Christine Milne (Tasmania, Australian Greens) Share this | Hansard source

Just to remind the chamber where we are up to, when we finished debating the amendments on the last occasion, the Minister for the Environment and Heritage, Senator Ian Campbell, had just responded to amendment (1) that I was putting forward. The amendment was to accept, in principle, a national energy efficiency target and to move that the Senate set up a task force to work out how that target would be implemented. The amendment also requires companies to do as the government asks—that is, to do an audit of the energy efficiency opportunities that may be available to them—but my amendment goes further and requires companies to implement that target. Also, it would require them to have a payback period.

As it currently stands on the sheet circulated by the Chairman, we are dealing with my amendment (1) on sheet 4784 revised. I ask senators to be aware that we are looking at the revised sheet. I ask leave to also incorporate amendment (2) in this body of amendments. So, when we vote on this tranche of amendments, it would include amendments (1) and (2) and (5) to (7), as they all go together.

Leave granted.

I move Australian Greens amendment (2) on sheet 4784 revised:

(2)    Clause 4, page 2 (after line 8), after the definition of monitoring warrant, insert:

payback period means the period of time it takes to recoup the cost of the initial capital outlay of an energy saving project.

I add this amendment to the amendments I mentioned before. I would like to speak to them now and respond to Senator Ian Campbell. Senator Campbell said, in his rejection of my proposed amendments, that there is a moral imperative to see strong economic growth continue. He implied that, by requiring companies to implement the findings of their energy efficiency audits, somehow that would not be good for economic growth. Once companies have identified the energy efficiency savings, my amendment says that they must implement those measures if they can get a payback on those measures within two years. It is not going to impact on economic growth because if the company gets the audit and it says, ‘You could take this measure, but in fact you wouldn’t get a payback on that for 10 years,’ my amendment would not come into play. My amendment is saying, ‘Let’s force them to implement the audit findings.’ In the first stages, between 2006-07 and 2007-08, we would say to them, ‘If you can pay it back and if you’re going to get benefits within two years, do it,’ and then it would gradually extend it to a four-year payback by 2010-11 and 2011-12. That way you gradually increase the pressure on companies to implement the findings.

I do not accept the minister’s statement that an interventionist approach such as this would have larger costs to industry, because he also went on to say later that in fact the idea of this is that companies would identify the savings and, once they have seen the savings as a result of their audit, naturally they would implement them. That is where my difference with the government is in regard to this. There has been no evidence to date to show that companies, when they have looked at what they could do in a voluntary capacity, would actually go ahead and do it if they have other short-term imperatives—for example, expansion and other things that the company’s strategic plan might have in place. This is not asking them to lose money. All this is doing is requiring them to prioritise energy efficiency over other strategic objectives that they may have in their company’s forward planning process. What the Greens are proposing will in no way undermine the bottom line.

The other thing that it will do is give a level playing field to the companies who want to do the right thing. At the moment, the government’s bill applies to the 250 largest energy users in Australia. What if they all do their audit as required by the government and they all see before them a number of initiatives that they could take which will cost them some capital in the short term? If those companies that want to do the right thing take those measures in the first three or four years, there will be a capital up-front cost. Then there will be the laggards who have no intention whatsoever of taking on those up-front costs. So the progressive companies will have a barrier to doing the right thing because they will be constantly held back by those who have no intention of doing the right thing. If you want to reduce greenhouse gas emissions in Australia and reduce the amount of energy that companies use, you have to allow the good, progressive companies to take the action they need to take without then being at a disadvantage on a non-level playing field.

This just goes to pure, simple, sensible economic management. I have talked to a lot of people in the private sector. What they have said is that they do not mind government regulation but they do not like being told how they have to do it. I am proposing that the government’s measure with my amendments would do exactly that. It would set a regulatory framework that would require them to do an audit and tell them they must implement the audit. But, as to how they do that, the measures they take are the measures they identify for themselves. I do not see a downside in the amendments I am proposing. Furthermore, I am proposing a strategic plan of identifying a national energy efficiency target for the long term. I am not suggesting how that target would be developed or how it would be implemented. What I am proposing is that the government moves to set up a task force which, within the next 18 months, would report and work out how to actually do that, as indeed has occurred in many European countries.

Finally, the government makes the statement that the Energy Efficiency Opportunities Bill will apply to the 250 largest companies and it will have a good outcome because it will reduce energy use. That is the leap of faith that the government makes. I would like the government to identify what its performance objective is and where the accountability is in this bill. I am proposing a mechanism which would give accountability. The minister has identified 250 companies. I am asking the minister to stand up and tell the Senate what he identifies as his objective energy saving as a result of this bill and what the time frame is, because there is no time frame either. I would like to know exactly how much energy he anticipates saving in the next three years as a result of this legislation. What is your target? What do you require these companies to save? If they do not, will you then move to do as I am proposing and put in a requirement to implement these particular measures?

It is no use going with this plan in the same way that the government currently is going on greenhouse. We have to reduce greenhouse gas emissions by 60 per cent in the next 50 years, yet there is no mechanism for doing it. There is no target to say whether we are on track, what our objective is and how we measure anything against it. The criticism that I am putting to the government now is that it is putting something out there which says, ‘Do an audit,’ and by osmosis the audit will lead to a reduction in energy use. I am asking the government to give us the target so that we, the Senate, can measure the government’s performance on energy efficiency as a result of this legislation by determining the performance level of the 250 largest companies in response to its legislation. If you do not have a target then you are just talking hot air about energy efficiency. We will not know for the next couple of years how many companies actually implement any measures as a result of the energy efficiency bill.

The downside and the big cost of this is that state governments right now are considering building new energy infrastructure at great cost to the taxpayer. The Australian taxpayer is once again subsidising energy use by large companies while the federal government is not prepared to put any pressure on them to use energy efficiently. We all know that energy efficiency is the cheapest way of saving energy. It is the low-hanging fruit in the whole energy debate. We do not need to be building new power stations and new sources of supply if we can reduce the volume of energy being used by the same amount that those new power stations would bring online.

I spoke last time about the potential to run a major education campaign to let people know that, when they turn off their energy appliances at home using standby remote control, they are actually using energy. About 12 per cent of energy use in Australia occurs when people are not there and they thought they turned the appliances off with the remote but in fact they are still using energy. There are a number of ways of doing it. My point here is that, with state governments moving again to look at the supply issue, why can’t we see energy efficiency as a substitute for new supply by saving the same volume that would be provided through development of new infrastructure that would cost a great deal more both in upfront capital cost and cost to the planet through greenhouse gas emissions and long-term problems?

And so I put to the minister that, rather than just reject the amendment I am putting forward, he should respond to the criticisms I am making. What is your target for these 250 companies? How will we judge whether this initiative is a success or not? If it is not a success—if you have not reached your target in the next 12 months—will you then do as I am asking and have a requirement to implement the audit findings over a period of time, where there is a reasonable pay-back period, and to provide a level playing field for progressive companies instead of continually rewarding those who are not and will never be prepared to do the right thing until they are required to?