David Gillespie (Lyne, National Party) Share this | Link to this | Hansard source

This bill increases the fuel security outlook for Australia, which is a critical issue. We must have many more distributed sites of fuel storage. The whole nation depends on diesel and on getting it in the right place at the right time. Darwin and the Northern Territory could potentially run out of fuel with this just-in-time supply chain. Whether it is a natural disaster, like a cyclone; something inadvertent such as tankers being blocked up in the Suez Canal or the Panama Canal when things go awry there; or conflict in the South China Sea, we really need to ramp up. I note that adjacent to my electorate is the port of Newcastle, which has two areas for potential massive fuel storage, with Park Fuels, an Australian owned company, and Stolthaven. They both have facilities in the port of Newcastle and are strategically located for ease of distribution to the north and west of New South Wales. Using them would move a lot of the critical infrastructure for fuel storage out of the Sydney basin. There are also opportunities in Port Kembla, but I think the port of Newcastle, with its strategic links to a nearby international airport and to the mining industry, is a logical choice for some of this strategic fuel reserve to be located. I commend this bill to the House.

Josh Wilson (Fremantle, Australian Labor Party, Shadow Assistant Minister for the Environment) Share this | Link to this | Hansard source

I'm glad to speak on the government's Fuel Security Bill 2021 and, particularly, to support the second reading amendment moved by the shadow minister, the member for McMahon. There is no doubt that fuel security is a critical issue. In fact, it's what I would describe as a serious security issue. We do have from time to time in public debate, in the parliament and from the government a lot of noise about security issues that are, frankly, much lower down the totem pole when it comes to meaningful security than is fuel security. It's a shame that we don't focus on areas like this more often. If we've learnt anything in the last year and a half, it is that areas like energy self-sufficiency, energy resilience, health resilience and climate resilience are really the kinds of serious risks to our economic, social and health wellbeing that we need to think about a lot more than we do. The beating of the drums in some other areas is disproportionate to the risks that something like fuel security presents to us.

Most Australians would have little sense of the fragile position that we are in when it comes to fuel security. It's easy enough to give some examples of the circumstances that we're dealing with. The bottom line is that, in the data from 2019, consumption cover in Australia was equivalent to only 18 days of petrol, 22 days of diesel and 23 days of jet fuel. So it's somewhere between two and three weeks of coverage. At the moment, people go to the supermarket and the shelves are stocked, and they go to the petrol station and they fill up their cars, or, if they're fortunate enough to be able to travel from one part of Australia to another, they go to the airport, without really thinking that, if there were to be an interruption to our fuel supply, all of that would grind to a terrible halt in very, very short time. It would affect everything. The economic and social impacts of that would be hard to anticipate. And the risks of that occurring are not small. We are an island nation. We are a significant fuel importer. We are predominantly reliant on fuel imports. If there were to be some interruption of supply because of events in the Middle East or the South China Sea, we would find ourselves running out of fuel very, very quickly. And fuel is essential to everything.

The risk of that kind of black swan event is not high, but the impacts of such an event are massive. The fact that we have done nothing to really address that vulnerability and that fragility is hard to understand. We fell out of compliance with the IEA in 2012. After the oil shocks that occurred in the 1970s, sensible countries joined together and said: 'Let's avoid that happening. Let's make some shared commitments to liquid fuel resilience, the easiest measure of which is 90 days of coverage.' Australia fell out of compliance in 2012, and we now have somewhere around 55 or 56 days out of the 90 days we should have. There are no other countries that are currently not compliant. In that period of time between 2012 and now, a couple of nations have fallen out of compliance by a few days, for a few days. I think Luxembourg is one of them, literally going from 90 days to 88 days, for a week or something. We've been mired down in the 50s for a long time, and we've not improved that position. To the extent that we've gone from the low 50s to the mid-50s, it's because the government has settled arrangements with other countries to spend millions of dollars purchasing oil tickets, which essentially mean that we can make a call on oil reserves in other countries. That's not really to deal with an oil crisis or a liquid fuel crisis in this country; that would just release supply into the market that would, in a sense, meet our obligations under the IEA. But nothing significant has occurred to address that problem.

Even though these bills put in place some measures that are helpful, they come very late. It wasn't that long ago that Australia had seven oil refineries. It wasn't that long ago—literally 18 months ago—that we had four refineries. We now have two refineries. So the government has decided to come along and apply $2 billion—$2,000 million—of taxpayers' funds to underwrite the last two refineries. Unfortunately the largest refinery in Western Australia has gone under. It's salient, as we have this debate at the national level, to remember that, unlike most other countries, Australia is a continental landmass with capital cities—with the six states and two territories—distributed across a huge area. We might talk about 55 days of liquid fuel coverage for the nation as a whole, but it would be interesting to see what that breakdown is state by state. If there comes a crisis, what happens in Western Australia or in other more distributed parts of the country that have a liquid fuel crisis? They're going to need to get liquid fuel from other parts of Australia. How are they going to get that? The only way to really move it is by ship. Australia doesn't have a single fuel tanker.

Think of all the kinds of security that we should be focused on in this country and the way that they've been either allowed to deteriorate, or, in the case of shipping, run down because the coalition in its current guise and the government before that, the Howard government, have an ideological dislike of maritime workers and Australian shipping because of its working foundation, which is the Maritime Union of Australia and the labour movement. As a result, we've now got about 10 flagged ships and we don't have a fuel tanker. So we're a continental landmass and an island nation that's entirely reliant on fuel being shipped here. If there were a crisis that put that in jeopardy, we don't even have the vessel that could transport the fuel to this nation.

We've seen through COVID the government do deals that were contractual arrangements in relation to vaccines. A lot of confidence was put in those arrangements. But, when there was a need for vaccines that we supposedly had a contractual call on from Europe, did they actually turn up here? No, they didn't, because those countries held onto the vaccine. I tell you what, if there was an international oil crisis, do you think other countries would be in a big hurry to send liquid fuel here? Would they be in a hurry to free up their own merchant marine to transport scarce fuel to Australia? You can imagine how that conversation would go. So this government has known for some time about the scale of the problem.

We are extraordinarily vulnerable in Australia. There is no other country that's in the same kind of parlous situation that we are in. We are an island nation. We now have only two refineries, and the problem with that is that refined fuel has a shorter shelf life, so our ability to bring in crude, hold it and refine it as we need is now decreased. We have the third highest per capita ownership of personal motor vehicles in the world. We have done an abysmal job, an appalling job, of moving towards electric vehicles, which the rest of the world is doing. We have one-seventh of the uptake by car-loving countries like Canada and the United States.

Our mining and agricultural sectors are 90 per cent reliant on diesel fuel. If you think about the Australian economy, you will hear from those opposite about how we are dependent upon and we benefit from mining, resources and agriculture, which is undoubtedly true, but they are 90 per cent reliant on diesel fuel. We have about three weeks of diesel cover. If there were a fuel shock that prevented diesel coming to Australia, can you imagine what would happen to those industries? Our transport is 99 per cent reliant on liquid fuels, partly because we've made virtually zero progress in terms of the energy resilience that you get by moving towards the electrification of transport. And all those other countries aren't doing that for fun. They're not doing that because it's a woke manoeuvre or whatever it would be criticised as being by those opposite. They're doing it because it's smart—because it improves their security.

One of the leaders of energy self-sufficiency in the United States is US Defense. Why are they doing that? It's because they know how risky it is to be reliant on liquid fuels. So, within Defense, in the various parts of marine, army and navy, part of their budget goes to new energy innovation because they want defence, as well as every other critical part of their nation's operations, to be free from the vulnerability that comes with massive reliance on liquid fuels.

But what's Australia doing? We have campaigns from those opposite. When we talk about making a modest change towards greater electrification, those opposite decide to run a scare campaign about people not having their utes anymore. It is just ridiculous. It makes us incredibly vulnerable to future shocks and to black swan events in a way that no other country on Earth is. If it happens, I'll be really fascinated to see how those opposite reflect on what they haven't done in the eight years that they've been in government.

Our defence department does have an energy related strategy. I think it's called the Defence Estate Energy Strategy. The last one ran from 2015 to 2019. We don't have another one. That strategy—look it up; get the PDF—is not a very impressive piece of work, because it doesn't have many commitments to using defence as a way of pioneering energy innovation. But it existed and at least identified a couple of things. It covered the period 2015 to 2019. As someone who has an interest in liquid fuel security, I've been looking for the next version of that, presumably the 2020 to 2024 version. It doesn't exist.

The US Navy has a project that's looking to make the Navy shift towards things like hydrogen. We actually piggyback off that, so we have been a participant in that US-led project. I think the Australian Army has put a little bit of money into some off-grid sort of energy sources that it could use in certain circumstances; that's about the scale of it—virtually nothing in transport. Why is that? Why is the US doing it and we're not? It's because it's too woke. Imagine if Defence, God forbid, was looking at energy resilience. That would be too woke. Defence would have gone green. We would probably get the minister up here, telling them that in addition to having certain morning teas, they have to abandon any efforts to make Australia's security in a better, more appropriate 21st century shape by investing in energy resilience, self-sufficiency and a shift away from liquid fuels.

What the government is doing now is very little and very late. The interim report of the Liquid Fuel Security Review was issued in May 2019. It received some further submissions and it closed. As I understand, it was provided to the minister towards the end of that year. We still haven't seen that. It follows the pattern of this government that it doesn't want to listen, it doesn't want to focus on the real issues but it wants to play political games and it wants to spend $55 million updating Christmas Island. It wants to spend six or seven million dollars keeping one Sri Lankan family on Christmas Island. These are the security issues, right? 'Our security is at risk, Australia. We have a Sri Lankan family that we need to spend more than $60 million keeping incarcerated until their younger daughter is gravely ill. That's how we will be strong and secure in this country. That's what we will do; that's brilliant!' Meanwhile, we've been out of compliance with our IEA obligation for eight years.

We are the most liquid-fuel-vulnerable nation on earth and this government has done nothing—nothing—about it. What finally prompts them? It's a bit like the sort of fuel security equivalent of that poor little girl. We go from four refineries to two refineries and: 'Oh, we better do something. What will we do? We will spend $2 billion from the taxpayer purse to keep those other remaining commercial refineries going!'

Investment in electrification, investment in storage, Australian shipping, doing something about Australian shipping, making sure we have, as an island continent, the ability to get things to and from here—don't worry about that. Beat the drums of war, talk about China, lock up young families until they're almost dead—that's how we will deal with security under this government. (Time expired)

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

I do disagree with the amendments and support the motion as put forward by the minister. There is a lot of excitement and discussion around Australia at the moment—certainly where I come from—about hydrogen, about the possibilities of a hydrogen production platform, about electric cars. As the shadow minister was speaking about comparative investments, I note that $1.2 billion was committed by the federal government to encourage the uptake of alternative technologies to power vehicles, including electricity. I must also point out that he somehow managed to bring in the Sri Lankan family and Christmas Island into that comparative spending effect and noted that $6 million had been spent keeping this family on Christmas Island. I would point out to him that $6 billion was spent fishing people out of the water. I think it bears to keep that in mind.

One of the things that we hope to do in Australia is transfer our energy consumption towards lower emissions and we are doing very well on that pathway. Oil, petrol, fuel and distillate are set to play a very important role in Australia for a long time to come. There is nobody who is sensibly suggesting that we will be able to phase out the use of these products in the short term, but we will be able to reduce our reliance on them.

Oil production in Australia peaked around the year 2000. At that time, it was supplying 90 per cent of our local consumption. That was a pretty good time, for those of us who remember the great adverts coming from BHP, from the Bass Strait and how Bass Strait oil was powering Australia, as it were. That's tailed off considerably now. We are on the dregs of Bass Strait, and production today meets less than 25 per cent of our requirements. Even with that, the oils that we do produce aren't really the right oils to supply our local market. There was a time when we had 11 oil refineries in Australia, and we are now heading for two.

Along with that oil refining capacity comes the storage. I'm from South Australia and well remember the tanks that sat at Port Stanvac. Those facilities are gone, so that ability to store diesel and store petrol in a refined form has largely disappeared. Of course, the problem with diesel and petrol is that they have a shelf life. For a refinery it's ideal: you feed oil in, you keep storage on site, it keeps feeding out and it meets the use-by dates. If you're just going to use these sites for storage, you are engendering a higher cost, because you have to turn the fuel over on a regular basis for no good reason apart from the fact that it's got too old in the drum.

With that refining capacity going, the storage capacity has gone as well. The refining capacity, too, allows us to access a source of fuel that doesn't have a use-by date. It's called oil. Of course, the best place to store oil is whence it came: the ground. Australia now has limited supplies of its own oil. There are good prospects around Australia for exploration for new oil. One of them, of course, that's had a lot of interest is in the Great Australian Bight, which lies off my electorate of Grey, and at this stage the commercial interest in it has evaporated. There are other basins, though, and I think it's important that as a nation we understand just how important this fuel security issue is. If our supply lines are interrupted, we will grind to a halt in a very short time. We know that we have mandated to hold 90 days supply either on site—that is, in Australia—or in the pipeline, but that's becoming increasingly difficult with this loss of storage capacity that I have been referring to.

So it's good to see that the government is making moves to address this issue. Primarily we are offering a subsidy to the two refineries that will remain on the condition that they remain until at least 2027. It's an interesting subsidy in that it's basically covering off on a cost basis so that, if their revenues fall short of making a profit, the taxpayer will move in to make sure the doors stay open. But it is constructed in a way that the companies will not profiteer from the taxpayer subsidy. When they go into the black, there's nothing coming from the taxpayer. I think that's a smart way to structure that subsidy. It means the incentive remains in place for that particular facility to be efficient and make a profit. That will give us some more breathing space, and we've also mandated lifting the reserves the importers and producers of distillate and motor spirits in Australia are to hold by 40 per cent, which will go some of the way to, once again, backfilling that 90-day holding capacity.

But make no mistake: 90 days is not the magic mark. Nothing could be better for Australia than to actually have internal security. We have internal security when it comes to gas, when it comes to coal, when it comes to wind and solar energy. All those things are achievable. But we know, and all the hardheads know, that we will be very reliant on oil for some time to come for our transport, construction and mining fleets. Farmers, I think, are quite some distance from being able to put hydrogen cells in their tractors. Maybe it will come quicker than a lot of us anticipate, but, at this stage, it's diesel. If you want to dig up iron ore—or, in my case, copper—or mineral sands out at Jacinth-Ambrosia, out from Ceduna, or whatever else it may be, it is diesel. There is no substitute for it. It is important we keep that supply line open and well oiled, for want of a better word, so people can access what they need when they need it.

I think this is good legislation. I think it addresses the issue of today. On the broader issue of how Australia transitions to new fuels, to lower-emission fuels, we need to be absolutely honest and realistic about our chances of achieving that in the short-term. For those who say, 'Well, we won't build any more gas-fired power stations; we won't build any more coal-fired power stations; we won't use any more fossil fuel,' that is a recipe for disaster. In the electricity field, without gas it will become increasingly impossible to build new renewable generation capacity. I made a speech about this last night in the Federation Chamber. You cannot keep building renewable energy unless you can backfill the gap for when the renewable energy is not generating.

Gas is the most viable option at this stage. Of course, we're into pumped hydro and nothing is greater than Snowy Hydro 2.0—I'm never sure why they put a zero on the end of that. Let's say Snowy Hydro 2. These are good investments, as is the new transmission line from South Australia through to New South Wales, but you can't do it all on your own. You can't rely on one technology. There is no silver bullet. We are working on a number of fronts—on all fronts, it could even be said—but in the meantime we have to make sure that we mind the shop and that the distillate and petrol supply, the motor spirit supply, to Australian industries and families remains constant. These two pieces of legislation do exactly that.

Madeleine King (Brand, Australian Labor Party, Shadow Minister for Trade) Share this | Link to this | Hansard source

How good is smiling for the cameras outside a Queensland fuel refinery when 600 devastated workers at the BP refinery in Kwinana are still in shock at losing their jobs just a few months ago? The images of a beaming Prime Minister Scott Morrison at a refinery in Brisbane, going the full 'thumbs up' alongside the workers he was motivated enough to save, serve as a reminder to Western Australians that we do not count in the political calculations of this Prime Minister. The announcement of a $2 billion rescue package for Australia's two remaining fuel refineries, one in Brisbane and one in Geelong, really is most welcome and Labor will support this package, and I support the amendments moved by the member for McMahon.

It is a stark reminder of just how willing Mr Morrison is to leave many workers behind while he tries to shore up support on the east coast. I was disgusted—I felt ill—to see our smiling Prime Minister taking credit for saving jobs while, clearly, not giving a second thought for the 600 skilled workers and their families who derive their livelihoods from the Kwinana fuel refinery in my electorate of Brand. Then there are the 300 refinery workers at the Altona refinery, in Melbourne, who are also abandoned by a federal government that simply does not care about them.

Before BP announced the closure of its Kwinana refinery after 65 years of operation, it had been sending out warning signs that this closure was imminent unless it received assistance. The media had been speculating for months about the closure of refineries before the hammer came down on Kwinana. Where was this government when the Kwinana refinery was in trouble? Where were Western Australia's federal Liberals in all of this? Why weren't they fighting for the fuel security of Western Australia within their own government? East coast backbenchers lobbied the Prime Minister and the minister for energy to get this important $2 billion support package for their refineries. But there was barely a murmur of protest or even disappointment from our local Liberals as they all waved goodbye to the capacity of Western Australia to maintain independent fuel-refining capabilities and therefore Western Australia's fuel security.

The Kwinana refinery was the largest refinery in the country and arguably the most efficient—something worth saving, you might have thought. When it was built by BP in the 1950s the Kwinana refinery was the largest international investment ever made in this nation. It formed the cornerstone of the Kwinana industrial area which grew around it and which has continuously been at the heart of WA's economic development. Today the legacy of the Kwinana refinery is the creation of a world-leading example of industrial symbiosis whereby businesses exchange by-products—water and energy—rather than discard them. The Kwinana industrial strip is now home to facilities that will produce the ingredients to make batteries around the globe and help the world achieve net zero emissions.

My father worked at BP from the start, from 1956, in the laboratory on night shift for years, to give our family a good life in the seaside suburb of Shoalwater, where we grew up and where my mother still lives. Until the refinery closed, this had been the story for so many workers and their families in my community. Many of my friends from Safety Bay Senior High School, where I went to school, used to work there. Some still do, although we know that the workforce has been reduced from 600 to 60. I want to say hello and give a tribute to my friends who used to be at BP: Ross Walker, Chris Greaves, Shane Kendall, Tony Crooks and the many others who went to Safety Bay.

The Prime Minister has declared that maintaining Australia's refining capacity is a matter of economic and national security. But in choosing to back refining capacity only in Brisbane and Geelong the Prime Minister is choosing to maintain the economic and national security of just the east coast. Energy minister Angus Taylor has said that Australia must have sovereign refining capability. Well, I'm glad the penny finally dropped for this minister, but unfortunately it's too late for the sovereign refining capacity of the state that literally drives the national economy with its vast mining and agriculture industries that require this refined fuel to operate.

The fuel security for the industry that underpins the Australian economy has been entirely cut adrift, and it looks like this government simply does not care. The question must be asked: how does this $2 billion fuel security package help Western Australia? When a plane lands in Perth from Sydney, we know it's out of avgas. We used to refuel it from avgas refined at the Kwinana refinery. Now the fuel will be imported from Singapore and will travel along the pipelines that used to carry locally refined aviation fuel. In the event of a crisis in Western Australia, how would refined fuel get across the Nullarbor? Does the government plan to truck it across and then up to the Pilbara in a crisis? Don't bet on it. My money is on all fuel staying exactly where it is, supporting the needs of east coast cities, towns and industries. Well, that's a positive result for them—and terrific. But we all know that this latest vote grabber will do nothing to help Western Australia. That's because this government's priority is saving its own skin. Frankly, there is little doubt that Australia's fuel security is worse than ever, and the Morrison government is still far from doing enough. We have arrived at this position after years of inaction and neglect. The Morrison government should have supported refineries and ensured adequate oil reserves years ago, yet they started only at the last possible opportunity and still had to be pushed, kicking and screaming all the way.

These bills will have a positive impact for the remaining two refineries in Australia, but it is too little too late for the people of my community, for the BP workers and their families who live right across the electorate, from Baldivis to Rockingham, and even in nearby electorates. But they all derive their income from the employment security in the work they did refining fuel in Kwinana. The government has done too little too late for these workers. They have been left behind by a government that simply does not care about the people of Brand and particularly the people of Kwinana.

On indulgence, Mr Speaker, I note that it is national bowel cancer day. I wear the ribbon today and I want to acknowledge the great tribute paid yesterday to the Queensland parliament Duncan Pegg, who suffered from and ultimately lost his life to this disease. My sister had bowel cancer when she was 49, many years ago now, and the price I pay for my sister having that disease—very thankfully, she survived it—is that I have to undergo colonoscopies regularly. It's not something you really want to do, but I totally acknowledge that it's a great thing to do to make sure we can resist the devastating impacts of a terrible, terrible cancer that kills many people in Australia. I urge everyone to do what they can on bowel cancer day to think about their health, go get the test if you're of a certain age and make sure you are proactive about your health and your bowel health.

Zali Steggall (Warringah, Independent) Share this | Link to this | Hansard source

I rise to speak on the Fuel Security Bill 2021 and consequential amendments. This bill implements two measures from the recent budget. Firstly, it establishes a minimum stockholding obligation for industry to ensure they hold minimum quantities of transport fuels. Secondly, it enables a production payment for refinery operations, also known as the fuel security services payment, to provide a cents-per-litre payment to refineries. In return, they will guarantee to continue operating until 2027. The payment can reach a maximum amount of just over $2 billion by 2030 in a worst-case scenario—a massive amount; let's be very clear.

The package will also support transitioning our refineries to reduce sulphur content, and that will cost $300 million. While not entirely against the fuel security package—and, specifically, the measures to reduce the sulphur levels of fuels, which I have called for—I am against the government not complementing any support of fuel refineries with a meaningful package to support transition to lower emissions transport, which is necessary for energy security and to meet our climate targets.

The history of oil refineries is important in this debate. Most of Australia's oil refineries were built in the mid-1950s and mid-1960s. During that time, refinery operators enjoyed a sheltered existence with limited competition from others in the region, protective tariffs and price and demand stability. But those protections are gone. Despite investment in modernising the infrastructure and facilities, the sector is under pressure from lower-cost facilities in Asia, increasing capital and labour costs for operation and maintenance, and a tougher regulatory environment. As a result, Australia's oil refineries have been in decline for some years. We have to be clear about that.

Business headwinds were exacerbated by the pandemic. In 2010-11, there were seven oil refineries in Australia. By early 2020, there were just four. This year BP and Exxon Mobil both announced they would close their refineries in Western Australia and Victoria, and the two remaining refineries were also threatening to go the same way, which is why we are now here debating such a prop-up by means of public funds.

Twenty years ago almost all of our oil demand was met by domestic refineries. Now it is less than half. As oil refineries have closed, there have been some concerns about our overall energy security. That is, ultimately, the argument often put forward: having fewer refineries may reduce Australia's ability to refine fuels if shipping and supply chains are ever severely disrupted for any reason in the future. But that view is contested. For example, the Energy white paper 2012 saw no risk from refineries closing, for the reason that those risks are mitigated by diversified supply chains. This contention hasn't stopped the government from providing a subsidy package for the remaining refineries, but the question has to be asked: how long can we prop up a system that is not self-sufficient and is not economically viable?

The Australian production of oil is not enough to meet our own demand. The oil produced from Australian wells is condensate, which is not readily available to be refined in Australia due to costs. It can be in an emergency, but it's not preferable. As a result, like many Asia-Pacific nations, Australia is highly dependent on importers. Over 90 per cent of our fuel is imported from countries in the Middle East, Asia and North America, which leaves Australia exposed to potential supply disruptions in our region, emanating from conflict, natural disasters and other pressures.

Australia spends roughly $29 billion per year on imported fuel. From the making of consumer products, to chemical feedstock, to transport, which uses 75 per cent of our total fuel demand, many sectors are exposed to oil supply shocks. This trend is worsening. The Department of Industry, Science, Energy and Resources has projected that oil demand will increase to 2040 if we don't change policies. The dependence poses a long-term risk. Rather than thinking that we're just going to continue propping this up, we need to think about the transition away. As the Australian Financial Review editorialised, 'The refineries plan doesn't mean self-sufficiency, even with more than $2 billion in subsidy,' as Australia will continue to import most of its crude oil anyway.

There are many other reasons to switch—in particular, reducing emissions. A fortnight ago, the International Energy Agency, one of the most conservative energy institutions in the world, released a landmark report called Net zero by 2050: a road map for the global energy sector. In it, the IEA modelled scenarios to get to net zero. The report sent shockwaves through the world, not least because it told Australia, one of the largest fossil fuel exporters in the world, that we cannot support any more fossil fuel developments from now on. But it also shone a light on other sectors, like transport. Transport emissions make up almost 18 per cent of our total emissions, or 90 million tonnes per year, the majority coming from light passenger vehicles. Prior to the COVID-19 pandemic, transport was our fastest-growing sector and source of emissions. The Australia Institute projects that emissions from transport could grow to 125 million tonnes per year by 2030. For perspective, that's the equivalent of almost eight Hazelwood coal-fired power stations. The IEA found that, to reach net zero by 2050, 60 per cent of global car sales will need to be electric by 2030.

So there is a chasm between the goal and where we stand today, especially here in Australia, where there is a policy vacuum. Other countries are taking steps to reduce oil dependency and ambitiously attempting to meet climate targets. Today less than one per cent of new car sales are electric in Australia. That's compared to over 11 per cent in the United Kingdom and 80 per cent in Norway. We are far, far behind—global laggards. The Bureau of Infrastructure and Transport Research Economics has modelled that, under our current policies, Australia will only reach 27 per cent of new car sales being electric by 2030—and that is putting a good gloss on it—putting net zero absolutely out of reach. Unfortunately there is no plan forthcoming from the government in relation to this. This antiquated fuel security package is yet another example where we're failing to do that orderly transition that's so required.

The government needs to support this orderly transition. For the moment, we simply don't see it. For example, with the transition to EVs we need to overcome the barriers to purchase. There are many barriers that are getting in the way of uptake of EVs. It's highly dependent on the cost of electric vehicles becoming comparable to the cost of internal combustion engine vehicles, consumer acceptance of the range limitations of these cars and the charging infrastructure rollout. Let's be clear: the government uses this as a political weapon, come election time, to stir up fears around range and whether there are limitations. That is so negative. It is so counterproductive. Ultimately it is against our national interest, because we need to do the transition.

The government actually has a duty to properly educate as to the opportunities in this sector. In forum after forum in Warringah I get asked about why the government is not helping overcome these barriers. One gentleman at a forum just last week in Balgowlah was puzzled that the energy minister, on the ABC's 7.30 program, would use convenient excuses like range anxiety as a reason to not support electric vehicles. People in Warringah want to do the right thing. In a recent Lowy poll, 77 per cent of Australians supported providing subsidies for the purchase of EVs. In New Zealand, just yesterday they announced that they're providing generous incentives for EVs. New Zealanders will get an $8,600 subsidy towards that. In Australia, it's quite the opposite. You get a very limited state based incentive—that is, a little of your stamp duty—and that's all. And we have a completely uncoordinated approach as some states go completely the opposite way and tax EVs.

Current policies in the Future Fuels Strategy, the government's tokenistic attempt at spurring investment in low-emissions vehicles, is just not enough to overcome the barriers. The Future Fuels Strategy is $70 million of repurposed funding from ARENA. It's not even new funding. That stands in stark contrast to the package fuel refineries got. So, on the one hand, we take away funding—$70 million—from ARENA to theoretically go towards a Future Fuels Strategy, but we put $2 billion towards gas guzzlers.

The strategy is unambitious and contains questionable modelling to justify no action. There is a do-nothing strategy. There are no vehicle efficiency standards or vehicle transition targets and there's no money for support towards those transitions. How could we expect any more from a government which, with due respect, is known for saying—and a Prime Minister who is known for saying—electric vehicles would 'steal the weekend' at the last election? It is so embarrassing and out of touch and it's so contrary to any principle of actually ensuring Australia is on the front foot of new technology and actually enabled to embrace opportunities.

With a lack of federal government action, we're seeing a dysfunctional policy from state governments. We're seeing the Victorian parliament pass a bill that would institute the world's first EV tax and then we have just a completely disparate and uncoordinated approach around the country. That's because the federal government is not taking up the responsibility. It is shirking its responsibility. We need a coordinated and meaningful national plan to transition our transport. The other sad part is that the package doesn't ensure jobs. There's no bang for our buck on this one. The return on investment is terrible. There are way better ways to spend so much public money.

There will be a maximum of 1,750 construction jobs and support for about 1,250 existing jobs, so that's about 3,000 jobs. With a package costing a potential $2.3 billion by 2030, that is almost $800,000 per job. If you spend $800,000, for example, on renewables, you could generate up to four times the jobs. Look at it another way: if you spent $2.3 billion on renewables, you would generate up to 12,560 jobs. This government is always claiming that it focuses on job creation, and yet time and again it ignores the industries, the mechanisms and the technologies by which more jobs can in fact be created.

We have such enormous potential to win the transition race. We could actually be fuel secure, reduce our pollution and benefit economically. Last month we saw Queensland's Tritium list on the Nasdaq with a valuation of over $1.8 billion. The reason? Tritium are supplying the world with high quality Australian EV chargers. You can see the charging stations dotted around Europe and the United States. We have several in Australia, but we don't have anywhere near the policy mechanism to actually support the rollout. We can process minerals for EVs. We can make batteries. We can build charging infrastructure. We can build the software for the clean technology revolution right here in Australia, if there was just the political will to do it. If an equivalent amount of this fuel security package could be spent towards a transition and some vision for the future, we might actually have some opportunities. I don't disagree with supporting the oil refineries and fuel sectors more generally at the moment, but, at a time of record debt, good governance requires a sensible plan for an orderly transition away from this dependence on oil across all the affected sectors. If we ignore the problem and fail to do this, the transition will occur regardless of whether Australia likes it or not and regardless of whether politically it is palatable or not. That transition is happening all around the world. We have two choices for this government: it can be done in a highly disruptive way, because we failed to have a coordinated response and plan, or it can happen in an orderly way. For it to happen in an orderly way, it requires some planning and transition policy.

The government policy must be used for a smooth transition and make it as least disruptive as possible on communities, on our economy and on our private sector. I implore the government, especially the Prime Minister: we need a parallel plan to support the transition and to explore the economic opportunities that come with it after coming back from G7, where we're positioning Australia. At the end of the day, our children will pay the price for the lack of vision and leadership in coordinating a transition.

Susan Templeman (Macquarie, Australian Labor Party) Share this | Link to this | Hansard source

There are a few of us—not so many of us right now sitting in this chamber—who would remember the 1970s and the big queues for petrol as a global oil crisis hit our country. I remember as a kid sitting in a car—I can't remember if it was odd or even days—on whichever day my parents were allowed to get petrol and thinking, 'This is strange. We are wasting an awful lot of time.' As kids, we sang a lot of songs sitting in the car in a petrol queue waiting to get petrol. I hope that is not a vision that the government wish to see repeated, but there's been such a delay in taking any action on the fuel situation we face in Australia that it's a wonder we haven't gone back to that and it is partly why I think our fuel security from a consumer perspective is so important.

I live in a peri-urban area. We go everywhere by car. When fuel prices go up, we feel it first. We spend more on fuel and tolls and we don't have the easy option of public transport. So this fundamental issue of fuel supply security is absolutely essential for a community like Macquarie. Back in 2017 I sat on JSCOT and this issue ran adjacent to the context of Australia's international obligations to have fuel reserves. I remember there being questions about us failing to meet our global agreements around international fuel supplies at that time, and that continues to this day. I remember the department talking about our own sources of supply here, and we were reassured that we imported crude oil from 21 countries and we refined product from 47 countries, so there were multiple sources. But, even at that time, it didn't help us meet our international obligations, and there were real concerns about our long-term fuel security. That was 2017 and that goes to just how long this issue has been around and how slow this government has been to do anything tangible. When they do come up with something tangible like these bills, which are welcome, they are the consequence of failure. There is only action after there's been failure, after more Australian refineries have closed down.

No-one questions that a secure fuel supply is critical not just to drivers and commuters in my electorate but to our whole economy, to our ability to move across this great land, to be able to—well, to mix my metaphors—grease the wheels of the economy. We need it not just for travelling by land but for flying, for the movement of groceries, construction supplies and medical equipment. We've seen that need grow even more. We saw extraordinary need in my electorate in March, when floods closed every route and the first road to open required a five-hour trip to get groceries delivered. We need to know that fuel is going to be there. It's only now we are close to nearly 100 per cent dependency on international supply chains and we're seeing job losses across the refinery sector. It is only as 50 per cent of our refineries close that we are getting action.

As I say, this wasn't unforeseen. A Senate inquiry in 2015 was the first in recent times to recommend the government undertake a comprehensive review of Australia's fuel security problem. It took three years—until I did my parallel inquiry into our global obligations around fuel—before an inquiry happened. That wasn't until 2018, with a due date for release of 2019. It just seems odd to me that fuel security and the jobs of thousands of refinery workers only get noticed when things are really a problem, when things are really going bad.

The interim report of the Liquid Fuel Security Review was delivered to the government two years ago, in April 2019, but we still haven't seen the final report. It was due late 2019, so we can't blame COVID for that one. We have not seen a report. The government chose not to act then, not even to deliver the final report. Thanks to that failure, we have been left almost entirely reliant on global supply chains for one of our most critical economic inputs. We do know, though, that the interim report identified a number of things that could have been acted on over two years ago—things like noncompliance with the International Energy Agency obligations for domestic fuel stocks, which I've already referred to, and our requirement to have 90 days of fuel stocks domestically to help protect against global and domestic oil shocks, which I've also mentioned. We weren't compliant then and we're not compliant now, but we could have done something about that. There have been very small steps taken to address that issue. When we talk about supplies now, we are at 58 days in our global agreement. That's 32 days short of the 90 days we've said we would have fuel stocks for. We're not just letting down Australians when we do that; we're not meeting our international obligations.

The average Australian home spends the same amount of money on fuel as they do on electricity and gas combined. I haven't seen the data from my electorate, but I'd wager that we spend more because of the distances that we have to travel. We also need fuel stocks for industry. We need them for defence. We needed them when we had planes fighting bushfires. Aviation is essential, and the world is becoming increasingly volatile. For a government that seems to like to talk a lot about national security, it has, for the last eight years, been absent from the debate about how we secure our fuel supply.

We have been an outlier. It's interesting to think about the fact that the government's policy makes us more and more dependent on fuel, as drivers of cars, because we don't have a policy on electric cars to encourage people to find an alternative. It's one of those ironies, when you think about it. Fuel security is more of an issue, yet we are more reliant than ever. Think about it: if there were a policy that encouraged people to buy electric cars, it would actually lessen our dependence on petrol, as consumers and as drivers, and ease up the demands on fuel. The Electric Vehicle Council notes not just a lack of policy but also the consequence of that, saying that it has created a market here where we are 'uniquely hostile' to electric vehicles. That's not the average punter, but they're the policy settings that we face. We used to try and be world leaders in Australia. We used to pride ourselves on being early adopters and being ahead of the pack, even inventing things and leading the world that way. We're not doing that now. We're not leading the world in terms of electric vehicles. We're certainly not leading the world in the development of vaccines and helping to meet the current demand. We are at the back of the pack in a whole lot of ways, and electric vehicles are one of them.

Only 0.7 per cent of cars sold here are electric, compared to a global average of 4.2 per cent. In the United Kingdom and the European Union it's 11 per cent and in Norway it's 75 per cent. This isn't because Australians don't want electric vehicles. A majority of Australians say they would consider one for their next car, but they're not available at an affordable price. There are no electric cars available in Australia for under $40,000, and there are only five that you can buy for under $60,000. Compare that to the United Kingdom, where there are eight models that are cheaper than the cheapest model in Australia. That's because we've had policy settings that lock us into the old technology of petrol powered cars. It's because of inaction and scaremongering by those opposite. Who can forget that the Prime Minister and multiple frontbenchers were saying during the last election that electric vehicles would end the weekend, that they would stop people from being able to enjoy their weekend. What a nonsense that was, because we can see all the models that are coming out from the major car manufacturers. It's just that they're not coming here, because we don't have policy to support them, and they're not going to get here in any decent numbers until we do. That is going to make us more and more dependent on traditional fuel supply.

Labor has an electric-car discount policy that is going to cut import tariffs and fringe benefits tax on non-luxury electric vehicles. That could be a game changer for our industry, but in the meantime, we are left with a bill like this that requires us to back in some things to support fuel security. We will do that, but we know this is not going far enough.

One of the key problems with the bill before us is that it's all announcement and not so much delivery. I'm really getting sick and tired of hearing people on the other side talk about the pandemic as the reason that we have found ourselves in this situation, when we know there is a very long history going back to an inquiry by the Senate Rural and Regional Affairs and Transport References Committee in 2015, quite a few years before COVID. I really hope that those opposite don't try to pull this one off under the cover of COVID.

Let us think about what was actually promised and compare it with what is being delivered. The Minister for Energy and Emissions Reduction, Mr Taylor, and the Prime Minister—they are very good at announcements, just not very good at delivery—announced a fuel security package that was going to secure Australia's long-term fuel supply and was going to create over a thousand new jobs. Let's be clear about what we have seen since that announcement. We've seen the closure of two of Australia's only four remaining refineries, so half the refineries we had in this country have closed since their announcement. I don't call that job creation. In September the Prime Minister and the energy minister again claimed their package would 'back local refineries to stay open'. Then on 30 October—six weeks later—the Kwinana refinery in Western Australia announced it would close. On 14 December the minister claimed:

… the Government was taking immediate and decisive action to keep our domestic refineries operating.

'Hear, hear!' we all say. But, no, within two months, on 10 February this year, Exxon also announced that its Altona refinery would close. What about the jobs? What about the people who no longer have a job in a refinery as a result? Those two refineries alone directly employ 950 people between them. So perhaps when the government was announcing a thousand new jobs it should have said, 'We're getting rid of nearly a thousand jobs.' There are also thousands more jobs in fuel-dependent industries that are on the line. The petrochemical manufacturers all rely on by-products produced from these refineries—the ones that have announced closures. I think that is just more proof that the government knows how to talk about jobs but doesn't actually know how to deliver them for this country and for Australians.

It was clear to us when these announcements were made that it wouldn't be enough. We warned that it wasn't enough. It failed to address Australia's fuel security needs, just as we've been warning for years about our increasing dependence on foreign fuel imports in a changing world. Problems with our fuel security and the need to have greater onshore stocks existed long before COVID, going back six years. But this government, as always, chose not to act. It waits until the very last minute before it does something—always waiting, always too slow and never enough.

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

I speak in support of the amendment moved by Labor to the second reading of the Fuel Security Bill 2021. Liquid fuel is essential to the Australian economy. According to the Department of the Environment and Energy's April 2019 interim report on liquid fuel security, Australia spends $57 billion a year on liquid fuels, $38 billion on electricity and $37 billion on gas. Admittedly, that was a couple of years ago, but I suspect those figures would be reasonably accurate even today.

Liquid fuel is the energy source we most rely on and will continue to rely on for years to come. It makes up 52 per cent of Australia's total energy consumption. Yet Australia is overwhelmingly reliant on overseas crude and refined fuel, with 90 per cent of our total fuels coming from overseas either as crude oil or refined petrol. Australia imports crude oil from around 40 countries and refined fuel from 66 countries, and it's imported on a just-in-time, free-market basis. So we have placed control of an essential commodity entirely in the hands of the private sector and, to a large extent, overseas based operators and multinationals.

Even if all of Australia's produced crude oil were refined and used here in Australia, it would only account for and supply about 25 per cent of Australia's average annual needs. The fact is that much of our crude oil is actually sent overseas, because it's of a different standard to what is imported. Just as concerning is that Australian crude oil reserves account for 0.3 per cent of global oil production, and they are diminishing. That's all of our own reserves. So, if we had to rely on our own reserves at any point in time, not only are they not enough; they are actually diminishing, not to mention that we now don't have the refineries to process all of that oil.

Australia is also a member of the International Energy Agency, which requires Australia to hold 90 days of liquid fuel based on annual consumption. Yet, according to the interim report on liquid fuel security, on average Australia has on hand around three weeks of consumption cover. According to the Liquid Fuel Security Review, consumption cover is the preferred measure of domestic fuel security as it counts stocks based on how many days they will last under normal demand. That three-week supply has been the case for about the last decade. Even if we count all that is on ocean tankers and at overseas ports and refineries, Australia still does not meet its 90-day fuel supply requirements. Australia hasn't done so for years. So the Morrison government has now belatedly caved in to public pressure and announced some measures to improve Australian liquid fuel security. It's done so by promoting limited assistance to the two remaining oil refineries—the one in Lytton, Queensland, operated by Ampol, and the one in Geelong, Victoria, operated by Viva Energy. It's also going to provide some financial assistance for the storage of fuels in this country.

At it's peak, Australia had 10 major oil refineries and there were some small operators as well. We're now down to the last two and they are only operating on the basis that they will get government support if they are not profitable. It shows how much we have allowed this critical industry sector to diminish. And as they have diminished, as other speakers have quite rightly pointed out in this debate, not only has our reliance on overseas fuel increased but tens of thousands of jobs have been lost along the way.

I remember the Port Stanvac oil refinery in my own state of South Australia. It's all gone. I can remember that, when it was built, it was considered to be a major asset for the state. It was promoted as something that was going to secure petrol supplies in South Australia for years and years to come. But not only is the refinery gone; so are all the oil tanks that held the fuel in the years it was in operation.

That not only leaves Australia vulnerable and more dependent on overseas liquid fuels; it doesn't give me and the people I speak to much confidence that, in an emergency situation, we'll have the fuels that we need. And perhaps even more concerning is that unlike some of our counterparts—the USA, Japan and Korea—the Australian government does not maintain any oil reserves itself or even mandate that minimum reserves be held by the private oil companies here in Australia. I know that there has been some noise about doing that as part of this legislation but, right here and now, we have neither government reserves nor private-sector reserves mandated in this country.

Even Australia's defence sector, which relies heavily on all of these fuels and which does have some capacity, only maintains its reserves at around 50 per cent capacity. You would have to wonder why, if we have the capacity to store more fuel—petrol, diesel or aviation fuel—we are not utilising those facilities at 100 per cent. I suspect it's all to do with money—the fact that storing fuel here comes at a cost.

One argument for not maintaining a 90-day reserve is that we don't have a fuel shortage problem in this country and we haven't had one for 40 years, so why should we worry. The fact that things have been going well for 40 years doesn't secure the future at all. I think we should be thankful that we haven't had a petrol problem for the last 40 years. I can remember the fuel crisis in this country 40 years ago—for weeks on end, there was fuel rationing going on—and the problems that all caused. Having said that, I'm grateful that we haven't had to go through that again in the last four decades.

Another argument is that storing fuel in this country would come at a significant cost. It is estimated by some that it would cost in the order of $6 billion to $7 billion to build storage facilities. If we can afford $270 billion in defence spending for national security purposes, why can't we afford to have storage facilities for our fuel, which is just as critical? Even for our defence services themselves, there is not much point in having all this defence equipment if they don't have the fuel to drive it.

Another argument is that having a just-in-time free-market approach means we can minimise the costs to consumers and that the cost of creating additional reserves would inevitably be passed on to consumers. I expect that that would be the case but, at the very least, it would ensure that we have a much more reliable fuel supply in this country in the event of a crisis.

The other aspect of all of this is that I recall some months ago the government stating that it was going to buy $94 million of fuel and then have it stored in the USA. It begs the question—indeed I recall at the time people literally laughing at that proposition as a joke. What is the value to Australia of having crude oil—not even petrol or aviation fuel but crude oil that then has to be processed—stored in a country on the other side of the world? It still has to be transported to Australia and, in the event of a serious disruption, that might not be possible. So storing it somewhere else simply didn't make sense. It certainly didn't make sense to me and the people who spoke to me about it.

So now the government does want to impose what we call minimum stock obligations on Australia's 15 fuel importers in order to meet critical demand, and I think that's a good thing to do. We have obligations on the private sector to store fuel in order to meet critical demand. The problem, however, is this: when you look at the definition of 'critical demand', it is estimated to be 16 per cent of normal demand for diesel, six per cent for jet fuel and four per cent for petrol. It doesn't give me confidence that that's going to be a great amount of fuel that is being stored in the event of an emergency or crisis situation. Those figures are hardly reassuring. Indeed, I suspect that to most people they would not be reassuring. Whilst they might enable what I'll call critical elements of the economy to tick over, that's about all that amount of fuel would enable us to do.

We have also heard from other speakers about what would happen in the event of a global conflict or serious global disruption of liquid fuel supplies. Given that we rely on the Middle East, an area or region of the world that is constantly in some kind of conflict, for about 40 per cent of all of our fuel supplies, it is not terribly reassuring to think that that is what we have to rely on. We are reliant on not only overseas oil but overseas refineries and overseas owned shipping vessels and tankers, and we have to rely on access through overseas or international waters that we don't always have control over. As we saw recently again, there was a disruption because one of those routes was interfered with because of a breakdown of a vessel. So, in essence, every step along the way of the process of getting fuel to Australia is dependent on everything going right with a party that is totally outside of Australia's control. Again, it doesn't give me a lot of confidence and nor does it give the Australian people a lot of confidence. Not surprisingly, it was public pressure that finally got this government to act in respect of this matter.

As other speakers have pointed out, Australia has the third-highest per capita ownership of motor vehicles. Our take-up and marketing of electric vehicles lags well behind that of other countries, and I don't have to repeat the statistics that have been used in this debate time and time again. The reality is that we lag well behind with respect to conversion or take-up of electric vehicles. That would certainly diminish the need for fuels, at least for motor vehicles in terms of diesel and petrol, but the reality is that, even if we do that, it will be many years before our reliance on liquid fuels diminishes to the point that we feel comfortable that we can have the necessary supplies. I will quote from the Liquid fuel security review: interim report:

… we need to be prepared for new and emerging threats … antiglobalist attitudes are rising and we face a diverse range of security threats, including foreign interference.

In fact, for years Australia has not been adequately prepared. This legislation provides little confidence that Australia's liquid fuels will be secured into the future.

I'll finish on this note. We also have a reporting system in this country that tells us how much fuel we have in hand. The problem with that reporting system is that it's already six weeks old at the time the reports are submitted, unlike other countries where the reports are about a week old. We have an increase in diesel usage in this country, and it will continue to be the case because of our reliance on mining, agriculture, transport and rail. Given that that is the case and that those matters are critical to the Australian economy, it is critical that we have secure liquid fuel supplies in this country. Whilst this legislation goes a small step of the way towards doing that, it does not go anywhere near far enough. We need to do a lot more if we are to be self-sufficient and have confidence in our liquid fuel supplies into the future.

Bill Shorten (Maribyrnong, Australian Labor Party, Shadow Minister for the National Disability Insurance Scheme) Share this | Link to this | Hansard source

It was in 1966 that the late Robert F Kennedy delivered a speech in which he said:

There is a Chinese curse which says "May he live in interesting times." Like it or not, we live in interesting times. They are times of danger and uncertainty; but they are also the most creative of any time in the history of mankind.

However, Senator Kennedy didn't know just how darkly interesting and dangerous the times would get when he said these words. Tragically, he was assassinated two years after he spoke them. In 2021, more than half a century later, much of what he said then applies now, to our times.

To understand how interesting the times are getting, you only need to read the editorials of the Global Times newspaper, long considered to be a trumpet of the policies of the Chinese communist government. A recent editorial thundered that if Australia were to join a US effort to protect Taiwan from an invasion by China then China should consider long-range strikes against us. The editorial darkly stated that Australia 'must know what disasters it would cause to their country'. Whilst I acknowledge that such rhetoric doesn't automatically come true, we need to also look at the Middle East, where we've seen deep tensions break into outright warfare once more. It means two things: a tragic human cost for the Palestinians and Israelis and a financial cost at the bowser for consumers everywhere else.

Even as we emerge from COVID, and, hopefully, put the worst of the pandemic behind us, we are reminded by our grounded jumbo jets and unvisited loved ones overseas that when the chips are down we are an island continent: on our own. I don't seek to paint a picture of doom and gloom or make the listeners of this debate sullen and depressed and frustrated at the state of the world. The women and men of this country are up to most any challenge that the fates can throw at us, so I'm an Australian optimist who's optimistic about Australia.

This is why, for so long, I have fervently advocated for a national fuel reserve. I've been a believer in this vital undertaking for years, but the advent of these interesting times makes it more pressing than ever. Boosting Australia's fuel stocks is one of the important national security measures that can also protect our economy from global disruptions. Once upon a time, Australia was a net exporter of oil, but as we've become more reliant on the global fuel market we've also become more vulnerable to international risks and uncertainty. One answer is to increase our national fuel security; therefore, we need to increase our national fuel stocks. I acknowledge there are other solutions—moving towards electric vehicles, developing our hydrogen industry—but I do believe that whatever other policies this nation adopts we need to increase our national fuel stocks.

I believe in this approach so much that I took it to the last election. The coalition refused to match it, saying it was too expensive. When we didn't win and the Morrison government was elected they came up with their own version of our fuel reserve policy. They say that imitation is the most sincere form of flattery, but the knock-off version here was so bad I didn't feel particularly flattered. The major hitch with the $94 million Liberal fuel plan announced by Angus Taylor in April last year was—and I ask listeners listening to the parliamentary debate to consider this—that the Liberals came up with the idea of an Australian fuel reserve to be based in the United States of America for the next 10 years. That's not very wise; it's not very Australian. If a pandemic or regional unrest cuts off supply lines from overseas then the Liberal fuel reserve will be about as useful as a concrete parachute.

In June the Liberals and Nationals made vague gestures towards expanding domestic fuel reserves, but any advances in this direction have been ad hoc and incremental. I want to suggest in this debate that the government should again look at my vision for fuel reserves. It wasn't just for local fuel reserves but also for a national strategic fleet to secure our access to fuel supplies, particularly in times of global instability. Anthony Albanese was then my transport spokesperson. We worked on our shipping policy, and I'm very proud of the final result. Over time we would have built up a decent sized fleet of merchant ships, including oil tankers, container ships and gas carriers. The need for a genuine national fuel reserve was very strong and we had four domestic refineries. When I was an organiser with the Australian Workers Union in the fuel and oil industry we had eight refineries. In 2019 we were down to four refineries. Unfortunately, in the time since the election in 2019 the number of refineries in Australia, which was already too low at four, has been slashed in half. We now have two refineries remaining. Now the government is suddenly making noises that they care about these things—better late than never, but it really is five minutes to midnight.

It would have been nice if the government had done what we're talking about now, perhaps by backing Labor's policies in a bipartisan fashion before the election or even coming up with theirs before the election, but particularly before ExxonMobil announced it was closing the Altona refinery in Yarraville and BP announced the closing of Kwinana in Western Australia. We may be an island nation largely on our own, albeit with a few good friends in our neighbourhood, but that should focus our energy or attention on the fact that if things get interesting no-one will be wanting to race to our rescue as much as ourselves. Good luck and hope are not plans for national security. A significant domestic fuel reserve is, in my view, an idea whose time has come.

I wish to close by noting that today is the 78th anniversary of the sinking of the United States Army transport Portmar. The Portmar wasn't sunk in a far ocean; it was sunk 35 nautical miles east of Smoky Cape near Coffs Harbour. The Portmar was built in 1919. It was 125 metres in length and its beam was 17 metres. It was a big ship. On the morning of 15 June—78 years ago yesterday—it was loaded with ammunition and fuel. It left Sydney for Brisbane as part of convoy GP55. The convoy had 10 merchant ships and three landing ship tank vessels escorted by the Royal Australian Navy vessels Bundaberg, Cootamundra, Deloraine, Kalgoorlie and Warrnambool. Yet 35 nautical miles off the Australian coastline on the east coast, at 5.15 pm in the evening of this day 78 years ago, the Japanese cruiser submarine I-174 fired a spread of torpedos. One torpedo struck one of the landing ship tank craft and another hit Portmar. The Portmar sank 10 minutes later. Two merchant marine seafarers were killed. The 71 survivors were taken aboard other ships and headed to Coffs Harbour.

People might think that what happened in the past remains in the past. But we're an island nation, we don't have enough ships, we don't have enough fuel reserves and all the great technology in the world and all the defence spend in the world is rendered meaningless if we can't actually keep running our vessels and our vehicles and we can't bring cargo to and from this country. We are an island and the world doesn't owe us a living. We need to stand up and start thinking for ourselves, and perhaps remember that 78 years ago Australian seafarers and Australian service people went in harm's way. We need to ask ourselves: if that could happen then, why are we sure it can't happen now and in the future? As the American sailors on the Portmar were killed defending this country, perhaps we owe it to their memory to do more to defend ourselves.

Bob Katter (Kennedy, Katter's Australian Party) Share this | Link to this | Hansard source

Those of us who read history books will be well aware that World War I was touched off by Winston Churchill purchasing, or getting his government to purchase, the shares in British Petroleum. So Britain owned Shell and it owned British Petroleum, with America. Shell plus British Petroleum was almost all of the world's oil reserves. When Churchill did this—enabling his navy, of which he was the minister, to outgun, outrun and out-protect any German vessel—the German government, the German people, said: 'The Anglos control oil throughout the world, and they will keep us as a third-rate power forever. So either we fight or we accept that we are going to be a third-rate power.' So Germany decided to fight. In the Second World War—the part that concerns us, with Japan—America embargoed the petrol going to Japan. So two world wars, resulting in the deaths of nearly 100 million people, if you throw in the Spanish flu, were precipitated by oil.

We've fought a war almost every single year—since I left school, anyway. When I left school we were at war with Indonesia. I was wearing the uniform, and I was on my way as a platoon commander to fight in Indonesia—my platoon was on 24-hour call-up. What was it about? It was about oil. Sukarno had moved in and seized the oil holdings of British Petroleum. I think it was British Petroleum, but it was British interests that owned the oil in Borneo, and he'd moved in and taken them. Churchill had a wonderful phrase when Hitler invaded Russia. He chortled, 'Those that cannot learn the lessons of history shall be condemned to suffer again the lessons of history.' And that is exactly what occurred, of course: the Swedish king—Charles II, maybe; my memory fails me—Napoleon and, of course, Hitler all sank in exactly the same way.

If we can't learn the lessons of history, and China embargoes oil into this country, a very simple thing I asked about the week before last—and the Middle Eastern people have embargoed oil on, I think, seven occasions. They've cut off the world's oil supply. Well, there were a lot of other sources in those days. Now there are not. We didn't have to worry too much, because we had our own oil. We were self-sufficient in oil. History will judge the free marketeers in its place, and future generations of Australians will spit upon the people in this parliament, just as people like myself spit upon the memory of Billy Hughes, because history tells you what really happened.

I don't know how many different figures we've got, because no-one will come clean. But let me say that, on balance, it would appear that we are 25 per cent self-sufficient in oil, and we export it all because our refineries can't or won't refine it. It's light crude—'light' means it's light in aromatics. Aromatics give a lot more power, and they are carcinogenic. Everyone wants aromatics out, so they buy the light crude from Australia. Australians don't care how many people die, in Sydney, Melbourne and Brisbane, from breathing in superfine particles. Every other country has gone to ethanol, of course, to overcome the superfine particle problems. It's five per cent throughout Europe, 12½ per cent—last time I looked—in America and 30 per cent in Brazil. Everyone has moved to ethanol for health reasons, but we don't seem to worry about that. The NRMA—God bless them—did their report and said we had effectively two weeks of petrol supplies in Australia, but I'm jumping ahead of myself. So we export all of our oil and we import all of our petrol, diesel and avgas. That's smart, isn't it: importing fuel that's carcinogenic and heavy in aromatics! Also, you don't get such a good burn, so you get the superfine particles going into your lungs and killing you. In actual fact, if you move from, let's say, Armidale or Tamworth to Sydney, your chances of dying of heart or lung disease almost double. They're the findings from California, and that's why America introduced ethanol and other renewables through its air quality control legislation, to replace the aromatics in petrol and to get a much better burn.

Let's put that aside for a moment. I've been in parliament nearly 50 years. I'm the second-longest-serving member of parliament in Australian history. For the first time ever I saw a leader stand up and lead a standing ovation for Andrew Robb for doing the free trade deal with China. I was sitting next to my colleague Andrew Wilkie, and I said: 'This bloke will not be there in six months. The people of Australia will never accept the rubbish that he's putting out here, that the free trade deal with China is good for Australia. Free trade deal with China? Are you joking? China will do exactly what China wants to do, and you, like little puppy dogs, will do exactly as they tell you to do.' And that's exactly how it worked out. But I was wrong on the six months. I said, 'He won't be there in six months; there will be forces that will hear and listen to this, and they will get rid of him.' I was wrong. It wasn't six months; it was three months—three months after the standing ovation for Andrew Robb. There's Andrew Robb, the man who sold the Port of Darwin for 30 pieces of silver—$990,000 a year—and the Liberals are giving him a standing ovation. What a great man! Only $990,000 a year from the company for the Port of Darwin—no punishment, no retribution, no apologies to the Australian people for having sold the port.

Reading the history books, you can see many intelligent people who are very determined, and I think in China we're dealing with very intelligent people who are very determined in their ambitions in the South China Sea and with Pacific nations. They are a flashing neon light. If you can't see that light coming down the tunnel at you and work out that it's a locomotive, then you are really dumb, to use Churchill's terrible aphorism. And I might add a couple of others, like von Clausewitz: 'A people without land look for a land without people.' If you take out what I call the 'golden nulla nulla'—starting at Cairns, 100 kilometres wide, coming down the east coast of Australia, through Melbourne to Adelaide—and take out a dot around Perth, you'll find that 93 per cent of the service area of Australia is occupied by under a million people. As a race of people, how much longer do you think that's going to go on for? Two hundred and fifty years ago, we thought it was alright to have 300,000 people here. We didn't need an army. We didn't need any right to protect ourselves. We didn't need to go and learn how to use a bow and arrow and all those sorts of things. No, we didn't need any of those things. She'll be right, mate. We Australians are very lucky to be alive today.

Have we learned by our mistakes? Let's go back to the free trade deal with China. China got upset over a comment by our Prime Minister, so they just cut off everything going to China. Did we cut off everything coming from China into Australia? No, absolutely nothing. So the free trade deal is not worth two bob, like every other free trade deal. Do you think America are going to listen to tiny little Australia if they want to preserve their aluminium industry or their sugar industry or their dairy industry? Of course not. But the brainless imbeciles in this place, the free marketeers, have sold off everything that can possibly be sold. We own nothing, the Australian people. They sold the Commonwealth Bank. They sold the airports. They sold the seaports. Anything that has not been hammered down, they've sold. The only reason they didn't sell the Snowy was that there were two people sitting on the crossbenches, Andren and me, and we recommitted the motion. And God bless Alan Jones and John Laws, who hammered and hammered and hammered, and the Australian people rose up in rage because they'd had enough of it: 'You're not selling the Snowy!' So the Snowy wasn't sold. The only things we own now are Australia Post—which I reckon is under a very heavy cloud, with the sacking of that wonderful lady Christine Holgate—and the NBN, put in by the much-maligned Kevin Rudd.

Let me go back. Twenty-five per cent of our oil can be used in Australia if those refineries are made and we ban the export of oil. Southern Oil is already working at a profit. The Premier of Queensland and the Prime Minister of Australia have both been into its factories. It is getting $27 million from both of them to build a giant plant at Ipswich in Queensland. It already has plants operating at Wagga Wagga and Gladstone, and they're running at a profit. They take waste from the garbage bin in your backyard and, through a process called pyrolysis, turn it into diesel. The Germans, in the latter days of the war, got almost all of their diesel from pyrolysis. We have the wherewithal, through waste recycling, to be able to meet 30 per cent of our needs.

I don't want to denigrate people but I mean, honestly, building an emergency supply of petrol in America? It's on the other side of the globe from Australia. It's in the Western Hemisphere, and we're in the Eastern Hemisphere. It's in the Northern Hemisphere, and we're in the Southern Hemisphere. If you want the rest of Australia to laugh at you, just do things like that.

Going back to this bill specifically, petrol prices are being held down by 4c a litre—and that is coming out of the ACCC, not from me—because United Petroleum is in the ball game. You've just given a golden handshake to their competitors, and they now have the wherewithal to wipe United Petroleum out, so you can kiss goodbye to that 4c a litre for the Australian people. You are the people who want a level playing field.

Andrew Wallace (Fisher, Liberal Party) Share this | Link to this | Hansard source

I just remind the member for Kennedy that, when you refer to 'you', you're referring to the chair, rather than the government or other persons. I just remind the member for Kennedy of that.

Bob Katter (Kennedy, Katter's Australian Party) Share this | Link to this | Hansard source

I most certainly will go along with your guidance, Mr Deputy Speaker. I have sat in this place for nearly 30 years or whatever the hell it is, and in another chamber, the state chamber, for 20 years, and I've heard again and again that we must have a level playing field, that no-one has the right to a golden handshake. Well, a golden handshake's been given to bad guys, and of course a kick in the backside has been given to the good guys! So, what you're doing here today, in my opinion—and, I believe, in the opinion of the ACCC—will kick the price of petrol in this country up by 4c a litre. And we are still exporting our oil! I don't know what you think you're going to achieve by having the refineries here, when we're not refining our own oil. And I'm very curious to know why you're not moving with waste recycling; I'm very curious to know what is going on there as well. You've got to ask questions when someone is getting a big handout— (Time expired)

Adam Bandt (Melbourne, Australian Greens) Share this | Link to this | Hansard source

Fuel security is a terrific idea, and Australia, with our magnificent sun and wind, could be not only fully energy independent but also be exporting energy to the rest of the world. But this bill, the Fuel Security Bill 2021, isn't about fuel security; it's about subsidies to fossil fuel corporations and about picking out a couple of those, with no guarantee that one cent of the money will find its way down to the workers in any of those corporations.

We know that in the rest of the world there has been a massive shift to electric vehicles. People not only have seen the pollution related benefits to switching away from oil or petrol towards renewable-powered electric vehicles but also have understood the security related benefits and the energy-independence related benefits. If your country is running on electric vehicles then you are not at the whim of geopolitics, of oil-producing corporations and of fights between countries that have very little to do with the people who just want to be able to get around and use their car, their bike or their truck. If your country is running on electric vehicles and generates enough energy to power itself and a surplus to export to the rest of the world, you're in the box seat both economically and environmentally, and you also have a security advantage.

If the government had come in here and said, 'We want fuel security and we've understood, as other countries have, that the best way to get that is to make sure we're not dependent on other countries or big corporations and we are going to make sure our transport fleet can run on power produced here in Australia,' then they'd get a big tick from us. But that is not what this bill is about. This bill says that $2 billion goes to fossil fuel corporations without a guarantee that a cent of that finds its way down to the workers. And there will be no plan in the long term for making Australia more fuel secure by switching over to EVs—by switching our industry over, by switching our transport over.

This comes on top of a budget that gave $11.4 billion in handouts to fossil fuels alone, another $1.1 billion for new coal and gas projects and now another $2 billion to some fossil fuel corporations but nothing for electrifying transport, nothing for electrifying industry—nothing for moving our country towards 700 per cent renewables, with our electricity running on 100 per cent renewables and all our other sectors running on renewably generated electricity while we're exporting it to the rest of the world through green hydrogen, or to Asia through direct undersea cable. That is what real fuel security would look like. Instead we've had a budget for billionaires and now more handouts for big corporations and billionaires without, I repeat, a guarantee that one cent will find its way to the workers in those corporations.

This bill is a continuation of the government's approach of giving billions of dollars in handouts to big corporations and billionaires—the same corporations that donate to the Liberal and Labor parties—while leaving everyone behind. Apparently there's $11.4 billion in the budget to giving handouts to fossil fuel corporations but not enough money to put dental into Medicare for everyone or to make education free again. That's because this government is in the pocket of the big corporations and billionaires—many of whom pay no tax.

We have a situation in this country where one in three big corporations pay no tax. Instead of making them pay, we have bills like this where the government lines up and says, 'How can we give you a handout?' At the G7 that happened over the weekend, they said that it's time to phase out fossil fuel subsidies by 2025. In other words, stop putting your hand in the public's pocket and asking the public to give money to big coal and gas corporations and oil corporations, many of whom pay no tax. Instead, address the climate crisis by using that money to get us onto renewables. You see this shift that's happening in the rest of the world in electric vehicles. By 2030 in Denmark, Iceland, Ireland, Israel, Netherlands, Slovenia, Sweden and the UK you won't be able to buy a new combustion engine car. That's when they are shifting over. By 2035, Japan will have phased out the sale of new combustion engines. France, Sri Lanka and Singapore will be selling only electric vehicles in 2040. Other countries are providing clear, up-front incentives for consumers, making it easier for people to shift to an EV right now.

Here in the ACT, thanks to having Greens in shared power, you get incentives to switch over to an electric vehicle as well, but instead this government is taking us the other way. But, because of what is happening around the world, manufacturers are responding. The Electric Vehicle Council recently summarised some of those shifts. Major manufacturers like Ford, BMW, General Motors, Hyundai, Nissan and others have made clear commitments to offer more EVs or to transition their fleets entirely. Those radical environmentalists at General Motors have said that they are going to shift their entire sales range to electric vehicles by 2035. If you don't believe what the Greens are saying, listen to what General Motors are saying—all electric by 2035. What does it mean to have fuel security? It means to switch over to electric and generate the electricity here. Generate the electricity here, so we're not reliant on a big corporation or another country on the other side of the world for oil or petrol. That's what it means to have genuine fuel security.

We have had such a lack of leadership from this Prime Minister. We were promised a national strategy in 2019, but instead it took two years for the Liberals to release a discussion paper in which the only thing they were willing to commit to was not offering any consumer incentives for electric vehicles at all. In that gap of federal leadership, we've seen a disjointed, and at times harmful, approach from state governments, including the Victorian government's tax on electric vehicles at exactly the time we need more of them.

A group of 25 organisations ranging from car manufacturers to environmental groups published an open letter calling the Victorian tax the worst in the world. This is happening because of the tragic lack of federal leadership. They've had several years to act on fuel security—that is, to genuinely act on fuel security—and to make us not only energy self-sufficient but energy exporters from 100 per cent renewables. Instead, we have this bill, which was rushed out of the door without any proper process. There was no public exposure draft of the bill that the community could have input on. The government will presumably oppose any kind of scrutiny through a committee inquiry. We've got the rushed, artificial deadline of 1 July to hand over an enormous amount of funding without any scrutiny at all. That's why the Greens will be moving to amend this bill, to try and force the parties in this place to acknowledge that, if you are serious about fuel security and you are serious about tackling the climate crisis, you must have an electric vehicle strategy. The government is not serious about either of those things. Instead of spending $2 billion of the public's money on a subsidy, without any requirement to protect jobs, we could be investing that in a national EV strategy—in a clear plan to transition to EVs, with urgent, significant public investment in a national fast-charging network, which Infrastructure Australia has identified as a national priority.

We think it's also appropriate that there be a review of how effective this subsidy is in improving fuel security, as opposed to lining the pockets of big corporations. We want to see a clear comparison with the benefits of an EV transition. We're not huge fans of trickle-down economics, economic rationalism and the market driven approach, but I know the Productivity Commission is. At the least, the government and the opposition should support letting the Productivity Commission have a look at whether you're better off giving a straight cash handout of $2 billion to big corporations, with no strings attached, or having a proper fuel security strategy based on electric vehicles. Let them run the ruler over it.

When you look at what is happening in the rest of the world, you'll see that the clearest and best way to make Australia fuel secure is to stop our reliance on oil and petrol. That is how we do it. Make the fuel here from our sun and our wind. That's how we do it. Make the batteries here in Australia. Develop a domestic, 100 per cent renewable industry that can drive the transport in this country. That is how we make ourselves fuel secure. If any country in the world can do it, it's Australia. We are not short of sun and wind. We are not short of places to put solar and wind farms, and we are not short of the nous to make batteries and fuel like liquid hydrogen here. We can do all those things. That's where the $2 billion should be going—to driving that transition. Instead, this government is doing the bidding of its big corporate donors and stapling us to a technology that the rest of the world is rapidly moving away from. The government says it's for technology, not taxes. It's giving handouts to big corporations, it's letting one in three big corporations in this country pay absolutely no tax and it's using a technology that is rapidly being superseded and about which everywhere else in the world is saying, 'We've got to get off it because that is the way to address the climate crisis.'

We also think—and this is why we're moving a separate amendment—that this bill should not apply until the government has taken some basic steps on EVs. That will be as simple as requiring them to state what their EV strategy is and provide some analysis of how it compares to that of other countries. I really hope that these amendments get the support of the government and the opposition. I have heard from the opposition that their reason for supporting this is that the $2 billion will guarantee jobs, but the problem is that it doesn't. We should have learnt from the way that the government handed out JobKeeper that, if you don't design the scheme right, billions of dollars can end up just lining the pockets of big corporations. That's what this is. This is another blank cheque.

To be crystal clear: the Greens support fuel security. But we want a genuine policy, developed with public consultation, about how we improve our fuel security by making the fuel here, from the sun and the wind that we are blessed with, so that we are not reliant on other countries and big corporations overseas. We have the capacity to do this, but all this bill and this subsidy will do is prolong our dependence on big corporations, big multinationals and other governments, because we will still be reliant on hoping that things trickle into this country at the right point in time. But we do not have to be. We not only have the sun and the wind but also the smarts in this country to be powering and driving our whole country from renewables.

This bill doesn't even have the pretence of a long-term plan. It's a short-term handout in the hope that giving more money to big corporations will fix the problem. Well, if there's anything the last 30 years has taught us, it's that giving public money in the form of handouts to billionaires in big corporations who don't need them doesn't work in the interests of people; it just makes them richer at the expense of everyone else. That's why this bill and this approach are wrong, why they need to be fixed and why the Greens will move amendments.

Sharon Claydon (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

It's with great pleasure that I rise to speak in favour of the amendments moved by the shadow minister in the cognate debate on the Fuel Security Bill 2021 and the Fuel Security (Consequential and Transitional Provisions) Bill 202 today. While there are welcome elements, indeed, in these particular bills, we shouldn't be under any illusion; these bills are the result of an ongoing government failure on fuel security. That's how we have come to be here right now. I would just like to remind the House that, while I said at the outset that these bills are welcome, this government has actually been responsible for overseeing half of Australia's remaining refineries close under its watch since this initial fuel security announcement was made back in last September. That's the lived reality here in Australia.

We are getting pretty used to seeing this, actually, from government, where everyone turns up for the announcement, everyone is there for the photo opportunity, but when you go to look for some follow-through, it's sadly lacking, and that is a pattern that is very clear and discernible for this government. Even if this package were to be implemented as predicted by the government, Australia will still be non-compliant with our International Energy Agency obligation to hold 90 days of oil reserves. This will mean that we would still be disproportionately impacted and disproportionately reliant on imports.

This critically important issue to my home town of Newcastle is recognition of the fact that Australia still lacks a strategic fleet. Nothing that this government is presenting to this House today or on any previous occasion does anything to remedy the fact that we, as an island nation, completely lack a strategic fleet. It leaves us utterly reliant upon a fleet of foreign owned and operated tankers. Australia does not own a single tanker anymore. All of the shipping up and down our coastlines is now in the hands of foreign owned and operated tankers. If that doesn't ring some alarm bells for this government, I don't know what does. Yet despite this government's claims—when they popped up the announcement last September for fuel security—that they are taking action to secure our long-term fuel supply, there is little to suggest that is in fact the case. As part of that announcement by the government there was an enticement of sorts, an effort not only to seek to secure fuel security and some of the jobs attached to it but to ensure that some money was allocated to make sure that new storage facilities could be built in Australia.

The port of Newcastle has a couple of applications in before the government. I was asked to go and visit the Stolthaven fuel storage facility in Newcastle, which is one of the applicants. Stolthaven are a leading independent provider of storage and distribution services for bulk liquid fuels. Their facility is a very important one in the port of Newcastle. It's a terminal that today has nine tanks, with a capacity of 130,700 cubic metres. They have development consent already for an additional 17 tanks to be installed, which would massively increase their capacity to store fuel. Those 17 tanks of diesel and motor gasoline would give an additional capacity of 224,650 cubic metres. That's nothing to be sneezed at. It is not a small increase by anybody's standards. It's development-application ready. They were asked to go through an expression-of-interest process, which they have done, as I know Park Fuels also have done. They have terrific access to a very deep water berth that would be adequate for LR2-capable vessels to be loaded from. So they've applied under this government's new fuel storage program for Australia. The application was submitted back on 15 June, and since then it's been crickets. Nothing has been said. Construction is actually meant to commence in July this year, which, according to my figures, is only a couple of weeks away, along with a recruitment process for workers in those facilities.

I really wanted to use this opportunity today to say that if you were serious about putting any substance behind otherwise hollow announcements about fuel security in this nation then you would hurry up. You would attach a sense of urgency to the selection of successful applicants under the fuel storage program and you would look seriously at the port of Newcastle as an absolutely essential location. The location not only has strategic importance through its connections with the RAAF base to the north of Newcastle, which has a very large civilian airport co-located with it, and a very deep water port, which is required in order to have big ships fully loaded with these fuels, but is a clear, logical choice for a nationally important fuel storage facility.

I urge the government to adopt some urgency on this matter, because it is a government that, to date, has quite a dismal record on following through on its announcements and on putting in place anything of substance that will lead to a secure, long-term fuel supply for this nation. Those opposite think that the announcements made back in September are going to create a thousand new jobs, but we have zero evidence of the delivery of anything at this point. We've seen nothing since that announcement.

The government has had a lot of private sector players—as I just noted, the case of Stolthaven in Newcastle—working tirelessly to put forward proposals. They could not have done their work better for them. Yet government is still so slow to respond, leaving those facilities still wondering what on earth this government's commitment really is to the region. It's only now that the government seeks to bring these bills before us. You've got a start date for construction on some of these facilities of 1 July. The government is cutting time superfine in trying to get bills passed with just a couple of weeks out.

It would be very good to see this government turn its mind to the ongoing issue of a lack of strategic fleet here in Australia. Newcastle would have been and remains an ideal location to have a permanent strategic fleet. The government recognises the strategic importance of Newcastle in so many ways yet fails to support the Port of Newcastle to develop and deliver its full potential. That is a shameful reflection on this government. This government's ideological opposition to ensuring that we have Australian flagged ships operating up and down Australian coastlines should be an issue of national security for this parliament but, no, this is a government that has undermined the Australian shipping industry and its workers at every opportunity possible.

We are left with the situation of being the largest island continent in this world having zero—we do not have a single one—fuel tankers, and the number of Australian flagged ships currently operating on our coastline is dwindling on a daily basis under this government's regime. This is all because the government fears organised labour. It's driven by such profound opposition to a properly organised workforce that insists on safe, secure work conditions. What we are left with are foreign owned vessels cruising up and down our coastlines, carrying critical cargoes and no assurances that workers on board those ships are treated adequately. There is no value-add to our nation in terms of being able to build on our own capacity here. It is a shameful act of neglect by this government, to continue undermining the Australian shipping industry in this nation.

I commend the opposition's amendments and ask that this government: (a) develop a sense of urgency about the work it has to undertake to ensure that there is a secure fuel supply in this nation, and (b) recognise the work and effort from so many fuel providers to take part in this bid for additional fuel storage in Australia. It should back in those companies, like Stolthaven and Park in the Port of Newcastle, and provide them with the kind of support that will be required to deliver on the government's intention of long-term fuel security for this nation.

Angus Taylor (Hume, Liberal Party, Minister for Energy and Emissions Reduction) Share this | Link to this | Hansard source

I rise to close the debate on the Fuel Security Bill 2021 and the Fuel Security (Consequential and Transitional Provisions) Bill 2021, and I thank the many members who have contributed to this debate. These bills are critical to ensuring Australia's long-term fuel security and our national sovereignty. The Morrison government's fuel security package, supported by these bills, will support our economy and keep our critical services running, particularly at critical times. I welcome Labor's support on these bills that will help secure the 1,250 jobs across the Ampol refinery in Brisbane and the Viva refinery in Geelong.

The Fuel Security Bill addresses the need to safeguard our country against disruptions in the market while making sure that Australians have access to the reliable and affordable energy that is essential to keeping our economy moving. While our fuel prices have remained affordable during the COVID-19 pandemic, demand for petrol and jet fuel has declined significantly. This had a major impact on our local refineries and reinforced the importance of being prepared to handle unexpected but significant supply chain disruptions. This is why the government introduced the fuel security package in 2020, which these bills continue to build on. We've committed to investing $200 million to build new diesel storage facilities which are expected to deliver new storage by 2020 and see our diesel stocks increase. We're placing a minimum stockholding obligation on industry, requiring a mandated level of jet fuel, petrol and diesel stocks to be held in Australia. It will provide much-needed certainty to motorists and other major fuel users, including our miners, truckers, families, farmers and tradies, that we have these products on hand to support commercial supply chains during disruptions. The minimum stockholding obligation will not only improve domestic fuel security but also assist Australia to meet the 90-day net oil stockholding required by the International Energy Agency.

Through these bills, the government has negotiated commitments from the Ampol and Viva refineries to lock in operations and protect jobs until at least mid-2027. These commitments will be secured through the government providing $250 million to help upgrade refinery infrastructure to deliver better-quality fuels in 2024. Those fuels of course will also play an important role in providing access to newer vehicles being put on the market and bringing down emissions, as well as in the legislated fuel security services payment. The fuel security services payment will be an adjustable cent-per-litre payment which is dependent on market conditions. The government will only make this payment to refineries during tough times, when they need the support. Payments will not be made when times are good and refineries are making a profit. We'll further protect taxpayers by ensuring this payment is capped at 1.8c per litre and implement a thorough monitoring and compliance framework.

Securing our sovereign refining capability is absolutely essential. Without this, Australia would lose the ability to refine domestic crude oil in an emergency, and our onshore stockholdings would only be suitable for a definite period of time before they ran out. So this bill is critical. Any risk to our ongoing fuel supply and of critical jobs being cut is unacceptable. Without these measures, it is very likely that Australia's remaining refineries would close within the next five years, leaving our country 100 per cent dependent on international supply chains to meet our fuel needs.

Through this package, we're protecting Australian jobs and livelihoods. These bills will protect 1,250 workers directly employed at the refineries and create a further 750 construction jobs through the major infrastructure upgrades. The agreement from Ampol and Viva to continue operating is contingent on these bills being enacted. Similarly, the Fuel Security (Consequential and Transitional Provisions) Bill ensures that the minimum stockholding obligation and the fuel security services payment will operate as intended. The package also provides for the proper monitoring of both measures, reducing the regulatory burden on industry and enhancing the integrity of the system.

Australia's future prosperity is dependent on a strong and stable fuel market. That is what these bills deliver. I thank my colleagues for their consideration and commend these bills to the House.

Ross Vasta (Bonner, Liberal Party) Share this | Link to this | Hansard source

The original question was that these bills be now read a second time. To this the honourable member for McMahon has moved as an amendment that all words after 'That' be omitted with a view to substituting other words. The immediate question is that the amendment be disagreed to.

Question agreed to, Mr Katter dissenting.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.