Penny Wong (SA, Australian Labor Party, Minister for Climate Change and Water) Share this | Hansard source

I thank the Australian Greens for agreeing to various changes. We will not oppose Greens amendment R3. We are happy to support that amendment. In relation to the questions asked, which really relate to the discussion yesterday, first, let us discuss the policy parameters here. We have split the small-scale and large-scale sectors to better reflect the dual policy objectives under this legislation, which are to transform Australia’s large-scale generating capacity and also to provide support for Australian households who want to do their bit to tackle climate change. Hence, we essentially have two schemes within one—the large-scale renewable energy target and the Small-scale Renewable Energy Scheme.

However, as Senator Milne has identified both in the contribution that she just made and elsewhere and as is reflected in one of her subsequent amendments, which I will come to, obviously the market in this area does shift over time. Sometimes we can predict that; sometimes we cannot. Sometimes different people predict different things. For example, as the senator would be aware, there has been a reduction in the unit cost in some small-scale technologies. There has certainly been higher uptake in some areas than might have been anticipated. As she herself has said, what we need to look at is sustainable growth for the industry.

In fact, the policy issues that we are attempting to grapple with are also those which lie behind the senator’s own amendment in relation to the solar credits multiplier, which in effect enables the minister to alter the multiplier. That is in fact altering the cost of the subsidy. It is precisely the same policy issue, I would suggest, driving the senator’s consideration of that as is driving the government in this clearing house price review process that was passed yesterday.

These are amendments agreed between the government and the opposition. It is true that some members of the opposition have publicly sought a hard cap in the small-scale sector. What 30LA, which we passed yesterday, does is set the clearing house price. It says, ‘It is $40 but the minister can specify a lesser amount in certain circumstances.’ Then it goes through in very clear detail the sorts of things a minister must take into consideration—for example, any changes to the costs of small generation units such as solar hot water heaters, co-contribution, the impact of the clearing house price and electricity prices, which are obviously an important issue. We do need to balance the cost to consumers against the benefit of having a subsidy for these technologies under the scheme.

In relation to the six million to which the senator has referred, one of the things the minister has to do is look at whether or not the total value by 2015 of this part of the scheme is likely or expected to exceed six million. It is not a hard cap, but it is seeking to ensure that the scheme works efficiently and effectively and that there is the capacity, if required, to deal with a situation such as, for example, if the expected take-up of six million is likely to be exceeded. It really deals with the same issues, Senator, you have raised and which your solar credits multiplier amendment which you will be subsequently seeking to move, depending on discussions, seeks to deal with.