Pat Conroy (Shortland, Australian Labor Party) Share this | Hansard source

I rise today to speak on the Liquid Fuel Emergency Amendment Bill 2017. This bill fulfils a number of important functions, and that's why the Labor Party is supporting it. The bill seeks to amend the Liquid Fuel Emergency Act 1984 to enable the Australian government to enter into commercial oil stockholding contracts, known as ticketing contracts, with either foreign or Australian entities. By way of explanation, as set out in the bill's preamble, ticketing is widely used by member countries of the International Energy Agency, particularly in Europe. Under the auspices of a ticketing contract, sellers agree to reserve on behalf of buyers, which equates to a predetermined amount of oil for an agreed fee. During the period of the contract, the buyer, specifically in this case Australia, has the option to purchase the stock. Price is determined by market mechanisms. Significantly, the buyer also has the option of releasing the stock back into the global oil market. Ticketed stock is either able to be held offshore by a foreign entity or onshore by an Australian one.

The reason this amendment is so important is it provides the legislative authority to spend money on oil stockholding contracts, according to the legal rules from the Williams case in the High Court. The purchase of oil stockholding contracts represents a return to compliance by Australia, with the IEA's agreement on an international energy program agreement, which is obviously a step in the right direction and a positive development for the country.

The agreement creates both rights and obligations. One obligation set down in the agreement is that IEA members hold oil stocks equivalent to 90 days of the previous year's average daily net oil imports. The government says it intends to purchase 400 kilotonnes of offshore tickets in the 2018-19 and 2019-20 years. This initial ticket purchase, the government says, will be the first phase of Australia's return to compliance with the IEA's 90-day oil stockholding obligation, something that can only be welcomed. As per the IEA requirement, the ticketing contracts will be supported by government-to-government level arrangements or treaties with the host country. This bill is important also because it empowers the Secretary of the Department of the Environment and Energy, on behalf of the Australian government, to enter into contracts for oil stockholdings. This means the secretary will have the ability to exercise the various contractual rights of the Australian government, and this will generally include the ability to exercise the option to purchase a ticketed stock or to release the ticketed stock back into the host country, as defined by the contract.

This bill seeks to partially restore compliance. But it doesn't get all the way there, and, quite frankly, it can only assist with one of the two possible emergencies that will affect oil stockholdings. There are two sorts of emergencies. One's a conflict in our region, particularly one that closes down the Strait of Malacca. This will obviously do nothing for that, and that's been pointed out by a couple of speakers already. It will assist if there is a shortfall, particularly a spike in prices. In that particular instance, this will have some merit, but it doesn't assist in the case of a regional conflict. I think it's quite right for the member for Canberra and even the member for Mallee to point that out.

I should point out that it's symptomatic of the energy fiasco this government has got into that a bill that it has put up is being questioned and opposed by the member for Mallee, who is the government's appointment, as the Chair of the House of Representatives Standing Committee on the Environment and Energy. Let me repeat that: the chair of the environment and energy committee, appointed by the Prime Minister, is questioning the energy policies of this government. This is how poor it is at running energy policy in this country. Without putting words in his mouth, I'll be interested in the position of the member for Hughes, given he's chair of the backbench energy committee for the government. I don't want to be Nostradamus, but it would be quite interesting if both the chair of the backbench energy committee for the government and the Chair of the House of Representatives Standing Committee on the Environment and Energy, appointed by the Prime Minister, both draw attention to serious concerns with the government's energy policy. I'm happy to be contradicted in the member for Hughes's contribution. I look forward to it, as I always do.

In the time remaining, I want to talk about the broader context for this bill—the energy crisis we face in this country and the four years of mismanagement we have had from the government in trying to affect that crisis. No-one should be lulled into a false sense of security that, if this bill passes, it will be anything but a bandaid solution to some of our myriad energy problems or that the gas crisis that this government has allowed to fester like an infected sore will be in any way substantially improved. Despite the Prime Minister and the energy minister trying their best to blame the last Labor government for their current predicament regarding gas supply, responsibility rests squarely with the Turnbull government and its short-sighted, inadequate energy policies and inaction and paralysis around these urgent problems. It's about time the energy minister admitted as much.

The government has presided over astronomical gas price rises that should make it hang its heads in shame. A few short years ago, Australian industry was paying about $5 per gigajoule for gas. It's now paying four times that much, with average costs hitting $20 per gigajoule in new contracts being negotiated right now. We've seen the government and the minister leap on comments from the shadow minister last week, comments that were just common sense. They were an accurate reflection of what the Labor government expected in 2010 to 2012, which was: when the LNG processing plants in Queensland open up, we would expect the domestic gas price in Australia to reach export price parity. If we're going to be exporting twice as much gas as we have for the domestic market, then obviously the prices are going to equalise over the long term. That's a statement of common sense. It's a statement of logic. That's all the shadow minister did last week. But what we're seeing now is prices well above export price parity. Export price parity would be somewhere between $8 to $10 a gigajoule. We've got gas prices at $20 a gigajoule. This is clearly scarcity pricing. This is clearly indicating that the market is broken.

Instead of actually taking action on this, we've got the minister, assisted by elements of the media, supporting the lies by Santos, defending the actions of Santos and aiding and abetting lies by Santos, the company that is most responsible for the gas crisis. Let me read onto the record what Santos said in their environmental impact statement pertaining to their gas export facility: 'This project is not diverting gas from local markets to export markets. Therefore this project has no direct implications for domestic gas prices.' It cannot be clearer. They're trying to point to other obscure references in EISs and other documents, but this is the base document. Let me repeat it: Santos have said that their project has no direct implications for domestic gas prices and is not diverting gas from local markets to export markets. That is a lie. Santos are perpetuating right now that they didn't say that and didn't give the assurance to the Australian government that their project would not increase gas prices in this country.

I find it interesting that the minister, who has been quite shambolic in his handling of the portfolio since he assumed it, is choosing to become a mouthpiece, a spokesperson for Santos, rather than trying to actually solve this energy crisis. Nothing demonstrates this government's hypocrisy around a gas crisis more than their failure to support Labor's national interest test. It is a national interest test that was passed at Labor's national conference in 2014, a national interest test that I have been supporting since 2013, and an interest test that was announced and formed as part of our 2016 election policy. What do we see from the other side? Claims that we were imposing sovereign risk on the country, that we were the Venezuela of the South Pacific and that we were somehow creating a crisis when one didn't exist. Well, they've been dragged, kicking and screaming, to recognise that there actually is a massive crisis and that Labor's national interest test has to be engaged with.

We've been sounding the alarm on this for four years and all we get from the other side is a blame game. Like every other policy area in this country, we get a blame game from the government. This is also symptomatic of their inaction around the broader electricity crisis because, obviously, gas prices feed into electricity prices, given that gas is the marginal generator in most scenarios. As a broader issue, the national energy crisis is a crisis of this government's making. This government has been unable, in four years, to develop a coherent energy policy, let alone a coherent energy policy that Labor could agree to in the interests of getting a bipartisan consensus on this—a consensus that is essential to providing investment certainty to end the investment strike in this country.

The Energy Council is the peak body for all of the generators in this country. It's not some out-there, hippy-dippy greenie group. This is the council that has people like AGL, Origin, EnergyAustralia, the Snowy Hydro and Pacific Hydro—the who's who of the energy industry are in this council. This council has made it very clear that the energy crisis in this country, the doubling of the wholesale energy prices in this country, is due to the policy uncertainty driven by this government. It's up to this government to fix it, quite frankly, but I have zero confidence in their ability, given the way they've mishandled the Finkel review. We're yet to know their position on the Clean Energy Target. One day they're pro building a new coal-fired power station in the north of Queensland, the next day they're going to build it in New South Wales or Victoria, the day after that they're going to force Liddell to stay open longer, and the next day after that the member for Warringah was talking about keeping Hazelwood open. They've had more positions on energy policy than there are in the Kama Sutra. It's this country, these workers, our pensions and our families that are paying the price for it. That is a great tragedy and it needs to end soon. It is a national shame. This government should be condemned by both this generation and future generations for their inaction on solving this crisis and for not playing a constructive role in combatting climate change.

I also want to touch on the role of the Greens in this particular crisis. We saw some posturing from the member for Melbourne earlier today. We saw some relevance deprivation syndrome. The major parties are talking energy policy and the Greens are being completely shut out, so we had a little 'Look at me, look at me' opportunity, where he put forward a piece of meaningless legislation that won't get supported by anyone to extend the renewable energy target, and lots of words about how Labor can't agree to a clean energy target with the coalition. Yet again, this shows the hypocrisy and the cynical opportunism of the Greens when it comes to climate change and energy policy. Let's revisit a bit of history.

In 2009, if the Greens had shown some ticker, some coherency and some commitment to future generations, we would have been able to legislate the Carbon Pollution Reduction Scheme—a Carbon Pollution Reduction Scheme that was supported by the great majority of the Australian people and by business groups, environmental groups and the trade union movement; a policy that would have legislated a carbon price through an emissions trading scheme that would have set us on a pathway to decarbonising the economy. It would have provided the policy certainty for the energy sector to invest so we wouldn't have the crisis we have right now. What happened? What happened is the Greens squibbed it, because they are rank opportunists. They would rather have this climate change crisis continue because it gives them a point of differentiation with the Labor Party. They would rather win the seat of Melbourne. They would rather contest inner city seats against the Labor Party than solve this national crisis.

They are the greatest opportunists in this parliament. I know that's a big claim because there are a few contenders, but they are the greatest and they are rank hypocrites. This nation, yet again, is paying the price for their failure to compromise. Compromise is not a dirty word. Skilled politicians are able to compromise as long as they are true to their values and always have the end goal in mind. Our end goal must be reaching a bipartisan consensus on energy and climate change policy in this nation. Other countries have done it. Germany has got it. Chancellor Angela Merkel, who is very conservative, has a Greens member as her energy minister. There has been a consensus in the UK for many years, so much so that the three major parties didn't even discuss climate change policy in the 2015 election because they all agreed on it.

We don't have to go out on a limb to say we need consensus and it is achievable if we see a bit of leadership. We need a bit of leadership and ticker from the government, who have squibbed it over the last four years, and a bit of commitment to values from the Greens and putting the national interest ahead of their petty, short-term political interests. It is achievable. I'm really proud that the Labor Party—and we've lost a lot of skin by doing this—have signalled a preparedness to compromise and signalled that we will put the national interest first rather than a grubby, vote-grabbing exercise, as the government and the Greens have done. This is an important policy and this is the way we must go forward on this issue. I commend the bill to the House but, unfortunately, it's another symptom of this government's mismanagement of energy and climate change policy in this nation.

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