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

I move:

That the Energy Efficiency Opportunities Amendment Regulations 2009 (No. 1), as contained in Select Legislative Instrument 2009 No. 119 and made under the Energy Efficiency Opportunities Act 2006, be disallowed.

The reason I am moving this motion is that, when this exemption was first granted, neither the government nor the coalition explained why it was necessary, and in fact why it continued, or why the Labor government now would continue the exemption. For the benefit of the Senate, the Energy Efficiency Opportunities Act 2006 established the Energy Efficiency Opportunities Program. It required energy efficiency opportunities to be assessed in companies that used in excess of 0.5 petajoules of energy and that they had to report on the energy efficiency opportunities they identified.

At the time I pointed out that the big problem here was that they only had to identify the opportunities and they did not actually have to implement any of the opportunities they identified. At the time I moved to say that the energy efficiency opportunities that they identified had to be implemented and implemented in a phased in way so that those that could show returns within two years be implemented immediately and phased in over a period of time.

I also moved that the threshold of 0.5 petajoules should be lowered over time so as to increase the number of companies that were required to report. However, the government and the coalition both opposed both the implementation of the energy efficiency opportunities so identified and opposed the increase, if you like, in the ability to capture companies and require them to report on their energy efficiency opportunities. But at the time, as I indicated, the Howard government of the day decided to exempt those companies whose main activities were in electricity generation, electricity and gas transmission or electricity and gas distribution from the act under section 7. That become operational once the regulations were struck in 2006.

There has never been anything substantive, in the explanatory material accompanying the then bill or in the parliamentary debate, about the rationale for the exemption. In the explanatory statement to the 2006 regulations there was this comment: ‘The exemption is intended to allow a review to be undertaken of how energy efficiency be most effectively be improved in these sectors.’ So in 2006 they were exempted, pending a review about how these sectors might contribute to energy efficiency. It appears to me that zero, zilch, nothing was done. This was simply the polluters turning up to the Howard government and saying, ‘We want to be exempted from having to identify energy efficiency opportunities in our sector.’ That exemption has applied from 2006 to 2009. Where is the substantive review that was supposed to have occurred?

In November 2008 the Commonwealth Department of Resources, Energy and Tourism issued a short consultation paper on the future of the exemption. Relevantly, the paper stated:

Energy is used in many ways within the sub-sectors of the stationary energy supply industry. Therefore, the potential for increased efficiency will vary; and this means that the costs and benefits of potentially bringing the industry into the EEO program will need to be analysed at the sub-sector level. Different approaches may be appropriate for different sub-sectors. To facilitate this sub-sector analysis, the Department is seeking submissions from stakeholders on the future of the exemption, and whether EEO or some other approach to improving energy efficiency would be most appropriate for the sector as a whole or the various sub-sectors.

According to the consultation paper, because the stationary energy sector consists of many different activities—as in generation, transmission and distribution—it is not efficient to apply the same standard blindly across the sector. The consultation paper also suggests that the costs embedded in existing infrastructure make it difficult to retrofit energy efficiency measures, especially since down time is not an option. It goes on to say that different approaches will need to be employed.

But the point that I make here is this: who did they consult with? Surprise, surprise: when you have a look at who they consulted with, it is the Australian Pipeline Industry, the Energy Networks Association, the Energy Supply Association, Ergon Energy, Horizon Power, United Energy Distribution, Verve Energy and so on. They consulted the stakeholders—the very people who had benefited from the exemption for three years and who wanted their exemption to continue. The effect of the current regulations is to extend their exemption—to maintain the status quo—for four years beyond the current expiry date, until the end of June 2013. So from 2006 to June 2013, these big energy generators, transmitters et cetera are exempted from even having to identify the energy efficiency opportunities that may be available in these businesses. That is extraordinary, and there is no rationale for it.

What did the government say after its consultation with the people who have benefited from the exemption, who surprisingly said that they wanted the exemption to continue? These are the very people who are crying poor and running round the country saying that things cannot be done in relation to climate change. But what they know can be done is to get an exemption from having to even identify—not implement, just identify—energy efficiency opportunities. There is a thought: in moving to a low-carbon economy, these big energy generators might be asked to do their bit in even identifying energy efficiency opportunities. But that has not happened.

There is also mention of the Generator Efficiency Standards program, which is a voluntary program for electricity generators under the Greenhouse Challenge program. The government stated that because the Generator Efficiency Standards program and the Energy Efficiency Opportunities program had some complementary they were looked at under the Wilkins review. But the review’s recommendations were pending at that time, so it is not clear whether it was felt that the generators were excluded because of an overlap. There is nothing clear about this at all except that the industries concerned were desperate to stay exempted and the government gave into them.

The review papers, foreshadowed at that time, of the 2006 regulations seem to have been there as an original rationale. But that review, as I indicated, did not ever take place in that three-year period. There was rushed consultation at the end of last year and—surprise, surprise—they want to continue their exemption. The government is trying to suggest that, because there have been various developments in climate change policy since then, including the proposed Carbon Pollution Reduction Scheme, there might be significant additional considerations for the future of the exemption. But they had no prominence back in 2006 when the regulations were enacted and, whilst that remains the sentiment in the current regulations, the fact of the matter is that the introduction of the Carbon Pollution Reduction Scheme and all the considerations for business apply to all businesses, not just these ones. So why should you exempt a small sector from having to go through this measure when you have got other companies having to comply with the Energy Efficiency Opportunities Act and also having to prepare for the coming in of the Carbon Pollution Reduction Scheme?

I am very keen for the government to explain to me why nothing was done between 2006 and November last year. Where is the review? Why was it not undertaken? Why in this review was the stakeholder consultation limited just to the people who got the exemption? Why is it that they need to have the exemption continued for them because of the Carbon Pollution Reduction Scheme, but for other businesses that are forced to comply with the Energy Efficiency Opportunities Act it does not seem to matter that they have the same obligations pending under the CPRS.

Of course, the submissions received from the people who currently have the exemption strongly supported the continuation of the current exemption. The review that was carried out—the small one that I mentioned—examined industry sectors and looked at how they are affected by a broader climate change policy and market and regulatory environments. The argument is that an extension of the exemption will allow time for broader climate change measures to be implemented—over another four years of this exemption, I might add—and that evidence of encouraging energy efficiency improvement in the energy supply industry might become available in that time. Really, there is no justification whatsoever for this continued exemption from the Energy Efficiency Opportunities Act.

Let me reiterate what this would do. It is asking these companies who are involved in these particular sectors—as I indicated, the electricity generation, electricity and gas transmission and electricity and gas distribution sectors—to identify the energy efficiency opportunities that they may be able to see in their operations. They are not being asked to implement them. I think that is wrong; nevertheless, they are not being asked to. All they are being asked to do is identify them, and they are saying, ‘No, we don’t want to do that.’ These are the companies that run around with their social responsibility notices in their annual reports. These are the ones who say: ‘Yes, we must have action on climate change, but not us. We must be exempted because it’s all too difficult for us, but other people should do it—yes, that’s a very good idea.’ There is no justification for this. In a world that has to address climate change, a world in which we need to bring down our greenhouse gas emissions, a world in which we know that energy efficiency is the low hanging fruit—that is the area where you can make big changes first—why would you exempt these sectors from having to identify the energy efficiency opportunities?

I will be very interested to hear from the government, firstly, their excuse for why it took until November last year for the idea of a review to be just abandoned and whether that was just an excuse in the first place to get them the exemption and then forget about it; secondly, when they had their consultation, why it was so narrow a consultation, referring only to the people who benefited from the exemption; and, thirdly, with this exemption, what the government intend to do to get this sector to do something about energy efficiency. There is nothing in any program that the government have got to drive energy efficiency in these sectors. What is the policy lever that the government are going to apply?

The community is getting pretty sick of the fact that the big polluters in Australia are exempted, sandbagged, by the government. They were under the renewable energy target and they have been exempted from having to buy renewable energy. Now we are exempting them from even identifying energy efficiency. At the same time, we will have the Minister for Climate Change and Water and the Prime Minister out there telling everybody that energy efficiency is something that should be encouraged, even though we know that the biggest difference is the scale of opportunity. The potential for savings is massive with these huge energy users, generators and distributors. In fact, the Energetics report said that the savings equivalent in this energy efficiency opportunities legislation as it currently stands—the potential for the ones that have been identified—are 4.7 million tonnes of CO2 per year, which is equivalent to the annual emissions produced by nearly 700,000 average residential homes or just over a million passenger vehicles. This is already identified under this scheme, not by these ones who have been exempted but by others. So you have got a situation where the companies that had to report under energy efficiency have the potential to reduce greenhouse gases by 4.7 million tonnes, but they are not doing it because they are not required to do it, even though it has been identified that they could if they were made to. Then you have got this whole other big sector exempted altogether from even having to identify the energy efficiency opportunities.

I am looking forward to the government giving me the rationale for why we should continue to reward the polluters. There is a principle of polluter pays; there is a principle that energy efficiency is the low-hanging fruit. There have been years since 2006 to address this sector, and it has not happened. There is no proposal that it be addressed until 2013, and global emissions have to peak and come down by 2015. I am looking forward to hearing the government and the coalition explain to me why these companies need to continue to be exempted when there has been no rationale for it whatsoever presented by the government or the coalition when it was in government, which was when the exemption that is now being extended by the Labor government was first introduced.

Nick Minchin (SA, Liberal Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

The opposition does not support this disallowance motion. The regulation that Senator Milne is seeking to disallow, as the senator has explained, extends the expiry date for the exemption of electricity generators, transmitters and distributors from obligations under the Energy Efficiency Opportunities legislation. It does so by extending the expiry date to 30 June 2013 from 30 June this year.

We are familiar with this matter. It was under the coalition government that the Energy Efficiency Opportunities program was introduced as part of the package of measures which our then government announced in 2004 under the energy white paper that we produced. It proposed that from 2006 large energy users—and I emphasise ‘users’; those using more than half a petajoule of energy per annum—would be required to undertake Energy Efficiency Opportunities assessments every five years and to report those publicly and to the government. Obviously, when we were in government we were committed to trying to ensure that we streamlined government reporting under this program and made the program cost effective and with the least possible impact on industry.

When it was passed under our government in 2006, as Senator Milne has appropriately noted, generators were exempted from its provisions. As I understand it the logic was, and remains, that generators already have a very natural incentive to reduce their energy costs. It is logical because this whole program is aimed at energy users—the big factories of Australia that use a lot of energy. It is about ensuring that energy users are motivated to look for efficiencies in the way that they use energy. Here we are talking about the generators of the energy that is supplied on a daily basis to millions of Australians and hundreds of thousands of big energy users. Logically, it makes sense that in a program like this the generators of the energy are treated differently, because this is a program aimed at users. I accept that.

The logic of Senator Milne’s position is that generators are also energy users. Yes, but their prime purpose and function—and it is a noble one; it does distress me to continue to hear Senator Milne talk about the workers of Australia, who keep the lights on and the power going, as just polluters—is to generate. That is what they do for Australia. When you introduce programs like this, if you apply them to generators it will inevitably add to their costs, and those costs will obviously flow through to all Australians who use that energy, including low-income Australians who rely on that energy to keep their power going—their lights, their air conditioning and their heating going. And to the extent that you increase costs for energy generators, that will flow through to energy users. So there is some logic to treating generators differently. If what you are talking about is trying to improve energy efficiency and cost-effectiveness in the use of energy by large energy users then it makes little sense to be adding to the costs of the generators, which are going to flow through to the users.

Senator Milne goes on and asks the government: ‘What are your policy levers to require energy efficiency of generators?’—taking that typical big-government, bureaucracy-knows-best approach. Frankly, the motivation—the lever—for energy efficiency by the generators is competition and the marketplace. Energy generators have a natural incentive to be as energy efficient as they possibly can. They make their money from the cost-effective generation of energy. They have a natural incentive to reduce their own input costs when it comes to energy so that they are producing energy as cheaply as they possibly can. That is the point of the marketplace and competition, which of course the Greens do not believe in.

In relation to the extension, the exemption was originally granted to 30 June 2009. There is a review of the regulations governing this matter, and that review is due in 2012. The amendments which the government has tabled take the exemption out to 2013—the logic of that being that the exemption extends to just beyond the deadline for the review. That makes eminent sense and we welcome this extension. I do not think the government is talking about a permanent exemption; it is a matter that should be kept under review, but we believe that extending this current exemption out beyond the current review timeline makes eminent sense and we oppose this disallowance.

Chris Evans (WA, Australian Labor Party, Leader of the Government in the Senate) Share this | Link to this | Hansard source

I seek to speak on behalf of the government and Minister Ferguson in indicating our opposition to the disallowance motion—

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Where’s Minister Carr?

Chris Evans (WA, Australian Labor Party, Leader of the Government in the Senate) Share this | Link to this | Hansard source

and Minister Carr, who represents him, but is unfortunately unavailable at the moment. So I have undertaken to provide the response on behalf of the government. (Quorum formed) Senator Brown, I apologise—not in the sense that we are required to provide the relevant minister in a disallowance; but we would normally try to provide for that courtesy—but Senator Carr was unfortunately in an appointment that he could not break at the time of this debate coming on.

The Energy Efficiency Opportunities program helps Australia’s largest energy users identify efficiency gains. The program has initially—up until June 30 2009—been targeted at energy end-users rather than generators and network businesses. At that time generators were being assisted to achieve similar outcomes under the Generator Efficiency Standards program. Network businesses, being subject to price regulation, have other incentives to deliver efficiency gains.

The government in March 2009 indicated its preferred position: to extend this exemption to 30 June 2013. The initial exemption applied until 30 June 2009, as it was thought that there would be greater clarity regarding the implementation of an emissions trading scheme by mid-2009. In developing a preferred public position beyond the current 30 June 2009 exemption a proper process, which included nationally advertised extensive consultation, was followed. Public consultation occurred in November 2008. This included public forums, and 19 written submissions were also received. A second round of consultation occurred and eight stakeholders participated. All submissions that were received recommended continuing the exemption, with stakeholders advocating making the exemption permanent. However, the government believes it would be premature to either remove the exemption or to make the exemption permanent. Extending the exemption to 2013 will allow the CPRS to begin, which will then allow an assessment of the role the CPRS is playing in encouraging energy efficiency improvements in the energy supply sector. The exemption extension will also allow the WEO to be reviewed in 2012 and the future role of the WEO to be clarified.

The decision to continue the exemption does not reflect any reduction in the importance the government places on energy efficiency as a means to reduce carbon emissions. The government undertook a proper consultation process and recognises that, with the introduction of a CPRS in coming years and the review of the WEO program in 2012, it is sensible at this stage to extend the existing exemption without committing to a permanent exemption. Given the capital-intensive nature of generation and network businesses, there are not the same energy efficiency opportunities within the payback period of up to four years as there are for other end users of energy. This position has been reached following appropriate and transparent consultation. Obviously, if other parties are unhappy with the outcome, they should have participated more fully in the consultation process. The government has consulted and has taken this decision in the light of what has occurred in relation to the CPRS and, as I say, the review of the WEO program, which will occur in 2012. For those reasons, the government will not be supporting the disallowance motion.

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Can you believe it? The government is so cavalier about this regulation to again featherbed the most polluting component of the Australian economy in 2009—that is, the big coal and energy generators, distributors and transmitters—that it cannot even get Senator Carr, the Minister for Innovation, Industry, Science and Research, the minister who represents the Minister for Resources and Energy in the House of Representatives, Mr Martin Ferguson, to be here. He has another appointment. That is how much this matters to the government. Senator Milne has quite rightly moved to disallow the extension of time for the prodigious greenhouse gas producers and polluters to be exempted from legislation. They should bring in, or at least discover and give to the government, opportunities for energy efficiency—that is, for producing energy without producing pollution. The rest of economy—the big polluters, at least—are put under the requirements of this legislation, but not the most polluting industries in the nation, the coal-fired power stations and their distributors. No, not them.

The Howard government was the most negligent government you could imagine for a country like Australia when it came to its responsibilities to reduce greenhouse gas emissions at a time of high public alarm and global awareness of an increasing threat to the planet and its future. We thought at least we would see a change with the new government. But the Howard government legislated for a three-year exemption for the big polluters and here we have the Rudd government—of course, supported by the coalition, made up of the Liberal Party and the coal corporation party—to have four years further exemption. Senator Evans, who has been commissioned to speak on Minister Ferguson’s behalf, said, ‘We’ll review it after that.’ He also told the Senate that all submissions received on this matter recommended keeping the exemptions. Wall-to-wall, self-invested big polluters presented themselves to the government with their submissions and had the Rudd Labor government fall into line, as they repeatedly do.

One would have liked to have heard the minister tell the Senate what the submission was on this matter from the Minister for the Environment, Heritage and the Arts, Hon. Peter Garrett. What did he think about exempting these formidable polluters from the requirement that they simply look at what they are doing to see how energy efficiency—that is, non-polluting processes and freeing up energy without further pollution—could be found within their industry. Of course it could. Senator Minchin says that may be an expense to these big polluting corporations, many of which send their profits out of this country. Senator Minchin would say that, wouldn’t he, because he counts the impact of climate change as zero. We have global economists like Sir Nicholas Stern warning that, if we do not expend some money—one per cent of GDP—fixing and redirecting our economy to a green economy so that we avoid catastrophic climate change, our grandchildren will be diverting six to 20 per cent of their gross domestic product to try to ameliorate climate change. But the philosophy of the two parties in here is, ‘Well, let the devil take the hindmost and let future generations look after themselves.’ This is despite having our eyes open to the evidence which we all know about and deal with here.

We have a government which in policy like this is controlled by the coal corporations—the big polluters. It says it did not have a recommendation from anybody who felt otherwise than to give the exemption to these big polluters and keep it going. Senator Minchin, in his submission, was blithely unaware of the fact that the efficiency of big coal-burning power stations itself has to be looked at in this matter. It is well known that many of these coal fired power stations are struggling at about 30 per cent efficiency—that is, of the coal they burn, 60 per cent is simply polluting the atmosphere for no good to the community. Should we not be asking those corporations to look at their processes and to improve on that? ‘No,’ says Senator Minchin, ‘because it might cost them some money.’ They will not be able to repatriate as much of their profits to New York, Berlin, London or wherever. That is because they come in here and get politicians who have no vision, who have no eye to the future, who accept no great responsibility but who nevertheless will be given no excuse—because Senator Milne brought this up this afternoon—to do the wrong thing by this nation. The other corporations who are receiving the energy and using it in whatever way do have to look to producing energy efficiency, but not the big coal burners. What an extraordinary situation.

I remember this legislation when the Howard government brought it through and the dereliction of this exemption for the big polluters. But I would not have credited then that three years later we could have a Rudd Labor government in office which wants to give them an even longer exemption. It is negligent. It is culpable. It is an affront to the future of the economy, as well as the wellbeing of this—

David Johnston (WA, Liberal Party, Shadow Minister for Defence) Share this | Link to this | Hansard source

More negligent than the Howard government.

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

The coalition senator interjects, as I heard it, to say that this is more negligent than the Howard government. It is only by 33⅓ per cent because Labor is offering a four-year exemption after the Howard government offered a three-year exemption. I can tell you that the interjecting senator will not get to his feet because he does not understand this legislation. That is part of the problem we are dealing with here. We have numbskulls that are prepared to interject and to create a cacophony from the benches who do not understand important legislation like this which has a massive impact on the future of this country and everybody who lives here. He is not prepared, and will not be prepared, to exhibit his ignorance by getting to his feet.

David Johnston (WA, Liberal Party, Shadow Minister for Defence) Share this | Link to this | Hansard source

You don’t even understand where your food and money comes from. You don’t even know where your air comes from.

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

There he goes. He is interjecting again, quite against the rules.

Claire Moore (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

Senator Brown, ignore the interjections.

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Maybe if you control the interjections it would be less difficult for me to ignore it. But he is inviting a response and he will get it from me as long as he keeps going, Madam Acting Deputy President. Let me get back to the matter at hand. This legislation has, according to the minister, led to the identification from the corporate sector of 4.7 million tonnes of greenhouse gas savings. That is equivalent to 700,000 households or, on my back of the envelope calculation, four million plane trips to London. I am sure Senator Milne would be saying that you would have a huge increase in that if you included the coal corporations. But, no, they have been able to corrupt the process that we are dealing with in this place through their sure-fire lobbying of this government, which is spineless when it comes to dealing with climate change—

John Williams (NSW, National Party) Share this | Link to this | Hansard source

Senator Williams interjecting—

Bob Brown (Tasmania, Australian Greens) Share this | Link to this | Hansard source

We now have Senator Williams from the coal corporation party trying to interject and I would be interested to hear what he has to say in defence of this legislation. It would be challenging indeed and quite a pleasant surprise to this chamber to hear that he knew even the basics of what this disallowance motion is about. I record for the benefit of people who might look back and read this crucial debate that at the moment there are eight senators in the chamber. So be it, but I congratulate Senator Milne for moving this disallowance motion. It should be supported by, for example, the Queensland senators in the coalition, if they are concerned about the impending fate of the Great Barrier Reef. It should be supported by National and Labor Party senators who represent seats in the Murray-Darling Basin, where 128,000 jobs depend on us curbing climate change. It should be supported by everybody who is working in the alpine tourism industries because, from predictions, they will not have one by mid-century if climate change keeps going the way it is. Instead of that, we have wall-to-wall support for the coal industries, 75 per cent owned outside this country, from the Labor Party, the Liberal Party and the National Party today. It has taken Senator Milne to bell that cat. The cat can keep killing, but at least the bell has been rung by Senator Milne, and I congratulate her for that.

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

in reply—I thank senators for their contribution to the debate on my motion to disallow the Energy Efficiency Opportunities Amendment Regulations 2009 (No. 1). I am reminded of when I was first elected in 2005 and started talking about climate change—there was the same lack of interest then as there apparently is now in addressing the issue of energy efficiency. I remind the Senate that the people of Australia, because of the Rudd government’s decision, are to fork out $3.8 billion to coal fired generators as compensation under the Carbon Pollution Reduction Scheme. What do the companies say about why they should be exempted from having to even identify energy efficiency opportunities? They say that being included in the program would unnecessarily increase business’s reporting burdens and the associated costs. Oh, dear! There would be a cost burden in identifying energy efficiency opportunities—when these coal fired power stations are getting $3.8 billion in cold, hard cash, supposedly as lost asset value, when anybody can see that moving into a zero-carbon economy is going to see these as stranded assets. As Professor Garnaut said, there is no economic justification whatsoever for parting with $3.8 billion to coal fired power stations. That is the fact of the matter. The Greens and Professor Garnaut see straight through what is purely a cost-shifting measure to the polluters in Australia.

I take umbrage with our colleague from the coalition, Senator Minchin, who says that disallowing a regulation which exempts polluters from having to identify energy efficiency opportunities is somehow an attack on the workers of Australia. That is arrant nonsense. It is not an attack on the workers of Australia. What is an attack on the workers of Australia is sandbagging the old economy and letting other countries bypass Australia, rendering Australia uncompetitive, without the manufacturing industry and without renewables in the future.

Today we see a classic case of that. First Solar in the US announced today that they are investing in the world’s biggest solar plant, in China. Why? Because the Chinese government has a feed-in tariff. First Solar said that was the main policy reason for going to China. What do we have in Australia at the same time? Solar Systems going into voluntary administration because they cannot raise the capital because we do not have the appropriate policy frameworks in this country to encourage private sector investment.

It is criminal. It is a crime against future generations that we have a government and a coalition refusing to bring in and support—I have brought the legislation in here but they could bring it in themselves if they wanted to—legislation that would drive capital investment in a new manufacturing sector, in jobs in the very regions which are going to be vulnerable. If they sandbag these old industries as they intend to do, they are going to see them redundant and shut down and see people out of work, and there is going to be serious dislocation when the world decides it can no longer tolerate coal fired power.

For the benefit of people listening and people in here, Four Corners on Monday night made it very clear that the nonsense of carbon capture and storage is not going to come to fruition. The United States government are not doing it. They were investing in it because it gave cover for ongoing coal fired generation and coalmining operations. That is about the extent of it. There is not going to be carbon capture and storage. We are going to give them $3.8 billion for nothing. At the same time, because it would impose a regulatory burden to assess energy efficiency opportunities, they will not do it.

I heard Senator Minchin saying, and the government more or less agreeing, that there are not the energy efficiency opportunities in generators and transmitters of energy. I ask the question: how do you know when you have not even asked them to look? You are not even requiring them to look. What is the excuse? The generators say that, because the investments in energy efficiency can only be made through investments in high-cost infrastructure, they cannot meet a four-year payback period—therefore, we should not do it. Well, there is a simple solution to that: we could negotiate to extend the payback period so it is a cost-effective investment.

Why should we give them $3.8 billion when the boards are not prepared to invest in energy efficiency, even if it is a cost to them? Ultimately, the idea is to reduce overall costs, of course. That is the whole point of energy efficiency—to reduce energy use and reduce costs. These companies also have the temerity to say that the Energy Efficiency Opportunities Program would not make any difference to generators’ plans for improving the efficiency of their plant or retiring old, inefficient plant. That is right, and that is my argument for saying that not only should they identify the opportunities but there should be a legislative requirement for them to implement those energy efficiency opportunities.

Rather than give them cash handouts of $3.8 billion, which is corporate welfare for the polluters, it would have been much better to say, ‘No, there are not going to be any handouts but we will look at accelerated depreciation for investment in energy efficiency initiatives that you might take in your business.’ It would have been a much more sensible way of approaching this to say, ‘We will help you actually achieve these efficiencies, because it’s better for the climate, it’s better for the economy and it keeps your plant operating in a way that is less polluting.’ But, no, what did we have? Those companies came here and said, ‘We don’t want just an exemption until 2013; we want a permanent exemption. We want $3.8 billion and a permanent exemption from having to identify energy efficiency opportunities.’ And the government said, ‘We won’t give you a permanent one. We’ll extend it to 2013.’ There has not been a single cogent argument in here to support a rationale for that exemption. The only rationale I have heard is that there will be compliance costs for identifying the opportunities. You would have thought companies would think, ‘This is actually a good idea because, ultimately, governments are going to require everybody to be energy efficient and, if we get in first and identify the opportunities, then we might come up with ways to finance investment in those opportunities so that we can be more efficient into the future.’ But, no, they know the political class in here very well. They know that all they have to do is come here and say, ‘Exempt us. Give us money and exempt us because we are the coal fired generators of Australia. We deserve it.’ That is all the rationale we have had. There is no argument for it. It is an absolute disgrace.

People will look back on this and say, ‘How is it that the parliament of Australia decided that it was a good thing to give the coal fired generators $3.8 billion even though the person the government employed to look at this, Professor Ross Garnaut, said there was no justification whatsoever?’ People will say, ‘Why did they do this when the only excuse was that it would be a regulatory burden to identify the opportunities? They did not even have to implement them.’ No, that does not matter. You have the government and the coalition—the Liberal Party and the National Party—saying, ‘We will exempt this sector from having to do anything in relation to energy efficiency.’ The government might well say, ‘The point is that they will have other programs which will provide incentives for energy efficiency at this level.’ Like what? I do not see anyone springing to their feet telling me what. It is because those programs do not exist.

What I am seeing here is a government and an opposition under sufferance. They do not even really engage on this issue because they know they have the numbers to continue to exempt those big coal fired generators from having to even identify energy efficiency opportunities. It is a disgrace that the policy people, sitting in their relative departments—whether that is in the Department of Climate Change or in Resources—are all happy; they are all hand in glove.

When I was here earlier I heard Senator Evans saying, ‘You might have put in a submission when the first consultation round was announced.’ Really? The first round the government commissioned, through McLennan Magasanik Associates, was to assist in conducting stakeholder consultations with organisations that have been partially or totally exempted from the requirements of the program. So you get a consultant to consult with people who are already fully or partially exempt and they tell you they want an extension to the exemption—in fact, they want that exemption to be permanent. So, no, Senator Evans, the Greens were not invited to give our opinion to McLennan Magasanik et al in that first round of consultations, because the only people the government was interested in asking were the beneficiaries of it. It was vested self-interest, and that is what this is.

It is really interesting. People will look seriously at the Prime Minister when he says he wants to take action on climate change. Every time we come in here you exempt the big polluters from the renewable energy target; you put coal gas into the renewable energy target, even though it is not a renewable energy; and you give $2 billion to clean-coal research—a direct subsidy to the coal industry—in addition to $3.8 billion under the Carbon Pollution Reduction Scheme. On the day that the Carbon Pollution Reduction Scheme legislation was introduced into the House of Representatives, the Prime Minister found himself in the Hunter Valley, turning the first sod on the coal railway and the expanded coal terminal. Then we have a situation like this, where we cannot even get to first base on identifying energy efficiency opportunities. There was the refusal by the government to bring in a feed-in tariff on the very day that China and the US got together and built the biggest solar power station in the world in China, because of that legislation. The government here stubbornly refused to have a gross national feed-in tariff. One can only assume that the reason Australia will not move on the policy frameworks that will encourage renewable energy is that they want to hold it up and store renewable energy until they can get some sort of lifeline going on carbon capture and storage for coal, which is never going to happen. I would bet that First Solar, the US company, is full of Australian trained engineers, designers and so on who have gone overseas. There are the people in Solar Systems, which has gone into voluntary administration. The only option for a lot of the people working on that technology is to go overseas.

Today, I heard Senator Carr announcing his program to give money to researchers to try and bring them back to Australia and keep the ones we have here. What he does not seem to know is that those people not only want money for their research; they want a policy framework that will see that research rolled out at a commercial stage and actually implemented. They do not want to sit in labs frustrated with technology that is ready to go but is not funded because there are no appropriate policy frameworks. I have people ringing me from the Northern Territory because off-grid solar is now finished, because the government ended the remote renewable program and at the same time put a cap under the renewable energy target so that there can be no more rollout of large-scale off-grid solar anywhere across Northern Australia, where it is desperately needed. On and on and on it goes.

I assume that the government expect that, if they throw enough money into advertising saying that the government is doing something on climate change, people will believe them. But when people dig down into it—and rest assured right around Australia community groups are digging down into this—and find out that there was an opportunity under the Energy Efficiency Opportunities Act to actually save, as I referred to earlier with the Energetics report, 4.7 million tonnes of CO2, equivalent to the emissions from 700,000 average residential homes or one million passenger vehicles, and the government decided not to require those opportunities to be implemented and, further, also decided to exempt coal fired generators from even having to attempt to identify energy efficiency opportunities, they will feel utterly disempowered. What of those community groups out there who are working for collective community buys of solar and who are starting to do all sorts of things in their homes because they can save small amounts of energy and are trying desperately to do it? Why wouldn’t they feel completely and utterly disempowered by what the government and the coalition are doing here today? It is exactly the same under the Carbon Pollution Reduction Scheme. If they work hard to reduce their emissions all it does is create the space for these big polluters to continue to pollute at an even greater rate. It is completely disempowering for individuals trying to do the right thing.

If you think you are going to sit there continuing to be disempowering, think again, because the youth of Australia are not going to tolerate this any longer, because it is their future. As President Obama said to the students in the United States, ‘It’s your future.’ And, as we all know, the average age of the people who worked on the moon landing was 26. These are the people who are going to come after political parties that have failed them by refusing to deal with the issues. As my colleague Senator Bob Brown said a minute ago, there is a report out there at the moment on the Great Barrier Reef which asks the question: is it already too late for the Great Barrier Reef? Coral reef scientists around the world worry about that, because they know that 450 parts per million is the tipping point for ocean acidification and that is the end of the world’s reefs.

That is a pretty serious situation we are in—near tipping points—but here we have our coal fired generators in Australia saying, ‘Of greater importance to us is the cost of the regulatory burden of looking and reporting on the energy efficiency opportunities.’ It does not even have to implement them. That is the state of corporate social responsibility, that is the state of ethical investment and that is the state of boardrooms around Australia. It is pretty disgusting. The people of Australia are becoming more and more aware of this as we speak and they are not going to tolerate it for too much longer. I would be encouraging everyone I speak to Lindsay Tanner and Labor. I will be speaking at La Trobe University on Saturday and I will be telling people to go and ask Lindsay Tanner and every single Labor member: ‘What is the rationale for exempting coal fired power stations from even having to identify the energy efficiency opportunities that exist for them, and what is your rationale for giving them $3.8 billion of taxpayers’ money as a bonus? Answer that and then tell me you are serious about climate change.’ They are the very uncomfortable questions that are coming the way of this government and this coalition in opposition.

Unfortunately, that is the politics of the industrial age. Fortunately, the politics of this century are with the solar generation, and solar generation does not give permanent exemptions to coal fired power stations to refuse to identify energy efficiency opportunities. I would hope that when this vote is taken in a minute there will be some rethinking here, because there has not been one cogent argument put forward anywhere in this place to excuse these industries and to exempt them from identifying energy efficiency opportunities. I would urge the Senate to think about their children, think about their grandchildren, think about the Murray-Darling, think about what happened in Victoria with the fires, think about the 400 people dead in South Australia and Victoria last summer and think about the future and recognise it is not with coal fired power and pollution.

Question put:

That the motion (Senator Milne’s) be agreed to.