TUESDAY, 14 AUGUST 2018
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All Australian households and Australian businesses know all too deeply that a profound energy crisis has emerged under this Prime Minister. That deep energy crisis has led to a collapse in confidence in our energy system, and it's seen power bills go up and up for households and for businesses. It's very clear what we need to start to bring that crisis to an end.
We need sensible, centrist, bipartisan energy policy. But what we saw today by this Prime Minister was the final act of capitulation to the hard Right of the coalition party room on climate change and energy policy. We saw the big man at the press conference declaring victory over his nemesis, the former Prime Minister, but actually what happened in that Coalition party room was a weak act of surrender. The white flag is flying high over the Prime Minister's office now because what he announced at the press conference was an energy plan that will not see a single renewable energy project built for a decade, an energy plan that will see the rates of installation of rooftop solar cut by a half, and an energy plan that will channel billions and billions of taxpayers' money to building new coal-fired power stations.
This is a plan that will smash jobs and investment in renewables, it will achieve no significant cuts in pollution from this sector that is responsible for a third of the total carbon pollution in our economy, and it will push power prices up even further.
Whatever debate there was, and whatever media leaking and speculation there was, it is very clear that this was a victory for the right wing in the Coalition party room. And the fact that the former Deputy Prime Minister, the member for New England (Barnaby Joyce), was able to support this energy plan tells you everything you need to know about it.
This Prime Minister, who once said he would not lead a party that was not as committed to effective action on climate change as he was, has joined the war against renewable energy and bizarrely decided to spend billions of dollars of taxpayers' money on new coal-fired power stations. Any credibility this man had in supporting evidence-based policy and in taking serious action on climate change and power prices lies in tatters today.
For two years the Labor Party has been constructive about this policy area - on the Emissions Intensity Scheme that Minister Frydenberg supported before it was vetoed by the former Prime Minister (Tony Abbott) in 2016 - and on the Clean Energy Target which, again, the Prime Minister and the Minister for Energy supported last year before being vetoed by the former Prime Minister. Federal Labor offered its support in spite of the fact that they were not our preferred policy prescriptions.
On this National Energy Guarantee, we have also been consistently constructive and consistently positive. But what the Prime Minister has offered up today is a plan to smash renewables and to channel taxpayers' money into building new coal-fired power stations. And we cannot support that.
The National Energy Guarantee that is still the subject of negotiations at the COAG process is an investment framework, but you have to have a plan for actual investment to make it mean something. This Government's plan for investment will not see a single new renewable energy project built for an entire decade. It will smash investment. The National Energy Guarantee is a vehicle for our energy system that this Government intends to drive back to the 1950s. And Australians will end up paying the price for this Prime Minister's abject weakness.
This plan will smash jobs in renewable energy. It will cause thousands of job losses, according to all modelling, in the renewable energy industry. Just as the former Prime Minister caused one in three jobs in the renewable energy sector to be lost in their last attack on this industry, according to the ABS.
And it will do nothing to cut pollution. The firm that's done the modelling for the National Energy Guarantee for this Government and the Energy Security Board, ACIL Allen, has pointed out recently that a sector responsible for a third of the carbon pollution in our economy—the electricity sector—will do just one twentieth of the job of reducing pollution to achieve this government's inadequate Paris targets, leaving all the rest of the heavy lifting to other sectors of the economy that don't have low-cost technology available to do it for them - all because this Prime Minister is too weak to take the argument up for a serious and ambitious emissions reduction obligation on the electricity sector.
It will also do nothing on prices. Minister Frydenberg particularly trumpets a $550 saving for households from his policy. Where have we heard that before? That's got an odd ring of familiarity to it for most Australian households who very clearly remember this same party promising five years ago that their power bills would go down by $550.
I don't know about my colleagues on this side, or on the other side, but I suspect none of them have had a constituent come up and say how glad they are that the Liberal Party's promise was fulfilled—that their power bills went down by $550—because the experience across the country has been power bills going up and up under this government.
Of the $550, $400 according to the modelling—that merchant bankers' gobbledegook, to use the language of the Member for Warringah—is a product of Labor's Renewable Energy Target - the recent spate of building to discharge the Renewable Energy Target, which this Government unsuccessfully tried to abolish a few years ago. The other $150 is some theoretical decrease in borrowing costs for new energy projects. It is hard to see how that will end up in householders' pockets, when the Government's own modelling shows that not a single new project will actually be built. This is funny money that households will never end up seeing.
What households will end up seeing under this Government, particularly pensioner households and households in receipt of allowances, is a $365 cut to the energy supplement. If they are a couple they will see a cut of around $550 a year, not the $150 funny money through a reduction in borrowing costs. This is real money that this government has been trying for two years now to cut from some of our lowest-income households.
According to all of the modelling and all of the expert advice, the surest way to bring down power prices is to expand renewable energy. Modelling by RepuTex released only a few weeks ago showed that wholesale power prices under Labor's more ambitious plan to cut emissions by 45 per cent would be 25 per cent lower through the course of the 2020s than under this government's inadequate plan, which will see no investment and no downward pressure on power prices.
But perhaps the most abjectly weak element of the Prime Minister's announcement today is that over the last few days he has decided to channel billions of taxpayers' dollars into building new coal-fired power plants, which the industry itself has said are “uninvestable”. Kerry Schott, the chair of the Energy Security Board - the board providing advice on energy policy to this government - has said there is “no way” companies will be investing in new coal-fired power stations; not just because they take eight to 12 years to build, not just because they're massively more expensive than solar and wind power, a fact borne out by the government's own modelling, and not just because of the enormous carbon risk - the price risk and the regulatory risk - that investors are shying away from; but because they're simply not going to work in the modern electricity market.
The member for Eden-Monaro pointed out in his first question today to the Prime Minister—and I'm sure he will have more to say about it this afternoon—that Snowy Hydro has made it very clear that you can have new coal or you can have Snowy 2.0. You simply cannot have both. Snowy 2.0 works only in an environment where there is substantial new building of renewable energy, something that the Prime Minister has weakly vetoed in his announcement today.
I thought this Government had a plan to land an energy policy that would have broad political and industry support—but to achieve that plan, this Prime Minister had to stare down the hard-right. We've seen today that he's too weak to do it. He has completely capitulated to the anti-renewables ideology of the hard right wing of his party room. Australians will pay the price for his weakness. They will pay the price in fewer jobs, more pollution and higher power prices.