Anne McEwen (SA, Australian Labor Party) Share this | Hansard source

I wish to address a few comments to this report and to pick up on a few of the points that Senator Milne has made, some of which I think are a bit disingenuous about the government’s actual position on feed-in tariff legislation. I will start by saying that the Rudd Labor government is taking Australia to a cleaner and greener future, and renewable energy will play an important role in that progression. We are committed to ensuring that at least 20 per cent of Australia’s electricity supply comes from renewable energy by 2020 and we have already made significant inroads to reach that target.

The government’s support for the solar industry is at record levels. In the budget the government brought forward an additional $25.6 million in funding, doubling the number of rebates available under the Solar Homes and Communities Plan, this year from 3,000 to 6,000. Funding has been further increased in the light of record demand for the rebate. In fact, in 2008-09 there will be more installations of solar powered systems and more Commonwealth funding for solar power than in any year of Australia’s history.

The Renewable Energy (Electricity) Amendment (Feed-in-Tariff) Bill 2008 that the report is about was referred to the Senate Standing Committee on the Environment, Communications and the Arts for inquiry. The committee received a substantial number of submissions—129—from individuals and organisations and held public hearings in Sydney and Melbourne. It was clear from those hearings that there is broad support for the adoption of feed-in tariffs as a mechanism to encourage the uptake of an investment in renewable energy sources. The committee’s report describes a feed-in tariff as:

… a policy mechanism used to encourage the use of both small dispersed generating capacity and large ‘utility-scale’ generators. A FIT is a rate, usually set by a regulator or government, which electricity retailers or a regulator are required to pay to particular electricity generators who want to feed power into the electricity grid.

Currently, as has been noted, there is some form of feed-in tariff in the Australian Capital Territory, Queensland, Victoria, my state of South Australia and others proposed for other states. Feed-in tariff has also been piloted in the Alice Springs Solar Cities program. Those schemes all differ in different ways from design to eligibility restrictions. While they are different, it has been very encouraging—and this came out through the inquiry—to see states and territories, which have responsibility for energy supply to their populace, implementing innovative schemes to encourage renewable energy uptake. Certainly the federal government wishes to encourage that innovation and that ongoing uptake.

The differences between the systems include things like, in South Australia, the limits of the size of customers and systems eligible to participate. Its eligibility criteria are that the system must be operated by a small customer, that is a customer who fits into the small customer category defined as ‘consuming less than 160 megawatt hours of electricity per annum’, must be grid connected to a distribution network which supplies electricity to 10,000 or more domestic customers, must be connected to the grid by a bidirectional or import-export meter and must comply with Australian standard AS40007. That is in contrast to the ACT which has very few eligibility limits. Large generators receive a less generous feed-in tariff and on household size installations, there is no size limits on individual generators.

One of the reasons the government believes, and the committee agreed, that COAG is the appropriate venue for progressing a national feed-in tariff framework is that state and territory governments are at different stages of implementation. It is possible through that process to reach a harmonised approach to renewable energy feed-in tariff. The government has given clear commitments to that and is working very hard to achieve that goal by the end of 2008. It is simply wrong of Senator Milne to say that that will not be achieved in the time frame prescribed.

The recommendations in the report are strongly supportive of a national feed-in tariff framework that is consistent and uniform as far as possible. Indeed, the first recommendation says:

Noting strong industry, consumer and government support for FIT schemes, the committee recommends that the Commonwealth government, through COAG, work as quickly as practicable to implement a FIT framework that is as far as possible nationally uniform and consistent.

It is became evident through this inquiry that, while it is relatively easy to put a piece of legislation into this parliament, as was Senator Milne’s private member’s bill, the actual practical implementation of feed-in tariff legislation needs to be very, very carefully thought out. The second recommendation in the report is that all governments, whether state or federal, should consider carefully the evidence received by the Senate inquiry regarding things like metering, as well as the track record of existing FIT schemes overseas, in designing a nationally consistent FIT framework for Australia.

The committee has also made recommendations regarding payments to generators—the degression rates—and those recommendations are considered more fully in the report. I urge people to not accept the simplistic arguments that we have heard from some people in this chamber but to read the report and understand the complexities of a feed-in tariff scheme. We heard about those complexities from Mr Hans-Josef Fell, a member of the German Bundestag, who very kindly gave his time to assist the committee in its deliberations on this matter. He certainly gave the committee a deeper understanding of feed-in tariffs, and he was adamant that much care needs to be taken when writing and implementing such legislation—so it is appropriate that the COAG considers all aspects of feed-in tariff schemes. Some of the things that also need to be considered include: eligibility of different renewable energy sources; tariff values available for different sizes of generators; the parameters within which FIT payments will decrease over time—or degression—whether and how FIT payments will be indexed; and information management for the administration of the scheme.

So those are not insignificant issues that have to be worked through and, while it may be frustrating for some that some time needs to be taken to get this right, it is appropriate that the government considers responsibly all of those aspects of feed-in tariff schemes and considers the legislation and national framework that it is committed to developing through the COAG. While, obviously, some people are disappointed that the final recommendation of the report is to not support the bill that was introduced by Senator Milne, I believe that much progress is being made in this important area of ensuring uptake of, and investment in, renewable energy targets.

In conclusion, as chair of the committee I would sincerely like to thank everybody who participated in the inquiry. I also note that in the report of the bill we acknowledged that the introduction of the private member’s bill into the Senate has been a very useful way for senators and other interested parties to hear more about the complexities that are involved in feed-in tariff legislation, and the position of states and territories—and, indeed, the position of other countries in the world—in that regard.