Monday, 27 November 2023
Regulations and Determinations
Competition and Consumer (Gas Market Code) Regulations 2023; Disallowance
WATERS (—) (): At the request of Senator McKim, I move:
That the Competition and Consumer (Gas Market Code) Regulations 2023, made under the Competition and Consumer Act 2010, be disallowed.
In December, the Greens supported legislation to give the government the power to set caps on the prices of gas and coal—not caps on rents, unfortunately, but we'll come back to that on another day. This regulation is a result of that.
From the outset, I want to make it clear that the Greens support cracking down on the unscrupulous conduct of the gas cartel. This gas code does have many important features that we support. We support shifting negotiating power away from the gas cartel and supporting large industrial users who have been screwed over by gas exporters since the east coast was opened up for exports in 2015. We support the transparency changes so that we can better see what's happening in what is otherwise a very murky gas market. We also support using the code to divert gas destined for export to be used here while we transition off gas. But what we cannot and will not vote for is using this gas code to encourage the opening up of new gas fields that are cooking our planet; we cannot support throwing more petrol on that fire. When the government announced this gas code on 14 June, they said in their media release:
The Gas Code will ensure that Australian gas is available for Australian users at reasonable prices, give producers the certainty that they need to invest in supply …
In the same week that the climate minister will announce how they're falling just short of their 2030 target—expected to be announced on Friday, and which I know is aligned more to two degrees of warming than it is to 1½, which would be catastrophic for the planet—the Albanese government are again going to vote to support new gas fields. What part of 'no new coal and gas' does this government not understand?
We are conscious that there's a gas shortfall hitting the east coast market from 2027 onwards, and that something needs to be done about it. There are three things that the government could do in the four years that we have to prepare for that. They could increase supply through new toxic gas fields. They could reduce demand by electrifying homes, businesses and industry. They could divert existing gas supplies away from the LNG industry, which is the biggest user of gas in this country, and fill the supply gap that way. But it seems like the government is putting all of its energy into simply opening up new gas fields and is completely neglecting the importance of getting Australia off gas and lowering energy bills as a result of doing so.
We do have the time. Germany, for example, reduced their gas use by 18 per cent in one year, when Russia invaded Ukraine. They did this through installing heat pumps and through energy efficiency. We've got four years to do what they managed to do in one year, but what we don't have, seemingly, is the political will. The government could also go harder in making sure that Australian gas stays here while we transition off it. Take, for example, the GLNG terminal in Gladstone which is owned by Santos, a well-known donor to the government and also to the opposition, I might add. Santos are currently buying up to 22 petajoules out of the domestic market to meet their own contractual shortfalls. They jumped the shark on their own contract promises and now they're chewing up uncontracted gas to meet their own overblown commitments, and everybody else is suffering. Santos screwed up their own contracts and now they're sucking gas out of our market to export overseas. It's very nice for them, not so great for Australians.
It's not a sovereign risk to let Santos deal with the mess of their own making. That is not sovereign risk. If we let them keep taking our gas, then it's the Australian people's mess to clean up and they'll be the ones paying higher prices. But because taking action would disadvantage Santos—well, it's a bridge too far for this government. They're going to bend over backwards for Santos and leave the mess for the Australian people to deal with.
The government has a number of options. It could also tighten the baselines of LNG terminals under the safeguard mechanism. If they electrified the compressors they use to convert gas to LNG—to liquefied natural gas—it could free up a staggering 92 petajoules a year. There are many options. This government needs to focus their minds on how we use less gas. Yet, it seems like all they want to do is open up new gas fields. They've drafted a code of conduct that applies a price cap that says: 'You don't have to meet the price cap if you open up new supply.'
Farmers around the country are pulling their hair out. First Nations owners around the country are pulling their hair out. They've seen the damage that coal seam gas and other unconventional gas has already done to farmland, our groundwater, the climate, agricultural productivity and culturally sensitive areas. They've seen that damage and they don't want new gas fields. They don't want what's left of the beautiful farmland in the Darling Downs, for example, where I was a couple of days ago, wrecked by more coal seam gas. I'm yet to find a supporter of this proposal, that there's a gas cap that you can avoid if you open up a new gas field—except, of course, Santos. They would love this. As big donors to the government, perhaps they've written this gas code, like they've written previous bits of regulation.
I was in Toowoomba on Thursday, and I want to commend the Toowoomba Regional Council for being the sixth council in Queensland to declare a moratorium on new coal seam gas operations. It's some of our best soil, in that area. In the 13 years that I've been representing the state of Queensland, I've been out there many times and I've observed the beauty and productivity of that black soil. I think we've even had folk from other political parties take an interest in this issue as well, which is great. Finally, the council have said the farmers don't want this. They don't want new coal seam gas wrecking their farmland and poisoning or dewatering their aquifers, particularly when there is still no legal right for landholders, traditional owners or councils to say 'no' to coal seam gas or coal on their land. I've had a private senator's bill to do that since 2011. It has been voted down more times than I can remember—at least five—even though it's actually in the LNP's platform, or was at some point. They kept voting against their own policy.
Farmers and traditional owners do not have the ability to actually say, 'No, I'd rather use my land for productive agriculture,' or, 'I'd rather simply continue to exist in this beautiful agricultural area than have Santos'—or whichever multinational gas company it is that's eating up the land, poisoning the water and polluting the climate—'come in and ride roughshod.' They don't have that legal right to say 'no'. So I want to take the opportunity to thank the Toowoomba Regional Council for, belatedly but really in a well-done fashion, finally representing the interests of their constituents. As the sixth council that's now done so, it sends a really strong message, both to the state government—who are also in cahoots with the gas industry—and to the federal government.
Councils don't want this. They don't want new gas fields. Farming communities don't want new gas fields. Traditional owners don't want new gas fields. Nobody wants the land wrecked and the water poisoned, or the climate polluted, just for the sake of the private profits of Santos and their other gas mates. What kind of a dodgy outcome is that? What are we meant to be here for? Who are we meant to be representing? I know some of the people in the government used to work for Santos, but you're not meant to work for them now. You're meant to be in here representing the people.
I'm not sure if I will name them, but I think those interjecting right now know exactly where they used to work—we all know too. I'm sick of the fossil fuel company running this parliament. I'm sick of the donations that they make that buy influence over this parliament. I'm sick of the 'regulation' being written by them in a way that creates loopholes for them. And everybody else is sick of it too.
We've got a gas code here that does do some good things, but the absolute flaw in this code is that it will incentivise the opening up of new gas fields. The Greens just cannot support that. We will never support new coal, oil or gas. We're in a climate crisis, folks. What more scientific evidence do you need? How many more natural disasters do you need us all to experience before the penny will drop that you can't fix this issue by making it worse?
We heard from Minister Bowen, who gave a bit of a sneak peek of what's going to be announced on Friday, that you're not going to meet your greenhouse gas reduction targets. We saw an announcement late last week that you'll underwrite more renewable energy, which is also facing a shortfall, to help meet that target. Yet now you want to write a code that essentially incentivises the gas companies to open up new gas fields. I'm sorry, but it just does not add up. You can't say you're taking climate action and, at the same time, tick off on almost every coalmine that crosses your desk and facilitate new gas fields being opened up. Nobody is fooled by that. They are sick of the mining companies, and the fossil fuel companies in particular, running this parliament.
We will not be supporting this gas code of conduct and we are moving to disallow it. I might just add that, in this place, in our last sitting week, we had a debate about the water trigger, which currently applies to coal seam gas but does not apply to unconventional gas—to the shale and tight gas that exists in the Northern Territory and Western Australia. Currently, their water is not protected at all by federal environmental laws. The Greens, again, have a bill to fix that and to extend that protection to all forms of gas extraction and include all unconventional gas in the water trigger. The timing of that could be quite nice, but rather than the government delivering on expanding the water trigger—which, I might add, is in their party policy, but we're still waiting for the delivery of that one—they're racing through new gas fields.
It hearkens back to 2013, when the initial water trigger was introduced. The then environment minister, Minister Burke, ticked off on two massive coal seam gas fields and then, seven days later, decided we needed a water trigger. The people are alive to how much influence the fossil fuel companies have on this parliament and they're fed up with it. They'd like their democracy back. They want you to stop taking the dirty donations from these companies that so poison your decision-making and they would like to see their water protected. They would like to have affordable energy to run their homes and businesses and they would like you to look at supporting businesses to transition off gas, not to create backdoors to prop up Santos's private profits. That is not your job anymore. Your job is here in this place now, and you are meant to be representing the people, the public interest. You are meant to be protecting the climate. We will be disallowing this gas code and we invite others to join us in doing so.
I will keep my remarks to the right amount of time to hear some speakers from the coalition on their position in relation to this disallowance because I'd be very interested to see what the position is of the alternative government in this disallowance motion, which is so irresponsible. It ought never have come here. It ought to be withdrawn. Apart from its stated purpose, the consequences of the Senate adopting the disallowance motion just spoken to, moved by Senator McKim, would be to put thousands of jobs at risk in our manufacturing sector on the east coast, thousands of jobs of people you will never meet, people whose interests you're not interested in, people whose work is fundamental to whether or not we can achieve the energy transition that is required in the manner in default manufacturing sector. We would put thousands of those jobs at risk tomorrow. It would mean the cost reductions that have been assessed for Australian families and businesses of around 25 per cent that have been achieved by the price caps—I know energy prices keep going up—would be at risk because of this disallowance.
The stability, the certainty that is required for investment not only in gas more broadly but in the energy sector in total are fundamental to us achieving our decarbonisation objectives, keeping energy prices low, building new industry. All of that investment would be at risk because of this irresponsible, disconnected-with-reality intervention from the Greens political party. Who knows what the coalition, the alternative party of government, are going to do in this debate? They have been very coy about the position that they intend to adopt on these issues.
It also puts at risk the deal announced today that is based on the code announced by Minister Bowen today with Cenex and APLNG to deliver secure gas supply for east coast manufacturers. All of those things will be put at risk for a stunt and a series of slogans.
The proposition that comes from the interjections over here and also in Senator Waters's contribution that there is a relationship—
That is exactly the point—undermine any capacity for a decent debate here. You know what, Senator McKim? We are advancing—
You ought to withdraw that. That is a grubby slur, and what we don't like—
What is going on here is that the government has a different view to you. The government has an ambitious position in relation to decarbonisation. The government has an ambitious position in terms of the re-industrialisation of the Australian economy. The government has an ambitious position in terms of transforming our electricity and energy sectors. And we disagree with you—we disagree with the Greens political party—about the way that can be achieved. The approach advanced by the Greens political party—and who knows whether it will be supported by the Liberals and Nationals—puts at risk our transition to a cleaner economy. It puts at risk thousands and thousands of jobs in manufacturing firms who rely upon gas for their feedstock and for their energy source, firms that are working with the government through the programs we have set out to make the transition that they need to make, to do the investments that they need to invest in to make sure that they can make the transition that is required.
But this group down here on my right don't care about any of that. What they want is a simple slogan, social media posts and no substantive policy change. This is postmodern politics. It is saying what you feel, saying what you think. It is losing touch with reality that our job here is about what we can actually achieve and do, about what we can do. And the position that has been advanced in this disallowance is the politics of feelings, not the politics of facts. It's utterly disconnected with the reality for modern industry, utterly disconnected with what the objectives of the government should be here.
This time last year, gas suppliers were quoting contact prices of $35 a gigajoule compared to $10 a gigajoule in 2021, but that's what the code is designed to deal with: to shield households and industry from these unprecedented price rises. The government acted. It is not a form of action that would ever have been any government's preferred approach, but it is the right approach—that is, setting the price of gas at a reasonable price for industry and for households.
The exemptions are there in order to make sure that the government can achieve what it needs to achieve in making sure that Australians can meet their domestic gas requirements. That is the truth. You may not like it, you may scoff, but jobs and industry and the decarbonisation agenda rely upon making sure that industry has the capacity to secure the energy needs that it requires.
Gas is also an important pillar of our international relations. Australia's gas is fundamental for our North Asian partners, particularly Japan and Korea, in making sure they can (a) go through security for their industry but (b) also be able to go through the transition to net zero that their economies have to undertake. They actually have to have energy security in order to undertake the transition that they know they must undertake, and this approach undermines all of those objectives: energy security, low costs for households and for business, rebuilding Australian manufacturing, and our regional relationships and the energy security of our partners.
It is utterly irresponsible. It is not a surprise. What I am very interested to see is the position that the coalition adopt around this and whether they have the discipline and the capacity to marshal their whole caucus behind doing the right thing and voting down this reprehensible disallowance.
As a servant to the people of Queensland and Australia, I once again find myself voting with the Greens in supporting this disallowance motion—although for very different reasons. This motion would stop the Labor government's gas code of conduct and price cap. The Greens are opposing it because they say it doesn't go far enough. One Nation says it should never have put in place at all.
You may remember nearly a year ago the Albanese Labor government rushed everyone from across the country back to parliament for an extraordinary extra day of sitting. This extra day of unscheduled sitting may have cost millions of dollars. We'll never know the true cost. When the Senate passed my motion to order the production of documents the Senate ordered the Labor government to disclose how much calling everyone back, because of their mismanagement, had cost taxpayers. Instead of the documents containing the costs, the government may as well have delivered an envelope containing a middle finger. 'We're not going to tell you' was essentially the response.
That extra sitting was to rush through the legislation to give energy minister Chris Bowen the power to effectively nationalise the entire gas market if he chose. Imagine giving that man power to look at the Sunday market. By executive decree, the minister for future blackouts, Chris Bowen, created these regulations imposing a price cap and a mandatory code of conduct dictating who could and couldn't sell gas in Australia, the terms and the prices.
Remember that this tin-pot dictatorship near nationalisation of the gas industry was meant to cut everyone's power bills. It has done nothing to bring down power bills and will likely only make things worse down the road. While the gas price cap was in place the wholesale prices continued to go up—they increased. Power prices got so high that state governments had to step in with direct bill relief with the federal government, taxpayers, paying for it. Mums and dads at home and small businesses are paying for it.
This flood of government subsidies has been huge. It hit roughly half a per cent for the most recent inflation figures. Q3 inflation was 5.4 per cent. Without all of the government bill relief it would have been 5.8 per cent, almost six per cent. While these subsidies might temporarily make electricity bills look cheaper, they're just a bandaid on the national electricity grid that's becoming increasingly unaffordable, unreliable and unstable. These coupons, rebates and subsidies will roll off over the next six months and more Australians will begin to see just how much the net zero push has ruined our country's most essential utility—keeping the lights on.
The Labor government fails to appreciate that when it comes to prices there are only ever two factors at play—supply and demand. Demand for electricity remains pretty steady on a predictable increase. That's not going to change until the government installs smart meters in everyone's house and it can turn off the power remotely. Remember, it's not technically a blackout if the government chooses to turn your smart meter off.
The only solution to power prices is more supply of cheap, affordable, consistent, stable, reliable electricity. The only forms of electricity that tick those boxes are coal, nuclear and hydro—not pumped hydro, which is a scam dreamt up in the net zero pipedream. It's important to remember why gas prices are so damn high. The government announced that coal is dirty—and that's a lie. Making reliable electricity from coal isn't allowed because they say it produces carbon dioxide—a natural trace gas essential to all life on our planet—yet burning gas that produces carbon dioxide is okay. That's what happens in the net zero, upside-down world.
Remember, wind and solar cannot deliver power when we need it. They need reliable sources to back them up. Gas is the only one available that's net zero cult approved. This huge boom in gas demand as coal is shunted to the side is leading to higher prices, higher power bills and instability of the electricity grid. The underlying cause of high gas prices is the demand due to the insane net zero pipedream, pushing expensive, unstable, unreliable solar and wind. Until the underlying cause is fixed, no bandaid can fix it.
The government has been meddling in the electricity market for decades to achieve political net zero agendas for the United Nations and the World Economic Forum. The answer to the problems isn't to meddle even harder. Meddling caused the problems. We don't want to meddle harder. There's a very simple fix to skyrocketing electricity bills—just ditch the renewable energy target and give a promise to the coal-fired generators that the government won't purposely try to send them broke, as they're currently trying to do.
In Collinsville in North Queensland there used to be a small coal-fired power station. As soon as the 2012 carbon dioxide tax came in—thanks to Labor Prime Minister Gillard and the Greens—it closed up shop. The manufacturing industry and hundreds of breadwinner jobs disappeared. The town is a shadow of what it used to be, and that can be traced back to the day they lost cheap, reliable, stable electricity. That's the story of the whole country ever since we began pursuing the net zero pipedream. Just as easily we can turn this boat around and stop this nonsense.
What we're seeing today is when the Left get together with the crazy far left, because neither have any credibility when it comes to this topic. The fact that the Greens just gave us a lecture about gas projects being built on arable farmland, and the destruction of Indigenous cultural heritage sites, while they consistently vote against any inquiry into transmission lines are going to do exactly those things—destroy arable farmland and destroy cultural Indigenous sites. But no, no, no—in the pyramid of the Greens and the pyramid of the far left, renewable energy is the very top. Whales, koalas and feeding anyone is way down the bottom! But we know their pyramid of priorities is all about solar and wind and those new transmission lines, destroying farmland, destroying communities and destroying Indigenous cultural heritage sites. So do not come in here and admonish anyone for supporting new gas mines that are going to provide energy and security for this country—including our export markets, which pay for all of these little pie-in-the-sky flights of fancy you negotiate with your mates in the government—when you are destroying farmland and you are destroying cultural Indigenous heritage sites all in the name of chasing pipedreams of new transmission lines across this country, decimating communities in rural and remote Australia, all of whom have the sense not to vote for anyone that sits on that side of the chamber. It's absolutely disgraceful behaviour.
We on this side will not be supporting Greens disallowance motion today. They just want to attack any exemptions from the code and, ultimately, shut the gas industry down. They'd have us all living in trees if they had their way! Maybe they can stop with their business-class fights and their Comcars every time they come to parliament—they can ride their electric bikes. Maybe they should live by what they preach to everybody else.
To put it on the record, the coalition does not support this Labor government's continuing attacks on the gas sector. This government has put Australia's natural gas market under extreme pressure with their heavy-handed interventions and policies that are harming investment but in no way increasing supply. We on this side have repeatedly warned the government of the long-term impacts of their policies over the past 15 months. We've called on the government to cease their constant interventions. I heard them referred to as bandaids—little sugar hits on energy bills, doing nothing to help Australian families facing real and ever-increasing energy bills because of their incompetence to manage the energy market. Their interventions are distorting the market and continue to cause more problems. We know that we need around 30 per cent more gas by 2050. We also know that this government is putting more money into the Environmental Defenders Office. That's great! That's really well done! One of my favourites—I miss him desperately—the former member for Hunter, Mr Joel Fitzgibbon, came out saying exactly the same: that those opposite have lost the plot by funding the EDO.