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Thursday, 12 December 2002
Page: 10586

Dr STONE (Parliamentary Secretary to the Minister for the Environment and Heritage) (10:43 AM) —In summing up the debate on the Renewable Energy (Electricity) Amendment Bill 2002, I want to say that the Mandatory Renewable Energy Target scheme is a cornerstone of the Commonwealth's strategy for growing the Australian renewable energy industry and it is a world first in creating a national renewable energy market that is backed by legislation. Section 3 of the act sets out the objectives for the Mandatory Renewable Energy Target. These are: to encourage the additional generation of electricity from renewable sources; to reduce emissions of greenhouse gases; and to ensure that renewable energy sources are ecologically sustainable. Essentially, the Mandatory Renewable Energy Target scheme, which I will refer to as MRET, aims to increase the share of electricity generation from renewable sources by providing a guaranteed market for an additional 9,500 gigawatt hours of electricity per year from eligible renewable sources and, by 2010, is envisaged to achieve greenhouse gas abatement of between 6.7 to 7.8 megatonnes of carbon dioxide per annum.

The mandatory renewable energy target demonstrates that a combination of regulatory and market based approaches can help minimise compliance costs of the measure by enabling participants greater flexibility in their decision making to seek out and utilise cost-effective eligible abatement options. Since coming into force on 1 April 2001, the measure has performed strongly, with some 170 power stations accredited, representing a broad diversity of eligible renewable energy sources and technologies throughout the country. The member for Ballarat criticised the Australian renewable energy target as less stringent than the United Kingdom's renewables obligation order, which mandates an increase in renewable energy share of 8.5 per cent by 2010. She should know and understand—but obviously she does not—that in the UK the electricity growth is only half as great as in Australia and electricity prices are high, making the environment already competitive for renewables based electricity. We have a very different environment and a very different energy sector in Australia. As most people on this side of the chamber would understand, it has been coal based traditionally, which presents a very different challenge for our government.

The Renewable Energy (Electricity) Amendment Bill 2002 amends the Renewable Energy (Electricity) Act 2000 by addressing minor deficiencies in the administration of the original legislation. These amendments are needed to maintain the integrity of the legislation. The changes proposed include the clarification of key definitions, including eligible renewable energy sources. The Renewable Energy Regulator is provided with a capacity to vary decisions or suspend accredited power stations in limited circumstances, including where there is thought to be gaming—gaming is where the output of a group of power stations has been manipulated for the purpose of creating more renewable energy certificates than otherwise would be the case.

The bill also provides adequate safeguards in that decisions by the Renewable Energy Regulator are reviewable under the Administrative Decisions (Judicial Review) Act. Other amendments included in the bill are the introduction of information-gathering powers to underpin the monitoring, auditing and compliance requirements and to bring the mandatory renewable energy target into line with similar pieces of Commonwealth legislation. The bill provides for the appointment of employees of state and territory governments, as well as Commonwealth officers, to operate as authorised officers for the purpose of the Renewable Energy (Electricity) Act 2000, and therefore to enable them to monitor compliance with the act. Finally, the bill addresses a potential double liability situation.

The changes are administrative in nature and are required now to provide certainty to the renewable energy industry and liable parties on the operation of the renewable energy trading system. These changes in no way impact on the government's commitment to conduct an independent review of the legislation as mandated under section 162 of the Renewable Energy (Electricity) Act 2000. Again, if the member for Ballarat had understood what she was talking about, she would have known that that independent review does include a consideration of the extent to which non-plantation forestry waste has been utilised. It is a shame she did not do her homework.

On 29 November 2002, the Minister for the Environment and Heritage confirmed that the independent review of the operation of the Renewable Energy (Electricity) Act 2000 will commence very shortly, in January 2003. The minister has indicated his intention that the review be conducted in a timely, open and transparent manner. As a first step, the minister has already written to all major stakeholders requesting their input into the scope of the review. It will consider a range of matters, including the level of the target, the mix of technologies that has resulted from the implementation of the act, the level of penalties and the need for indexation to maintain the real value of the penalty charge, as well as some other environmental impacts.

The Commonwealth has a suite of renewable energy policies. Members of the opposition speaking on this bill seem to have overlooked this entire suite of renewable energy development policy worth $377 million. They include the renewable energy commercialisation program of $54 million, the renewable remote power generation program of $264 million and the supporting photovoltaic systems of $31 million. I was very pleased to hear the member for Lingiari refer to solar photovoltaic systems that he had observed in the Northern Territory. He said that, as they were a good idea, why didn't we do something about them. He would be aware that there is significant Commonwealth funding in those Northern Territory solar photovoltaic systems.

We have the Renewable Energy Equity Fund, $17.7 million; the Renewable Energy Action Agenda; and the renewable energy technology road map. The action agenda is in partnership with the renewable energy industry. This partnership has also launched a renewable energy agenda, which provides a strategic policy framework for the development of a sustainable and competitive renewable energy industry in Australia that aims for growth in annual industry sales to $4 billion by the year 2010.

We have heard a number of opposition speakers refer to the cooperative research centres announced just in the last 48 hours, concerned about the renewable energy CRC. They need to look at the entire suite of CRCs announced in the last 48 hours. The Howard government has announced funding exceeding $46 million for three cooperative research centres that will aid in abatement of greenhouse gases—namely, the CRC for Antarctic Climate and Ecosystems, $23.54 million; the CRC for Greenhouse Gas Technologies, over $21 million; and the CRC for Greenhouse Accounting, $1.35 million. Therefore, we have more than taken care of the research and collaborative research needs of this particular significant issue. The decision not to fund the Cooperative Research Centre for Renewable Energy for the second time must be seen as a result of the competitive bid process.

Let me talk about our future. The member for Lyons talked about the fact that Australia continues at this point to not ratify the Kyoto agreement. I stress again, the government is committed to playing an effective part in the global effort to reduce greenhouse gas emissions and is taking action on both the national and international fronts. In fact, we are leading significantly in some of the work associated with the carbon sequestration through vegetation planting. When I was in Japan in January of this year, I was very proud to stand up and talk about how Australia is doing significant work—in fact, world's best practice work—in terms of understanding the carbon sequestration cycles. What we have done in Australia is world beating. The government has consistently stressed that, to be effective, action to address climate change needs to include participation by all major emitters of greenhouse gases. The United States has said that they are not going to ratify the Kyoto protocol—and they are the most significant emitter. To date, there has been no clear pathway for the involvement of developing countries in the Kyoto process. Without their involvement, there are risks of an energy-exporting country such as Australia burdening its own industry with additional costs.

We are concerned about our Australian work force and our Australian industry and its competitiveness both domestically and internationally. The government is committed to continuing to develop and invest funding in domestic programs to meet the 108 per cent target that it agreed to at Kyoto. The national greenhouse accounts released in August show that Australia is on track for this target. I conclude by saying that the refinements contained in this bill are another step towards achieving enhanced uptake of renewable energy and ensuring the emerging market in renewable energy generation is functioning according to the intention of this parliament. I commend the bill to the House.

Question agreed to.

Bill read a second time.

Ordered that the bill be reported to the House without amendment.