ABC AM: 08/06/17

June 08, 2017





SABRA LANE: Could the debate about Australia’s climate change policy be about to end? The Opposition Leader, Bill Shorten, has written to the Prime Minister indicating Labor would be prepared to support a well-designed Low emission Target. A Low Emissions Target is expected to form part of the Chief Scientist, Alan Finkel’s, recommendations on modernising the nation’s electricity grid, which will be released tomorrow. To discuss the Opposition Leader’s letter and approach, we are joined by Labor’s climate change and energy spokesperson Mark Butler from Adelaide. Mr Butler, good morning and welcome.    


LANE: Mr Shorten’s letter, is that an olive branch?

BUTLER: Well we hope it is because we’ve heard very clearly, particularly from the business community, that they are very concerned with the energy crisis that has emerged in this country over the last couple of years. We’ve seen wholesale power prices double, we’ve got a particularly severe crisis in the gas market; and expert after expert, as well as industry bodies, have said that the key driver of that is a lack of certainty around energy policy. We’ve simply got to do all that we can to sit down with the Government and try to resolve that.  

LANE: A key group of businesses in fact paid for an ad this week in one of the national papers urging all politicians to consider Dr Finkel’s report properly before reaching judgement. Voters are fed up with the fighting on this policy. Have those sentiments informed Labor’s policy positioning?

BUTLER: Of course. We talk to the community and business groups about this area of policy. We obviously have some very firm views and principles about what the policy should look like going forward, and we will take those views and principles into any discussion we have with the Government. But equally we are going to be constructive about this; we’re not going to simply stand on our haunches because the Government has decided for one reason or another not to adopt an Emissions Intensity Scheme, which had the support of pretty much every business group. If there is a properly designed alternative mechanism, like a Low Emissions Target then we will assess that against our principles and see whether it is a way forward.  

LANE: Why climate change policy? Given the Opposition shunned Labor styles policies on Gonski 2.0 and lifting the Medicare Levy to pay for the NDIS. Why are you prepared to move to the centre on this particular policy now?

BUTLER: As I said we’ve got a very serious energy crisis in this country, which business groups and individual businesses tell us, is threatening the jobs and the livelihoods of literally tens of thousands of Australian workers. We need to do all that we can to see whether finally we can end this ideological dispute between the two major parties and find a bipartisan way forward. Now I’m not going to underestimate the degree of difficulty here; there is clearly a strong voice in the Coalition that doesn’t want to end the wars. We only saw Tony Abbott voice those concerns yesterday. But we will do all that we can constructively in continuing to engage with business, to consider the report from the Chief Scientist Alan Finkel very carefully and see whether there is a way forward on a bipartisan basis.

LANE: Labor says it would consider a well-designed Low Emissions Target; it might be called a Clean Emissions Target or a Clean Energy Target tomorrow. What is well-designed?

BUTLER: We have one hand behind our back in a sense that we haven’t seen the report. As the Opposition we are not involved in the briefings with the Chief Scientist. So we will have to wait and see what it looks like, but as the Grattan Institute said earlier this week, at the end of the day these are all versions of carbon pricing mechanisms. They all have to set up a stable policy framework that gives a boost to clean, renewable energy. As the Chief Scientist describes it, we’ve got to find a framework that reconciles what he calls, the trilemma of reliable supply of electricity, affordable supply, but also an electricity system that starts to bring down our carbon pollution levels. 

LANE: It’s been reported that a Low Emissions Target, compared with an Emissions Intensity Scheme, would prolong the life of coal-fired power plants. How comfortable is Labor with the idea that those plants wouldn’t be forced to close so quickly?

BUTLER: We need to have a process of renewing our infrastructure, three quarters of which is operating beyond its design life, that first of all ensures there is reliable, affordable supply but is also consistent with the commitments we are making to reduce carbon pollution. Now you can do that through an Emissions Intensity Scheme, or a Low Emissions Target, ultimately it comes down to the design details of that scheme. There will be an effective carbon price under either scheme that provides a boost to clean, renewable energy. I think that is what the community wants. That is the future of electricity that is being pursued all around the world. That is certainly the thing we will be looking for in this design.

LANE: One of those schemes, apparently, won’t force those power plants to close as quickly as say they would under an Emissions Intensity Scheme. Does it worry you at all?    

BUTLER: I don’t accept that, at the end of the day an Emissions Intensity Scheme has been worked through very carefully by the Energy Markets Commission, by a range of different experts and industry bodies. Both of the schemes are essentially technology neutral schemes that provide either an effective carbon price that obviously disadvantages coal-fired power, because it is a dirty polluting form of electricity, and provides a boost to renewable energy. Those questions ultimately come down to the design. In of itself a Low Emissions Target does not necessarily provide a bigger boost to coal then an EIS, but we are going to have to wait and see at the end of the day what Alan Finkel recommends.

LANE: As you mentioned the former Liberal leader, Tony Abbott, sounds like he might be spoiling for a fight on this issue. Saying the Coalition needs to be the party of cheap power. Is the national interest served by his ideas?

BUTLER: Well certainly the Liberal Party interests aren’t served by his ideas. When an Emissions Intensity Scheme was on the table last December, and when the Commonwealth had prepared this process or model to be considered by a COAG meeting, it was Tony Abbott’s intervention, along with Cory Bernardi, that forced Malcolm Turnbull to rule it (an EIS) out. Despite the fact that every business group in the country, as well as the CSIRO, the Chief Scientist and others had supported it. So Malcolm Turnbull can’t let Tony Abbott dictate this policy area again. He’s got to stare them down and he’s got to be honest about the fact that whether it is a Low Emissions Target or an Emissions Intensity Scheme, this will be a version of carbon pricing that provides a boost to renewable energy. It is an oxymoron to have a Low Emissions Target scheme that provides a boost to coal-fired power. If that is the condition of Tony Abbott’s support, it’s not going to be able to come on.

LANE: Mr Butler thank you very much for coming on AM this morning.  

BUTLER: Thanks Sabra.