Barnaby Joyce (New England, National Party, Shadow Minister for Veterans' Affairs) Share this | Link to this | Hansard source

What I have to explain to people today is that if you have an issue with the cost of living then you have to understand how energy prices work. This is a remarkable swindle, a scam, that is played on the Australian people. Let's go through it, just briefly.

The first part of the scam, obviously, is you have the Capacity Investment Scheme, where the government underwrites the return on the construction of intermittent power precincts in secret agreements. They're not renewable; they're intermittent power precincts—solar panels, wind turbines that are littered all over the country. I noted one from Vestas fell flat on its face the other day, but let's not worry about that. Even if they don't provide power, you pay. The taxpayer pays. They underwrite a return on them. Not bad; I wish I could get a return on a property that I bought even if I didn't produce cattle, even if I didn't produce grain—the taxpayer just forks out and pays me for it. Then we have the next thing; they provide a product that, apparently, you have to buy. Using the cattle analogy, you have to buy my cattle—my belted galloways or speckle parks. Whether you want them or not, you have to buy them; that is what is demanded.

But I think one of the best things to understand is how the pricing stack works. In a pricing stack, they don't bid. Even though your fridge works 24 hours, and even though you expect your lights to be on for 24 hours, you only have to bid to provide electricity for five minutes. People can pick that. 'The breeze is blowing. The sun is out. Five minutes? I can do that.' So they bid into the stack. The stack is like this pencil. In the intermittent periods, when the sun is shining, they bid in. It might even be negative. And they say, 'We're the cheapest,' but they're only providing for five minutes. Then others bid into the stack. After wind, coal will come in, then gas and even diesel electricity. Even though these people might be negative, they don't get paid in the negative. They actually get paid the highest price that is determined by AEMO. If AEMO says, 'We need that much of the stack'—that much of the pencil—then the price right there is what all these people get paid. Isn't that marvellous. Once more, it's like going to the saleyards. I get paid the same price for my poddy calves as someone with fat steers. That's a great deal. It's almost like a bazaar set up by someone to make a bucketload of money.

Though these people are negative, let's have a look at what the price has gotten you. I've gone to the official site of AEMO. It's says the forecast spot price per megawatt hour is $57 a megawatt hour. That's not bad. It's pretty reasonable. So you'd think you'd be getting it at $57. But listen to this: this was the price it went to on 5 February. Have a guess, have a punt as to what you think that $57 might have gone to. Maybe you believe it went to $70 or $80. Maybe you're right out there and think it went to $100. Oh, no. It went to about $17,000 dollars. That's for something that has a spot price of $57.

Now, you're worried about your cost of living. You're worried about why you're poor. You're worried about why you cannot pay for your power bill. Well, you're just bundling this money up, and it's heading overseas to multinational corporations—Chinese corporations, Dutch corporations, French corporations. It's bundling it up. This is great! This is a rolled gold annuity. You've got taxpayers on the hook at the start with the passive investment schemes. And the poor old pensioner? She's on the hook at the end. She pays for it through that power point. She can't live with power for just five minutes. She has to live with power for 24 hours. If you made a stack where they had to provide for 24 hours, all the intermittent power disappears. It's a trick. How do you keep these people on the hook?

I'm a little old accountant. I used to be a costs accountant. My job was to try to make sure we made money. You keep them on the hook through guilt. The first thing is to change it. Rather than call it intermittent power, which is what it is—it intermittently works—you call it renewables. It's a wonder it isn't called angel power. It would work even better if you called it angel power. Then there are these lines of wind towers that just litter the landscape and are connected by transmission lines. When they're finished their lives, guess who's responsible for pulling them down? It's the farmer. And guess what? Andrew Dyer was the ombudsman appointed by the Labor Party. Guess how much he said in his report it would cost to decommission one? It was between $400,000 and $600,000, and up to $1 million if there's a structural imperfection. There's one that fell over the other day. It certainly had a structural imperfection. What farmer will have a million dollars a tower in eight to 10 years time with which to pull these down? There will be none. What you will have is negative value on land. The land will have no value. The impairment, the contingent liability that will rest on that land, will be worth more than the land, so these things are just going to fall over.

This is creating a bit of a problem. Imagine they had to provide power for 24 hours, like how your fridge works for 24 hours. If you had to bid for 24-hour slots, then it would be only baseload people who'd be able to do it—coal-fired power stations, nuclear, hydro—because they actually can provide power all the way through. We have to come to grips with this because, if we don't sort this out, we are not going to have manufacturing. Don't worry about 'made in Australia'; there'll be nothing made in Australia because the cost will be through the roof. If there was any prospect that we were going to have globally cheap power prices, then the very smart people at Mitsubishi, Hyundai, Skoda, Boeing, Rolls-Royce and Microsoft would all move here to take advantage of what they believe will be the cheapest power in the world. But, of course, none of them are moving here, because they understand our power market better than us.

The next part of this great swindle is, of course, green hydrogen. Remember when everybody was saying: 'This is going to work so well. The whole world's going to be run on green hydrogen. It's great.' It's all falling over. They talk about how much the cost of the lunch policy is, where you can get tax deductibility for lunch. I think we want to know what the cost of these energy policies is. How many billions of dollars were borrowed for these policies? Why don't we know that? Why is the Capacity Investment Scheme a secret? Surely you can just take the names out of the documents. Surely we should be able to know what sort of return these companies overseas are getting, like the Chinese real estate companies.

In our area, we had a Nigerian billionaire, and good luck to him. He had very smart accountants. A Nigerian billionaire was terribly worried about the environment in Australia, so he was in there bidding on this. Obviously he had some very good accountants who said: 'Mate, this is incredible. We have the Australians—wonderful, beautiful people, but they're kind of crazy—offering to pay you a return even if nothing is produced. Then you have to buy their product, and then they're able to sell it in five-minute blocks.' This will be really good when the batteries come in, because batteries will probably be able to provide for five minutes. So they'll jump into the stack at the low end, knowing they'll get paid the price at the high end.

We can muse about the cost of living. We can say the wonderful things that we're all going to do about it, but, until we properly address power prices—in fact, until most people actually understand how power pricing works—we're not going to fix very much at all. It's just not possible, when the AEMO site itself says it's going to $16,000-plus a megawatt hour, to put that back on the power bill of the pensioner and somehow make their life better. You're going to make their life worse.

Why I'm so worked up about this is because, in regional areas, we live with the poorest people. In my area, one of the local schools is one of the poorest in New South Wales. It's probably one of the poorest in Australia. There are no police in the town and no hospital in the town. There's no public sewerage—no facilities really at all. People roll down the hill in life and keep rolling down and down, and where they finally end up when they're right out of luck is in little villages in the hills with no services whatsoever. But the one dignity that we should be able to provide them is electricity.

It gets cold, especially in Woolbrook. Woolbrook gets pretty cold. Once it got down to minus 17 degrees. Minus 10 degrees happens quite a few times a year. That means, if you leave your window open and you're maybe intoxicated, you're dead. It's quite a simple outcome.

So they've got to have power, and we do have people in our areas where they can no longer afford the rent because the money is chewed up because they used the power—poor people have bad electrical appliances. They use the appliances that use the most power, the worst heaters and the worst fridges, just like how their cars are the most inefficient cars because they don't have money. But when you can't afford the rent because the power price is through the roof and you can't afford the fuel, you go out to live in your car. That becomes your house. You live in a car. And this really happens. When you meet these people, you get angry because you think: 'What am I doing? Why is this person living like this in Australia?' They're not on drugs. They're not alcoholics. They're decent people.

When we're being assuaged in this sort of moral turmoil of climate policy and told that we're going to do marvellous things and that it's all so important, premise that feeling on exactly where you are coming from. Do you have a house? Do you have a wage? Are you comfortable? Do you have to live with the privations of going without? If you are living like that, just in a little corner of your mind start balancing up on your moral scales what is important: the dignity of this human being or my feelings? Because that's what it is.

There is nothing that's going to happen in this nation that—I'm not going to even enter the debate of what's happening to the climate because it's not relevant to this. What is relevant is what's happening to that person. That is very relevant. That is so relevant, and that is what I feel we've lost sight of. We're trying to help billionaires, we're trying to help multinational corporations who have created this marvellous scam, and we're trotting along with it.

Sooner or later, the epiphany is going to happen. If power prices don't come down, if people remain poor, then, snap, overnight the political dynamic will change. When enough of these people are living in their cars, when enough people have had enough of their power prices, when they realise that power prices go into the price of food and go into the price of everything—can you name one thing in your life that you buy that doesn't have electricity involved with it somewhere?—and once people realise that unless you fix the power problem, unless you are a realist and unless you are honest and decide who is most in need then you have Buckley's and none of fixing the cost-of-living crisis.

Josh Wilson (Fremantle, Australian Labor Party, Assistant Minister for Climate Change and Energy) Share this | Link to this | Hansard source

I thank honourable members for their contributions to the debate on the Competition and Consumer Amendment (Australian Energy Regulator Separation) Bill 2024. The bill seeks to establish a legally separate Australian Energy Regulator, the AER, as distinct from the ACCC to provide greater management and financial autonomy for our energy regulator, enhancing its ability to manage resources and set its strategic direction. This will allow the AER to respond with agility to changing energy consumer needs and to focus with greater clarity on energy security, reliability and affordability for energy consumers.

It's a reform that was supported by three separate ministerial council processes or inquiries during the time of the previous three-term, nine-year coalition government. It's an utterly sensible reform that the previous government didn't manage to deliver. As I say, what it will mean is that the AER can do an even better job when it comes to delivering energy security, reliability and affordability for energy consumers.

To pick up on the contribution to the debate made by the member for New England, the member took the opportunity to range widely on a whole series of aspects of—I don't really know what, to be honest—energy, perhaps, to some degree, the economy more broadly and various other things. It is hard to hear someone talk about the dignity of human beings when they were a member of a government that inflicted robodebt on the poorest and most vulnerable Australians and when they were part of a government that led to the share of income for ordinary working Australians falling to the lowest level in Australian history, and they now propose to inflict the most expensive form of energy on all Australians, paid for entirely by taxpayers, in a way that will put serious imposts on precisely the people that the member for New England claims to represent. It is a bit hard to hear that lecture.

The reform we're making with this bill, which was recommended, as I said, by three separate ministerial council processes to the previous government, will enhance Australia's energy market governance arrangements, allowing the AER to be responsible for its own resources and administrative arrangements and contributing to a strong and independent energy regulator that will ensure energy consumers across Australia are better off for many years to come. It will literally make sure that Australian energy consumers have cheaper, more reliable and more affordable energy. On that basis, I commend this bill to the House.

Bridget Archer (Bass, Liberal Party) Share this | Link to this | Hansard source

The question is that this bill be now read a second time.

Question unresolved.

As it is necessary to resolve this question to enable further questions to be considered in relation to this bill, in accordance with standing order 195 the bill will be returned to the House for further consideration.