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Wednesday, 17 September 2008
Page: 7683

Mr HUNT (12:10 PM) —I rise to speak today on the Offshore Petroleum Amendment (Greenhouse Gas Storage) Bill 2008, in a cognate debate with the Offshore Petroleum (Annual Fees) Amendment (Greenhouse Gas Storage) Bill 2008, the Offshore Petroleum (Registration Fees) Amendment (Greenhouse Gas Storage) Bill 2008 and the Offshore Petroleum (Safety Levies) Amendment (Greenhouse Gas Storage) Bill 2008. I want to proceed in two stages. The first stage is to address the problem and the second stage is to address our three-pillars response to climate change, clean energy and clean air.

Let me start by addressing the problem and recognising a very important thing. As a coalition, we have made a clear judgement—we did this in government and we continue this position—that Australia has to be part of a clean energy future for itself and part of a clean energy future with respect to our international and global responsibilities. We do so because we recognise that the accumulation of CO2 in the atmosphere has been the subject of international work which in turn says that this will have an impact on the world’s future environment through the greenhouse process. I recognise that that is disputed by many, but we make the judgement that it is of sufficient magnitude that we treat it as a vital issue. I have clearly stated, on the record on many occasions, that this is a strong personal issue, a matter of belief, a matter of judgement on the balance of probabilities, which are, I believe, overwhelming.

Having said that, the problem Australia faces is very simple. We contribute just 1.4 per cent of global emissions—about 578 million tonnes out of a total of approximately 40 billion tonnes of CO2 annually. Action alone is irrelevant. We have to do our part but action alone is irrelevant. We know that China and India are adding approximately 800 new coal- and gas-fired power stations over the coming five years. This alone is about 20 times greater than our entire generating stock in Australia of existing fossil based power stations. In essence, unilateral action will mean nothing.

That leads me to our three-pillars approach and where this set of bills, in relation to greenhouse gas storage, fits in. The first of our three pillars is this: we must have unrelenting international pressure to make sure that the great emitters—China, India, the United States, Brazil, Russia and Indonesia—are fundamental contributors to any change. If they are not part of the solution there will be no solution. Any actions we take at home will be rendered utterly irrelevant. The second part of the international approach is that the Rudd government has utterly and completely dropped the ball in relation to protecting the great rainforests of the world. These forests—in Indonesia, Brazil, Papua New Guinea and other parts of the tropics—represent 20 per cent of global annual emissions when they are felled and burnt. That is eight billion tonnes out of 40 billion tonnes. This is the single biggest source of emissions reduction and the single cheapest way to do major work towards emissions reduction over the next five years globally. We believe it is possible to halve the rate of net deforestation. In turn, that has benefits for local ecology and for communities, and it has a profound impact on buying the world time and the capacity to do what it can to decrease emissions. On that basis we think that the failure of the Rudd government to treat seriously the challenge of deforestation is an abject failure, one which we criticise and one which we will deal with.

The second pillar is in relation to the direct intervention in clean energy, and that is where these bills, which come from our work when we were in government, play a role. We support the general thrust of these bills but we have specific reservations, which we will make clear in the Senate. Those reservations include the minister being able to direct an outcome that potentially overlaps greenhouse gas storage and petroleum titles, incumbent petroleum operators, long-term liabilities and, in particular, ensuring that the Great Barrier Reef Marine Park is protected. Having said that, we support the general thrust of these bills, because half of Australia’s 578 million tonnes of CO2 per annum comes from the generation of electricity and on-site stationary energy production. That is the subject of these bills; that is the material that can be captured and stored. Where coal is used, greenhouse gas storage is a three-stage process—drying, gasification and then carbon capture and storage. In order to enable carbon capture and storage we need carbon supercorridors—we need the carbon highways that will allow the captured gases to be transmitted and then stored. In order to allow that storage we need a legal regime.

We are seeing that greenhouse gas storage is occurring around the world. Carbon capture and storage is occurring in Norway with the Sleipner and Snohvit projects, in Algeria with the Salah project, in the USA in Illinois and in Australia with Chevron’s Gorgon project, which is well advanced in its proposal to sequester greenhouse gases below Barrow Island. We are already seeing in my home state of Victoria the CO2 Cooperative Research Centre’s Otway Basin pilot project advancing at a great rate. I am proud that we put that project into place when we were in government. It is a model of both clean energy and, importantly for communities, clean air. It is a way of dealing with particulates, although CO2 itself does not have a local impact. When CO2 is captured we also see the generalised clean-up of the other particulates that accompany it. So it is good for local communities in the Latrobe and Hunter valleys, it is good for global emissions and it is indispensable in ensuring that we have a long-term future for clean coal and clean gas as fundamental energy sources in Australia. That is why we support this bill.

The third pillar of our approach to climate change is a marked, moderate and sensible approach to emissions trading that does not blow up the house and that does not mean that Australia puts itself at a competitive disadvantage with the rest of the world. If there is no global agreement, then we believe in a low and slow commencement price starting in 2011-12. We are committed to the concept of emissions trading—indeed, the architect of it is the new Leader of the Opposition, the member for Wentworth. But the member for Wentworth was sensible in putting in place a proposal that would be careful, that would not destroy the clean energy sector—as we are seeing—and that would not wreck Australian industry by bringing it in too quickly and out of sync with the rest of the world. We need to look at how we address the question of a level playing field. I have met with numerous industries, including industries from the cement, aluminium and LNG sectors. All of those industries will find themselves at a gross disadvantage internationally. There are also the import exposed industries such as automotive manufacturers, components manufacturers and cement and various forms of food and grocery production that will be exposed if there is not a level playing field.

The government do not seem to have put an appropriate mechanism in place. We support the general concept, we believe it has a role, but it is the only mechanism that they are pursuing. They have dropped the ball in relation to cleaning up our energy sources, they have dropped the ball in relation to protecting the great forests and they have put all their eggs in the basket of a rushed emissions trading scheme. We believe in dealing with this issue, but there is a good system and a bad system—and the government have proposed a bad system that has been rushed. Under what they are currently proposing, Australian jobs will suffer while there will be no benefit to the environment.

Nevertheless, cleaning up our energy sources is fundamental. The clean energy vision is ours; the solar continent vision is ours. We will prosecute them and we will develop them. We believe in the capacity of clean energy to be a fundamental source of innovation and competitive advantage for Australia if done correctly. That is why we support the bill in principle, but we will move the amendments as foreshadowed in the Senate.