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Wednesday, 26 May 2010
Page: 4253


Mr BALDWIN (7:12 PM) —I rise tonight to speak on the Renewable Energy (Electricity) Amendment Bill 2010, Renewable Energy (Electricity) (Charge) Amendment Bill 2010 and the Renewable Energy (Electricity) (Small-scale Technology Shortfall Charge) Bill 2010. I want to remove any doubt that the coalition is not supporting renewable energy. In fact, it was the coalition who set down achievable goals under the Howard government. The coalition is committed to generating at least 20 per cent of electricity usage from renewable resources by 2020. What does that 20 per cent mean? It is easy to quote percentages and statistics, but in reality what we are looking at in that 20 per cent is 60,000 gigawatt hours, of which 15,000 gigawatt hours are pre any targets and mostly come from hydroelectricity, 45,000 gigawatt hours are the coalition’s already established 9,500 gigawatt hours and an additional 35,500 gigawatt hours that were legislated with bipartisan support in 2009. Again I say, the coalition is absolutely committed to renewable energy.

Renewable energy is something that requires high investment and perhaps the greatest concern of those investing in renewable energy is the sense of security and stability for that investment. One of the issues pertaining to renewable energy is the cost when we have some of the cheapest forms of producing electricity here in Australia. Australia has an abundance of coal that is very affordable and provides the opportunity to produce cheap electricity. That works as a disadvantage to those that are looking to make the investment in new forms of technology that should never be limited. Currently, when people think about renewable energy, they think about wind or solar or hydro. Those more out on the limb start thinking about geothermal and biomass, but there are many, many more forms of renewable energy technology—in particular, tidal—and there will be more technology to come. What we must not do is restrict the opportunity for those creative minds to develop new technology.

If I think back to when I first saw silicone based photovoltaic cells or solar cells, I can remember that they were largely different to the new and current technologies in thin-film photovoltaic cells. We need to have a program and a policy that legislates minimum amounts of energy is to be from renewable energy technologies and also to encourage investment and development in new technology. If we do that we improve the efficiency of electricity generation. As we improve the efficiency and reduce the production costs then those forms of electricity will become so much cheaper.

What people want to see is security in investment. Unfortunately, in the management by the Rudd Labor government of the programs that it has put in place—programs like the insulation program—there has not been enough thought. There has been a lot of rushing and a lot of rhetoric and very little actual delivery of programs. This is a government that has failed the first test of government, and that is to adequately manage programs. On something as large and expensive and as investment-intensive as this, the Australian people, particularly those who are investing, need a level of security.

Today I met with an Australian company called CDB Energy. I understand the member for Werriwa spoke of them because he had meetings with them today. CDB Energy are an Australian company who, before the last election, in my electorate of Paterson, were prepared to invest in an opportunity to build a solar farm—something that would have produced electricity in the Hunter Valley. More importantly, they were prepared to invest and build a manufacturing facility for photovoltaic cells, supported by one of their partner companies, SOLON Energy in Germany. All they required was $20 million from the Australian government. The coalition said, ‘Yes, if re-elected we will provide that $20 million,’ but this government walked away from that opportunity.

For discussions today the CEO of CDB Energy, Mr Gerry McGowan, brought down representatives from the China Development Bank, Hebei Branch, who are now investing $1.8 billion in renewable energy in Australia. They were Ms Shan Xinhong, Vice-Governor of CDB Hebei Branch; Mr Xu Huaizhong, Senior Engineer of Appraisal Department 1, CDB; Mr Geo Wenli, Director of Accreditation Department, CDB Hebei Branch; Mr Lei Jinqi, Deputy Section Chief of Credit Section 4, CDB Hebei Branch; Mr Wang Feng, Project Manager of Accreditation Department, CDB Hebei Branch; Mr Cui Haitao, Vice General Manager of Baoding Tianwei Wind Power Technology, and Mr Wang Yong, the chief representative, CDB Energy.

They are here because they are committed to investing in Australia in partnership with CDB Energy. They are going to build a plant called Adjungbilly Wind Farm, which is located to the east of Gundagai. The first project in this wind farm is the installation of twenty-four 1.5-megawatt wind turbines, which will create around 36 megawatts of power, with an expansion planned of a further 41 turbines planned, which will create 60 megawatts. So, all up, we are looking in the vicinity of 100 megawatts of wind power. This comes because they are able to bring investment to Australia. However, this investment, as I said, relies on security and opportunity. Through the process of this bill—provided the government does not change its mind halfway through—there will be opportunity for further investment. But this government is becoming renowned for changing its mind. You can never trust what they say; you can only trust what they do, and what they do is not exactly all that pleasant for business.

One of the areas that particularly interests me—the technology was developed in the electorate of Eden-Monaro—is an energy storage system through a carbon heat sink. This technology takes solid blocks of graphite and pumps energy, in all different forms, into that block. You can then draw the energy out as you need it to create steam to drive a turbine.

I stand today to encourage investment in renewable energies; however, that investment needs to be underpinned. Recently, when I went to Afghanistan and then over to Gallipoli and the Western Front, I had an opportunity to meet with one of CDB’s investors and partners, SOLON. I had a look at the thin-film photovoltaic solar panels that they were producing. The automation and production facility was quite fascinating. I saw the production and the installation and the tracking of solar arrays and how they worked. In fact, those arrays are part of a pilot program that is being developed as part of the Howard government’s diesel fuel replacement program for energy production on King Island.

I also took the opportunity to meet at the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety, with Ms Andrea Meyer, Head of General and Fundamental Issues on Renewable Energy Section. I also met with Mr Bjorn Klusmann, Managing Director of the German Renewable Energy Federation and with Mr Rainer Brohm, Head of Department, Government Relations and International Affairs for the German Solar Industry Association. Germany is the leading country for renewable energy. In fact, they have put a program in place where they intend, by 2020, to have 45 per cent of their energy from renewables.

But there are some important lessons to be learned in installing renewable energy. As I said, one is about security. Experts have said to me that the thing that will attract most investment is a feed-in tariff regime, where a contract is drawn for 20 years. That 20-year contract enables the people that install renewable technology into their houses or factories—or on a broader scale—to put together a business case: a plan to take to the bank.

The simple message is: what needs to be provided is incentive, not penalty. I am proud to say that the coalition through our leader, Tony Abbott, has developed a direct action plan. That direct action plan is based on incentive rather than penalty. We do not believe that if you penalise something it will grow, any more than we believe that under the great big new tax on the mining industry the economy will grow. But if you incentivise, you will grow investment and opportunity.

There are other technologies. One company in my local area that I have been involved with for a number of years is Corky’s Carbon and Combustion. I have watched them grow and assisted where I can and helped them get research and development grants. The company have been able to develop new technology—they are very innovative guys, the guys at Corky’s. They have been taking biomass and processing it into energy in a unique way that can be run from small scale to large scale. The process uses waste product and coal mine tailings. These are the things where we can value-add by using the waste—for example, by just going through a municipal tip and having a look at what is dumped there and the methane that it is creating. If you can harness that energy you get two benefits. Firstly, you reduce the amount of landfill and waste and, secondly, you develop an opportunity for generating energy.

Energy is the lifeblood of our nation. Everybody needs it; every business needs it. It is part of what we need to be able to do what we do. So we need to incentivise people. We need to encourage. We need to make sure that people feel comfortable with their investment. This is critical. If they do not feel comfortable and if there is uncertainty, then, as the former speaker said, people will move their investment offshore.

I repudiate his claims that we did nothing under Kyoto. This country under the former Howard government achieved its targets under the Kyoto protocol. The Rudd Labor government makes very misleading statements when it says we did nothing. We actually achieved our targets. We put together a range of investment opportunities for people so they could have a level of security in their investment. There was the introduction of the $8,000 solar rebate, which this government means-tested on budget night 2008, and sent the industry into chaos. We introduced the Remote Renewable Power Generation Program, which it abolished in June 2009, again, sending industry into chaos.

The clear message with all this is that investors need certainty. The coalition is committed to renewable energy. The coalition is committed to making sure that internationally we pull our weight by reducing our carbon footprint. But there are many ways of doing it. Under the Rudd Labor government it seems that the only answer they have to anything now is to tax—to tax and penalise—whereas, the coalition’s plan, the direct action plan, is about incentivising and making a difference. There is a difference between talking the talk and walking the walk. It is whether people individually apply themselves to making a difference or rely on the government taxing everybody and indirectly paying for it. I would rather encourage people to make a direct contribution.

Like many other members in this House, I am the very proud parent of three teenage children. My teenage children tell me all about climate change and of the need to reduce our carbon footprint. However, like all children, do you think you can get them to turn off the bedroom lights or bathroom lights, the computers or televisions? They are just typical. They understand the rhetoric but they do not understand that you need to apply direct action. I would notice the difference in my electricity bills at home if indeed my children turned off the power when they were not using it. That is replicated everywhere. There is not much point in generating all of this clean energy or renewable energy if, indeed, individuals do not take direct action in reducing their energy consumption.

I think that education is part of the process and I think that we need to apply more effort, such as Ian Kiernan did with the Clean up Australia program. He educated people that it was not good to leave rubbish lying around, that we could individually make a difference by picking up bits of rubbish and putting them in a bin, having cleanup days and cleaning up our nation. But if we sit back and just rely on governments rather than taking direct action as individuals, then I am sad to say that a lot of the effort is wasted.

Before I finish I would like to talk also about how people can make a difference in reducing their carbon footprint. I am proud to say that I have an association with a company called Weathertex and I have watched them go through the trials and tribulations of their development. This is a company that takes hardwood timber with some bits of softwood in it and produces Weathertex. Weathertex is a hardboard weatherboard. They do it by steaming it—and the process is very technical. In essence, they are using a renewable source. They use trees, and trees continue to grow. As the owner, Paul Michael, said, ‘The best thing we can do is chop down a tree and grow a new one. It consumes more carbon. If we take the old tree and turn it into a valued product, then we get a doubled effect.’

I think that there are many opportunities. There are new and emerging technologies that will come to our nation and we need to seize on those opportunities. I urge the government to be very sure of the direction they are going in. This government, in putting together this renewable energy plan, needs to make sure that down the track it does not change its mind and take a whole new direction, because that will destroy investment and confidence for people investing in this industry. As I said, one of the opportunities, as learnt from the German example—because people put to me that the ETS has largely not worked there—is that feed-in tariffs have worked there for those that are investing in renewable energy technology. If we create the opportunity and the security and we provide the means by which people can individually make a difference, then we can achieve outcomes.

Finally, I, like everybody else in this House, want to make a difference. We all want to make an individual contribution and we need to provide a secure pathway for that investment to make a difference. I commend the bill to the House.