Tuesday, 8 November 2011
Clean Energy Bill 2011, Clean Energy (Consequential Amendments) Bill 2011, Clean Energy (Income Tax Rates Amendments) Bill 2011, Clean Energy (Household Assistance Amendments) Bill 2011, Clean Energy (Tax Laws Amendments) Bill 2011, Clean Energy (Fuel Tax Legislation Amendment) Bill 2011, Clean Energy (Customs Tariff Amendment) Bill 2011, Clean Energy (Excise Tariff Legislation Amendment) Bill 2011, Ozone Protection and Synthetic Greenhouse Gas (Import Levy) Amendment Bill 2011, Ozone Protection and Synthetic Greenhouse Gas (Manufacture Levy) Amendment Bill 2011, Clean Energy (Unit Shortfall Charge — General) Bill 2011, Clean Energy (Unit Issue Charge — Auctions) Bill 2011, Clean Energy (Unit Issue Charge — Fixed Charge) Bill 2011, Clean Energy (International Unit Surrender Charge) Bill 2011, Clean Energy (Charges — Customs) Bill 2011, Clean Energy (Charges — Excise) Bill 2011, Clean Energy Regulator Bill 2011, Climate Change Authority Bill 2011; In Committee
by leave—I move together amendments (1) and (2) on sheet 7173, standing in my name, on behalf of the opposition, and in the name of Senator Xenophon:
(1) Clause 111, page 145 (lines 6 to 17), omit subclause (2), substitute:
Issue of units
(2) The Regulator must not issue one or more carbon units to a person as the result of an auction unless the person has lodged a deposit that relates to the total amount of charges payable for, or imposed on, the issue of the units.
Note: For rules about deposits, see section 113.
When balance of charge for a unit is payable
(2A) The balance of the charge for the issue of a carbon unit is payable in the year corresponding to the vintage year of the carbon unit.
(2) Clause 113, page 149 (after line 25), after subclause (4), insert:
(4A) A deposit specified under paragraph (2)(n) must not be greater than 10% of the total amount of charges payable for, or imposed on, the issue of carbon units to a person as the result of an auction.
This is the last chance the government has and the Greens have to avoid an even worse rise in and an even worse outcome for Australia's electricity prices than would otherwise be the case under this legislation. These amendments would ensure that at least 90 per cent of the up-front costs associated with the advance purchase of permits by electricity generators would be removed. These are important amendments because they ensure that unnecessary electricity price rises above the gross electricity price rises already imposed under this legislation could be avoided.
Electricity generators believe and have told all sides in this debate that without this amendment there will be a transfer of around $10 billion in working capital from Australia's electricity generators to the pockets of the Australian government. The ultimate risk with this occurring, if what they predict happens, is that the forward contracting of electricity in Australia will drop off. That does not sound very sexy but it is very important because, if the forward contracting of electricity in Australia drops off, the Australian electricity market becomes ever more dependent upon the spot market and the spot market price is ever more volatile and therefore ever higher. The electricity generators estimate that, with even just a five per cent drop-off in electricity prices, there will be an increase of between 10 and 15 per cent in electricity prices above and beyond the 10 per cent rise that the government forecasts as a result of their carbon tax. That is why these amendments are so important. They do not have any other bearing or impact on the operation of the carbon tax. Even Senator Milne has acknowledged that these concerns are an important consideration. Senator Xenophon has been convinced to pursue this. We had extensive questioning on this. I urge all members of the Senate to support these amendments.
Given that this is likely to be my last opportunity to comment in this debate, I would like to again highlight the contemptuous nature of the Labor Party in pursuing this tax. Be under no illusion that at the end of today Julia Gillard will be leading a government under which there is a carbon tax. In contrast to everything that she said before the last election, she will have backtracked on that, back flipped on that and backed down on that and will be delivering a carbon tax that she promised never to introduce, a carbon tax that will see all Australians face at least a 10 per cent rise in electricity prices and at least a nine per cent rise in gas prices. Under the government's own optimistic forecasts, we will see at least three million Australian households worse off and Australian industry made less competitive than industries anywhere else around the world. Just today we see evidence splashed across the front page of the Australian Financial Review demonstrating just how high this carbon tax is in comparison with the rest of the world. It is basically double the price of the European scheme, the only scheme that is vaguely comparable to what is being proposed in Australia.
As I heard one of my colleagues say, this is indeed a black day for Australia. It is a shameful day for Australian democracy that this government lacks the courage to take this to the Australian people. That is the final challenge I lay down. If this government has courage in its conviction, if it is genuine about this policy, then it should take it to the people. Before going to the Governor-General and recommending proclamation of the carbon tax, the Prime Minister should go to the Governor-General and call an election.