TUESDAY, 22 SEPTEMBER 2020
ALI MOORE, HOST: A little later this morning the Federal Energy Minister Angus Taylor will stand up and give a speech in which he will release what he is calling a technology investment roadmap. Essentially this is going to guide around $18 billion of investment towards what the government has identified as ‘five priority technologies’ hydrogen, carbon capture and storage, soil carbon, storage option, and low carbon steel and aluminium production. Angus Taylor declined an invitation to speak with us this morning ahead of his own speech but we thought we would check in with the Shadow Minister for Climate Change and Energy Mark Butler. Mark Butler welcome to the program.
MARK BUTLER, SHADOW MINISTER FOR CLIMATE CHANGER AND ENERGY: Thank you Ali.
MOORE: Back in June, Anthony Albanese offered support for this roadmap before we saw the final detail. Is there bipartisan support?
BUTLER: What we said was we welcome the description of the technology, that’s useful as far as it goes. But it needs an investment policy alongside it to actually see those technologies delivered on the ground, to see them delivered in a way which brings down power prices, that brings down other energy prices and very importantly in the middle of a recession of the type we have not seen in almost a century, delivers jobs. That is what we have not seen.
We made that offer 10 weeks ago. We wrote to the Prime Minister saying we would sit down and try to develop bipartisan investment rules that would see investment get going again in the energy sector and we have heard nothing from the government about that.
MOORE: I thought this was all about investment. It is guiding $18 billion worth of investment and indeed it needs changes to legislation to allow the Australian Renewable Energy Agency and the Clean Energy Finance Corporation to fund these particular areas focused on by the government?
BUTLER: No, the $18 billion is money that is already in the budget. It is largely research and development funds that were set up under Labor, the Clean Energy Finance Corporation. It includes CSIRO funding, cooperative research centre funding, so it is existing funding that in many cases has been existing for years and years to promote research and development in Australia. So, to that extent it is pretty unremarkable. There is nothing in this report that hasn’t been very well understood for many years now about technological innovation in the energy sector. There are literally hundreds of reports lining government bookcases about what is happening with energy technology.
But, if we want to lead the world in clean energy, if we want to grab the jobs and investment that go with it, we need targets. We need a timetable for the deployment of these technologies. We need policies to guide the investment, not just a fancy description of the technology that has been canvassed in a thousand other reports. That is what we’ve got today.
MOORE: What do you make of the energy options, the technologies that have been identified, particularly carbon capture and storage? Something that seems to still have a very big question mark over it.
BUTLER: Well it has really struggled to be deployed anywhere at scale, even close to being economic. We had, when we were last in government, substantial funds to support research and development in carbon capture and storage because scientists, including our own Chief Scientist but international bodies as well, advised that we need that on the table to continue to explore options for decarbonising, particularly in hard to abate sectors like the industrial sector through CCS. Ironically it was Tony Abbott that abolished all of the research funds into CCS that John Howard, Kevin Rudd and Julia Gillard had put in place. To see some more money put in, I guess, is a welcome admission by them that they made a big mistake six years ago. Soil carbon is another one; we had substantial research and development funds going into the land sector to find ways to draw down carbon into our soil and at the same time improving the productivity of soils. But again, Tony Abbott abolished those funds so it is good to see them admitting that as a failure.
There is good stuff in here but without an investment framework you will continue to see investments start to collapse. We already heard from the Reserve Bank that, before COVID, renewable energy investment was down 50 per cent. We heard from the University of Technology Sydney that we will lose 11,000 renewable energy jobs over the course of the next two years because we don’t have the investment rules in place that will actually see all of the projects that have planning approval actually delivered. Creating jobs, bringing down power prices.
MOORE: Will you support though, in the Senate, the legislative changes that are required to change the investment rules so those bodies can fund what the government is announcing? In terms of being able to put money into those technologies.
BUTLER: We are still working through the announcement that was made last week. We haven’t seen detailed legislation but we’ve made this point, that if the government wants to put in place some dedicated research funds for carbon capture and storage, we would support that. We had that in place ourselves, as I said, and Tony Abbott abolished it for some inexplicable reason.
MOORE: But you won’t support broader changes?
BUTLER: We won’t support a raid on renewable energy funds, funds that are dedicated for renewable energy and associated clean technology research and development. The government is trying to cover up that they abolished existing CCS funds. So we are still working through the announcement to determine which bits we are able to support and whether we are going to seek to negotiate with the government about other elements. But our principels around that have been quite clearly articulated now for a period of time. Happy to support some research and development into CCS but we won’t support a raid on renewable energy funding to fund that.
MOORE: What about the issue of a carbon price? Angus Taylor, in his speech, makes the point he calls it “technology not taxes” but if you talk to any business that is connected to this area or indeed is trying to do an emissions footprint for what it produces or for investors, they are using a carbon price, they are factoring it in.
BUTLER: You are right, all of the big businesses that have big emissions footprints have shadow carbon prices to guide their investment decisions. I find it ironic that this Government says “technology not taxes” it is one of their three word slogans. But every bit of their climate change policy involves taxpayers footing the bill, not polluters paying, but taxpayers footing the bill. The Emissions Reduction Fund, some of the announcements made last week about the possibility of building a taxpayer funded gas-fired power station, they are pressing ahead with a taxpayer supported coal-fired power station in Queensland. It’s pretty rich.
MOORE: So do you support a carbon price, do we need to formalise what is already being used?
BUTLER: I don’t think we do, particularly in the energy sector.
MOORE: Why not?
BUTLER: Because a carbon price was important 10 years ago to level the playing field for an emerging technology, renewable energy, to be able to compete with gas and coal and more mature technologies.
MOORE: So if it is not important now why is it being used by so many businesses?
BUTLER: Just to finish the point, in the energy sector what is clear is if you have a properly functioning market you do not need any subsidies for solar and wind. They will beat coal and gas, the traditional fossil fuel technologies, without a carbon price. Now that happened I think sooner than anyone expected would be the case if you go back 10 years ago. But it is clearly the case, the energy industry says itself you don’t need a carbon price to get solar and wind on the ground winning competitive tenders against the traditional fossil fuel technologies.
MOORE: But that is solar and wind?
BUTLER: I’m talking about the energy sector. In the industrial sector where some of the companies you are talking about are operating, there is already a safeguards mechanism that the government operates that effectively involves a price signal in the form of penalties if companies aren’t able to stick to their emissions reduction obligation. So there is, even though the government wouldn’t admit it, a carbon price operating in the industrial sector.
MOORE: So bottom line, does this have bipartisan support? I take your point that you are yet to see the absolute detail of it. You are more aware than anyone that investment needs policy stability. But it doesn’t have bipartisan support at the moment?
BUTLER: Well, it is good as far as it goes. There are some serious questions about it. Why is nuclear power, in but bioenergy doesn’t appear at all in this roadmap? A critical technology particularly for the aviation sector and some other transport sectors. How on earth does this roadmap describe energy efficiency as an emerging technology? The International Energy Agency says it should be the first fuel. It is critical in getting down prices and emissions and probably the most powerful creator of jobs in this area. Why is there still not a plan for electric vehicles? We heard overnight that electric and hybrid car sales in the UK overtook diesel cars for the first time, but Australia continues to lag on this revolution that is sweeping the global car industry. So, we do have some questions about this but our essential criticism is you need timetables and targets to actually see this technology delivered on the ground. And in the middle of the worst recession in almost a century none of these announcements we have seen over the past week will create jobs in the timeframe that we need, which is right now.
MOORE: Can I ask you Mark Butler, just another quick question. You are a South Australian pollie but we’re not hearing a lot from Federal Labor about Victoria. Are you standing with Dan? Are you impressed with how Dan Andrews has handled the pandemic?
BUTLER: What we have said is it is important that all governments, state and federal, listen to the advice and follow the advice of their Chief Health Officers. It’s hard from the distance I’m at, from Adelaide, largely stuck in Adelaide for the last several months.
MOORE: You’re not that far away, is he doing a good job?
BUTLER: I look at the numbers and they are very, very hopeful. I haven’t seen today’s numbers from Victoria but the numbers that we have seen over the last few days do show that the extraordinary efforts being made by all Victorians, not by Dan Andrews particularly, but by all Victorians to get through this second wave.
MOORE: I’m giving you the opportunity to give him a ringing endorsement?
BUTLER: I think if you can get this second wave under control, and the numbers look like they will, I think everyone will be very very pleased with that not just in Victoria, although obviously you are bearing the brunt of it, but this has ramifications for the whole country. So, we are just crossing our fingers and wishing Victorians all the very best through what has been a very difficult period.
MOORE: We are crossing our fingers as well. Mark Butler thank you for talking to us.
BUTLER: Thanks Ali.