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Tuesday, 7 February 2017
Page: 148


Mr BROADBENT (McMillan) (17:26): Deputy Speaker Hastie, this is the grievance debate, where members get the opportunity to bring issues of importance to the nation, to their state or to their constituency, and I put to you today that electricity prices are going to be one of the most important issues over the next 10 years. This affects my constituency directly because of the closure of the Hazelwood Power Station, which supplies 25 per cent of the power for Victoria and between five and eight per cent of the power for the nation. It has been and could remain a very important facility because, Deputy Speaker, like you as a Western Australian, who has great riches and wealth there in Western Australia, we also have great riches and wealth in that brown coal out of the Latrobe Valley. It has driven the thousands of jobs and opportunities for cheap electricity that changed the structure of the nation under the tutelage of John Monash, a great forward thinker.

But remember Hazelwood Power Station and the way it is built. It is probably 1930s innovation and design. There is an opportunity, if we are to be brave, to look at how we might use that amazing resource for the production of electricity. I mentioned some forward thinkers in a speech in another place. The former Minister for Energy Resources in Victoria, the Hon. Theo Theophanous, said one of Victorian Labor's preselection policies was to shut one-quarter of the Hazelwood power plant—not the plant, one-quarter—at a potential cost to consumers and taxpayers of $2 billion. He saw that as an attempt to garner Green votes. Labor's adoption of the policy was seen as success for the Greens and increased anxiety amongst Labor's traditional voters about impending electricity price rises—his words, not mine. It contributed to Labor's electoral losses at that time. This is going back a bit. Previously, the Labor government under John Brumby had pursued other ways of reducing Hazelwood's emissions.

It is well known that some years ago the Victorian government entered into an agreement with Hazelwood that included conditions for new technology to cut emissions by 35 million tonnes in exchange for extending the plant's life. What is not commonly known is that about four years ago the government almost clinched a three-way deal with the aluminium producer Alcoa; International Power, the owner of Hazelwood; and the state. This would have seen the state's annual commitment to subsidise power to Alcoa until 2016 paid as a lump sum. In exchange, Alcoa, which uses a huge amount of power, would have helped pay to refurbish Hazelwood. This would have given Alcoa more than 20 years of power supply. As part of the deal, Hazelwood was to refurbish or rebuild up to six of its eight units to include state-of-the-art supercritical burners and coal-drying technology. This could have potentially cut emissions from 1.6 tonnes per megawatt hour to 900 kilograms per tonne per megawatt hour. The estimated cost of converting each unit at the time was $200 million to $300 million, which would have been partly absorbed by International Power and partly by Alcoa. Both would have gained from a long-term contract and a greener image. Alcoa flagged that it might increase its workforce and production, but the government thought the deal's political risks were too high. What was the political risk? The only political risk was that their green vote in the city would be diminished. And they were relying on the greens in the city for their vote. But what about the workers at Hazelwood? What about the people of Moe, Morwell and the surrounds? What about the 26 per cent of people that currently work at Hazelwood today that live outside of the city of Latrobe? What about them?

The politics said: 'We can't do this. It's a great idea and it really helps Alcoa and it really helps the workers and International Power. And it really helps the government and it is cost free to the government and we could have an ongoing power station that delivers 25 per cent of our power and 10 per cent of Australia's power and therefore reduces the threat to our national grid.' A person came to me in my office—I will not name him, because he works for one of these companies and has built powerlines—and he said to me, 'It's not just South Australia that is under threat.' He actually said to me, 'Here is your grid,' and pulled out a plan of the whole grid of the eastern seaboard. Then he said, 'On your worst day—and I know you do not have this problem in Western Australia—you could be relying on one cable coming out of Queensland for the whole of the eastern seaboard.'

This nation, in my opinion, never acts until it is a necessity. Do we have to go through a total power meltdown on one of our hottest days for the residents of Canberra, Melbourne, Adelaide and Sydney to recognise that we have a problem and that we cannot just close down these power stations and expect renewable energy to take over? Nobody is a greater supporter of renewable energy than I am. If we can shift to that and have some storage and some opportunities, I am going to back it all the way. I have other uses for our brown coal down there, especially for urea plants and for future hydrogen plants with Kawasaki. There are a lot of opportunities in brown coal.

What I am putting to you is this: good thinkers who had the national interest and the state interest and the interest of the blue-collar workers in Latrobe Valley at heart would have investigated thoroughly and made public what that Labor government's intention was at the time. There is nothing wrong with that proposition. My only shame, I suppose, is that this is the first time I have read it. It is the first time I have seen. It was published on 4 July 2011, and the former minister exposed that there was a proposition for Hazelwood to carry it into the future. Am I going to be part of a government or sitting in opposition when the Labor government of the time, after a crisis, turns around and says: 'We're going straight back to Hazelwood and, at enormous cost, we're going to rebuild it; we're going to spend millions of dollars tearing this place down and then reconstituting the mine—millions'?

Should we be protecting our own community, our own people, our own workers, our own opportunities, our own safety and our own guarantee of energy and looking again at Hazelwood? I know private enterprise is not going to do it because what the community, through the Greens, have said to free enterprise is this: 'You don't touch coal, because it's bad. Bad coal, bad coal—or, even worse, brown coal.' That is what they are saying. So business will not touch it. It is the parliamentarians in this place who are going to look at our energy needs into the future, who are going to have to come to grips with what they have to do, or it is going to be the state government and the federal government in conjunction looking at how we can best protect ourselves and guarantee power supplies.

I want to finish with this: those of us in the community who are wealthy will always survive somehow but, if you are a pensioner or if you live in a regional area or if you are from a lower socioeconomic area, you will carry the burden of these high electricity prices that come out of the closure of Hazelwood. I have been a pain in the neck on behalf of people from lower socioeconomic communities because I represent a region and I represent lower socioeconomic communities as part of my responsibility. It is my responsibility. They are my responsibility. Those pensioners are my responsibility. The buck stops here with me and, if I cannot defend them and speak for them and if I cannot speak for those workers, who can I speak for? I speak for them. We have forgotten them. Our relationship is broken, and it may be up to the next generation to fix it.