member for Murray. He talked about a $20 million cost imposition. Even if I accepted that—and I do not—Hazelwood was facing a $400 million safety upgrade bill just to bring it up to modern WorkCover standards. Add to that a massive requirement to increase their capital expenditure to modernise the plant and you have the real reason the Hazelwood owners made a commercial decision to end this plant's life. The decision is no surprise, because the average age of Victorian power stations is 41 years. In New South Wales, it is 35 years. This infrastructure is reaching the end of its life, and we should be having an adult and sensible conversation in this parliament about how we replace its generation capacity. But we are not, and that is the great tragedy of this government and this Prime Minister.

Yesterday we saw the demolition of the two 155-metre cooling towers at Lake Munmorah power station on the Central Coast. It is a region you represent, Madam Deputy Speaker Wicks, as do I. It was the end of an era. The power station was of the same vintage as Hazelwood but produced slightly less power—1,400 megawatts versus 1,600 megawatts for Hazelwood. This was another power station that closed because it had reached the end of its plant life. The Hunter Valley, of which I am a proud representative, has one-third of the coal-fired power stations in the country: 9,000 megawatts of power production. Its four power plants are due to close in 2022; around 2030, for Vales Point; 2034; and 2035. A third of our power production from coal-fired power will go in the next 20 years, yet this government have no plan to replace it. They have no plan to replace it because they will not embrace what all of industry is calling for: an emissions intensity scheme that will give industry the certainty to make investment decisions. These decisions cannot be made based on the whim of whoever is going to be Prime Minister in six months time; they must be based on a bipartisan commitment on investment regulations over the next 40 years.

Every significant energy player in this country has called for an EIS, most recently—last week—Snowy Hydro, of which the Prime Minister is such a great fan. BHP has called for it, and so have the Business Council and AIG. Every major energy player, the energy consumers, the energy networks, the Grattan Institute—effectively everyone with a pulse in this sector has called for it, and the only people standing in the way are the government. That is a great tragedy. We do have an energy crisis, and that is because the government have sat on their hands for four years. Workers and communities are now paying the price, and we will see more need for structural adjustment as these plants close down.

That is the essence of this motion: the complete lack of commitment to structural adjustment from this government. When Northern power station closed last year, the government provided nothing other than a CV-writing course. Unfortunately, coalition governments have an appalling track record on this front. When the mighty BHP steelworks in Newcastle closed in the late nineties, what was the structural adjustment support the federal government gave the workers? The renovation of the Newcastle yacht club. The renovation of the Newcastle yacht club was the greatest structural adjustment assistance for thousands of steelworkers put out of work. Regrettably, not many steelworkers are members of the Newcastle yacht club and they did not benefit. Not even the construction activity benefited those redundant workers.

We need a just transition for the Hazelwood workforce, and that is why I support the Victorian government's attempt to move as many workers as possible into other power plants. I really applaud the fact that they have been able to save 150 jobs. Hopefully, there will be more as other power companies come online. I pay tribute to the Victorian government, the unions involved and the companies who tried to make this happen, and hopefully, if the federal government comes to the party, more can be done.

This is a time for a serious adult conversation about energy in this country. What we have from the member for Hughes is climate change scepticism, petty point-scoring and a failure to embrace the future. What we need is a serious plan centred around an emissions intensity scheme and a just transition focus for structural adjustment that means that workers in communities like mine, the ones around Hazelwood and the next member's communities are not suffering all the pain from a necessary transition. I am hopeful that we can come to a solution on this. I am very willing, as is all the Labor Party, to work with the coalition on this, because this should be above politics, but unfortunately so far we are just getting desperate political point-scoring for the coalition government.

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

I am the member for McMillan and I represent the workers in the Latrobe Valley.

Why is it that we rejoice at a birth and grieve at a funeral? It is because we are not the person involved.

Mark Twain, 1835-1910.

Today, it is not a pleasure for me to hear the hear the conversations between members of this House, where voices are raised and considerations are given outside of those people who are directly affected by this change. Listening to Fran Kelly's program in Morwell the other morning, as I was at a faraway place, I heard one of the workers come on to discuss, obviously, this plant that he loved. I did not get his name. He said to Fran, 'Fran, it's an old girl and it's done its time. You can fix it and we can keep it going, but even if you do it's still an old girl and it will always be needing attention far beyond the attention that can reasonably be given to the Hazelwood power plant to keep it going.'

I have not been privy to the negotiations of the company with the government. I know there were increases in coal royalties that may have had some effect on the company's own position. I know that the Greens in Victoria were using this to thump the state Labor government every day of the week—the dirtiest coal power station in Australia or the world et cetera. But my workers felt that, every time someone had a go or a crack at them, they were at—excuse the pun—the coalface of that attack. I want to say to those workers: 'That was unfair. That's not right. You’ve given your all, and some of you have given three generations of your families' work on people's behalf, my behalf, my family's behalf and on our behalf. You've given your time, energy, and expertise and you have given it to Victoria and Australia to grow our manufacturing industry to give us opportunities we would not otherwise have, so I am reflecting on the fact that you gave to us something that no-one else could give to us, through Sir John Monash, who gave to us the great opportunities for Victoria's manufacturing industry over many years.'

Now times have changed and there is an expectation of the Australian community and even this parliament that that which was is no longer and cannot be sustained. The previous speaker was absolutely correct. There is probably more than millions to be spent to upgrade the plant on occupational health and safety grounds, and that would only be the beginning. To keep this plant going, you are talking a billion—a thousand million—or more dollars. And on behalf of my people, I would say, 'Take me to Driffield and build me a new and far better, cleaner coal-fired power station, if that is your intent to keep it going for three years.' You are not going to spend a billion and a half on the old lady. If you are going to do that, spend a billion and a half working on how you can best use the coal, whether it beats the fertiliser or hydrogen or all the opportunities that have been laid out before us where you can use that amazing God-given resource that is the Latrobe Valley.

I say to the members here, in five minutes you cannot describe the wealth that has been given to us by this old power plant. You cannot describe how those workers will feel when they walk out of that plant this week. I agree with you, some of them will be going to another power plant, and that is great. For some, it is time to retire, and that is fine too. But all those left in the middle ground will have to make decisions that are difficult for them. They will have to say to their children, 'We've got to move.' One of the workers said, 'We've got to move to South Australia,' and his daughter said, 'I don't want to move, Dad. This is my life: Latrobe Valley. My friends are all here.' Everyone in this parliament feels for that young girl who does not want to move because of the situation that has happened in her father's life that she does not understand. If I were that 13-year-old girl, I would be upset too.

I say to this House: let us forget the bickering over Hazelwood Power Station, and let us look to the future and the opportunities that are there to grow Gippsland in a way that we can all, every one of us—I need to finish on this—can be proud of. (Time expired)

Lucy Wicks (Robertson, Liberal Party) Share this | Link to this | Hansard source

The time allotted for this debate has expired. The debate is adjourned and the resumption of the debate will be made an order of the day for the next sitting.