House debates

Tuesday, 14 August 2018



7:45 pm

Photo of Craig KellyCraig Kelly (Hughes, Liberal Party) Share this | | Hansard source

About a fortnight ago I was very honoured to make a trip to Japan, where I and the members for Dawson and Mackellar and two colleagues from the Labor side of parliament made visits to several power stations and to a steel plant and also had meetings with Japan's Ministry of Economy, Trade and Industry; with J-POWER, which is one of Japan's largest electricity generators; and with Japan Oil, Gas and Metals National Corporation. The unequivocal message we had from those three organisations, three organisations that have been majorly responsible for the economic success of Japan over many years, was that renewables are not cost competitive. That is the message coming out of Japan. They have done their sums and have worked out that the cheapest way to generate electricity to supply their people is to pay a premium and import coal all the way from Australia to use in their latest technology coal generation plants. That was the clear message they gave us.

During the month prior to when we went there, the Japanese government reduced its carbon emissions targets. In their electricity sector they were trying to achieve by 2030 a 26 per cent reduction from 2013 levels, which is very similar to what we have here in Australia. However, they weren't doing that by locking those targets in legislation and mandating them with penalties. In fact, I thought it was interesting that their target for intermittent generation of wind and solar combined was a mere 9.4 per cent of Japan's total electricity generation by the year 2030. In contrast, under the NEG modelling, we are looking at something like a 29 per cent to 30 per cent target for intermittent generation facilities—and the more intermittent generation capacity you put into the grid, the higher the costs you have.

We were also able to visit Japan's Isogo clean-coal plant in Yokohama. In fact, it is located only six kilometres from downtown Yokohama. It uses ultra-supercritical technology, not only to reduce carbon dioxide emissions but also to reduce sulphur dioxide, nitrous oxide and particulate matter. Japan is also at the moment planning to roll out something like another 30 new coal-fired power stations across the nation. They have a similar issue to us: their existing coal fleet is ageing. They have done the sums and are going to replace their existing coal fleet with latest technology coal-fired power stations. That is what Japan is doing to ensure their nation stays economically competitive.

Last week some very interesting data came out on the People's Republic of China's China Energy Portal. It showed the year-on-year growth in power generation from the second quarter of 2017 to the second quarter of 2018. All up, it showed growth of 244 terawatt hours, and the main growth came from thermal generation. An extra 176 terawatt hours of electricity was generated using thermal generation—that's coal and gas—in China in the second quarter.

To put that number into some type of context, Australia's total annual thermal generation as of 2018 is around 150 terawatt hours of electricity. So what China has added in the last 12 months alone in electricity generation from thermal resources is actually more than Australia's entire production of electricity from thermal resources over an entire year. Whatever we build— (Time expired)