Doorstop: 9/6/17

June 09, 2017






MARK BUTLER MP, SHADOW MINISTER FOR CLIMATE CHANGE AND ENERGY, MEMBER FOR PORT ADELAIDE: Thanks for coming out, Federal Labor is very much looking forward to the long awaited release of the Finkel Review into the electricity system later today. We recognise that Australia is in the middle of a very serious energy crisis, wholesale power prices have doubled under this government and retailers are starting to pass those prices onto consumers as we speak. The gas market is in a very serious crisis, which is impacting manufacturers across Australia but also impacting the electricity system. Federal Labor has heard the calls, as recently as yesterday, from a coalition of business groups, the Business Council, the Farmers’ Federation, the ACTU, ACOSS, WWF and others, to use their words, that we should give “full and fair” consideration to the Finkel Recommendations before acting. Federal Labor commits to doing just that. We will study this report very carefully, we will engage very closely with business groups and other stakeholders before providing a response. We undertake to work constructively with the Federal Government to do all that we can to deliver a bipartisan energy policy framework for a long-term future.

I do have to say that I am concerned about some of the conditions that Tony Abbott and Barnaby Joyce appear to be trying to set for those negotiations before they even start. Barnaby Joyce was out this morning saying that a Clean Energy Target must accommodate the building of new coal-fired power stations. That is nonsense, and we need to be honest about that in a way that the electricity industry itself has been honest about that. A Clean Energy Target that accommodates new coal-fired power stations is an oxymoron; it is a contradiction in terms. If Tony Abbott and Barnaby Joyce are seeking to establish that as a condition for negotiations before they even start, well negotiations are not going to get very far. 

JOURNALIST: So will that point by Barnaby Joyce be a deal breaker for Labor’s support?

BUTLER: It just means that there is not any intention on the part of the Government to put in place a credible Clean Energy Target. You can’t have a Clean Energy Target that defines clean energy to include coal-fired power. Australia already has one of the highest shares of coal-fired power in its electricity system of any nation on the face of the earth. That’s why we produce about twice as much pollution in our electricity system, as America does or as the OECD average. Our challenge is to reduce our reliance on coal-fired power, not to increase it.

JOURNALIST: What do you think would be an appropriate timeframe for coal-fired power to be shut down in Australia?

BUTLER: Look it is going to take many years. Coal-fired power is going to be a significant share of our electricity system, particularly over the period which we are all considering, the period to 2030. It is not like we are abolishing coal-fired power overnight, but we need to be honest about the fact that we are not going to increase our share of coal-fired power. The direction of coal-fired power As a share of our electricity system is going to go down; and Barnaby Joyce and Tony Abbott pretending otherwise is simply aimed at scuttling these negotiations that we are trying to approach in a constructive way. 

JOURNALIST: The report says that coal companies should give three years notice before shutting down any power stations, how would that work in practice?

BUTLER: Well we are going to work through the detail of that but I am glad the Finkel panel has dealt with this issue. What we saw in South Australia with the closure of Northern and Playford, and more recently with the closure of Hazelwood in Victoria; is far too short a period of notice provided by private companies to our electricity system and to local communities whose economies were built on those coal-fired power stations. That does have the potential to seriously undermine the security of our system, if those decisions, in the case of Hazelwood, can be taken in corporate boardrooms on the other side of the world, with precious little notice to Australia and perhaps more importantly to the local community where jobs are dependent upon it. We have said for some time there needs to be a framework that imposes conditions around the orderly retirement of generators. They are going to retire, and many of them are already operating beyond their design life. We need to make sure that happens in an orderly way. As to the recommendations about periods of notice, we will study them carefully; we will talk to the industry very closely. But I have noticed that the Business Council has been out calling for that period of notice for some time now as well.   

JOURNALIST: Do you see a situation where those generators would be paid by the government, in that period?

BUTLER: We will have a look at the Finkel Review recommendations; I don’t know what the details of the recommendations are other than the reports of it being about a 3-year period of notice. There needs to be some government action, not necessarily payment, but some government action that would force companies to keep power stations open for that period of time. Particularly in states like South Australia and Victoria, where state Liberal Governments have sold those assets off to private companies. They’re not directly controlled by government so there needs to be some regulation put in place. 

JOURNALIST: How committed is Labor to  a LET or a CET?

BUTLER: We are committed to working constructively about this. We think this is a model, while it is not our first preference and has not been the first preference of businesses groups either, it is potentially a model that can achieve what we want to achieve; which is a reliable, affordable, electricity system that operates consistently with the commitments we’ve made internationally and to future generations to start to bring down our carbon pollution levels. It is about getting the design details right and that is the work that really begins with the delivery of the Finkel Report. 

JOURNALIST: Does Labor believe that an economy wide carbon price is still the best way to cut emissions?

BUTLER: No we’ve said for some time now, for a couple of years, we’ve had a policy of having an electricity specific model. Now that was an Emissions Intensity Scheme, it can be a Low Emissions Target. I think though there is broad agreement across the business sector that you need a model that does provide a carbon pricing signal to the electricity sector specifically, to guide future investment. Now there is still a need to come up with climate change policy that deals with pollution levels in the transport sector, manufacturing sector, arising from the land sector and such like. That remains a challenge for Australia but at the moment we are focused on a policy that would be specifically directed at the electricity sector. 

JOURNALIST: Just on another topic, the Prime Minister says the government should be tougher on people with links to terrorism. How do you think that should happen?

BUTLER: Well I think this is obviously a very serious matter of discussion between the Premiers and the Prime Minister today. I hope that it is a sensible, mature discussion. I think there has been a little too much politics over the last few days, particularly from the Prime Minister about what state responsibilities are and what national responsibilities are for keeping the community safe. I hope, and I think all Australians hope, that what comes out of today’s meeting in Hobart is a mature approach to making sure that all of the nation’s resources, whether they are controlled by the Commonwealth Government or by State Governments are brought to bear to make our community as safe as possible.

JOURNALIST: Do you support the idea of a federal prison for terrorists?

BUTLER: Look I’ll wait and see what comes out of the discussion between the Prime Minister and the Premiers. We all hope that is a constructive discussion.

JOURNALIST: Just back on power. With ACT residents soon to be hit with electricity and gas price rises from July 1. Do you think that is justified given that wages are flat?

BUTLER: Well unfortunately I think it is almost inevitable given the fact that wholesale power prices have doubled over the last couple of years under this government. Industry, business groups and independent experts have been very clear about the reasons for that and that is the policy inertia, the policy paralysis that developed under Tony Abbott and has continued under Malcolm Turnbull. That is what we are trying to free up now so that power prices can come down, we can free up investment and consumers can’t be hit by the sort of price increases that are happening in the ACT and are likely to come to other jurisdictions under the Turnbull Government.

JOURNALIST: Statoil has also announced today that it plans to drill in the Great Australian Bight, having taken over some of the exploration permits from BP. Do you have a particular take on that at this stage?

BUTLER: Look I haven’t read that story so I’m not able to comment on it, not having read it.

JOURNALIST: As a South Australian MP were you disappointed that the Saudi’s didn’t stand for that minute silence last night at the football?

BUTLER: I’ve seen reports about that, I didn’t watch the game, I didn’t see it directly. I understand from the reports this morning that it was a breakdown in communications and the Saudi team has apologised for any disrespect. I think the Australian community takes these ceremonies before any hard fought sporting events very seriously and I hope in the future we make sure that communication flows very freely to other teams, particularly visiting teams from overseas so they understand the ceremonial importance of that for the Australian people, and I am sure it won’t happen again.