17 July 2024
*** Presented alongside a PowerPoint presentation.
Thank you very much mate. Ladies and gentlemen, sorry to have changed the schedule up a little bit and I do appreciate to the State Ministers, and to Kane for their courtesy of going earlier.
I won’t bore you for State of Origin. I will just ask any other Queenslanders to put your hand up. I’m on my own.
No, we’ve got a few of us. So, I’m happy to take bets immediately after this speech. But New South Wales, you got buckley’s tonight. So, now I’ve got a lot of friends…
Let me take this time to go through, basically, I’m trying to turn this on here. I can click this. What was that? There we go. Can I start here?
I think we all know that climate change and energy is a very important topic. Lots of good argy-bargy politically. But if there is an area of bipartisanship, it’s a good place to start. It’s just here. We have joined global efforts to reach net zero by 2050. It is a bipartisan goal here in Australia.
The question, therefore, is no longer a debate about why, but how? How do we get there? Now, as the Shadow Minister for Climate Change and Energy, when I first put my mind to this, believe it or not, the first thing for me was not a question of necessarily emissions reduction, energy security or prices, but rather what sort of Australia we will be in the year 2050 and beyond. Each of us have our own loved ones.
So, for me, it’s these three, three little ones at home. What is the Australia and what is the world they live in by 2050? When they are somewhere between the mid-20s to late 30s? Australia will either be a rich, strong and fiercely independent nation, which is precisely what I’m hoping it will be.
So that those children I have, and their peers have every bit as much an opportunity as we have had through our lives. But that is not a certainty. How we manage the path to reach net zero by 2050 will determine if we are indeed a rich, strong and independent nation. We are at a fork in the road.
Over the last two- and a-bit years, Australia has been venturing down one of those paths. Let’s call it the path on the left under the Albanese Labor government. It takes you to a very different direction. If you look at the trilemma, look at emissions, emissions reduction after years of emissions year on year coming down right now, they have flatlined at best.
I went to the COP Climate Summit last year in Dubai. It was the first year in many where Australia had to rock up and declare that emissions were going up. Not down. Emissions have now flatlined. That wasn’t the case previously.
If you go to affordability or prices, which is another well-known part of that trilemma, over the last term of the coalition government for households, prices came down by 8%. Across Australia since, they’ve gone up as high as 39%.
Prices are now going up. If you then look at reliability, which is the last of the trilemma. We all know what’s happening in terms of the electricity grid and the shortfalls and what the market operator is saying about the threat of blackouts as soon as summer. Now, behind of course, the story of the trilemma is the impact every single day.
Over the last two years, insolvencies in the manufacturing sector in Australia have tripled. Companies are closing their doors. I’ve been speaking to them and I’m speaking to very large manufacturers at the moment, who was saying that they too are looking at closing their doors and relocating elsewhere in our region.
Households are also feeling it. Over the last two- and a-bit years, every single week, over 600 households – every week – over 600 households have gone on hardship arrangements with their electricity retailer.
Never in our history, have we had so many households feeling the pain, they cannot make ends meet. We are also hearing some awful stories about some projects which are damaging the environment. And when my counterpart came out and proudly declared that we need to have 22,000 solar panels installed every day, until 2030, 40 wind turbines a month.
There were parts of Australia that were deeply worried about what impact this will have on the local environment. Based on the government’s own reporting, 92% of regional communities have real issues with community engagement projects. Beyond what’s being felt we know that there are struggles right now.
We have a shortfall in the workforce. We know that electricians alone, 70,000 electricians short by 2030 in order to achieve the 82% renewables target. Not even to talk yet about supply chain constraints, increasing costs of materials. These are serious supply chain issues which cannot be ignored.
And yet I am deeply concerned that the market operator, every single scenario put up for our future based on the last ISP only a few weeks ago, every single one assumes 82% will be achieved by 2030.
Every single one. I’m from a business background, I’m a pragmatic sort of a person. I’ve got real concerns about that assumption. We have 90% of our baseload energy being forced out of the electricity grid over the next 10 years without any guarantee of a replacement. Now let’s be clear about this.
This is a direct consequence of public policy. The speed at which baseload power is closing in this country is far faster by the predictions of the government than the operators themselves.
Labor’s plan requires a build out of 7GW of new renewable energy projects every single year. Last year’s final investment decision deal closures 1.3GW. 1.3GW. We have a real issue with the stalling of investment in this class of asset.
Then we have gas. We’re running out. It’s not your barbeque bottle that you can turn the tap on and off, drive the car up to servo and get a new bottle. These are projects years in the making, requiring enormous links of investment.
But government intervention is leading to a depletion of gas. Foreign capital, domestic capital, is now looking elsewhere, not in Australia. That is why the market operator, ACCC and others, are warning of massive shortfalls in the future.
This leaves a black hole, we’re running out of energy, which is why you don’t close down one system without having another one ready to go. Can I take a step back for a moment and explain from a coalition perspective, where I believe as a nation, we are going wrong as we tried to get that pathway to 2050 right.
And that is this. We are on our own internationally thinking that we can have an electricity grid run predominantly by intermittent wind and solar. I’ll get to the importance of those technologies in a moment because they do have an important role to play.
But as somebody who’s from an economics background, practitioner business, for well over 20 years before politics, I see no sense in putting all your eggs in one basket no matter what you’re doing. Whether it’s your diet, whether it’s your investment portfolio, certainly when it comes to electricity grid, we are on our own going down the pathway being set.
82% renewables by 2030, 98% thereafter, predominantly wind and solar. We heard from the Tasmanian Minister before but as we know, mainland Australia does not have the abundant wealth of water resource for hydro. Our approach as a coalition, therefore, starts with the principle of ‘all of the above’.
Getting to net zero is so hard, the last thing we can do is take any option off the table. We believe not in putting all our eggs in one basket, but a balanced energy mix. A balance, and how we formulate our policy focuses on putting the consumer at the centre. Something that does not happen today.
After two years in government, the Albanese government still cannot tell you the total system cost of their plan – cannot tell you. They do not know. Over the long term, we believe we need a balanced energy mix.
Today that balance is through renewables, gas and coal. However, as coal retires from the system, we believe it should be replaced with zero emissions nuclear energy. Now my counterpart, my opposite number, Chris Bowen, is making another speech today saying that, well, you know, nuclear can’t work with renewables.
Well, again, we’re on our own if that’s our approach as a nation. He better let the other 19 members of the G20, the most advanced economies in the world know, because that’s precisely what they are seeking to do, if they are not doing already now.
When it comes to our baseload power stations, when it comes to coal, we have a basic position which is you do not close baseload power stations prematurely. It’s economic lunacy to close baseload power when you do not have a replacement ready to go. When it comes to renewables, we believe in the need for renewables to continue to roll out, but higher quality projects.
We believe that storage is going to be absolutely key and the policies that we are putting together, and we will soon release, you will see go to the importance of looking at renewables, including storage for households, for businesses, and for communities. Then we’re going to gas.
We need to pour more gas into the system. I referred earlier to going to COP in Dubai last year, and some of you were there too. We had the Australian Minister get on the world stage and call for an end to gas as it has no role to play in our future energy system. The coalition has a different view.
We need gas. We absolutely need it. As a nation, we are setting renewables up to fail unless we have complementary technologies that can work with them. And right now, gas is absolutely critical to play that role, which is why we have been unashamedly critical of the government saying stop making market interventions which is drying our capital, increasing sovereign risk.
We need gas. We need gas. We need gas, we need more of it. I asked today to some of the state energy ministers, I believe there’s a meeting this Friday of energy ministers, with my counterpart Chris Bowen. We need to prioritize gas. We need more of it, and keep in mind too, as coal retires from the system and renewables comes in – what plugs the gap in the middle? Gas. That’s the plan.
It is also the approach taken by advanced economies the world over. Can I summarize and finish by saying that I recognize the importance of the task ahead for all of us. And I recognize too, that in this room, are people who are doing a lot of the heavy lifting, and I thank you for it.
None of this is easy. The coalition doesn’t suggest it is. But the basic principles we stand on. Come from learning lessons internationally of what has worked, what has not. Our own track record and that of our counterparts in government today.
We believe in all the above approach, having a balanced energy mix. Only then as a nation, can we see my children and their peers, your kids and theirs, live in an Australia which is rich, which is strong and fiercely independent for generations to come.
It can be done if we get the settings right and go on the right pathway to 2050 Thank you very much for your time today.