House debates

Tuesday, 21 August 2018

Matters of Public Importance


3:27 pm

Photo of Tony SmithTony Smith (Speaker) Share this | | Hansard source

I have received a letter from the honourable member for Port Adelaide proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The government’s chaos and division on energy policy, which is forcing Australians to pay higher power prices.

I call upon those members who approve of the proposed discussion to rise in their places.

More than the number of members required by the standing orders having risen in their places—

3:28 pm

Photo of Mark ButlerMark Butler (Port Adelaide, Australian Labor Party, Shadow Minister for Climate Change and Energy) Share this | | Hansard source

I think that at the beginning of this sitting fortnight, most observers of national politics thought that the matter of extreme and grave public importance they expected this parliament to deal with was the deep energy crisis that has emerged under this government. Instead, what we've seen from the other side is an obsession with personal ambition, petty hatreds and the weird, conspiracy-based hobby horses that dominate the ideology of this coalition's party room. For those that remember the events of late 2009, at first blush, as Yogi Berra would say, there's a lot of deja vu all over again this week. The member for Wentworth is again being stalked over climate change policy. We have the same characters playing the same roles: the member for Warringah obviously; the redoubtable member for Menzies; Senator Abetz, who we see on television quite regularly. We have the same ballot result: 48 to 35, with all that that entails for predictions about the next couple of weeks. And we see the same antiscience claptrap and conspiracy theories being spouted on TV, through the newspapers and on blogs.

But there are some important differences between the events of 2009 and the slow-motion car crash we are seeing unfold on the other side of politics. The first is the background condition of our energy system. In 2009, it's fair to say, our energy system was in rude health. It was in rude health. Gas prices were low. Gas was plentiful. Wholesale power was plentiful. Wholesale power prices were low as well. There were no supply concerns. There were no wholesale power price spikes of the type we've seen under this Prime Minister. We also saw at least some bipartisanship around the Renewable Energy Target, so there was still a floor under investor certainty, even given the wars within the coalition party room on climate change.

Today could not be more different. Australia is deep in the throes of the most severe energy crisis in living memory, which has emerged under this Prime Minister. Confidence in our energy system is plummeting. Power prices and gas prices are skyrocketing and continuing to go up in spite of all protestations from the Prime Minister and the energy minister that households and businesses have never had it better and that power prices are coming down.

The second difference, which has not escaped the attention of anyone who watches this, is that back in 2009 the member for Wentworth stood firm on a point of principle. He stood firm on a point of principle. That is perhaps the most significant thing the Australian people remember about the member for Wentworth. He was willing to lose his job because he said he was not willing to lead a party not committed to effective action on climate change.

What have we seen over the past two years? A starker contrast is not possible. What we've seen, particularly over the past two weeks, is a humiliating series of weak, abject surrenders to the hard Right of the coalition party room, which continues to exercise a veto over sensible climate and energy policy in this country. The Prime Minister announced seven days ago an energy policy that would not see a single renewable energy project built in a decade, would halve the rate of solar installation on people's roofs and would channel billions of taxpayer funds into coal-fired power plants that the industry says are uninvestable and are inconsistent with the viability of Snowy Hydro, but that still wasn't enough for the member for Warringah. He still forced the Prime Minister to back down on that pathetic, weak policy.

Of course, the member for Warringah was very grateful for the backdown. As he said last night, he was extraordinarily grateful for the backdown. He questioned whether this Prime Minister has any convictions—a question being spoken about in front bars and cricket clubs and across dining tables across the country. He accused the Prime Minister simply of having a 'conversion of convenience'. What did that conversion of convenience involve? I don't think anyone really knows. We've had the third, fourth and fifth of this Prime Minister's energy policies announced in just seven days. No-one knows what the fifth policy is. The chair of the backbench energy committee confessed on Sky News that he had no idea what the fifth energy policy was. Apparently it didn't even get presented to the joint party room today. It certainly wasn't subject to any endorsement.

This reoccurring nightmare in Australian politics—of climate and energy policy being held hostage by the member for Warringah and his co-conspiracy theorists—is actually not about the member for Warringah, the member for Wentworth, the minister or the new entrant, the member for Dickson. It actually reflects much more than personality. As the Leader of the Opposition said in his speech, there is a deep, irreconcilable fissure that runs right through the soul of the Liberal Party today. It runs right through the soul of this party on a range of important policy areas—policies important to the Australian people—and there is no clearer fissure in that party than that over climate and energy policy. This is a party incapable of recognising the challenges and the opportunities involved in tackling climate change. These challenges and opportunities have only become clearer over the decade since 2009. This is a party incapable of coming to grips with the profound transition that is happening in energy systems not just here in Australia but across the globe, because they are obsessed with some leftist conspiracy involving the spread of renewable energy.

This government's energy crisis—this deep energy crisis, the likes of which people haven't seen for decades in this country—presents a range of challenges. Labor is focused on all of them. We announced we would accept the ACCC recommendation to put in place a default price on Sunday. We were very happy to see the energy minister follow our lead only 24 hours later. But, without doubt, the most important challenge in this energy crisis is investor certainty. As the parent of this energy crisis, and as the authors of the experiment of privatising this essential service over the last 20 years, no-one has a greater responsibility to deliver investor certainty than the Liberal Party. And yesterday, this minister and this Prime Minister walked away from that. They utterly walked away from that.

We know there is a deep need to replace ageing generators in our system, but there are no rules for investment after the end of this year. Be clear: this will crash investment in the sector. Businesses across the board, including those on the front page of the Financial Review today, have made it clear that, immediately, $3 billion to $5 billion of investment in new energy systems will basically be crashed by the weakness of this Prime Minister yesterday. That will have implications for jobs. This is a party that has already crashed one in three renewable energy jobs, according to the ABS, through its term. It will have implications for reliability and, most clearly, it will have the clearest of implications for prices.

You might remember that last week they were talking a fair bit about $550. What happened to that? Well, $400 of that is from all of the new investment that they killed yesterday, and the other $150 was from the reduction in the risk premium from investor certainty. Kiss that goodbye. If you ever believed that in their second attempt to promise and deliver $550, not having delivered it six years ago, they were going to deliver it this time, that has gone. In its place, all we get is a grab bag of vapid headlines—cooked together over the last 24 hours, trying to look like they're being tough on big energy companies, wielding, as the member for Grayndler said, the big stick but mostly hitting themselves in the head on the way—and a surrender to the new coal ideologues, mainly up there but also on the backbench.

It is a surrender to those new coal ideologues pretending that taxpayers can fund a technology the industry itself has said is uninvestable. The academy of engineers has said it would be a mistake. The Prime Minister likes to refer to engineering a lot. The Snowy Hydro and 'Battery of the Nation' projects have said they are completely incompatible with the investments that those boards have decided upon and we thought were supported by this government.

Households are under enormous pressure with this energy crisis. Businesses are threatened with their viability and thousands of jobs where they provide employment. There have been five attempts in two years by this government to put in place a policy that would help resolve the energy crisis they have presided over, and all have fallen victim to the parlour games of this coalition party room. This minister has tried his guts out. He has worked as hard as any minister. He cannot deliver his backbench, because he has a Prime Minister in charge of this government who has completely lost authority.

3:38 pm

Photo of Josh FrydenbergJosh Frydenberg (Kooyong, Liberal Party, Minister for the Environment and Energy) Share this | | Hansard source

The Labor Party's arrogant. The Labor Party is showing hubris. What we saw in question time today was them trying to do a victory lap before the next election! They tried that once before. That was after the 2016 election. You had the member for Maribyrnong, the Leader of the Opposition, doing a victory lap. He was like Harold Abrahams in Chariots of Fire, running around saying, 'I've won, I've won, I've won!' Well, two years later, he's still in opposition! And after the next election he'll still be in opposition! The reason for that is when Labor was last in office it wrecked the country.

Do you remember the Rudd-Gillard-Rudd chaos, Mr Speaker? Do you remember when it came to energy policy? The member for Port Adelaide is a nice bloke who won't give up the presidency of the Labor Party. He said in his own book that the Labor Party sent mixed signals when it came to climate and energy policy, that the Labor Party made mistakes. That's an understatement. Do you know what happened? Do you know what happened when the Labor Party was last in office? Energy prices went up each and every year. They doubled.

I see some of my colleagues in the House, like the member for Fairfax, and I know the member for Bonner, and the member for Brisbane, and the member for Ryan, and the member for Fisher and the member for Forde. Do you know what they all have in common? Their seats are all in that part of Queensland where prices went up under the Labor Party every year.

Where are the member for Rankin and the member for Lilley? They're hiding, because they know that, when Labor was last in office, in 2008, prices went up eight per cent. In 2009, prices went up 15 per cent. In 2010, prices went up 13 per cent. In 2011, prices went up six per cent. In 2012, prices went up 13 per cent. And, in July 2013, prices went up 19 per cent. That's why I say to the member for Fairfax: what about the families and businesses in your electorate? When Labor was last in office, prices went up each and every year. They ignored the warnings about the increase in gas exports and what it would mean for domestic prices. They oversaw the energy system when there was the gold-plating of the networks, which we are now trying to unwind. They had no plans for storage. That was the Labor Party's record.

And let's not mention cash for clunkers, the citizens' assembly, the carbon tax, the CPRS, the ETS—do you remember all of that? Do you remember that great Athenian example of democracy, the citizens' assembly? Do you remember Green Loans and the terrible pink batts scheme? That's what the Australian people remember. They remember the cheques to dead people—yes. They remember GroceryWatch and FuelWatch. They remember all of that. When it comes to energy policy, they remember their bills going up each and every year.

We on this side of the House have tried to fix the energy mess that was left to us. So we abolished the ability for the networks to game the system through the limited merits review process. If the Labor Party had thought about that when they were in office, the Australian public would have saved over $6 billion. We've ensured more gas is now available to Australians before it's exported overseas, and the ACCC has reported prices coming down by up to 50 per cent as a result of that. We've ensured that retailers have given better deals to Australian families—1.8 million Australian families, including many listening to today's proceedings, know that they got a better deal as a result of Prime Minister Turnbull calling in the retailers and demanding a better deal.

When it comes to Snowy 2.0, the member for Eden-Monaro is at the barricades, saying, 'Good on you, Prime Minister!' This is what the member for Eden-Monaro said about the Prime Minister's signature policy: 'It's an exciting project for our country.' I say to him: join the coalition, because you're supporting our policies when you don't have any other ideas opposite. But he's not the only one opposite who supports our policies. What about the member for Paterson? The member for Paterson, the daughter of a coalminer, goes out there and says that we need new coal-fired power stations. That's what she told The Australian.

But I think the Manager of Opposition Business and the opposition whips have a bad sense of humour. Do you know why? Because they've sat the member for Paterson next to the former head of the ACTU, the member for Batman. It's like putting Punch next to Judy. You couldn't get two bigger opposites. The member for Paterson wants a new coal-fired power station, and the member for Batman wants to nationalise the whole energy system. She'd be better off sitting with the Greens. What a bad sense of humour!

As a result of the measures that we introduced, power prices came down in New South Wales, Queensland and South Australia on 1 July. Let me tell the members for Fairfax, Ryan, Brisbane, Fisher, Bonner, Forde, Rankin and Lilley what happened to those families and businesses in south-east Queensland from 1 July. They saw prices for residential customers go down by up to 5.4 per cent. They saw prices for small businesses go down by up to 8.5 per cent. That's on the watch of the Turnbull government.

We announced another set of significant energy policies just yesterday, implementing the ACCC's report into the affordability of the electricity system. It was a coalition government that commissioned that report. It took 15 months to put together. They were able to compel nearly 50,000 documents that otherwise would not have seen the light of day. Among a number of recommendations in there that were implemented was a default offer—a default offer which will now see 1.2 million Australians go off the highest standing offers to this cheaper default offer. If you're a family, you can save up to $416. If you're a small business and you're currently on the expensive standing offers and you go to a default offer, then, as a result of this, you could save up to $1,457. That's good news. That's good news for families and businesses around this country.

We're giving the ACCC new powers to be the permanent cop on the beat—to have a big stick—whereas those opposite are the friends of the big energy companies. We are taking them to task. We are holding them to account. We are on the side of the consumers. You are on the side of the big energy companies. And these new powers include fines, and go up to a use of a divestment power. That is a big stick.

And what about recommendation 4? We will support, through debt financing, new generation assets, to deal with a mark of failure identified by the ACCC, where new generators in the market—not the big three; new generators—who don't have definite market power can build new assets to deal with commercial industrial customers. And this dispatchable power is firm power. This could be coal; this could be gas; this could be hydro. This is firm power.

So these are the policies that we're announcing. These are the policies we have introduced. These are the policies that are now working to lower power prices.

But, at the end of the day, what does the Labor Party want? The Labor Party wants to give out more subsidies. The Labor Party wants to put a tax on consumers. The Labor Party has recklessly high targets that have been opposed by its own union movement. Tony Maher, the national president of the CFMEU, in an open letter, said, 'An increased renewable energy target of 50 per cent by 2030 will increase the cost of electricity for manufacturing and ordinary households.' Ben Davis, the Victorian secretary of the AWU, said: 'The rush away from coal and gas-fired electricity power stations to renewables is a little unseemly in its haste, because we are potentially crucifying hundreds of thousands of manufacturing workers.' This is what the unions are telling the Labor Party about its own policy.

No doubt the unions are not on the same page as LEAN, the environment network that supports the Labor Party, that the member for Watson says has its fingerprints over every piece of environment policy. You know why? Because LEAN thinks that higher prices are not a sign of market failure but of the market working well! That's the Labor Party's equation.

We're on the side of energy consumers. We're on the side of families. We're on the side of businesses.

I'll leave the final word to Graham Richardson, a doyen of the Labor Party, who said of Labor's energy policy: 'They're playing roulette with people's lives, hurting pensioners and the poor more.' The unions and former Labor ministers have belled the cat on Labor's policy. You'll always pay more for your energy under Labor than you would under the coalition.

3:48 pm

Photo of Pat ConroyPat Conroy (Shortland, Australian Labor Party, Shadow Assistant Minister for Infrastructure) Share this | | Hansard source

I'll give this to the member for Kooyong: he's a trier. He keeps following up. He keeps trying. He's a stayer. Unfortunately, he's also the Groucho Marx of energy ministers, where he's saying, 'This is my energy policy. If you don't like this one, I've got another one! I've got another one ready to go.' He's had five energy policies in two years—five in two years! He's had three in seven days, since Tuesday of last week, when he had his triumph in the party room. We've had NEG Draft 1. Then, on Saturday, we had NEG Draft 2. Then, by Sunday night, we had this other thing that they can't describe and they refuse to give us the legislation for. But just imagine that! He's the minister who's had three policies on energy in seven days. I note his perseverance, but I've got to give him points down for his policy coherence, because it's appalling. It's abject surrender after abject surrender.

How would you be if you were the current Prime Minister, the member for Wentworth, looking up at the ceiling at 4 am on Monday morning? This is a man who had a legacy in 2009, saying, 'I will not lead a party that's not as committed to effective action on climate change as I am.' Then, at 4 am on Monday morning, when the demons of the soul are confronting him, he's looking up at the ceiling saying: 'I will surrender to the member for Warringah. I will surrender. I will enact his policy and completely walk away from any commitment to emissions reduction.' Just think of it! It's rare to see someone's soul ripped out before your eyes, but that's what we saw on Monday in this place with the Prime Minister. It's rare to see it, but unfortunately that's what we saw: a man who destroyed his legacy—his one remaining legacy of being committed to taking action on climate change—just to hold onto power for, at the moment, somewhere between three days and two weeks, depending on whether the member for Dickson moves on Thursday or whether he moves in September. Just think about junking your legacy to sit as Prime Minister for two more weeks.

That's a tragedy, but it'd be a minor tragedy if it didn't impact anyone else. Unfortunately it affects every single person in this nation. It affects every single person in this nation because their abject surrender of energy policy, their abject surrender on any commitment to rational policymaking, is hurting working families. It is hurting pensioners every day. We've seen 5,000 megawatts of power being withdrawn. We've seen 5,000 megawatts of power stations close down in the last six years because they're getting old. They're at the end of their natural life, and they're closing down. But we're seeing very little replacement because of the energy policy uncertainty in this place, because they have had no energy policy for the five years they've been in government.

What's the result of this? What happens after that? We've seen wholesale electricity prices double under their watch. In the last two years alone, we've seen a 30 per cent increase in retail power prices. They talk about the last quarter, but they don't mention the two years before that, where we saw a 30 per cent increase in retail power prices. That affects families and pensioners right now—right now, they're feeling it. I have the honour to represent the town of Windale, which is the poorest town in all of New South Wales. Those are people who struggle every day to put food on the tables for their kids, and they're facing 30 per cent higher power prices because the fossils in the Liberal Party room can't accept a decent policy.

We're now at a ridiculous stage where not only have they surrendered but they won't even give us draft legislation on whatever their policies of the day are. They refused. Yesterday in question time the Prime Minister admitted that every single backbencher over there—the member for Canning, for example—has a right of veto over government policy. Until they get it through their party room with 100 per cent support, we're not allowed to see draft legislation. What an appalling state of affairs we have right now.

This reflects on this government. Energy policy is really the symbol for this government's dysfunction. Five years of infighting. Five years of surrendering any policy principle that gets in the way of holding onto power, just to stop Labor. This is all just to stop Labor, who's got a committed plan to reduce power prices and reduce emissions. This MPI is very important because it symbolises this government's moral bankruptcy. This is a government that will do anything to stay in power, but won't stand up and reduce power prices.

3:53 pm

Photo of Melissa PriceMelissa Price (Durack, Liberal Party, Assistant Minister for the Environment) Share this | | Hansard source

The irony of this debate is almost too much to bear. What an extraordinary claim by the Labor Party and those opposite, who know all too well that the price of power today is the result of their disastrous legacy. They'll shout and they'll argue otherwise. We've heard it all before. But those on the other side know—don't they, Minister for the Environment and Energy?—that they are responsible for this mess. But it's okay, because we're fixing up the mess.

The Labor Party wants to talk about power prices—they talk big about power prices—but let's have a look at what happened when they set about dismantling the energy market. We've heard it all before today, but I think it's worth repeating: (1) last time Labor were in office, electricity prices doubled; (2) prices went up every year they were in office; and (3) they introduced the carbon tax and when we repealed it—that's right, we repealed it—Australians received the largest reduction in power prices on record. That's pretty good. But the Turnbull government has overseen a drop in retail power prices across three states on 1 July and that is good news for all people across those states. Wholesale prices are down 25 per cent compared to this time last year—more good news. And no matter how the Labor Party wants to spin this, we on this side know we are going to deliver and are already delivering lower electricity prices for all Australians.

The Labor Party just simply cannot be trusted to manage the national energy market. Let's look at some real examples. No point them bleating about what we're doing, let's look at what the Labor parties have been doing around the country. Let's look at the gold star winner, South Australia—a Labor government which gave Australia its first state-wide blackout. What a legacy, what an absolute bunch of champions! There were 1.7 million people with no lights on, and half a billion dollars of taxpayer money was what the Labor government cost South Australians. And we know that a Shorten government would take that failed experiment to a national scale.

The Leader of the Opposition already has told us he wants a 50 per cent Renewable Energy Target because he thinks it was such a great outcome in South Australia. And he'll push ahead with this policy, even though we all know it's a recipe for higher prices—we've seen this time and time again. Even in my own home state of Western Australia, the state Labor Party also wanted to take a 50 per cent target to the election last year but they dropped it, like a bag of hot potatoes, thankfully, because their own members rebelled. Well there is some sense after all in WA state Labor.

The member for Collie-Preston, Mick Murray, a frontbencher who represents a coalmining community, threatened to resign if his party were to introduce such a policy. He knew that such a policy would be a disaster. He knew it would destroy jobs. He knew it would drive power bills up and he knew it would punish regional communities. The Labor Party, especially in Western Australia, are having a great crack at destroying regional communities. At least they didn't have it at 50 per cent, so that's good news, and the opposition leader knows that too. We know his energy policy is not edited by the Labor Party; it's edited by the Greens party.

The opposition leader wants an emissions intensity scheme but he's too afraid to have the modelling done. But that's not a problem, because the Climate Change Authority has done the modelling all for him. What that modelling told us was that power bills would increase, on average, by $192 per year for 10 years. There is no way a Labor government will ever bring down the price of electricity. But this government, us sitting on this side, are committed to bringing them down and we've already demonstrated that. We'll set a default price next year and we'll put a process in place to enforce compliance. If those energy companies fail to pass savings to Australians, they'll be penalised. And to use the phrase coined by the Treasurer, 'we've got that big stick'.

Our energy policy will create a more reliable system and introduce a new requirement for more dispatchable power to lower prices and also to avoid those blackouts. We know that if those opposite ever were to grace these couches that they would drive up the price of electricity and they would rob Australians of baseload power to secure preferences for the Greens. We, on this side, are determined to get the price of power down for the mums and dads—my mum, her relations on the East Coast—and we're also determined to support business. And it's only the coalition that can be trusted.

3:58 pm

Photo of Mike KellyMike Kelly (Eden-Monaro, Australian Labor Party, Shadow Assistant Minister for Defence Industry and Support) Share this | | Hansard source

What we've seen is that the only consistent power policy on that side of the chamber is the power politics policy. The number of times they've engaged in coups now has completely preoccupied them. It has paralysed them, preventing them from producing the power policy this country needs. For five years they've sat back, fat, dumb and happy, spinning on their axis, while power prices have spun out of control around this nation. What is the reason for that? Obviously the major factor has been the lack of stability in policy.

The country is crying out for a bipartisan approach to energy. We know that so many experts have said that is the key to getting investment in power generation. We know that renewable energy can deliver that baseload power, which all the experts say will bring down power prices. But the government has crippled that investment flow. And no less a person than their own Chief Scientist has said that industry needs policy stability to give it the confidence to invest in new power plants. So firstly, the uncertainty of policy has helped drive up those prices. That is completely on the government.

Second, of course, is the gold-plating of the network. The network companies based their investment decisions on forecasts projecting demand for electricity—that it would continue to rise—and those forecasts were wrong. In New South Wales they spent billions, and that cost was passed on to consumers. That was a major factor in price rises at the time of the effect of our Clean Energy Future package. It had very little to do with that, and what was there was offset by our compensation scheme for all those people that needed it. Here today, when we're talking about the impact of higher electricity prices, this very government is the one that's trying to take away the energy supplement and the relief that people need for their situation. As my colleague says, we've seen a price rise of 30 per cent in two years. The gold-plating of the network was a big factor.

The closing of power stations has been another factor. That's been a product of the privatisation of the system. We've seen Northern and Hazelwood go. The decision to close Hazelwood power station was made in boardrooms in France and Japan because Victoria allowed privatisation of its network. That's the only reason that happened. There were another 10 minor power stations that closed in this five-year period, on this government's watch, with no action being taken to ensure that that base-load flow of investment was coming in behind that.

In addition to that, we've seen, with this underinvestment in the maintenance of those plants, that the uncertainty and the breakdowns that happen with individual generators also add to impact on cost. The government talks about trying to prop up Liddell. In the last big heatwave that we had, it was Liddell that was the problem. Two of its four units fell over. It was the Snowy Hydro scheme, the biggest of our renewable energy projects, that kept New South Wales going during that time. It's the uncertainty in the existing coal infrastructure that's also putting pressure on prices, particularly because of issues relating to propping up the system during peak hours—the spot market and the hedge market.

Gas, of course, is another big issue. As those coal-fired power stations fell over, people fell back on gas generation. The government wouldn't listen to us when we told it to enter into a national guarantee on gas. We said this would happen. We begged the government over years to do that, and it did nothing until it was too late. Additional to that are the effects of privatisation themselves. The government allowed that process to go with no strategic approach to regulating the market, so those private companies have been out there gaming the system and absolutely ripping consumers off. We've seen something like a 13 per cent profit margin from those retailers, which is more than double the norm for utilities. That's happened on the government's watch. There was no plan to regulate the market as it was unfolding in that respect. It was complete negligence in the management of our system.

We know that renewables will bring those prices down. That's what all the experts say. In fact the ACT is on target to reach 100 per cent renewable energy, and it has the lowest bills in the country. All the analysis has found that renewable energy targets will help soften price rises by increasing competition in the national energy market—I thought you guys were in favour of competition! I also point out that we've talked a lot about Snowy 2.0. The government are threatening it because of its plans to build coal-fired power stations. It says that that long-term commitment of 60 per cent renewable energy by 2040, that it highlights, will reduce energy spot prices in New South Wales by 10.2 per cent. It's the culmination of Snowy 2.0 and renewables that will deliver lower prices. The government needs to listen to the community out there and get its act together. (Time expired)

4:03 pm

Photo of Ted O'BrienTed O'Brien (Fairfax, Liberal Party) Share this | | Hansard source

This is about a competition between two different policies. If you look at the scoreboard today, on one side you have the Labor Party—six years, and the price of electricity doubled. Speaking as somebody from South-East Queensland, electricity prices went up every single year under Labor. If you look at the other side of the scoreboard, you have the Turnbull government. We have seen in South-East Queensland, from 1 July this year, reductions in prices of up to five per cent for residences and eight per cent for businesses.

The Labor Party has not only been a disgrace at the federal level. At the state level, we still have a Labor Party in Queensland. This is a Labor Party that has been more than happy to see poles and wires on charge to consumers at ridiculous, inflated prices. We have ownership from the Queensland government. They've been more than happy to see the values of those assets maintained at a high level. The answer is to actually write down those assets. If the Labor Party in Queensland cared about the pensioner at home and if the Labor Party in Queensland cared about the small business owner, they would write down those assets. It would not cost them a cent. And, if the Labor Party in Queensland were to say,' We will not privatise,' then they have no reason not to write down the assets. There is a reason they won't write down those assets. Do you know what that is? They love the money. They love the dividends. They know the higher their assets are valued in Queensland the more they can charge those pensioners, the more they can charge those small business owners and the more they can charge those hard-working Australians struggling to put food on the table. They are more than happy to apply what is effectively a secret tax to price gouge every Queenslander, and do you know what they'll do? They'll put it in the coffers of an incompetent state government.

This is also a state government that has been more than happy to ensure, on ministerial instruction, no less, that the government owned entities take out debt. They take out debt and then they pay it back to the state government in special dividends. This is a racket; this is a scam. They're more than happy to have government enterprises taking out debt, and I'm talking about nearly a billion dollars of debt.

What have we done on the other side of the equation? What has the coalition government already done?

Photo of Pat ConroyPat Conroy (Shortland, Australian Labor Party, Shadow Assistant Minister for Infrastructure) Share this | | Hansard source

What have you done?

Photo of Ted O'BrienTed O'Brien (Fairfax, Liberal Party) Share this | | Hansard source

Good question. What have we done? Do you know what we did? No. 1: we scrapped the carbon tax. That's what we did as No. 1. We reduced the RET. We reined in the networks. We put more gas into the domestic system. How about Snowy 2.0? The list just keeps going on. Do you know why we're doing that? Unlike those opposite, we actually care about the pensioner, we actually care about the small businesses and we care about the hard-working people who can't afford to put food on the table because they've been price gouged by state monopolies up there in Queensland. It is the federal government taking action. And, by the way, that's just action to date. That is why the scoreboard is looking good. But what we have now is a plan to just keep on going.

We now have a plan to ensure that we have more dispatchables coming into the system. We're going to have base load. How good is this? That's why they're silent, because not only did they have a poor track record; they didn't have a plan. The only plan you hear from those opposite is a 50 per cent renewable target. Woo hoo! Drive prices up. Are you serious? This is what we have. The party on the other side wants to jack up not just taxes but also electricity prices. Not only are we ensuring that we'll have dispatchables coming in but we will also ensure that there is a new default mechanism for price. Effectively, it's almost like a recommended retail price, if you like, with serious issues for anyone who breaks that. We're going to have a cop on the beat with the ACCC that they have not seen before, with serious teeth, including the possibility of having to divest those assets.

4:08 pm

Photo of Justine KeayJustine Keay (Braddon, Australian Labor Party) Share this | | Hansard source

We have a clear choice when it comes to energy policy. Labor is for renewable energy and lower power bills. The Prime Minister is for more coal and higher power bills. North-west Tasmania has some of the best renewable energy resources in the world, but, thanks to the Prime Minister's complete capitulation to the hard-right agenda on renewables, billions of dollars of investment and thousands of potential jobs in renewable energy in Tasmania are now threatened. Tasmanians know their Battery of the Nation vision isn't the Liberal Party's. It is an idea that has a long history in Tasmania, with strong support from many industry players, including former Hydro-Electric Commission chairman Peter Rae. It was not invented by the Prime Minister, as he said last week. It is an idea that only stacks up alongside a broader transition to renewable energy. Labor understands this transition. We need to ensure a clean, modern energy system. Labor understands the huge potential this transition brings to Tasmania in terms of jobs, clean and affordable energy and lower pollution. It is a transition that a divided and anti-renewables coalition cannot and will not deliver. Instead, it means no Battery of the Nation and higher bills for all Tasmanians.

The Prime Minister's backflip on the Battery of the Nation only further demonstrates that any credible development of evidence based policy and taking serious action on climate change and power prices is in tatters. Tasmanians want certainty in where investment will be attracted to build renewable energy to be used across the country—and the north-west of Tasmania, with some of the best renewable energy in the world, is attracting interest. As I said before, more than $2 billion in planned investment is now under threat by those opposite. And we can thank, in part, Senator Eric Abetz, who continues to push forward not the interests of Tasmanians but the interests of the troglodytes in the Liberal Party.

There could be certainty in lower power prices, which can only be driven by Labor's commitment to 50 per cent renewable energy by 2030; certainty in reduced pollution; and certainty in jobs. Hydro Tasmania has said that the Battery of the Nation initiative supports Australia to embrace cost-effective renewable energy generation while maintaining secure, reliable energy supply. But expanding the pumped hydro arrangements in Tasmania through that initiative only makes sense if you have a government in Canberra that will deliver renewable energy investment, not seek to strangle it as this government has and will.

This government's definition of clean energy is coal fired power. This government's definition of what Australian taxpayers want for their money is new coal-fired power stations—which take the better part of a decade to build, are not as flexible as a modern energy system requires and are exposed to high levels of carbon risk. And guess what? They also produce expensive electricity. Even this government's own Treasurer has admitted that new coal power stations are not the answer to higher power bills, saying 'new cheap coal is a bit of a myth'.

The reality is that this government is not focused on lower energy prices or reducing pollution; it's just about appeasing the Prime Minister's enemies in the Liberal Party so he can keep his job. But even that strategy has come undone at the seams. This government's energy plan will smash jobs and investment in renewables. It will achieve no significant cuts in pollution from the sector that is responsible for a third of the total carbon pollution in our economy and it will push power prices up even further.

The experts have been very clear that the best way to lower power prices is to support new, cheap, reliable and clean electricity generation investment, and the cheapest new generation today and into the future is renewables backed up by appropriate storage. This is exactly what Labor will deliver. We will not walk away from our commitment to 50 per cent renewables by 2030 and our 45 per cent emissions reduction target by 2030 on 2005 levels. We will declare my region, the north-west coast of Tasmania, as Australia's first renewable energy zone, sending a signal to investors to invest, generate and create renewable energy jobs in Braddon. My electorate can deliver some of the cheapest wind power anywhere in the world, with the potential to be a great export earner, selling electricity to places like Victoria and receiving income back to be used for support services and to do other great things in my state.

Senator Abetz yesterday destroyed the Tasmanian government's position on the National Energy Guarantee. The Prime Minister and Senator Abetz have abandoned Tasmania's renewable energy industry. It is now abundantly clear that the Prime Minister cannot provide the leadership needed to solve his energy crisis.

4:13 pm

Photo of Damian DrumDamian Drum (Murray, National Party, Assistant Minister to the Deputy Prime Minister) Share this | | Hansard source

The energy crisis that we have in Australia at the moment is quite simply a gigantic failure of the states. The states have responsibility for providing energy to their people in each of their respective jurisdictions. At the moment in Queensland, they actually own the poles and wires. The poles and wires have been acknowledged as creating about 50 per cent of the increases in families' bills. They actually own the Queensland poles and wires, and this gold-plating is just going on. It's an incredible system. The Queensland government have actually been caught out for gaming the system and creating further profits than anyone else would be game to announce, yet this has been run by the government against the people of their own state. In Victoria, where I live, they are sitting on 50 years of gas reserves, and yet the Andrews government has a moratorium and a ban on the extraction and even the exploration of gas. They've got the opportunity to bring the explorers in, find out where the gas seams are, bring more gas onto the market and create lower electricity prices, but they choose not to. They choose not to have any gas exploration. Certainly they have no gas extraction from onshore gas wells in Victoria.

What they want to do is build a gas port off one of the docks in Melbourne, so they're happy for someone else in Australia to have gas wells, they just don't want to do it in their state. In Victoria, they don't care whether it comes from the Northern Territory, whether the gas is drilled in Western Australia, whether it's taken out of Queensland or whether it's even from South Australia. They're happy to bring it around on boats, they just don't want to have any in their own patch, because, somehow or other, it's okay for someone else to do that work, but they don't want to get their hands dirty themselves.

In Victoria, they also tripled the coal royalties that they were charging at the Hazelwood mine. Within three months of that decision, the French owners decided to close Hazelwood down. This has also had a huge impact on the price of electricity in Victoria. There are some of the most amazing anti-electricity price policies that are coming out of the Victorian Labor government, and yet all of a sudden we look around the various states and see the cost of energy to the average Australian household. Well, the Australian government felt as though it had to get involved. It had to try and generate a NEG, a National Energy Guarantee, that would somehow or other create further investment into the sector, not just in investment for renewables. We all love renewables and we all want renewables to be the cornerstone of our electricity grid, but we also want to look after the families and the businesses that need electricity when the sun is not shining and when the wind is not blowing. The previous member said her plan is that she wants more and more renewables backed up by appropriate storage, but she failed to mention what this appropriate storage could be for the whole world.

Photo of Pat ConroyPat Conroy (Shortland, Australian Labor Party, Shadow Assistant Minister for Infrastructure) Share this | | Hansard source

It's called pumped hydro.

Photo of Damian DrumDamian Drum (Murray, National Party, Assistant Minister to the Deputy Prime Minister) Share this | | Hansard source

Yes, pumped hydro works beautifully in Tasmania, but it doesn't quite work in Western Australia.

Mr Conroy interjecting

Photo of Kevin HoganKevin Hogan (Page, National Party) Share this | | Hansard source

The member for Shortland is warned!

Photo of Damian DrumDamian Drum (Murray, National Party, Assistant Minister to the Deputy Prime Minister) Share this | | Hansard source

It doesn't quite work in South Australia, it doesn't quite work in Queensland and it doesn't quite work in New South Wales. It will when we get Snowy Hydro 2.0 up and built, but the concept that pumped hydro or natural hydro can effectively be the battery for everybody, at the moment, doesn't work. At the moment we need base load and dispatchable electricity for when our families need it and when our industry needs it.

We understand that some of the plans around here are for just more and more renewables. It's going to make that other mix of the system, which is critical and which is the dispatchable power, even more expensive. There is no way of dodging this. The more you load up the system with renewables for when everything is going well—when the sun is shining and the wind is blowing—the more expensive it's going to be to rely on dispatchable power, whether it's gas-generated or coal-generated, to deliver the power and electricity when it's needed. This is an inescapable fact that the opposition are happy to gloss over because they want to keep sheeting home the fact that renewables are the answer to everything. We're hoping one day renewables will be, but at the moment, they're not. (Time expired)

4:18 pm

Photo of Susan TemplemanSusan Templeman (Macquarie, Australian Labor Party) Share this | | Hansard source

I have to confess that I've given the Prime Minister the benefit of the doubt.

Photo of Brian MitchellBrian Mitchell (Lyons, Australian Labor Party) Share this | | Hansard source


Photo of Susan TemplemanSusan Templeman (Macquarie, Australian Labor Party) Share this | | Hansard source

I know, it was a mistake. When he was rejected by his colleagues yet again to drop his energy policy, I just thought, 'Oh, he's weak. He's a bit bemused. He's sort of sad.' But now it is an inescapable truth: he has no principles and he has no beliefs. It's not that he's ditched them. They obviously weren't there to begin with. What we're talking about today is power, and that's exactly what is going on, on the other side of the chamber. This is about power. It's a Prime Minister whose only belief was the belief in power—power for himself—throughout his political career. Clearly, there were never principles involved.

Then we turn to the Minister for the Environment and Energy. This is a man who changes energy policy so fast that you don't really know which one they're up to. Is it the emissions intensity scheme? It is the Renewable Energy Target? Is it NEG 1? Is it NEG 2? Is there a NEG 3? You have to wonder what his legacy is going to be as energy minister. Let's think about it. As environment minister, this is a man who has effectively cut the highly protected areas of Commonwealth marine parks in half. He has halved them. This is the largest area in the world limited to recreational fishing that is now being re-accessed by commercial operators. Perhaps the most disturbing thing of all is that the government has now established a massive trawling area immediately alongside the Great Barrier Reef. Longlining will now be permitted north to south through the Coral Sea. That's a decision made by this minister that is bad for the reef and bad for recreational fishers. We are going to restore the damage that that minister has wrought.

Let's think about him as heritage minister, because that's another portfolio he has. This is the heritage minister who has failed to act to save the colonial gem Thompson Square in Windsor. Right now, under cover of night tonight, they are preparing to dig up convict-built brick barrel drains that are 200 years old. They're unique; you can't find them anywhere in the country. All this is so the New South Wales government can slap a bridge through the place—one that won't even solve our traffic needs. This is a minister who just sat back and let this happen. It's the oldest public square in the country, and he will be responsible for its demise.

So is it any wonder that all we have is confusion, indecision and inaction? What is the consequence of all of this? Clearly we have policy paralysis, but that isn't the worst of the consequences. The worst of it is that everyone who opens their mail and pulls out their power bill tonight is going to see skyrocketing power prices. That's the real consequence. It's a consequence of the chaos that's occurring on that side of the chamber. There's no point shaking your head, member for Wide Bay, because the Nationals have had their fair share of chaos as well. People are desperate for relief from power bills. Perhaps that is impossible for the Prime Minister and some of those opposite to understand. Perhaps they've never struggled to pay their power bills. But every one of us understands that our constituents are struggling.

There is a confession by the other side that there is a crisis, and that gives me perhaps some idea that there is some tiny little understanding of it over there. In March last year, the Prime Minister said, 'We are facing an energy crisis in Australia.' So there is recognition there, or at least lip service to recognition. A year ago—this is one of my favourite quotes from the Prime Minister, actually; it really sums up where we're at—he said, 'That's why I say our policy is based on engineering and economics, not on ideology and politics.' What a joke that is! The crisis has emerged under this government. People weren't talking about power prices in 2010, nor in 2013. As old power stations have gone offline, as they've reached the end of their life, this government has had no framework in place to allow investment to occur.

Talk to farmers, small businesses, manufacturers, pensioners, single parents and families—they are all struggling. Yet the only plan we have from this government is a plan to talk about themselves. That's all they're doing. We know that, even when something is put in place, this government will put in something that is inadequate. It will not deal with power prices and it will not deal with the issue of climate change. That will be the legacy that this government leaves us.

4:23 pm

Photo of Rowan RamseyRowan Ramsey (Grey, Liberal Party) Share this | | Hansard source

This matter of public importance today focuses on 'The Government's chaos and division on energy policy which is forcing Australians to pay higher power prices'. But they're not paying higher power prices, actually; power prices are receding. Let me give you the numbers.

In South Australia, we have provided an example to the rest of the Australia of what happens if you allow policy to not be properly controlled and the transition on energy to not be properly controlled. The rampant policy, the RET, got out of control, and it was harvested by the former South Australian government to a point where we have 52 per cent renewable energy in South Australia. That in itself would be a good thing if we weren't at risk of the lights going out and didn't have the most expensive electricity in the nation. But it is coming down. In fact, South Australia's wholesale price for electricity in 2017 was $108 a megawatt hour. This is the average price. In 2018 it was $98, and so far this year it's $89. So it is coming down. Those prices are starting to come through into the retail yields.

I had a publican the other day tell me that his latest offer is $15,000 a quarter less than the one he was on before. As a result, he can put somebody new back on the payroll. He said, 'This is good progress, but we need more.' And we know we need more, which is why this government is dedicated to making sure those prices keep going in that direction.

We have been focused on the NEG, but it's not the only firecracker in the cupboard. In fact, the work the Prime Minister and the energy minister had done prior to now is very important in what's been happening with electricity prices in Australia. The legislation that was passed on having the ability to curtail gas exports until the major companies put more gas on the Australian market, effectively almost halving the price of spot price gas, has been absolutely integral in this recession of prices.

A lot of people may not understand, but the price that the whole electricity column receives is the last price bid into the system. In so many cases—in fact, almost 40 per cent of cases now—the last price bid into the system is gas. The effective halving of gas prices has brought down the time that open cycle gas-fired peaking stations come onboard, the figure at which they kick into gear. This has put the pressure down on the whole electrical column. It also comes after the Prime Minister brought the electrical retailers into the office and gave them a good talking to—about being clear, direct and transparent with their customers. This has enabled thousands of customers Australia wide to change companies and chase down a better deal.

There are other things on offer. The Labor Party is pursuing a 50 per cent renewable target. We have 50 per cent renewable in South Australia and we have the dearest electricity in the nation. That is a problem. I think the push of the NEG, and that's what we're trying to do at the moment, is to turn a lot of that renewable energy into base-load energy. If we legislate the NEG, the hot market in South Australia will be investment in storage, and that is exactly what we need to do. If you just pursue renewable energy and do not take into account how this changes the total format, the total complexity of the way energy is delivered, you will—not you personally, Mr Deputy Speaker, but whoever that proponent is—fall on hard times. What happened in South Australia will happen to you. You blow up the system. You lead to a point where you cannot supply. And even now, while the prices have backed off, we are still the highest in Australia, and it would be much worse if we did not have an interconnector to Victoria.

The ALP is aiming for 50 per cent renewables but the Greens are going for 90 per cent. The Labor Party are chasing a 45 per cent cut in CO2 emissions when our commitment in Paris is 26 per cent.

Photo of Kevin HoganKevin Hogan (Page, National Party) Share this | | Hansard source

The member's time has expired and the time for discussion has expired. I call the minister.