Tim Wilson (Goldstein, Liberal Party) Share this | Link to this | Hansard source

) ( ): We all know that we are in an energy transition for this country. Australia has set out ambitious goals to reduce its greenhouse gas emissions. We face challenges around attracting investment in new energy to make sure that we can build the manufacturing base of our economy, which so heavily depends on affordable energy, and deliver reliability for the economy so that businesses can invest with confidence, so there can be stability in the grid, and when Australians need to flick the switch the light comes on. Over many years, and recently, we've had a significant transition already. Despite the claims of those on the opposition benches, we've had the biggest rollout of renewable energy this year of any year, and it continues to go on unabated.

Australia is leading the transition to a lower-carbon future, but we also recognise the challenges and the limits of different technologies. I say this as somebody who is so pro-technology—the future is going to be awesome if we embrace technology—but we also have to acknowledge its limits, what things can be done, what things can't be done and what we need to add into the mix. That sense of balance is at the core of our approach to energy in Australia. We understand that Australian households need affordable, reliable energy. We know they want to cut our greenhouse gas emissions because they want to steward a more sustainable environment for their kids and their grandkids. That's everything we are about, which is why we also acknowledge the importance of technologies like gas, fuels that play a critical part in manufacturing to be affordable and to guarantee supply against the intermittency of renewables, which play a critical part of providing for households and low-energy demands, small businesses and even larger businesses, increasingly, with firming power and the backup potential of batteries as well. We want a sustainable solution, so it's an important part of that.

One of the reasons gas is such an important part of it is not because it's an end in itself but because of what it prioritises and enables for the future of energy demand of the country.

Dr Freelander interjecting—

This is the point the member for Macarthur simply doesn't understand. But the Chief Scientist does, and more the power to him. Alan Finkel does a fantastic job in leading the discussion around the power of hydrogen. Why does he like the potential of gas? Because gas so easily enables the transition to a hydrogen based economy. Think about the potential. We could use renewables to create hydrogen and export it to the world, the member for Macarthur. I was at the opening of the Kawasaki plant down in the Latrobe Valley, in Victoria, where we're looking at options to export hydrogen to countries like Japan.

The future of our export industries don't even need to be in fossil fuels. It'll be part of the discussion, but we can also see new opportunities and new horizons. That's because we're interested, this government, in building the Australian economy of the 21st century. Labor's caught in its ideological battles of the old 20th century, capital versus labour, defending the status quo, without understanding the power of leadership. Under this minister and under this Prime Minister, we're looking at how we build the Australian economy of the 21st century and transition from the base load of energy that we've used so much, from brown and black coal, towards gas, because what it will enable is a hydrogen future.

Make no mistake, this is incredibly exciting, the potential of hydrogen to provide transportable and base load energy for the Australian economy at an affordable price and to be exportable, while still using the same technology and infrastructure for generation that can be used for gas that we can build today. We're not just looking at what we need to do to build the future of the economy of Australia today, we're looking at how to futureproof Australia today.

I know that's a big problem for the opposition, who like to wax lyrical about these problems thinking only they are the solution—because this is the problem with the Labor Party. The Labor Party always sees themselves as a solution to the problem—not what we can do together through the power of initiative and ingenuity of the Australian people. What it will help us do is reach our road map, not just for that energy reliability and not just for that energy security but, of course, to reduce the price of energy and to meet our emissions targets.

Australian hydrogen energy could generate more than 8,000 jobs—a critical part of the discussion in the post-COVID recovery—many, critically, in regional Australia, where there is so much opportunity to build up regional centres to be part of the future of the economy of the country and contribute $11 billion in GDP by 2050. It's time to get on board, Labor. It's time to get on board with the future development of the Australian economy. It's time to get on board with building Australia's future.

Mike Freelander (Macarthur, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak on the motion brought forward by the member for Ryan. I welcome the ability and the opportunity to discuss the importance of having a well-invested and supported hydrogen industry. I'm not sure what the last speech was about, whether it was about hydrogen gas, methane gas or some other form of gas, but we've heard time and time again during this pandemic that Australia needs to invest in manufacturing, that we need to develop new employment opportunities and that our nation requires a long-term economic and energy plan. To these, I state that hydrogen—that is, clean hydrogen—is the answer.

Labor has made this point for some time and embraces hydrogen as a reliable and efficient energy source, so much so that we've had an ambitious hydrogen policy during the last election and the election before, and this is slowly influencing those on the other side. We knew then, as the government is now starting to know, that Australia can be—and should be—a world leader in hydrogen technology, and we have the benefit of providing an industry with economic and job prosperity whilst providing a cleaner energy resource.

Chief Scientist, Alan Finkel, sees a hydrogen export industry that in 10 years time could be worth up to $2 billion. I concur with the member for Ryan that it is welcome that the government is investing in hydrogen projects, albeit I believe this could have been done much sooner and at a much higher level and would have resulted in more opportunities for Australian households and businesses to benefit from the transition to a clean energy source.

A report prepared by PricewaterhouseCoopers describes the emerging hydrogen industry as a bright one and notes that the private sector will require signals of confidence from government that this is a long-term industry worth investing in. This is important as the shift to clean hydrogen energy will not be an organic one that will happen just by and of itself. It will not go ahead without support and encouragement from government, from industry and from the Public Service.

During a time when it appears that energy policy is a partisan and fractured issue within states and, indeed, within the federal parliament, it is welcoming to note that New South Wales, Queensland, South Australia, Western Australia, Victoria and Tasmania have all launched programs and initiatives that show confidence in clean hydrogen energy as a source of energy for the future. Of note is the plan to roll out hydrogen fuelled bus services in many states.

I don't know about other members, but I am thoroughly sick of the partisan nature of energy policy in this country. It's time for the federal government to show leadership in this regard. The days of bringing lumps of coal into this parliament are gone. Coal seam gas and other forms of methane gas are fuels of the past, not of the future, and we need to look to the future and future technologies to guide us through this difficult time.

I welcome the initiatives shown by the states, and I personally believe that hydrogen has a very important role in our automotive and transport industries. Specifically, fuel cell electric vehicles will be a terrific alternative to the current internal combustion engines powering most vehicles on our roads today and an alternative to electric vehicles. In January, Deloitte released findings that found within 10 years FCVs will be cheaper to run than internal combustion engines and battery electric vehicles. They will be good for vehicles that are required to haul heavy loads, and they will be very feasible for things like buses, for the transport industry, and for heavy cartage.

Whilst we discussed the economic feasibility of these technologies in Australia and their future implementation here, around the world FCVs are not a thing of the future but, rather, a part of the everyday. There are over 2,000 FCVs in China at this time, and. South Korea is developing more, as is the European Union, to bring together countries across the EU to boost the market uptake of hydrogen technologies and hydrogen fuelled vehicles. I welcome the work of the ACT government, Hyundai and other stakeholders, who are on track to open the first public hydrogen refuelling station later this year. I also welcome reports that hydrogen cars will be built not far from my electorate of Macarthur at Port Kembla, in the electorate of Cunningham, and should be on our roads within two years.

I firmly believe that these investments in hydrogen technology and hydrogen fuelled transportation are not to be overlooked and are something that we'll rely on in the future. As we rebuild and restructure our economy during these troubling times, it's time for a bipartisan energy policy.

Rowan Ramsey (Grey, Liberal Party) Share this | Link to this | Hansard source

Green hydrogen offers great hope, not just for Australia but for the world, when it comes to the task of the transformation of our energy network—the shift from fossil fuel to renewables.

Sitting suspended from 17:51 to 17:56

As I was saying, the important thing about transition is that the price of the renewable becomes lower than the fossil fuel that is available now. While we in the developed world can put restrictions on ourselves—we can raise the price of fossil fuel; we can wear a hair shirt, if you like—it won't make a significant difference to the fossil fuels that are consumed in the rest of the world. The path to sustainability, the path to renewable energy, is to make the renewable energy and make sure that it is cost-competitive and undercuts fossil fuel. Then, of course, the world will beat a path to your door.

Hydrogen offers great hope. The National Hydrogen Strategy said in only November last year that the magic figure for production and transportation to the point of usage is around $12 to $14 a kilogram for hydrogen produced to compete with distillate and petrol. To replace gas heating, you would have to produce hydrogen for around $1.20 a kilogram, so that's a little way away yet. We've got quite a bit to go.

However, it's worth contemplating that South Australia leads the renewable energy charge across Australia. We have 2,300 megawatts of installed capacity of wind and large solar in South Australia. Around 1,700 of that, I might add, is in the electorate of Grey. There is 1,080 megawatts of rooftop solar. When that's all up and operating, that's more than enough to run South Australia. In fact, the grid has become quite unstable, to the point where AEMO is now restricting large wind generators to 1,300 megawatts at any particular time because, if they allow for more than that to be generated and fed into the grid, it puts pressure on the baseload generators that are underwriting the system, that hold it all together.

The great possibility here is for the transition fuels for storage. In South Australia, we have four different options, I think. One is the interconnector proposed by the South Australian government, which will go directly through to New South Wales and, by dint of that, will actually connect with Snowy Hydro 2.0. We are also providing money to build up the business cases for two or three local pumped hydro projects, which will give anything up to eight or nine hours electricity at full tilt.

There has been a big investment and expansion in batteries. I'm the first to sing the praises of batteries inasmuch as they provide a very special role in balancing both frequency and voltage. They are instant responders, if you like. There is more investment going into batteries, but as far as I can tell, based on everyone I speak to in the industry, it's widely accepted that the technology in batteries is nowhere near providing the deep storage capacity that we need, that can back up a system that is not generating for hours or one day or two days at a time because the wind's not blowing.

At this stage the most important transition energy source is gas, and we should be making sure that we use the gas that we have been provided with in Australia. But there is a space for hydrogen in there, and hopefully, in the first instance, it will come for firming up operations. But if we can get the price cheap enough, and experience shows the more you invest in an area the more likely you are to get there, then perhaps we can get it down to the stage where it can provide baseload electricity on a repeatable basis. We must remember though, if we want to produce 50,000 tonnes of hydrogen a year from a renewable, intermittent energy source, we might have to build a plant that has 100,000 tonnes a year capacity. So somewhere along the line you pay the price: you build for overcapacity to compensate for the intermittency of the electricity generation at the first point. I'm sure I'll get to add to this at another time, because it's a subject I feel quite passionately about.

Sharon Claydon (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

Clean hydrogen has a critical role to play as we make the global shift towards a low carbon economy. If we can produce hydrogen from renewable energy, Australia could forge a multi-billion dollar green industry with tens of thousands of new, well-paid jobs. While this has long been an aspiration, the economics are changing rapidly, as is the potential for this technology to become a viable commercial reality. And the market potential is massive, with the global market expected to top A$200 billion by 2024.

Given our natural advantages, Australia has the potential to be a hydrocarbon powerhouse. My home city of Newcastle in particular the has energy smarts, the industrial experience and the infrastructure needed to be a key player, but first the policy settings need to be right. After seven years and 19 energy policy attempts, the Morrison government still have no national energy policy and they continue to push an anti-renewables agenda, refusing to capitalise on the huge benefits that clean energy can bring to Australian households and businesses. It's time for the Morrison government to reject, once and for all, climate change denialism and end its war on science. We need an energy policy that incentivises renewable energy investment, putting green carbon front and centre.

Federal Labor have long recognised the incredible potential for carbon, for the environment, for jobs, for our international competitiveness. We went to the 2019 election with a strong $1.1 billion national hydrogen plan, which would have been one of the largest industry development packages in the history of this country. We also committed to delivering 50 per cent of energy from renewable sources and doubling the budget of the Clean Energy Finance Corporation to invest in these game-changing projects. Regretfully, we weren't able to form government, but that doesn't make the need to support a green hydrogen industry any less urgent.

Research by ACIL Allen projected that Australian hydrogen exports could be worth $10 billion in 20 years, mainly in regional areas. As I mentioned earlier, my home city of Newcastle is uniquely placed to benefit as one of the nation's premier energy research hubs. With a rich history steeped in energy production, Newcastle has all of the ingredients to become a powerhouse of hydrogen research, development, production and export. We have energy smarts in abundance through the world-leading Newcastle Institute for Energy and Resources and the flagship CSIRO Energy Centre. We have a strong industrial skills base with more than a century of experience and we have a fabulous deepwater port.

Like most Novocastrians, I have nothing but respect for the hard and often dangerous work of coalminers in the region. These men and women are part of our families and our communities. They've helped shape our past and present and play a key role in driving our region's prosperity. But coal, like oil and gas, is a finite resource that produces significant greenhouse gas emissions. If we are to combat climate change, we know we must transition to a low-emissions, low-carbon economy. Hydrogen, along with battery storage, will be key to Australia's energy future.

Newcastle and the Hunter have a lot at stake in any such transition, which is why we should be leading these discussions, ensuring no-one is left behind as we take full advantage of the opportunities ahead. As Ross Garnaut showed in his book Superpower: Australia's low-carbon opportunity we now have a golden window to capitalise on our abundant natural resources and our exceptional research capabilities to become a global energy superpower—although, on this second point, I'd like to note CSIRO and science itself have suffered gravely at the hands of this Liberal government, and our energy scientists aren't immune. Indeed, only a few months ago we learned that 40 energy jobs are set to go from the CSIRO, including up to nine from the CSIRO Energy Centre in Newcastle. If we are to fulfil the incredible promise of clean hydrogen, the government must call time on their reckless climate wars, stop attacking scientists and grasp this opportunity with both hands. Right now, Australia needs a genuine national energy policy that will drive investment and growth in the clean energies of the future.

Sitting suspended from 18 : 06 to 18 : 11

Nicolle Flint (Boothby, Liberal Party) Share this | Link to this | Hansard source

The Morrison government is investing in the energy opportunities presented by hydrogen. In November last year our government released a landmark strategy that will guide the development of our nation's growing hydrogen industry. The National Hydrogen Strategy was developed in consultation with the states and territories. It lays out a path to solving the problems of today and creating the jobs of tomorrow by investing in new technologies. Consistent with our focus on new technologies to reduce emissions and lower energy costs, hydrogen will become a key pillar in our ongoing work to secure better environmental outcomes without sending the nation broke.

Our approach could not be more different to that of those opposite, whose only solutions are to impose billions of dollars of taxes on Australian businesses and our communities. This makes absolutely no sense. By comparison, our plan for the hydrogen industry makes a lot of sense. It makes sense for Australia. We have abundant energy resources, extensive carbon storage sites, and a strong track record of and capability for energy exports.

Hydrogen has substantial untapped potential. We're working to release that potential through the CEFC's new 300 million Advancing Hydrogen Fund and ARENA's $70 million funding round for electrolyser projects. The latter fund in particular has received strong interest, with over 36 expressions of interest submitted, showing that industry is ready and able to co-invest to help grow our hydrogen industry. As we know, supporting pilots, trials and demonstrations is important to further research and development and to realise the extensive applications hydrogen has to offer.

In addition to this targeted funding, we have laid good foundations for hydrogen's safe use across Australia, by working with the states and territories to review hydrogen safety regulations for government and industry. In April this year Australia also became a member of the US Center for Hydrogen Safety and, alongside industry, we are developing a certification scheme. This scheme will adhere to agreed international standards and allow us to trace and certify hydrogen production, guaranteeing transparency for consumers and certainty for government in assessing emissions. We are also supporting the integration of hydrogen in Australia's gas networks, reviewing national gas laws and other energy laws and options for setting and allowing updates to the upper limits on the volume of hydrogen-natural gas blends permitted in our networks. This brings me to a very exciting hydrogen project based at the Tonsley Innovation District, which is in my electorate of Boothby.

Tonsley is the home of innovation in South Australia. Their involvement in hydrogen production and blending is no exception to this. Hydrogen Park South Australia is being built at Tonsley by Australian Gas Infrastructure Group and will feature Australia's largest electrolyser. The 1.25 megawatt proton exchange membrane electrolyser will remove carbon from the natural gas supply using renewable energy, creating zero carbon hydrogen gas before that gas is blended back into the natural gas network for an efficient and clean burn. It is underpinned by another visionary Liberal government, with a $4.9 million grant from the Marshall Liberal government, alongside AGIG's $6.5 million dollar investment.

The project will supply over 700 homes in the adjacent suburb of Mitchell Park with up to a five per cent blend of hydrogen. The gas network supplying these homes has been sectioned off to allow for better measurement of the project's outcomes and goods consultation and communication with those residents who will be using this clean and blended gas. It will demonstrate the feasibility of blending hydrogen across the broader South Australian gas network and help inform government planning on the transition to a low-carbon gas distribution network that heavily features a hydrogen blend. Crucially, there will be no extra cost to customers who are receiving this gas as part of the project.

To borrow words from AGIG's chief executive Mr Ben Wilson, the project will deliver renewable hydrogen made from water, sunshine and wind and paves the way for commercial deployment of a hydrogen economy. Additionally, having the largest electrolyser in Australia has its benefits. Production at Hydrogen Park will be around 480 kilograms per day, providing a surplus that could also benefit local industry in South Australia where we currently import the product from Victoria.

It is such an exciting time for this industry which is supported by the Morrison and Marshall Liberal governments. I wish to commend all those who are leading the way for hydrogen in Australia and particularly the work of Ben Wilson and the Australian Gas Infrastructure Group for their ground-breaking work and their project in my electorate of Boothby.

Sitting suspended from 18:17 to 18:21

Josh Wilson (Fremantle, Australian Labor Party, Shadow Assistant Minister for the Environment) Share this | Link to this | Hansard source

I'm glad to make a contribution tonight to the debate on this motion. I thank the member for Ryan for bringing it forward. It's refreshing to see a member of the government from Queensland speak about the export and job-creation potential of new energy technologies, particularly those that support the rapid shift that we need towards renewable energy and related forms of zero-emission fuel. That's in contrast, of course, to his colleague, Senator Canavan, from the other place, who in January last year described Labor's promotion of an Australian hydrogen industry as snake oil and said that any large-scale production and export of hydrogen was probably decades away. Meanwhile, of course, countries like Japan, Germany and South Korea are busily forging down the hydrogen path.

In Australia, we have some of the best renewable energy conditions on the planet and we should be a top-of-the-tree, state-of-the-art player when it comes to green hydrogen, but, needless to say, that's difficult when you have a government that underrates and undermines renewable energy at every turn, a government in denial about climate change, a government that has sought to weaken or dismantle features of Labor's successful work in this space, like the Australian Renewable Energy Agency and the Clean Energy Finance Corporation. The government has belatedly released its hydrogen strategy, but, let's not forget, that comes after six years of doing very little—so little, in fact, that we still don't have a national energy policy. That means we don't have the clarity and certainty of a national framework to guide energy investment and emission reduction, and that means we have higher prices and falling investment. What else don't we have? We don't have an updated Defence estate strategy, which should ensure that Defence planning and procurement make a contribution to new energy innovation, as happens in the United States. We also don't have the final report of the review into Australia's liquid fuel security, when making rapid progress towards electric and hydrogen vehicles would alleviate our terrible over-reliance on liquid fuels. The review's interim report that was issued in May last year said:

Australia may be left behind as the world moves away from oil-based fuels to other forms of transport energy such as electricity and hydrogen.

The world is transitioning to other transport energy sources faster than Australia. To maintain reliable energy supply, particularly for transport, Australia needs to keep pace with global trends, otherwise we risk being left behind with aging infrastructure and potentially more limited supply of oil. Take-up of other sources of transport energy in Australia has been slower than in countries like New Zealand, Norway, Japan and China. In Australia, the market share of electric vehicles is less than one-seventh of the market share in the United States and Canada.

Hydrogen is significant, precisely because it offers a means of renewable energy storage that has particular value as a zero-emission transport fuel. That's why Japan is working so hard to develop passenger vehicles that run on hydrogen, Norway is developing hydrogen ferries and Australian resources companies are making the shift as well. For example, Fortescue in my state has kicked off a first-of-its-kind project that will deploy 10 full sized hydrogen coaches at Christmas Creek to replace the existing fleet of diesel coaches by mid-2021. This will involve installing a hydrogen fuelling station that will be sustained by FMG's 60-megawatt Chichester solar project and is supported with a grant from the WA government's Renewable Hydrogen Fund. Taken together, these measures will reduce carbon emissions by 40 per cent and displace 100 million litres of diesel each year. While we so often hear the lazy assertion that Australia's export oriented industries, including in mining and resources, are dependent on conventional energy, the reality is these companies are moving to adopt renewable energy and storage technology as the foundation of their operations at a rapid rate. Why is that? It's because they know the approach will guarantee them cheap energy that they control while making a contribution to reducing emissions.

Unlike the government, the Business Council of Australia supports the target of reaching net-zero emissions by 2050, as does every state in Australia. Both BHP and Rio Tinto have committed to achieving net zero within their own operations by 2050. It is this government, the Abbott-Turnbull-Morrison-dot-dot-dot government that is the outlier on this issue. I understand and endorse the member for Ryan's enthusiasm for the CSIRO's work on hydrogen in his electorate. It's a shame the government has cut funding to the CSIRO. It is without question that Australia should be a leading exponent of the shift to hydrogen produced by renewable energy, but we have fallen behind the international pack through inaction and through policy neglect. State and local governments are forging ahead. Companies are forging ahead. It's the Morrison government that is letting the side down.

Lucy Wicks (Robertson, Liberal Party) Share this | Link to this | Hansard source

Given there are no further speakers, the debate is adjourned and the resumption of the debate will be made an order of the day for the next sitting.