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

I rise to contribute to the debate on the Energy Efficiency Opportunities Amendment Bill 2006. In fact, it should be called the ‘Energy Efficiency Lost Opportunities Bill’. What we see here is a technical amendment. We will be supporting that technical amendment, but the lost opportunity is to actually deal with energy efficiency. I will get to the amendments that the Australian Greens will be moving in relation to this bill when we get to the committee stage.

I am always appalled when I hear any debates on climate change in which the side of the equation that gets the most emphasis is producing greater supplies of energy. The other side of the debate—reducing demand through energy efficiency—is nowhere to be seen. Only last night, on an ABC program, we again had the former head of the Prime Minister’s task force on nuclear energy talking up the opportunities as he sees them for nuclear energy to increase supply and the coal industry talking up the need to continue to use coal. But we also had Alan Pears and Mark Diesendorf talking about renewable energy, energy efficiency and the capacity to reduce demand through energy efficiency measures.

The importance of energy efficiency is that it is the easiest and the fastest way to reduce energy use and therefore to reduce greenhouse gases. It is not something that requires any kind of rocket science; it just requires commitment from government to change the regulations to make sure that it happens. We have a situation in which the government has recently announced its intention to phase out light bulbs and bring in the more energy efficient light bulbs—and I applaud that; I think that is a good idea. But what it seeks to do is to distract the community into taking personal responsibility for their energy use whilst taking their eye off the fact that the government is not doing anything in terms of policy initiatives to deal with the main energy users.

Let us face it: it is not the domestic sector that is the main energy user when it comes to electricity. In fact, in the minister’s own document he said that 250 corporations that use more than half a petajoule of energy per year cover around 40 per cent of Australia’s total energy use. So we are talking about 250 corporations. What this bill did originally—and the amendment does not change it—was simply to say to those large energy users: ‘You are required to do an audit of energy efficiency opportunities and you have to report on that audit. And that is it; you are not required to implement the findings of that audit.’

When the legislation originally came in, I asked the then minister, Senator Ian Campbell: ‘Why is the government so resistant to requiring these companies to implement their audits and to start off with a low, very easy bar and then take it out to more difficult ones? Why is the government only concentrating on those companies that use more than half a petajoule of energy per year? Why don’t we phase in gradually and include companies that use lesser amounts over a period of time so that we capture more and more energy users and require them to implement the findings of their audits and get the bar higher and higher over time?’ He could not answer the question, and I will be very interested to hear Senator Colbeck’s response as to why the government still will not require these companies to implement the findings of their audits.

Why have we still got the focus on voluntary measures? Between the time that this bill was introduced and now, we have had the IPCC report globally, which has told us that things are grim in terms of climate change. We have reports virtually daily from scientists telling us that the IPCC report was way too conservative in its findings, that the impacts of climate change are accelerating and that the predictions scientists were making for 10, 15 or 20 years from now are actually occurring as we speak. We are seeing species extinction. We are seeing ice melt at a rate never expected. We have predictions coming out in April on the IPCC’s report on the impacts of climate change which are telling us that the polar bear is going to be extinct in the wild because the amount of ice we are losing in the Arctic is such that they will lose their habitat. That is just one example of what is going on as we speak.

Yet we still have a government that says, ‘We are only interested in voluntary arrangements.’ From the explanatory memorandum we know that the companies that used over half a petajoule in 2005-06 have until March, the end of this month, to register in relation to this energy efficiency opportunities legislation. By late November last year six companies—Alcoa World Alumina Australia, Hanson Australia, New Hope Mining, Queensland Alumina, Rio Tinto and Leighton Holdings—had registered for the energy opportunities program, and more are expected to register shortly. They are looking at their energy efficiency. They are required to register, but these companies can well afford to implement the findings of their audits.

The importance of doing it is that, if we implement energy efficiency initiatives now, it will buy us the time that we need to be able to roll out the renewable energy technologies so that we do not have people talking about building new coal fired power stations. We have just had the United Nations Foundation saying no new coal fired power stations should be built unless they can be retrofitted for carbon capture and storage. We also know that carbon capture and storage is at least 15 to 20 years away—if it ever occurs; it is unproven technology. We have had admissions in the last couple of months that the government’s big promise with clean coal is not working out as they expected. In fact, their aqua ammonia process is a complete failure. It is not scientifically viable as it releases large clouds of ammonia. So we are back to square one. We are back to the only process they have, which is a monoethanolamine process. It is going to double the price of coal fired power and it reduces the efficiency of power stations by 30 per cent, therefore increasing the pressure on the demand and supply side.

We need to buy some time, to not build polluting new infrastructure and to allow the renewables sector to roll out, by reducing energy demand. Why is that such a difficult concept for the government to grasp? Why is it that every time we are told about climate change and the government’s response we are told that demand for energy is soaring and therefore we need to build new supply constantly? Why can’t we reduce demand at the same time as we are working on rolling out the renewable energy supply?

In Europe they introduced an energy efficiency target by way of a directive from the European Commission. It has been hugely effective. They have brought in programs that deal with things like stand-by power. Most people are not even aware that 11 per cent of their energy usage is in the flickering lights that they might see if they walk around their house at night in the dark. They do not need those appliances to be on. It is carelessness, a lack of awareness and the fact that it is so difficult to reprogram a lot of these technologies. People would quite like to turn them off but in many cases they get frustrated because they have to reprogram them to get them back on again, and that makes it a no-win exercise.

We need governments to move in and require appliances to meet new standards so that the consumer can easily do what they want to do, and that is reduce their energy consumption and reduce their power bills at the same time. People want to do the right thing and they want to save money as well. But they are not being facilitated in doing so because the mandatory energy performance standards are too low. Why is it that you can still buy in Australia such inefficient appliances? Why is it that you can buy such inefficient electric hot water cylinders? We should not be doing that. They are not doing that in Europe because they recognise the cost savings that they can achieve by bringing in government regulation that requires new standards.

The Greens announced a few weeks ago a plan to roll out solar hot water across Australia. We pointed out that the government is forgoing $1 billion a year by providing people with a fringe benefits tax concession which is an incentive for them to drive their cars more and waste fuel in an effort to get to a higher level of concession. That is a nonsense when Australia is running out of oil and our bill for imported oil is growing larger. If you were to abolish that fringe benefits tax concession for using more and more fuel, you could use that billion dollars to roll out solar hot water across the country and you could back it up with higher mandatory energy performance standards so that you could not buy inefficient hot water technology.

At the same time, we need to strengthen the Building Code of Australia so that it is uniform across the country and is a higher standard than it is now. It was ludicrous, when I was in the Tasmanian parliament only a few years ago and introduced legislation to make it mandatory for insulation in new houses in Tasmania—which you would think was a logical thing to do—that the Master Builders Association came out and condemned it, saying that all that would do would be to increase the price of new houses. They refused to concede that not doing so adds inefficient housing to the building stock and leaves people with higher and higher power bills over time as they try and heat inefficient houses in the Tasmanian winter. Now, of course, people cannot understand how it was possible that people building relatively new houses in Tasmania were allowed to get away with not insulating them. It is ridiculous when we have an energy and global-warming crisis.

We need incentives to roll out energy efficiency technology, increased mandatory energy performance standards and mandatory and uniform increased standards in the Building Code of Australia for new houses, for retrofitting older houses and for extensions to existing housing stock. Where state governments are providing government housing they should be required to build that state owned housing stock to the highest levels of energy efficiency, because it would cost the consumers in those houses far less to live. They are the people who need those sorts of benefits, and we all need them as a community in terms of climate change. But we are not seeing that level of consistency. Here we have a completely forgone opportunity.

With our amendments to this, the Greens are proposing, first of all, to set up a mechanism for the government to establish a national energy efficiency target. Then, from that, we need a strategy that is designed to achieve the target not only for big business but also for the transport and residential sectors. We would roll it out over a period of time, as the European Union has done. I congratulate the European Union for the leadership they showed on climate change just recently when they announced a 20 per cent reduction in greenhouse gas emissions below 1990 levels by 2020.

I remind the government that Jacques Chirac has said that the European Union is not going to tolerate countries around the world getting a free ride and that the European Union is considering bringing in a tariff on imports into Europe from countries that have not ratified the Kyoto protocol, that have not taken these matters into account. So, whether we like it or not, Australian exports going into Europe are very likely to be taxed in the foreseeable future with a carbon tax because of the failure of the Australian government to introduce appropriate policies.

Our amendments set up a mechanism for a national energy efficiency target. Secondly, it is a mechanism to require companies that are captured by this bill, those 250 that are effectively using 40 per cent of Australia’s total energy, to implement the findings of their energy efficiency audit over a period of time with an increasingly high bar. Another amendment is to capture those medium-sized companies so that they also get involved in this energy efficiency program over time.

Our amendment will require those companies to report to their shareholders what the energy efficiency audit says about what they could achieve over a 10-year time frame, for example. Whilst the government requires them to report on what the audit is doing, frequently they do not tell their shareholders because, contrary to the government’s view that they will automatically understand the cost savings and so just go ahead and do it, many of these corporations have other priorities that do not include energy efficiency and spend money on those and do not implement the energy efficiency audit.

So we need to achieve serious cuts—and it is my view that we need in excess of an 80 per cent reduction in Australia’s greenhouse gases below 1990 levels by 2050—if we are to have any hope of stabilising greenhouse gases in the atmosphere and containing a global temperature rise below two degrees, and that should be our aim as this parliament. It should be our aim if we are interested in the wellbeing of future generations and particularly our capacity to sustain ourselves in Australia in what is effectively a desert landscape in many parts of the country. We are already living beyond our ecological limits. Climate change is making that absolutely apparent in terms of extreme drought, extreme flood and bushfires. We are already experiencing the impacts of climate change. It is not good enough for the environment minister, Mr Turnbull, to stand up and say he is going to change over light globes and then not take the obvious step. Just one of these companies implementing their audit is the equivalent of 10,000 households. We are talking about serious energy efficiency savings if the government was actually serious, but I do not think it is.

I was disappointed to hear Labor’s spokesperson, Senator Evans, saying that Labor will support the framework as it currently is. Last time, Labor voted against these amendments that I am going to move again which require companies to implement their audit. I would hope this time that we get that support because since then the world has had a much clearer understanding of the size of task. Frankly, if we cannot act on the lowest hanging fruit, which is energy efficiency, then we have got no hope of getting where we need to be by 2020 and 2050.

There is an opportunity now for a tripartite response to the challenge, and I honestly believe that if the government moved in this way the Australian community would be enormously grateful, because 250 companies can make a big difference. This is not about a government subsidy; this is about a change to government regulation and abandonment of the notion of voluntary commitments and going with regulating for change. I would remind the government that Sir Nicholas Stern has said that climate change and the impacts of climate change are the biggest market failure of all time. The free market has failed in our efforts to address climate change.

Let us bring in the regulation now, and I urge both the government and the opposition to support the Greens’ amendment for these companies, these 250 large energy users, to implement the findings of the energy efficiency audit and therefore delay the time in which decisions have to be made about new infrastructure at the same time as rolling out more renewable energy. It is a win-win for the country, and I would be very interested if there is any logical argument against it, because none are apparent to me.