Ted spoke with 2HD’s Richard King about the closure of Liddell and Earing Power Stations and the impact on Australia’s energy prices.
Read the transcript below.
Richard King: And it’s nice to have visitors in the studio. Somebody I’ve spoken to on a number of occasions is The Shadow Minister for Climate Change and Energy. He’s also the member for Fairfax in Queensland. Ted O’Brien is in the studio. Good morning Ted.
Ted O’Brien: Good morning Richard. Great to be here in person.
Richard King: Nice to have you here as a Broncos supporter. And another good win.
Ted O’Brien: Yeah I won’t boast mate. We’ve got a few pretty tough games ahead. But yeah, it was a great weekend for the Broncos.
Richard King: And the reason you’re here is obviously the closing of Liddell power station. I think the final reactor, they stopped. Well, they turned it off on Wednesday. And I believe there’s a 10 day process and that’s it’s all over Red Rover.
Ted O’Brien: It’s all over. The final unit goes down and the old girl is put to rest mate.
Richard King: And look a lot of people have been saying oh, look, you know the suggestion that Chris Minns and I think in the lead up to the New South Wales election, both labour and liberal, were suggesting they might intervene to keep it open. I think the last time I spoke to you, you were saying no, it’s gone beyond the point of no return. Now you can’t really resurrect it.
Ted O’Brien: You know, hypothetically, it would have been lovely. If that could have been done, but you know, I think it’s just too late. It’s too late now. And if you tried to do it the last couple of months it would have been too late. So yeah, unfortunately we are where we are and it starts off at a pretty turbulent era. I think for for Australia. Because you know, we are now going to see 20 gigawatts up through to 2035 exiting the grid, 20 gigawatts.
Richard King: We haven’t been getting 20 gigawatts out of Liddell for …
Ted O’Brien: No no, no, no, no, no, I’m not talking about the Liddell representing this, it’s the start right. So Liddell comes off. I mean, Liddell’s total capacity is about two gigawatts, it hasn’t been working on two recently. But what I think the big issue here for us is Liddell big power and we’re going to have 80% of our baseload power ripped out of the blue by 2035 with zero guarantee of a replacement. That’s what it’s all about. And it starts here it starts now.
Richard King: Well, the impact that’s, as I mentioned, there’s an article in today’s Australian Financial Review the imminent shutdown of the power station that provides more than 10% of New South Wales electricity and I’ve heard up to 30% that Liddell provides so we’ll say 10% of New South Wales electricity may drive up power prices and trigger more frequent squeezes on supplies, coal closures accelerate, and that’s your argument, isn’t it? It’s going to shove prices up. We’re going to have shortages, blackouts.
Ted O’Brien: Exactly. Richard, we’ve spoken about this before. I have not met any analyst that says we don’t have a supply problem. In Australia. We have a supply problem and that is particularly due to labor trying to kill off the gas industry. But we’ve got a supply problem. So when you take supply off the market, of course you have less supply. Less supply drives prices up and you just got to hope that winter doesn’t bite and then summer is going to be the real test.
Richard King: The ACCC a fortnight ago was saying we won’t have a gas shortage.
Ted O’Brien: Well, well I was saying that in the short term, maybe we’re going to have enough now but everything’s predicated on the weather. So that’s the challenge right? And I’m not a brave enough fella to start predicting the weather. But if it is a people looking at the weather saying you know what winter this year may not be as bad as last year. I think we might have enough. But I mean, we’re in Australia for crying out loud. We shouldn’t have a business model where we’re really comfortable saying, I think we’ve got just enough and seriously. Third World countries talk like that Australia shouldn’t talk about that. We have an abundance of resources. We should be enjoying those resources and our households shouldn’t be paying exorbitant prices and our businesses should have confidence so they keep employing people and keep investing.
Richard King: It’s already too late. Monday morning with Richard King. My guest is Shadow Minister for Climate Change and Energy Ted O’Brien who’s in Newcastle so will be heading out to Liddell. What do you think should be done? I mean, what what what should we be doing? The plan was that this gas peaking plant at Kurri Kurri the former coalition government were that you know this was supposed to be completed before Liddell closed. It’s now 12 months behind schedule in late next year. And also to its way over budget and as I understand that there’s no gas that’s connected.
Ted O’Brien: Yeah, correct. So Richard, when when AGL made its decision on Liddell. The coalition government then negotiated an extension of Liddell. And we also said we need to have a plan to ensure that we don’t have instability in the grid. So that’s when we invested in Kurri Kurri for gas, Now what has subsequently happened is we’ve lost government, Labour’s come in. And instead of backing in that Kurri Kurri plan, Labour said no, we want a different sort of plan. We want it to be running 30% hydrogen from day one. Now as a result, I mean, green hydrogen too. Yeah, I mean, the whole thing is just daft. Right? So, but nevertheless, they’re being pigheaded about it. They’re saying that that’s what’s gonna happen.
Richard King: They’re not still saying hydrogen though? I think.
Ted O’Brien: Well, they’re not saying anything. Now they’re saying well, you know, maybe it could be a different percentage. Who knows? So when it’s all vague, what they should be saying they should come out and drop the hydrogen. prerequisite. That’s what I’m calling them to do. It’s rot. Everyone knows it’s rot. So just get on with it being a gas plant. Because once this summer hits, I tell you what, there is a real risk that we’re gonna see. We’re gonna see the lights go out.
Richard King: Okay. In fairness, though, the operators of Liddell AGL, there was no desire for them to spend the money to upgrade it and keep it going. I mean, there’s been no desire to build coal fired power stations in Australia by private enterprise.
Ted O’Brien: Oh, Richard. Look. Yeah, you’re right. Yeah. I’m glad you mentioned it because I’ve been out at Liddell. I’ve checked it out. I’ve met with AGL on a number of occasions and my criticism doesn’t go to them. They gave the mark a lot of warning on this. By my judgment. It looks as though they’ve really tried to do the right thing by other workers. The issue here is government policy. We have government policy that is driving further premature closures of baseload power stations. When we’re talking today. I just looked at my phone, I’ve got this little app. And right now, New South Wales is running 70% on coal 70%. Now, if you think baseload power across our entire grid, eighty percent gone by 2035 It’s just gone. There is zero guaranteed replacement. That’s the real issue. And what we see in Liddell is just the start of that. And it’s not the full 20 gigawatts, that’s leaving this month in Liddell. But it’s, it’s such a minor proportion, but already, you’ve got the likes of the article you just read out before from the financial review. So Whoa, Whoa, hang on, hang on. This actually could be a price shock. What’s going to happen with supply? And my point is yet, we barely even started. That’s the issue.
Richard King: Alright. We’re being told it is happening. People are building big batteries everywhere. There’s more wind farms. We’ve got solar everywhere. Your argument is, yeah, maybe down the track. It might be able to cope but not the near future.
Ted O’Brien: Correct. And look, the coalition’s always been pro renewables and I personally am too. The thing is, you’ve got to set renewables up for success, not failure. And, you know, it’s said all the time, but I’ll repeat it that, you know, that the sun doesn’t shine, the wind doesn’t blow – renewables can’t do the job. And that’s why Kurri Kurri was so important, right? You need gas to come in. It’s dispatchable.
Richard King: Alright. do you think we should be building more of these gas peaking plants around the country?
Ted O’Brien: I think we need more gas everywhere. You know. First and foremost, we need more gas extracted. We need more pipelines to get gas around. But I think it’s inevitable that as baseload power, coal, leaves, exits, we’re going to need more gas. Otherwise renewables won’t do the job. So you know, we got to work. We’ve got to start treating technologies as partners. It’s all about a mix of technologies. Not say one technology is better than the other, they work together because they have different benefits, different capabilities, they complement each other, you know.
Richard King: Ted O’Brien, my guest, who’s today in Newcastle. He’s the Shadow Minister for Climate Change and Energy. I know you’re a fan of nuclear power. Nobody seems to want to talk about that. I mentioned to you before just as you came into the studio, Germany has begun shutting off its last, its last three nuclear reactors. Meaning six decades of nuclear power that helped spawn one of Europe’s strongest protest movements that of course, everybody’s been well, they I think after Fukushima, they shut them down and then they get them going again, and now. They’ve got three left and they’re going to shut them down. And it seems that you know, the world is divided on nuclear power.
Ted O’Brien: Well, I think the world has been divided Richard and I think what Germany is doing is causing a lot of eyebrows to be raised across the world at the moment. You are right. I mean, Angela Merkel was not in favor of nuclear and post Fukushima, she made a decision and you know, basically what we’re seeing now is the gradual closure. Meanwhile, you’ve got another 33 economies in the world that have nuclear and they want more, and you’ve got another 50 countries wanting to introduce nuclear for the first time or at least considering to do so. So the rest of the world is saying we want more nuclear, mainly because of energy security and climate change.
Richard King: So Peter Dutton, your leader is a fan of the small nuclear reactors, but a number of other people have said well, we’re in the perfect perfect position here in Australia. Let let the rest of the world iron out all the problems with their small nuclear reactors. When they’ve got them perfected then maybe we can think about it. Is that your view as well?
Ted O’Brien: Well not really. I mean, the the, I think those who like to push nuclear into the nether never will always say oh, no, no, no, let’s just wait til other people do things right. No one is saying clearly Peter Dutton, nor me. Nobody is saying that we should have first of a kind reactor. We should wait until certain reactors are tested. There’s no doubt about that. But that doesn’t mean we have to sit around and wait. We can keep going. I mean, generation three plus technology is the latest technology. These small modular reactors, are generation three plus nuclear technologies. There are already generation three plus technologies working in the world on on grids doing their job. So it’s not like this sort of thing is just on a piece of paper. I personally have visited nuclear sites. I have visited a handful of vendors of small modular reactors. These things are real and they’re coming and countries are going there because they are zero emissions technology, so it’s great for climate change. They are 24/7 so they can provide the baseload power and they can also ramp up and ramp down so they complement renewables.
Richard King: Just finally, the voice. I’ve got to mention it. You’re on the front bench of the opposition. Julian Leeser stood down as Simon Birmingham said, Look, I’m not going to actively support the no case, but I’m not going to stand down for the guilt. You’re going to defect as well over the voice? You’re standing firm?
Ted O’Brien: I think absolutely standing firm. Yeah, I think there’s one thing that unites all Australians and and that is we want to see our first peoples advance their cause, especially people in remote communities, children and women. The question then is well how best do we do that? When it comes to the Constitution? I think everybody would agree that our first peoples should be recognized in the Constitution. But the voice is something completely different.
Richard King: Alright. Let me clarify as I understand it, that the party room voted for, but it wasn’t mentioned afterwards, a national voice that would be legislated. Not not enshrined in the Constitution. Is that correct?
Ted O’Brien: No. So I mean, the part of the party room doesn’t work like that in terms of, you know, if people think it’s bit like the parliament where you’re sort of, you know, you pass a piece of legislation and people vote and so forth. It’s not so much like that. But there was a big discussion in the party room. I mean, you don’t go into the details which I won’t breach party room. But since you asked the question, the principal proposition that was put in the party room was how do we respond to Albanese’s proposal of a Canberra voice? Overwhelmingly, people said, we don’t want that. Then there’s a discussion about well okay. Let’s be clear, though. It’s not just a matter of us saying no. We’re also saying yes. The main thing that we’re saying yes to is recognizing indigenous heritage, indigenous people in our Constitution. And that’s a huge thing, because I think it can unite the entire country. There was then a discussion, which really went to the importance of local and regional voices. And, and I believe in that I mean, I’m from the sunny coast is, you know, richer than, you know, we’ve got our Gubbi Gubbi mob up there. Right, terrific guys. And I spent a bit of time with them at the local footy, actually, on the weekend. I want their voices heard. And if you look at some of the tragedies that continue to unfold in remote communities, you know, I went into some of those missions as a teenager, a lot of stuff hasn’t changed. And this isn’t pointing the finger at people. This is just saying, well, how do you get the right outcomes at the grassroots level? And we genuinely do not believe is through having a new bureaucracy based in Canberra. They’re not going to get the local voices heard there. If you don’t change the constitution when the Prime Minister himself can’t even explain the impact its going to have. This is dangerous right.
Richard King: So you do agree with constitutional recognition?
Ted O’Brien: Absolutely. Absolutely. Yeah. And this, again, goes back to, I have great fear that the way the Prime Minister has run the process. The proposition he’s put up is going to divide Australians. We have an opportunity to unite Australians. Let’s unite Australians around recognizing our first peoples in the Constitution, but not introducing a voice that has powers that can’t be defined. No one knows what it’s all about. That is actually taking Australia down a dangerous path. I think it’ll be divisive Richard.
Richard King: Good to talk to you in person, having done it over the phone a few times. And enjoy your stay in Newcastle. You’ll be heading up to Liddell a little bit later this morning.
Ted O’Brien: I’ll be doing, speaking further at Kurri Kurri, later today too. So yeah, love being in Newcastle again. And good luck to the Knights.
Richard King: Yeah, well, good luck. Yeah. I think you’ve got Parramatta.
Ted O’Brien: Yeah, we’ve got Parramatta. So, yeah, we’ve got some tough ones going here. But we were top of the table at the moment but I don’t want to be egotistical because …
Richard King: Well I won’t hold it against you. Thank you for coming in. Ted O’Brien who’s Shadow Minister for Climate Change and Energy.