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Monday, 9 December 2002
Page: 9942

Ms JACKSON (9:38 PM) —We have before us today a bill which aims to improve the administrative integrity, effectiveness and efficiency of the Renewable Energy (Electricity) Act 2000. The Renewable Energy (Electricity) Amendment Bill 2002 proposes various legislative adjustments to the electricity from renewable energy sources scheme. These adjustments include the creation of significant new penalties. The Renewable Energy (Electricity) Act 2000 establishes the mandatory renewable energy target, the MRET, of an additional 9,500 megawatts of renewable energy by 2010. The objectives of the MRET are: firstly, to accelerate the uptake of renewable energy and grid based applications—that is, energy that does not come from fossil fuels—so as to reduce greenhouse gas emissions; secondly, as part of the broader strategic package to stimulate renewables, to provide an ongoing base for the development of commercially competitive renewable energy; and, finally, to contribute to the development of internationally competitive industries which could participate effectively in the burgeoning Asian energy market.

Before I consider the legislative amendments to the MRET under the Renewable Energy (Electricity) Amendment Bill 2002, it is necessary to consider the specific objectives of the original Mandatory Renewable Energy Target. It is also necessary to consider the wider issue of climate change and greenhouse gas emission reduction and the federal government's overall response to this complex and important issue. It is worth stressing that the MRET is the only mandatory greenhouse measure introduced by the Howard government. This measure must be viewed in the context of a federal government that has refused to ratify a global target for reducing greenhouse gas emissions—that is, the Kyoto protocol. It is in the context of a federal government that has, according to the Australian Greenhouse Office annual report, underspent by a massive $141 million on greenhouse reduction initiatives.

This measure must be seen in the context of the government's last-minute announcement of funding for the Climate Variability in Agriculture Program of only $500,000, which hardly constitutes a real commitment to national climate variability research. The government's own Agriculture Advancing Australia survey shows that 63 per cent of Australian farmers are yet to take forecasts into account in their farm management decisions. It is in the context of a federal government that needs to do far more to support public transport initiatives and address our reliance on private transport. It is in the context that we are clearing native vegetation in Queensland at more than 400,000 hectares per annum while many other countries are recognising that vegetation acts as a natural sponge for polluting emissions and generates carbon sink credits. Anyone who spent time with the landcare and catchment groups in their electorates would know how long it takes and how expensive it is to revegetate and regenerate native vegetation after clearing. This is even before we consider the resulting salinity and loss of biodiversity from land clearing. Furthermore, climate change could well affect the productivity of this land for agricultural purposes in the long term.

This bill is in the context of the federal government failing to confirm that it will continue to fund the Cities for Climate Protection program through the Australian Greenhouse Office, an important partnership between the federal government and local government to address greenhouse gas emission reduction at a local business and household level. I have received a letter from the City of Gosnells in my electorate of Hasluck, representing the South East Regional Energy Group, outlining their concern that the agreement between the Australian Greenhouse Office and the International Council for Local Environmental Initiatives that collaboratively manages the Cities for Climate Protection program is currently being considered for refunding. The City of Gosnells urges the minister to:

... reinvest in CCP and support the ICLEI to continue its valued approach to assist local government reduce greenhouse gas emissions.

I join the City of Gosnells in urging the minister to take that action.

In the context of this government's complete failure to come to terms with the incredibly important issue of climate change, the mandatory renewable energy target becomes very important. In the absence of any other greenhouse measures, the MRET must deliver its stated purpose and, to this end, requires detailed analysis. Given that the federal government appears not to be taking the issue of climate change seriously, I feel it is necessary to spell it out. Climate change is already occurring; it is no longer a scientific debate. The CSIRO presents a very clear picture of the threats that climate change presents to Australia. The Prime Minister's Science, Engineering and Innovation Council notes in its 1999 report:

... climate change will affect environmental, social and economic systems of present and future generations.

Minister David Kemp was reported in the Australian Financial Review dated 26 November this year as saying that Australia was `very vulnerable to climate change', noting coral bleaching, declining rainfall and rising sea levels as areas of concern. He went on to say that we have to reduce the planet's greenhouse emissions by close to 60 per cent. In the context that Kyoto will contribute only one per cent of that, I would have expected to see a raft of policies by Dr Kemp to address the issue of greenhouse emissions, along with a clearly stated global commitment.

One of the clear threats to our dryland farming and grazing lands is drought. I find it astounding, given the incredible hardship being experienced right now by communities in rural areas because of drought, that the Howard government has not taken a strong and decisive position on climate change. It is not an exaggeration to state that the social, economic and ecological impact of climate change in Australia is one of the biggest issues facing our country, yet somehow it has failed to capture the Prime Minister's attention and has definitely not provoked any remnant of leadership from him. Strangely enough, the Prime Minister's international position on this issue—as on other issues—closely mirrors that of George Bush. The position of Australia at the Johannesburg Earth Summit was embarrassing for all of us who take seriously the predictions of Australia's most pre-eminent scientific organisation, the CSIRO. Australia was obstructionist rather than constructive in an international forum attempting to deal with the global impact of climate change.

Climate change has the potential to impact on all aspects of our life in Australia—agriculture, fisheries, forests, water resources, tourism, biodiversity, weather, our health, our insurance industry, pests and weeds. The potential economic implications of climate change need to be understood, and we need a clear response from our federal government. I believe that the decision to do very little now because of the supposed economic benefit will become a very expensive one in the long term. It is necessary to address the issue of the 1997 Kyoto protocol, and I take this opportunity to urge the Prime Minister and the government to ratify this agreement. No matter how hard the Prime Minister tries to ignore it, the challenge of climate change is not going to go away; we need a global solution. The Kyoto protocol may not be perfect, but it is the first step towards an effective global response.

The Prime Minister originally set two preconditions for Australia's ratification of the protocol: the involvement of developing countries and the involvement of the United States. Now that both India and China have committed to ratify, perhaps the Prime Minister could set his sights just a bit higher to consider the benefits of global cooperation and to take some domestic leadership on this issue. Frankly, fiddling at the edges of the Renewable Energy (Electricity) Act 2000 is not—in my opinion—an adequate response.

The Prime Minister has placed Australia in the absurd position of committing to meet the Kyoto targets while refusing to ratify the protocol. This means he wants Australia to meet its international climate change obligation but denies Australian industry access to significant and growing markets. If Australia ratifies the protocol, we can use the Kyoto regime to reap hundreds of millions from new emissions trading. But these markets are available to Australia only if we ratify the protocol. In addition, without ratification, Australia cannot gain credit for assisting developing countries to reduce their emissions. Australia must grasp the economic opportunities that are now emerging as the rest of the world moves to deal with climate change. If we wait, Australia will run the risk of missing out on global opportunities and of not playing its part in reducing the immediate impact of climate change. As some prominent Australians have recently stated:

Ratification of the Kyoto Protocol is a win for Australian jobs, and a win for our environment.

The Prime Minister's Science, Engineering and Innovation Council acknowledged that many businesses:

... will adapt well, others will resist or postpone change—

even though—

those industries and countries which choose to do nothing may well in the long run be severely disadvantaged.

These comments clearly identify the need for government intervention and action on this issue. The Science, Engineering and Innovation Council went on to state:

... timeliness is critical for market penetration. There is a risk that if those businesses which can succeed globally are not identified early, and assisted for success, economic and export opportunities for Australia may be lost.

I note that the Sustainable Energy Roundtable and the Electricity Supply Association of Australia identify the need for government to fix appropriate policy settings, which will drive further industry investment in new generation technology. They call on the MRET to be increased year by year—that is, to index the penalties for failing to meet the targets. It is important to remember that Australia has a very good deal under the Kyoto protocol. When most other countries were required to reduce their greenhouse emissions by as much as 10 per cent, we were entitled to increase ours by eight per cent. The Prime Minister's Science, Engineering and Innovation Council noted in its 1999 report that even the Kyoto target of an eight per cent growth in Australia's greenhouse emissions:

... will be a formidable challenge, requiring a cut of 35% or some 135 million tonnes of carbon dioxide equivalent from expected business as usual growth by 2010.

To put the challenge in some perspective: in 1999, our greenhouse emissions were already 17 per cent over 1990 levels. The Australian EcoGeneration Association are of the view that the federal government's two per cent renewable energy target will not deliver the promised increase in market share for renewable energy. They are calling the target the `half a per cent' target. In 1997, the market share for renewables was 10.5 per cent. The increase in share by 2010 will be negligible, according to the AEA. In 1999, the federal government changed the two per cent target to a 9,500-kilowatt target by 2010. It appears, however, that the forecast figures are such that, to achieve a two per cent increase in market share, a target of 13,000 gigawatts needs to be set.

There is widespread support for the MRET as an innovative initiative to stimulate additional greenhouse gas abatement from new investment in renewable projects. It is not surprising, however, that the community and industry expect the targets—and the penalty for failing to meet the targets—to be such that they deliver genuine reductions in greenhouse gas emissions. Electricity accounts for almost 40 per cent of Australia's greenhouse gas emissions and is therefore a sector to be taken seriously in terms of fixing appropriate policy settings. With the UK and the European Union setting targets of between five and 10 per cent, our efforts are indeed paltry. The Prime Minister's Science, Engineering and Innovation Council also noted:

... in making a response to abatement targets, there is an opportunity to stimulate new technologies in the related areas of energy, agriculture, transportation, recycling, land and water resource management, construction, biodiversity, tourism and physical infrastructure.

PMSEIC went on to say:

As government takes action to ensure greenhouse emission targets are met, industry can develop new products and services and gain benefits in other sectors.

We have seen in other countries what is possible when a government takes the lead and promotes renewable energy production. We have seen a country such as Denmark seize the agenda and become a world leader in wind energy at a time when this was definitely not fashionable.

Denmark's wind industry now employs some 15,000 people, from zero at the start of the 1980s, and has a turnover of in excess of $US1 billion. In 1997, wind turbines were the country's fourth largest export commodity. Wind currently produces 10 per cent of Denmark's electricity, and the latest target is 50 per cent by 2030. This is surely a lesson in leadership.

The PMSEIC 1999 report outlined a vision for sustainable industries and technologies as the drivers of economic growth. It is very clear to me, sad as it is, that this government is not up to the challenge. A fundamental principle on which MRET was based was that it would deliver additional greenhouse gas abatement from new investments in renewable energy projects.

Using climate model simulations, the CSIRO has estimated future changes in Australian temperature, rainfall and evaporation. Scientists expect that continued increases in greenhouse gas levels will lead to further global warming and regional climate change. This is an issue we have to take seriously. We have no choice. If we just take our agricultural sector, CSIRO predicts that dryland wheat in south-western Australia is likely to be at particular risk because of the projected large decreases in winter and spring rainfall. Warmer winters will lead to lower yields of fruit and reduced fruit quality, particularly for stone fruit and apples in southern Australia. Warmer conditions, with significant decreases in winter and spring rainfall in southern Australia, could significantly reduce plant production in high rainfall grazing industries. Rangelands in Australia's arid and semi-arid interior may also face the effects of reduced rainfall in winter and spring, the main growing seasons for herbage in the southern rangelands.

The impacts of climate change have also been outlined by the CSIRO for our forests, natural systems and biodiversity, water resources, human communities and human health. Climate change will have social, economic and ecological impacts that will have a far bigger and less predictable impact on our future than planning for change.

The impetus for change is in the hands of the federal government—to fix appropriate policy settings and targets to increase production and use of renewable energy. The federal government claims that this bill aims to improve the administrative integrity, efficiency and effectiveness of the Renewable Energy (Electricity) Act 2000. It would be more meaningful if the bill aimed to improve the uptake of renewable energy in grid based application so as to reduce greenhouse gas emissions. Surely that should be the actual intention.

The DEPUTY SPEAKER (Mr Barresi)—Order! Before I call the member for Curtin, I advise the member for Hasluck that, for the first half of her contribution, the chair was most indulgent. I would ask you to have a look at standing order 81.