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Wednesday, 26 May 2010
Page: 4236

Mr HAYES (5:55 PM) —Before the interruption of debate on the Renewable Energy (Electricity) Amendment Bill 2010 and cognate bills, I was speaking about the objectives in the suite of technologies that are contained in these bills. Clearly, the objectives are to develop renewable energy, to encourage the research, development and commercialisation of renewable energy projects and to underpin the support both for the renewable energy sector itself and importantly—and this is not often mentioned—the jobs that are growing in that industry. I know, Mr Deputy Speaker Thomson, that you have taken a keen interest in this yourself. A range of companies from this sector that both you and I have spoken to have described to us the new and emerging employment opportunities and skill sets in this industry. There is a whole suite of skills required of those involved in geothermal, wind power generation, biomass preparation, solar and so on, and these skill sets are of considerable importance to large-scale projects.

Among the things that should be encouraged is addressing those issues and looking at those skill sets. I remember reading last year a paper produced in Germany that talked about that having been done. The paper described the decision to start auditing the skills required for an emerging renewable energy industry. That is something that we in Australia really have to apply ourselves to, because whilst those skills can be tailored and developed, if we are going to seriously address those issues so that companies will invest in and develop these technologies, we need to make sure that we have the skill sets to do it. It is heartening to see that the investment is taking place and that vocational education in particular is moving to ensure that we have those skill sets. From speaking to those companies, I know that the opportunities are now being taken to use the skills that have been developed through those courses to these new and emerging industries.

As I said in the opening part of my speech before the interruption of the debate on these bills, I had the opportunity to work with a renewable energy company prior to coming to this place, so I know about the difficulty of commercialising technology. I know that most of these technologies will be developed not through the public purse but through commercialising the project by raising funds on the share market. In saying that, companies that are developing large renewable energy projects need certainty. They are developing these projects partly for altruistic reasons. They want to get in and do something decent not only for our economy in the long term but also for our environment. These companies are well motivated in those respects. But, if they do not have a share price that underpins their altruistic motivations, the projects do not get commercialised and the viability of all the research and development work that is needed to bring them on stream is threatened. One of the things that this bill does in looking to create two aspects to renewable energy technology and in distinguishing between large-scale and small-scale projects is to try to provide the certainty needed to take investment decisions.

It was a coincidence that 10 or 15 minutes before I started to speak this morning I ran into Gerry McGowan, who is the managing director of CBD Energy. The people from the Bank of China were in the House today as well. He was telling me that they were trying to develop a substantial wind farm for renewable energy power generation in New South Wales, I think in Gundagai. People have to be able to bring to bear their entrepreneurial spirit, to make the commitment to invest in something that is going to be significantly long term with a view to committing to the development of those resources in such a way that we will see a long-term benefit.

I know that in Victoria, since these bills were announced, AGL has already committed to conditional agreements for the construction of a very substantial wind farm, the Macarthur wind farm, in south-west Victoria. It is going to produce, after full construction, 365 megawatts of power. That is very substantial. The point of saying this is that these organisations need a degree of certainty. One of the things that can undermine this certainty, bearing in mind that this is an energy trading system we are looking at and they are going to invest on the basis of having 20 per cent renewable energy power by 2020, is a high take-up of small-scale renewable energy projects, or the development of small-scale renewable energy technology.

This bill goes a substantial way towards giving certainty in respect of those investors in large-scale renewable energy power generation. Both large-scale and small-scale will be delineated, and that will give certainty to the investment decision surrounding large-scale renewable energy projects. From the figures I have seen to date, putting both of those categories together is possibly going to lead to something larger—I do not know how much larger—than 20 per cent of renewable energy being produced by 2020. I suppose a number of things can influence that. This will allow those major investors looking at significant projects to be able to commit funds for the development of those projects based solely on the notion that this is where we will be in 2020. That is why this is of some particular significance.

It is also important to remind people of what the renewable energy target does. The RET provides guarantees; it is a market for the additional renewable energy power we require. It certainly provides that financial incentive by dictating the energy mix that will be achieved by 2020. The RET uses mechanisms of tradeable renewable energy certificates, and those certificates can be produced by renewable energy generators large or small. As I say, being able to make this distinction between large-scale and small-scale generators, whether small scale is just having solar panels on your roof, or a solar hot water system, gives a very clear signal to any boardrooms looking at investing in renewable energy technology that by 2020 we are looking at 20 per cent of our power being produced through renewable energy. These are matters which are quite substantial.

I did say when I started my contribution earlier today that we are an energy rich nation. We are one of the largest coal-producing nations in the world, and I think we are the biggest exporter of coal. Clearly coal will play a significant role in the generation of power for some time to come in this country, but we are making decisions now about how we move towards developing not only clean coal technology, which I know the minister at the table has a very significant interest in, but also a clean energy mix for this country. It does not happen just because we say it should. We need to provide the framework within which that can be developed, and that is clearly what these bills are aimed at. These remarks are similar to those I made in respect of the ETS itself when it was debated in this chamber on a couple of occasions. We pressed for a mechanism that would allow the change to occur within a very planned commercial process and enable the deployment of these technologies.

What we are doing here today is augmenting our position in terms of the 20 per cent renewable energy target by 2020. We are giving greater definition and greater certainty, particularly as they apply to large-scale projects. On that basis I commend the bill to the House. I encourage people to participate in this debate and certainly take an interest in what is happening in each and every one of our own backyards in relation to renewable energy. Not only mums and dads but also their kids are now developing the very clear view that we must make changes for the future. We are trying to provide a real, positive incentive to make that change.