David Fawcett (SA, Liberal Party) Share this | Hansard source

Senator Farrell interjects again with the normal claim that comes from South Australian Labor, which is that there was a storm. Well, Senator Farrell, you know that my background was as an experimental test pilot. I was dealing with the design of systems that had to be able to cope with a range of environmental factors. When you design an aircraft well, it can cope with turbulence and interruptions without failing either structurally or in terms of its systems. Those trigger events highlight good design or poor design.

And so the fact that there was a storm in South Australia merely points to the fact that the system was poorly designed; it had low redundancy; and it didn't take account of the failure modes. Basic systems engineering has a thing called failure mode criticality effects analysis. I would argue that nobody ever did the level of systems engineering to understand what the failure modes were in the South Australian system as a result of the rapid increase of renewable, unreliable, intermittent energy as opposed to reliable, frequency-stable, base-load energy. So don't come into this place and say that it was a storm. The storm was merely a trigger event. The storm was merely a trigger event that highlighted the poor system design that resulted because of the policies that have seen that incredible growth in renewable energy in South Australia.

Having seen that there, why would we then impose that same kind of system instability and poor design on the whole nation? Yet that's what federal Labor's plans are for Australia. Labor said in its climate action plan that it would kickstart the closure of coal-fired power stations. It teamed up with the Greens to pass a motion that would encourage the closure of coal-fired power stations, saying:

The question is not if coal fired power stations will close, but how quickly …

This would lead, as we've seen in Victoria and other places, to the destruction of jobs in Australia's coal-fired plants and thousands of jobs elsewhere. The Australian Energy Market Commission has said that the forced closure policy could cost up to $24 billion around Australia. In Hazelwood, in Victoria, as a result of their closure, energy companies AGL and Energy Australia have increased bills by up to $135 in 2017. In South Australia, as a result of pushing out the Northern Power plant, at Port Augusta, contract prices for large industrial users jumped 50 per cent, and spot market prices tripled in the months following.

So there are a range of issues with taking the view that we can just push renewables without doing the engineering behind it and realising that there is a cost associated with the integration of renewables. Doing that systems engineering, understanding the failure modes and understanding the true costs of those inputs, is what we need to be considering as we look to see whether we would expand the RET. Consequently, we should also be considering what we can achieve in terms of optimising the three critical parameters that we're concerned about, which are energy price, keeping it low; energy reliability; and emissions. The whole concept of modern use of big data in modelling is to test those various parameters and variables and iterate your modelling until you come up with the optimal mix. I would lay odds that the answer would not be a 50 per cent renewable target, as is being pushed by the ideologues. As the Prime Minister has said, rather than engineering, it's ideology and in some cases idiocy that have brought us to this point.

I will come back to Senator Leyonhjelm's bill. As I said, this is not the chamber. If it's to do with appropriation and taxation it needs to come into the other place. You've quoted $200. Some of the interim steps that the government is seeking, around the dealing with retailers, could save families orders of magnitude more than that—$500 to $1,500.

Importantly, in terms of things that this chamber can do, today there will be a vote in this chamber about how we deal with the limited merits review. The indications are that those opposite want to push it off to a committee and kick it down the road, as opposed to dealing with it today. I would challenge them: if they are concerned about the of closure of businesses, like Buongiorno Cafe in Modbury, and if they are concerned about the impact of prices that are impacting families in South Australia then they will be voting with the government today to enable us to deal with the limited merits review, given that network costs are one of the most significant inputs to the costs paid by consumers and businesses in Australia. So I won't be supporting Senator Leyonhjelm's bill, not because I don't share his concern about electricity prices, but because technically this is not the chamber and because there are other measures that we could be dealing with today that could have a far greater impact on prices that go to Australian consumers.