House debates

Tuesday, 2 June 2015


Renewable Energy (Electricity) Amendment Bill 2015; Second Reading

4:48 pm

Photo of Andrew NikolicAndrew Nikolic (Bass, Liberal Party) Share this | Hansard source

If that is the sort of speech you get from the member for Kingsford Smith when there is bipartisan agreement on a renewable energy target, imagine the performance if he disagreed.

I have great pleasure in telling you, Deputy Speaker, that this bill, the Renewable Energy (Electricity) Amendment Bill 2015 reflects an important bipartisan agreement between the government and the opposition on renewable energy.

Ms MacTiernan interjecting

I might just remind the member at the table that 'bipartisan' is an adjective. It means 'involving agreement or cooperation of two political parties that usually oppose each other's policies'. By any measure, this is not only a bipartisan but an ambitious agreement, which seeks to achieve 23.5 per cent of Australia's energy from renewable sources by 2020. And, as the Clean Energy Council has pointed out, that will require about $10 billion of investment.

I have been a persistent champion for this deal, with my colleague the member for Lyons and our other amigo the member for Braddon, along with a number of my colleagues, in writing to the Prime Minister a year ago to make the point that aluminium smelters should be exempt from the renewable energy target. This advocacy is linked to a desire to secure over 1,500 direct or indirect jobs at Bell Bay Aluminium in my electorate of Bass.

I have lobbied everyone from the Prime Minister, to the industry minister, to the environment minister on this issue and I am pleased at their willingness to listen and act so decisively in support of jobs in Northern Tasmania.

I am particularly grateful to the member for Flinders, Greg Hunt, the environment minister, frequent visitor to and great supporter of Northern Tasmania. Greg has done an outstanding job. Not only does this include making good on one of the coalition's key promises to repeal Labor's ill-considered carbon tax but he has now played a central role in delivering this deal on the RET.

His work in protecting our iconic Great Barrier Reef is also noteworthy and most deserving of this parliament's acknowledgement. In recent days both UNESCO and the World Heritage Centre have praised the significant and unprecedented work that Australia has done to protect the Great Barrier Reef and made it clear that the reef will not be listed as 'in danger'. In fact, there is no mention of 'in danger' at all.

While the reef may have gone onto a watch list under the Labor-Greens government, it has come off that watch list under us. Minister Hunt deserves great credit for securing this great news for all Australians and we welcome that decision. It demonstrates that this government and the member for Flinders are committed to protecting the reef at home and its reputation abroad.

Returning now to the agreement on a renewable energy target, it undoubtedly alleviates millions of dollars in renewable energy target costs annually on Bell Bay Aluminium's operating costs. Importantly, the RET agreement includes a 100 per cent exemption for all emissions-intensive trade-exposed industries, including aluminium, which will remove a regulatory cost burden to my smelter in Bell Bay of between $8 million and $10 million per year. The net impact of the RET on what we refer to as Tasmania's 'big picture industries' is around $20 million a year. RET payments by these industries over the next 10 years would see a wealth transfer of around $200 million out of the Tasmanian economy.

Looking just at Bell Bay Aluminium in my electorate of Bass, since the RET scheme commenced in 2001 it has cost the company more than $48 million. Forecast RET costs for the next five years were $42 million if no change was made. This business is, sadly, one of the few of its size left in Northern Tasmania and its importance cannot be overstated. It uses 25 per cent of Tasmania's total electricity, contributes almost $700 million to Tasmania's gross state product each year and provides 1,500 direct or indirect jobs. It is worth noting that the power this smelter has used since 1955 has been predominantly renewable. Consider this: the power that Tasmanian families and businesses use is well over 80 per cent from renewable sources, primarily hydro. So, frankly, it fails the common sense test to impose RET costs on businesses like Bell Bay Aluminium in a state that is the exemplar within the Federation on using renewable energy.

The General Manager of Bell Bay Aluminium, Ray Mostogl, is a good man—the member for Lyons and I know him well. He has won CEO Magazine's Manufacturing Executive of the Year. His operation at Bell Bay has cut costs in a very difficult market, with a high Australian dollar and historically low aluminium prices, which has caused well over 130 jobs to be shed from this business in recent years. As Mr Mostogl has said publicly, they have continued to absorb RET costs at a time when their industry can least afford it and when many other Australian manufacturers have closed or are signalling their closure. And as aluminium is a globally traded commodity, Bell Bay Aluminium has no ability to pass these additional costs through to its customers. So it should be no surprise that Bell Bay Aluminium has warmly welcomed the Abbott government's deal on the Renewable Energy Target. I am grateful that, in their public comments, Bell Bay Aluminium states that they 'would like to particularly thank the local MP for Bass, Mr Andrew Nikolic, for his support through these negotiations.' I appreciate that support from one of Tasmania's biggest employers and taxpayers.

Removing regulatory costs from businesses like Bell Bay Aluminium through this RET agreement helps to secure the long-term future of aluminium smelting in Australia. But while most people in our community celebrate this agreement, those perennial ideological whingers in acrylic koala suits, the Greens, have ungraciously rejected it. In doing so, they have again put their flawed and superficial voodoo ideology ahead of helping secure jobs in Northern Tasmania—an area that has been doing it too tough for too long. As a Southern Tasmanian, it was predictable that former Greens leader Christine Milne would refer to major Tasmanian industrial companies like Bell Bay Aluminium as 'exaggerators wanting a handout'. Ms Milne is able to hurl such abuse from trendy cafes in Hobart, a luckier part of the state that can always rely on a steady flow of taxpayer funded public service jobs. But the North of Tasmania does not have that luxury. You would think Greens senators north of Oatlands would show more common sense and respect for the jobs at Bell Bay. I have had many people contacting my office to express their disgust at the comments of Greens Senator Peter Whish-Wilson, who lives and works in Launceston—not too far away from Bell Bay Aluminium. Senator Whish-Wilson has publicly referred to aluminium producers as 'a dirty industry always overstating the risks of the RET'. It appears there is no limit to the local jobs the Greens are willing to sacrifice on the altar of their superficial ideology. Once again, by failing to acknowledge that companies like Bell Bay Aluminium are amongst our biggest employers and biggest taxpayers, the Greens Party rules itself out of the rational debate.

This bill represents a balanced approach. The reduction in the large-scale target from 41,000 gigawatt hours to 33,000 gigawatt hours will result in 830 to 1,000 fewer wind turbines. Solar will be a big winner with significant new investment in small- and large-scale solar expected. As I said earlier, the bill protects jobs in the emissions-intensive and trade-exposed sectors by reducing their costs. The bill wisely reinstates native forest wood waste as an eligible fuel source, representing a welcome return to common sense. The bill acknowledges and reflects changes that have occurred in the electricity market and will allow for sustainable growth in small- and large-scale renewable energy.

I have already talked about some of the bill's key features but let me focus on one other matter in the time I have available. A vital feature of this bill from a Tasmanian perspective is reinstating biomass from native forest wood waste as an eligible source of renewable energy. I congratulate my friend the member for Lyons who last Thursday gave an eloquent, passionate speech exposing the soft underbelly of hypocrisy in Labor on this issue. He encouraged the member for Franklin to listen to her constituents and, indeed, the state Labor Party on this issue.

This government is committed to the inclusion of wood waste as an eligible form of renewable energy generation and it will be included in legislation. Native forest wood waste was in place as an eligible source of renewable energy under Labor's own legislation until November 2011. Consistent with our election commitment, this bill reinstates native forest wood waste as an eligible source of renewable energy under the RET, basing eligibility on exactly the same conditions that were previously in place under Labor. One of the objectives of the RET is to support additional renewable generation that is ecologically sustainable. We are reinstating native forest wood waste as an eligible renewable energy source because there is no evidence that its eligibility leads to unsustainable logging or has a negative impact on Australia's biodiversity. In all cases, the supply of native forest wood waste is subject to Commonwealth and state or territory planning and environmental approval processes either within or separate from the Regional Forest Agreement frameworks. Burning wood waste for electricity generation is more beneficial to the environment than burning the waste alone or simply allowing it to decompose on the forest floor and give off CO2. In rejecting this aspect of the bill, the Labor-Green opposition demonstrate that they are still tied at the hip on this measure—that they are, in fact, climate science deniers. As my colleague Senator Colbeck has said, by blocking biomass from being included in the renewable energy target they are clinging to last century ideology. The science is clear, I say to those opposite, when it comes to the environmental benefits of biomass as a source of energy. It is even recognised by international environmental groups such as the World Wildlife Fund. Instead of voodoo ideology and superstition, Labor and the Greens need to get up to date with the latest science. The environmental benefits of biomass are widely recognised. Let me quote to you a couple of things. A report by the World Wildlife Fund and the European biomass industry found that replacing coal-generated energy with biomass would significantly reduce carbon emissions. The IPCC—the Intergovernmental Panel on Climate Change—which is often quoted by those opposite, states that:

In the long term, a sustainable forest-management strategy aimed at maintaining or increasing forest carbon stocks, while producing an annual yield of timber, fibre or energy from the forest, will generate the largest sustained mitigation benefit.

This government supports wood biomass as a source of renewable energy and recognises the benefits it could bring to the environment, the forest industry and the economy. It is the policy we took to the last federal election: to reintroduce renewable energy initiatives using wood biomass. It was a key element of our forestry policy, and it is a complete sham for Labor to describe this is a last-minute push. In fact, I repeat that this used to be the Labor Party's own policy before their dirty deal with the Greens. Using wood biomass is making use of an otherwise wasted product such as timber offcuts, bark and branches that would otherwise be discarded. You would not slaughter a cow for the prime eye fillet and leave the rest of it to fester and rot, and the same principle applies to the forest industry. Federal Labor has shown their true colours yet again by siding with the Greens and indicating that they will attempt to block biomass from inclusion in the RET. It is disappointing that they are not interested in supporting an environmentally and economically beneficial industry.

In conclusion, let me say this: this bill is a very good deal that should be supported. It reflects the government's commitment to a renewable energy target that will encourage sustainable growth in both small- and large-scale renewable energy in Australia, and I commend the bill to the House.


Charlie Schroeder
Posted on 3 Jun 2015 10:50 am (Report this comment)

It is a typical view of the Liberal Party and by the look of it this member as well:

That the environment will survive as long as business, no matter how polluting is given open slather.

This can't be real, and yet we see it from those with a myopic view all the time.

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