Wednesday, 6 September 2017
Questions without Notice
My question is to the Minister representing the Minister for the Environment and Energy, Senator Birmingham. I refer to Adam Creighton's article in The Australian newspaper last week entitled, 'The cost of going green: taxpayers hit with a $60bn power bill'. According to the article, for the 20 years from 2010 to 2030 taxpayers will be paying $60 billion in subsidies to the renewable energy sector, delivering the world's most expensive, unreliable power, particularly in our home state of South Australia. The more reliable and affordable base load power solutions, such as coal, gas and nuclear, are being built all over the world but are made unwelcome in Australia under Liberal and Labor governments. Why is your government ignoring overseas experience and throwing tens of billions of taxpayer dollars at intermittent, expensive and unreliable renewable energy?
I thank Senator Bernardi for his question and for the continued focus in the chamber today on energy reliability and affordability. As I have emphasised a couple of times already today, and said a number of times over the course of the week, the government is taking action across the different elements of the energy market—generation, transmission or networks, and retailers—to make sure that across all areas we work to enhance reliability as well as affordability. We see this as being critically important. This is not just something we've been doing over the last few months or even the last 12 months or so but something that since we came to office we've been working across the board on energy prices, affordability and reliability.
Under our political opponents, it is correct that electricity prices rose by some 101 per cent. They doubled over the space of six years. Under our government, at the time when you were a member, Senator Bernardi, we saw energy prices record the largest fall on record, through the elimination of Labor's carbon tax, through other reforms to network regulation, and through steps that were taken around the Renewable Energy Target, including putting in place more realistic targets that were more in keeping with the original ambition. We are now working on looking to the future in terms of more secure generation frameworks. As we've indicated, that means keeping operating, existing generation facilities for as long as they are reasonably viable, as well as looking at what types of new, cheap, viable and affordable options can come online to provide for that dispatchable base load energy that AEMO recognises as being so important. That is where projects such as Snowy Hydro 2.0 come in, which can provide significant additional generational capacity at the time that it's needed in the market, and that will put prices down at those moments. (Time expired)
Mr President, I have a supplementary question. Minister, your government has teamed up with the Labor predecessors to commit $60 billion of taxpayer funds and subsidies on expensive and unreliable renewable energy. How many megawatts of base load capacity in 21st century nuclear power generation could be built with $60 billion?
I'm sure it won't be a surprise to Senator Bernardi or the chamber that I don't have an estimate for a hypothetical question of what $60 billion could buy in nuclear generation capacity. I would note that there have been various studies—by academia, parts of industry and parts of government—over a number of years about the economics of nuclear generation in Australia. Generally, those studies have found that nuclear generation has not proven to be something that is commercially attractive to potential investors.
Senator Bernardi interjecting—
Senator Bernardi, I hear your interjection that, if we were to subsidise it, perhaps it would be attractive. What things like the Renewable Energy Target have sought to do is to incentivise the development of new capabilities, and they have had some success in that regard. But we have seen policies that have taken that too far, and that is what we are trying to correct at present. (Time expired)
The Snowy Hydro scheme presently operates at 12 per cent of electricity generation capacity, yet the government's utopian Snowy Hydro 2.0 is, in truth, $2 billion spent on yet another electricity experiment. Why not save the taxpayers money and simply give contractual certainty to generators who could improve our base load capacity by building more reliable and affordable coal-fired power stations?
I'm not entirely sure what Senator Bernardi means by 'contractual certainty', but I would emphasise, as I have already emphasised to the chamber today, that the government is genuine in its conversations with the owners of Liddell about how we work to extend the life of operations. These are proper, serious considerations to make sure that we do get the best and most out of our coal-fired generators. I'd say in relation to Snowy Hydro 2.0 that actually the confidence that the business case, and the likely return on investment of that, stacks up is very high. We already have around 350 people working on the feasibility and the development of that, and the potential for that to provide more certain base load power that can be put into the grid not only at the times when it's needed but also at the times when prices would otherwise be high, to drive down the wholesale price at those times, providing not only a reliability benefit but also an affordability benefit to households and businesses. (Time expired)