Michael Danby (Melbourne Ports, Australian Labor Party) Share this | Link to this | Hansard source

My question is to the Minister for Resources and Energy and the Minister for Tourism. What progress has been made with the Solar Flagships program and how will it contribute to Australia’s carbon reduction targets?

Martin Ferguson (Batman, Australian Labor Party, Minister for Resources and Energy) Share this | Link to this | Hansard source

I thank the member for Melbourne Ports for his question because it is about a practical approach to how we as a nation move forward to a low-emission economy. In that context, whilst we remain in a state of waiting for the outcome of the complex debate in the Senate about how we put a price on carbon, the government moves forward with a key focus on the issue of technology. It is in that context that I remind the House that one of the key components of the government’s budget last year was a $4.5 billion clean energy initiative. Central to that is a focus on carbon capture and storage. I also remind the House of key grants in areas such as trying to facilitate the development of a geothermal industry in Australia.

That takes me back to a key component of the clean energy strategy, the government’s $1.6 billion commitment to the Solar Flagships program, which is about bringing forward in a great leap the commercial deployment of solar energy in Australia. The program itself represents potentially the biggest commercial deployment of solar energy in the world—

Greg Hunt (Flinders, Liberal Party, Shadow Minister for Climate Action, Environment and Heritage) Share this | Link to this | Hansard source

It was 1,000 megawatts, wasn’t it? What is it now?

Martin Ferguson (Batman, Australian Labor Party, Minister for Resources and Energy) Share this | Link to this | Hansard source

As the member for Flinders reminds me, this government is doing something that the Howard government failed to do—that is, trying to target the introduction of 1,000 megawatts of electricity generation from solar capacity. Hopefully, as a result of this program we will put four on-grid solar power stations in the commercial energy market, aimed not only at the commercial deployment of solar energy but also at a potential breakthrough on storage capacity which is central to the development of renewable energy in Australia.

On that question, I was fortunate enough last Saturday to visit King Island with the member for Braddon where the government is focused on not only major on-grid solar energy development but also standalone small-grid capacity which is so important to remote areas of Australia. I saw on King Island an Australian government contribution of $15.2 billion through the government’s Renewable Energy Demonstration Program for a standalone grid operation bringing together solar, biomass and wind power aimed at both peak and base load capacity. This is potentially a very important project for King Island and also for Australia, especially remote communities.

In the context of where we are going on the major Solar Flagships program, a world first, I am pleased to say that the government has now completed calling for interest in the first round aimed at targeting 400 megawatts of grid connected solar generation which closed on 15 February. I am pleased to report to the House that my department has received a total of 52 applications representing significant interests by state and territory governments and the business sector in this key clean energy initiative. The department’s association with a committee of technical experts selected to assess these programs will now go forward with the initial assessments. I am delighted to report to the House that the quality of the applicants is exceptionally important, going to not only the potential testing of solar thermal but also potentially testing on-grid solar PVs.

It also brings me to the question of the energy system in Australia, which requires certainty. We clearly have a responsibility to invest in technology, but in terms of actually resolving our energy questions there is also a primary need to resolve the debate about a price on carbon. I simply say that, from the point of view of the energy ministerial council of Australia, this is an issue of major significance because we have potentially $100 billion in new investment to maintain the reliability of the existing system over the next decade, which confronts the business sector, state and territory governments and the Commonwealth in Australia.

In that context, I simply say to the House that the greatest risk to actually achieving that $100 billion in investment is the coalition, and that goes to decisions for investment in new generation—investments we actually require to ensure reliability of the electricity system in Australia. I understand from the nature of the ministerial council that, in terms of some of these investments, time is running out. I say that because we are fast approaching a significant reduction in the difference in base- and peak-load capacity in Australia, which potentially raises serious questions about energy reliability at particular times of the year.

So I raise for the proper consideration of the Australian community the requirements not only to support the Australian government’s clean energy strategy, including the solar energy strategy, but also to send a message to the coalition in no uncertain terms that they are the biggest risk to the reliability of the electricity system in Australia because without a price on carbon we will not attract the necessary investment to guarantee the operation of the system in the years to come. I say in conclusion that it is exceptionally important that we continue to proceed to make the necessary technological breakthroughs to ensure the commercial deployment of renewable energy on a large scale and, in doing so, to make practical endeavours to reduce greenhouse emissions in Australia.