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Wednesday, 26 May 2010
Page: 4166


Mr KATTER (1:01 PM) —The Renewable Energy (Electricity) Amendment Bill 2010 outlines the problems of small-scale technologies and their impact on the renewable energy certificate market. This is delaying investment in large-scale renewable energy projects. This bill sets out structural change to the renewable energy target—20 per cent by 2020—and separates large-scale generation from small-scale generation. Large-scale generation has a separate quarantined target, reaching 41 million renewable energy certificates, or 41,000 gigawatt hours, by 2020. Small-scale generation will provide an additional 4,000 gigawatt hours to reach the target of 45,000 gigawatt hours renewable energy by 2020.

In Kennedy, the north-west mineral province is the richest in the world, generating an income of around $12,000 million a year, albeit this figure was calculated during the boom in mineral prices. The area is home to an as yet untouched 500 million tonnes of iron ore reserves. Iron ore has never been sought in this area, but was simply stumbled upon when they were looking for the more lucrative metals. It is also home to two per cent of the world’s known uranium reserves, four of the world’s 24 phosphate deposits, three of which are completely untouched, the world’s biggest vanadium deposit, and one of the four biggest oil shale deposits in Australia. And of course it has some of the world’s biggest untouched proven reserves of copper, silver, lead and zinc. Dugald River, Mount Rose Bee and the Rocklands deposits outside of Cloncurry are but three significant areas.

This region has long been starved of power. It is only supplied by a single power station, powered by gas brought almost all the way from the New South Wales border. Gas is now at extremely high prices, having increased some 300 per cent in the last eight or nine years. Power demand is expected to outstrip supply by 2012. This is the world’s richest mineral deposit, bringing in $12,000 million—almost 10 per cent of this nation’s export earnings is coming in from this mineral province—and the year after next it will run out of power. There is not enough power left to keep the mines operating. You have to ask, what sort of government cannot provide electricity to process our metals?

You, Madam Deputy Speaker Moylan, are from the wonderful state of Western Australia—the biggest iron ore producing state in the world. You, of all people, know that the top one-third of our continent has all of the base metals—all of our copper, lead and zinc is coming out of that top third. Almost all of our gold production and all of our iron ore production is coming out of that top third. Where would you think you would base your baseload power stations? Where they are needed to keep these industries going, where power is needed at competitive world prices? No, there is not a single baseload power station within a thousand kilometres of the northern third of Australia. What sort of a crazy country has all of its water in the top third of the country and tries to do all of its farming in the bottom two-thirds? It takes a fascinating maladjustment in thinking to arrive at these conclusions.

Let us look at the problem. The problem is that nearly one-tenth of this nation’s entire export earnings comes from the north-west mineral province. Its potential has only been scratched—two per cent of the world’s uranium reserves, and they have never been touched. And the area is running out of power. We will have to choose which mines we are going to close down, because they have no electricity. They can get the electricity—they can put diesel generators in, at about $200 a megawatt hour when they need a competitive price of about $70 or $80 a megawatt hour. This is not from my document; it is the Queensland government’s document. Here are the graphs, and you can see clearly that in 2012 the north-west mineral province will not have enough power to keep it going and we just have a ramshackle power station—I commend the great men who man it and have kept it going even though a lot of the units are going on for 50 years old, and most certainly are over 40 years old.

The government recognised in its budget papers last year, and I assume there has been no change in their policy, that, after broadband, the connection to the national grid of the north-west mineral province, the iron ore province in Western Australia and Olympic Dam was a priority. We must pay Minister Ferguson a very great tribute for being able to bring such enlightenment to the federal government. That transmission line, in our case, needs to go from Townsville out to Mount Isa. Let me explain another problem. If you put chicken wire over your house, it most certainly will not keep it warm in winter or keep it cool in summer. It will make absolutely no difference. But let me tell you, Madam Deputy Speaker, that wire is actually more dense than the CO2 in the atmosphere.

I do not want to go on to the other arguments about photons and their directional ambience or any of those things. But clearly, if you think about it for 10 minutes, the proposition that 400 parts per million are going to warm up the earth is utterly ridiculous! And I am not a sceptic; I am an anti. Never has a scientist stood up anywhere in public and proved the scientific connection. In fact, we have out of the British people who are responsible for overseeing this the remarkable admission that it is very unfortunate that the Australian scientist died because he was the only one getting close to proving a scientific connection to global warming. Global warming may be taking place, but it has taken place many times in our geological history. It may be taking place, but to attribute it to this source is ridiculous!

Unlike many people in this place, I spend a lot of time doing research. One of the dozen or so leading world authorities is the Australian Institute of Marine Science, off Townsville, and Katharina Fabricius, an internationally renowned scientist there, says there is a situation which will arise in the oceans. And just the same as it is scientifically impossible to show any connection between global warming and under 400 parts per million in the atmosphere, there is also the same scientific evidence that will prove absolutely that a problem will arise eventually in the oceans if we keep increasing at the current increasing rate. So even an anti—not a sceptic, but an anti—like myself will say that the matter needs to be addressed. As we say where I come from: we need to take a bit of a pull on the reins here.

How do we go about this? Do we go about this by putting a price on a carbon pollution unit and then making Goldman Sachs rich—I understand they are currently being looked at with a view to prosecution in the United States. That is what has been reported in the media. It might be very unfair to them, but it is what has been reported. They are being looked at with a view to possible prosecution. But do we put a price on a carbon pollution unit to then make people rich in businesses like Macquarie Bank and Goldman Sachs and all of those people who trade in securities? There will be the creation of thousands of millions of dollars of securities that do not exist at the present moment. There will be a new commodity that they can trade and that will make them rich, and all of the stockbrokers—what I refer to as the slithering suits out of Sydney with all of their little sycophants in this place, and I see them on my visits to Sydney—will be rich people. They do not produce anything. They believe money should produce more money. They do not believe that money should be used to produce any tangible production, to quote a famous man called Roy Stankey from North Queensland.

What we need to do are simple things that result in a lowering of the carbon emissions, including switching to renewable energies. It has been a wonderful breakthrough for intellectual reality in this place that we do not talk much about carbon now, hardly at all, but we do talk about renewables. As a former Minister for Mines and Energy in a Queensland government, and as the minister who secured the national science prize for our solar energy standalone system in the Torres Strait—abandoned I might add by the following socialist government; they abandoned the project that had won the science prize for Australia—I was the person who had gone into the costs of this very deeply. I was not doing it to be some enlightened solar energy advocate; I was doing it because it was the most economically responsible action to be taken—that is, very simply to put solar panels in very isolated situations. They were more efficient than diesel generation. That is why I was doing it. Not because I was in love with the trees—no-one would ever accuse me of that—but because it was the economically responsible action to take.

I gave warning orders to my department—the government was nearing its end at the time—that if re-elected all government housing in Queensland would be moved to solar hot water systems. Forty per cent of your domestic power usage is in heating water. We would not be able to take away the whole 40 per cent; we most certainly would take away 20 per cent. There was no doubt about that. We were a very economically oriented government, we were a government of businessmen who had backed our judgment with our own money—to use the words of the very great former Premier of that state, Bjelke-Petersen—and who had put in place the aluminium industry of Australia, Australia’s second biggest industry, and the coalmining industry, Australia’s greatest industry. But to quote that man: these were men who would back their judgment with their own money. And if you have not done that, then you should not be making decisions with other people’s money if you have not backed your judgment with your own money.

So we were businessmen and we simply made a business decision. It was cheaper; it worked out cheaper for the homeowner. What he saved in electricity charges—in Queensland electricity charges have almost quadrupled since then—he made up for in increased rent. So as far as we were concerned there was no cost to government. And as far as any economist was concerned there was no increase in cost for the householder because the cost of the solar hot water system, which was put on his rent and amortised over 15 years, was offset by the savings in electricity. But if you do that you reduce by some three or four per cent the entire electricity consumption in this country, a very simple, obvious thing to do. We are assuming of course that a lot of private houses would go into it as well under a cheap government contractual arrangement.

Finally, we need to be cost competitive. I do not criticise the government for its initiative in proposing the resource rent tax; I most certainly criticise the government for the 40 per cent proposal and say that it simply cannot continue. Our industries have to be cost competitive. Those industries have to be attractive. The current government need not worry too much, because if they persist with it there is no doubt that they will not be the government of Australia. You only have to look at the North Queensland seats, which are highly marginal, and all mining seats—all of them, not just mine. Look at New South Wales, where so many of the marginal seats are in the burgeoning coal industry areas. If you think those employees are not going to be told, they will be told all right. And they will believe what they are being told, because it is simply logical to them that if the government is getting a huge amount of money then somebody has to be losing that money, and that somebody happens to be an industry in which nine out of 10 of its mines will collapse.

We must be cost competitive, and that brings me to the solutions. As I said, there are three great sources of income for this nation. There is the aluminium industry, which mostly is in North Queensland but is in other parts of Australia as well. There is the iron ore industry in Western Australia, and of course there is the giant coal industry. That is all we have going for us now. Mr Keating in his wisdom deregulated the wool industry, which was Australia’s biggest export earner—bigger than coal—in 1990 and destroyed it completely. There is only 40 per cent of it left now. It and the other rural industries are simply closing down. I have spoken about this on many occasions in this place.

If we look at the clean energy corridor, I must give the government great credit to date, but I must also say that we have had a lot of noise and a lot about what they are going to do. But ‘gonna-doers ain’t doers’, from my experience in life. So we do not want any more ‘gonna do’; we want some action here. I have seen the action with the rollout of broadband. For all of its criticisms, I stood there and watched the big backhoe go past, digging a hole and laying the cable which will enable the people of my home -the 30,000 who live in the Mount Isa-Cloncurry area—to go on to broadband at a speed which is commensurate with that anywhere in the world. That is a great breakthrough. They have had a rollout of the information highway. Now they need a rollout of clean energy—a highway of clean energy.

I table in the House the North Australia clean energy corridor proposal that the Tully sugar mill switch over to co-generation, reducing electricity use. When you take the sugar out of cane and boil off the water you are left with a cane fibre that can be burnt to produce electricity. Currently 60 per cent of it is burnt just to get rid of it. We could rearrange our mills, which is very expensive in the case of the Tully mill—$120 million—to produce electricity. God bless Robert Carey and his proposal for a new mill to be built to produce ethanol and electricity in Ingham, as well as all the other people involved. Combined, the three mills could produce 200 megawatts of electricity. Of Australia’s 40,000 megawatts of electricity demand, they will produce 200.

We move on to the proposed dam at Hells Gate, west of Townsville. It will produce 100 megawatts of hydroelectricity—albeit peak load, not baseload. It will bring that water down to west of Charters Towers to the Pentland solar biofuels project. Arcadia has already put in an application for the solar grants which we are discussing at the moment in the House. Arcadia is a big international trader in energy. The difficulty with solar power—and having won a science prize for Australia I speak with very great authority on this—is that the sun shines for only eight hours a day, effectively. How are you going to cover the other 16 hours of the day? Therein lies the problem. In the case of Pentland we have two giant sugar mills. We will bring this water down and open up a huge area—not huge in Australian terms but huge in the sense that two very big sugar mills will come out of it. Solar power will fuel the boilers during the day; during the night they will burn the gas from the sugar mill to fuel the boilers during the evening. That will produce 450 megawatts of electricity. If you like hydro at 30, 40 or 50 megawatts of baseload, we are now up to 500, 600 or 700 megawatts of baseload power, which is almost the entire northern grid—five per cent of Australia—now on renewable energy. What a great achievement for this government, for this nation and for this generation. It will be there for a hundred years.

Let me just slow down. The Pentland solar biofuels project, coupled with these other projects, will produce some 700 megawatts of baseload power that will be there forever. That river will flow; the water will flow through the generators. And if you are worried about the 12 or 13 million megalitres in that river, we want only one million megalitres of it, so 90 per cent of it will still be flowing down to the ocean. Coupled with the phytofuels proposal, which will get rid of our dirty, filthy, prickly trees and the wind generator— (Time expired)