Wednesday, 6 September 2017
Questions without Notice
Government senators interjecting—
My question is to the Minister for Regional Development, Senator Nash. Yesterday the minister begged senators to ask her questions about issues important to the Australian people, including, 'What is the coalition government doing to improve energy affordability?' Can the minister confirm that, under the coalition government, wholesale electricity prices have doubled?
In terms of the specific number, I'm not entirely sure what Senator Cameron is referring to. I am not confirming that. What I will confirm is that it has taken this coalition government to focus on energy reliability and affordability. We have a track record in this area, unlike those opposite. When we look at, say, the Labor state of South Australia, to see what has happened there on energy reliability and affordability, it is the worst state.
I may just run through for those opposite what the coalition government are doing on energy reliability and affordability. We are expanding the Snowy Hydro scheme, increasing capacity by 50 per cent—
This is on relevance. I did not ask what they were doing. I simply asked whether it was true that, under the coalition government, wholesale electricity prices have doubled. That is the policy question and the minister should answer that.
Those opposite may know that the Prime Minister has recently met with energy retailers. I must commend the Prime Minister for the work that he has been doing with those energy retailers to ensure that our consumers have the best plans available. Around two million Australians have been contacted or will be contacted to ensure that they are on the best available energy plans.
This is in contrast to what those opposite have been doing, which shows an absolute lack of commitment to providing reliability and affordability for the Australian people when it comes to electricity prices. We are putting downward pressure on gas prices. It's taken this government to put policies in place to ensure that we have that downward pressure on gas prices. Unlike when we look at the comments from Mr Butler from the other side, of course, showing the previous track record of the Labor government is less than positive when it comes to gas prices, it is the coalition government that's going to deliver on reliability and affordability for energy for the Australian people. (Time expired)
Almost three months ago, the Finkel review recommended the establishment of a clean energy target, a move energy generators say is necessary to reduce upward pressure on energy prices. Can the minister confirm that the coalition government has still not been able to agree on the clean energy target?
When I was talking about questions that were important to the Australian people, I didn't think I'd be asked questions outside of my portfolio area on energy, but I'm very happy to take the question.
Thank you very much, Mr President, and can I acknowledge the Leader of the Opposition in the Senate for her assistance and for being so helpful. I was merely pointing out that, while I'm very happy to take the question, indeed, about an issue that's very important to the Australian people and that the coalition government is delivering a solution for, it's simply not my portfolio. My understanding is that Finkel himself said that the response would take up to six months, and we are on track to do that.
Six months, eh? Isn't it clear, whether it's energy affordability or the eligibility of ministers who make the decisions that impact all Australians, that this minister and the coalition government don't have answers to the issues that are important to Australians?
I can tell the senator what's important to the Australian people. What's important to the Australian people is making sure, as I've said, that we have affordable and reliable energy. There is probably nothing more important to the Australian people at the moment than knowing that they're going to be able to afford their electricity prices.
I'll tell you what else is important to the Australian people—making sure that we've got a strong and sustainable regional economy. Regional Australia drives this nation and drives the economy, and, unlike those opposite, it's the coalition that is going to put the policies in place to make sure that we do that. This government is absolutely focused on what's important to the Australian people.
I'll take that interjection from the other side from Senator Collins. She's going, 'Oh dear.' That's about the only contribution she's got for regional Australia. That's all she can come up with—'Oh dear.' It's the coalition that's going to deliver for this nation, and we'll continue to do so.
My question is for the Minister representing the Minister for the Environment and Energy. Today the Prime Minister said that there's been 'a colossal failure in the planning of our energy system', and we Greens absolutely agree. It's hardly a surprise when the government's destroyed the long-term price signal; slashed the Renewable Energy Target with the support of the Labor Party, turning away international clean-tech investors; and created enormous uncertainty in the energy sector. Given that Malcolm Turnbull's energy plan now consists of nothing more than extending the life of a polluting coal plant when even its owners want to shut it down, why isn't this just another colossal failure in the planning of our energy system?
It's clear that Senator Di Natale has not had time yet to have a look at the AEMO review—the study that looks at the requirements for base load-dispatchable power in Australia and highlights, indeed, some of the risks to the Australian economy, energy supply and affordability of energy of the current arrangements in Australian energy delivery. It's a report that highlights the fact that those risks have been exacerbated by the closure of the Northern Power Station in South Australia, which was a coal-fired plant, and Hazelwood Power Station, which was also a coal-fired plant. It's a report that highlights the fact that those risks have come about because—as indeed Dr Finkel himself highlighted in his work—the stability in the market has been undermined by an excessive reliance on renewable energies and by a loss of those steadying influences of base load power and the way in which they interact with the energy systems.
I invite Senator Di Natale to take a look at the AEMO report to actually see very clearly what it says and the indication it makes about the importance of maintaining stability in the system. It's why one of the early recommendations of the Finkel review that this government has acted on is to provide certainty around the closure of major base load generators. It's why we want to keep those major base load generators in the system for as long as possible. So, yes, it is why we want to keep Liddell Power Station open for as long as possible and why the Prime Minister is actively engaged in ensuring that Liddell Power Station does stay open to provide the time and the stability to ensure reliability in the Australian energy market into the future.
Let's go to the AEMO report. The Energy Market Operator is not recommending extending the life of coal generators. Its clear preference is an ambitious national plan for more renewables, embracing the modernisation of the grid and accelerating the uptake of new technologies like storage, smart software and demand management. Why won't the government adopt this plan and rule out spending one cent of public money on extending the life of the Liddell coal-fired plant?
Senator Di Natale is clearly ignoring the elements of the AEMO report that make it clear that were the scheduled closure of Liddell in 2022 to go ahead there would be a supply shortfall. When there is a supply shortfall, the consequences for households and businesses are real. Our government is working on the delivery of Snowy 2.0, which can provide reliable energy into the system. But that will take time. It's important that, in delivering these things, we keep maximum reliability in the system, which is where extending the life of something like Liddell—
Just prior to that you did ask why won't the government adopt the report, or the details of the report, and the minister at the beginning of the answer to your question indicated elements of the report. He directly responded and was directly relevant and indicated why not. I agree he hasn't answered the second element of your question but he certainly answered the first element.
This government is not going to make any apologies for engaging directly with the owners of Liddell to make sure, if it is at all possible and viable, that that plant continues its operation beyond the scheduled closure date to give the reliability and base load certainty to our energy markets in the future that will help to keep prices down and reliability up. (Time expired)
The potential gap in supply following the closure of the Liddell plant would have been more than filled by renewable energy like solar and wind if it wasn't for the Labor and Liberal parties slashing the 2020 renewable energy target. Given that they created this mess, why won't they fix it by making sure we have more renewable energy in the system and adopting AEMO's plan?
Base load despatchable energy—base load energy that's there when you need it, as you need it—is not solar and wind, as Senator Di Natale neatly summarised it; that's not at all the case. It is about how you guarantee the energy is there when you need it. For all the good things about renewables, you cannot guarantee solar and wind will be there when you need them.
Hydro! This is exactly why the Turnbull government is getting on with looking at pumped hydro projects, ensuring we can deliver reliable energy. We have seen in states like mine that have gone down the pathway of an overreliance on renewables—South Australia and your home state as well, Senator Di Natale—
Thank you, Senator Hinch. I remind all senators that interjections are disorderly. It's only fair that we all get to hear the answers as well as the questions, so I would ask all senators to refrain from making additional noise and interjecting, which is disorderly.
AEMO highlights that in South Australia and Victoria, where state governments have pursued more aggressive renewable targets and where we have seen the closure of base load plants, there is a higher risk to reliability than elsewhere in the market—that's the reality and it is a reality we are trying to address and fix. It certainly won't be fixed by your narrow solutions. (Time expired)
My question is to the Minister representing the Minister for the Environment and Energy, Senator Birmingham. Particularly given your response to Senator Di Natale about a state government who closed down a base load power station and then had to commission filthy, polluting, diesel generating capacity to make up for the shortfall, can the minister update the Senate on what the Turnbull government is doing to put downward pressure on power prices and ensure stable and reliable electricity for all Australians?
I thank Senator Fawcett, from my home town of South Australia. As I was just referencing to Senator Di Natale, and it's important to Senator Hinch, who indicated that he wanted to hear the answer, the threat to energy security and reliability in states like South Australia and Victoria—and across New South Wales if Liddell were to close—is a real threat. That is why we've been getting on as a government with focusing on how it is we enhance reliability in the system and issues of affordability that flow from that.
It's why, as a result of the state-wide blackout that our state faced last year in September, we made sure emergency measures were put in place: at least two synchronous generators must be running at any given time, given the unreliability that comes from the wind generators within the system in South Australia. It's why we've also taken action to ensure that a new generator-reliability obligation is in place to ensure that intermittent sources of generation have an appropriate level of backup in place to guard against blackouts. It's why we've taken the action, in relation to energy security obligations, to provide necessary support services around frequency control and ancillary services and inertia—again, to deal with the issues that come from having a higher reliance on intermittent sources of energy rather than on base load dispatchable power sources. We want to make sure as well, as I indicated in my previous answer, that large generators have a minimum period before closure. Ideally, we want to extend the life of those large generators to get maximum use out of the investment, maximum reliability into the system—again, to keep prices down.
Senator Cameron, of course, wants to see jobs lost in the Hunter Valley. He wants to see Liddell gone as soon as possible. But we on this side want to make sure that we actually keep those jobs, where we can, and, importantly, keep affordability and reliability in our energy system. (Time expired)
It's remarkable the interjections coming across here from Senator Cameron who seems to be taking great delight in the concept that the Liddell plant might close. I heard Mr Fitzgibbon on radio this morning saying he'd love it if the life of Liddell could be extended; he'd love to see those jobs survive. While he was being cynical about it and while he was saying that he didn't think it could happen, he at least was positive about the prospects of saving those jobs. Senator Cameron seems to be wishing them away even faster than 2022.
The AEMO review has highlighted, very clearly, the importance of base load dispatchable power to make sure there is enough in the system. It has highlighted that the closure of Liddell in 2022 would create a supply shortfall, would exacerbate and replicate the problems we have seen in South Australia and Victoria. That is why we are taking every possible step to make sure that is avoided.
The ignorance from those opposite is on display for all to see when it comes to the risks to a reliable energy system—but, as well, the blindness of the different state and territory governments: Victoria, who continue to charge on ahead in the pursuit of their own renewable energy target, or our home state of South Australia, where the madness is on display that, having closed down the coal fired Northern Power Station, having developed an excessive reliability on renewable energies, the solution, apparently, is now diesel generation. At a cost of $110 million, the diesel generators will be fired up using 80,000 litres an hour of diesel—80,000 litres an hour of diesel is apparently what's going to be required to keep the lights on in our home state. That, of course, is not acceptable. It's why as a government we're investing in smart solutions, sustainable solutions, long-term solutions and making the market— (Time expired)