Jenny McAllister (NSW, Australian Labor Party) Share this | Hansard source

I want to take a moment to talk about this, because Senator Macdonald is having a minor fit over there about the fact that someone at AGL once worked for GetUp! and maybe supported renewables.

Senator Ian Macdonald interjecting—

Well, there are all sorts of conspiracy theories, and Senator Macdonald is voicing them now, about how environmentalists are trying to capture Australian business with leftist policies. The fact that people have missed is this: it is not that the Australian energy sector has been dragged to the left; it is that renewables are now a sensible, mainstream, entirely unobjectionable policy proposition everywhere except in the coalition party room. And it's not just business but households as well.

It's worth reading the material AEMO produces, rather than just name-dropping AEMO, which is the government's current approach. AEMO says that net residential demand—the households, the mums and dads the coalition love to talk about—is 'projected to decline as growth in population and appliance usage is offset by increased generation from rooftop solar and by energy efficiency initiatives'. That is what AEMO projects. That's its vision of a future electricity network, and it actually doesn't look like a great big new coal-fired power station.

The electricity system is changing. It is radically altering, and the coalition are simply not keeping up with the market reality, with the technological reality, with the engineering reality. Despite all the carry-on about how they are going to be guided by economics and guided by engineering, none of that is evident in their approach, because they're so selective in the material they are willing to draw on when they are considering the AEMO information. Think about transition. On average, network charges accounted for 43 per cent of residential electricity prices in 2015. If you are generating locally, that entire charge no longer need apply to you. There are enormous savings. If you want to go chasing savings, there are enormous savings available with a more decentralised energy system. Let's talk about storage technology. We've already seen two huge technology driven changes in electricity demand. The peak in the electricity system used to be in winter, associated with heating homes. Now it's in summer, associated with the ubiquitous presence of air conditioning in so many Australian homes. The growth in rooftop storage has seen further changes. There's a dip in energy use in the afternoon as people generate their own power and then a surge in use in the early evening. And storage technology is going to drive further changes.

The system is changing. The demands of the system are changing, and solutions that were appropriate back in 1970, when most of the people on the other side formed their view about energy policy, are not solutions that will work in the future. Battery technologies are expected to fall in cost by another 40 to 60 per cent by 2020. We are seeing the introduction of entirely new technologies that will radically change the way that households and businesses consume electricity, providing opportunities for people to manage their electricity demand behind the meter at home. Energy Networks Australia predicts that 30 to 50 per cent of Australia's energy needs will be supplied by millions of customer-owned generation and storage devices.

The Prime Minister can complain—and he often does, slightly disingenuously, because I'm not sure that he actually believes it—about wind and solar having different generation profiles from traditional coal. Sorry, Mr Turnbull, that is just the future. That is where technology is going. People are going to have rooftop solar; they are going to have batteries—they already do. Tens of thousands of Australian households already do, and they are looking to the government for leadership as to how all these new technologies will be integrated into a new system. But all they get is a nostalgic hankering for coal, which presents no solution to the energy challenge that we face now.

We should be able to make our energy system more flexible, better able to accommodate diverse sources of supply, and better able to manage our demand and sequence our demand so that overall the system is in balance. That is what all of this communication technology will allow, if only the market can be adapted to allow these things to take place, and nothing has happened on this front. The coalition has been asleep at the wheel while report after report has been produced by the AEMC, the AER and the AEMO begging the government to undertake meaningful market reform to allow these technologies to work.

I come back to the original proposition. We need to create a certain investment environment. This is something the coalition has comprehensively failed to do, and the repeal of the carbon price was the first step in a long march towards trashing the energy market. Everybody who knows anything about the electricity system is demanding policy certainty. Dr Finkel presented options months ago that still wait to be enacted. All that it would take is for the coalition to get its act together, sort out its own differences, put aside the dinosaurs and the hard Right of the Liberal Party and the National party, and come to a decision, based, as they say they will, on the engineering, on the science, on the economics and on Dr Finkel's report.