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Wednesday, 21 September 2011
Page: 10994


Ms PARKE (Fremantle) (12:32): There has not been a more important set of bills debated in this place in the first 11 years of this century than those before us. Like my colleagues, I am very pleased to be able to speak in support of what is without question an extremely well designed and carefully balanced scheme for setting Australia on the path to a low-carbon economy, on the path to a greatly increased renewable energy industry and on the path to greater global cooperation in the fight against dangerous warming and other climate effects on the planet we all share.

This is a distinctively Labor reform. In a critical but difficult and complicated area of policy, this policy response has been hard work and hard-won. That work and that struggle continues. Both the driving imperative and the basic structure of the Clean Energy Future package have been clear for some time. Our imperative is the need to address climate change; it is the need to reduce Australia's carbon emissions as part of a shared commitment to global emission reductions that is aimed at limiting to two degrees the increase in average global temperatures by the end of this century. Beyond that kind of increase, we know that the consequences will be grave and extremely difficult to mitigate.

The clear imperative to act is founded on the fact that climate change is occurring and that it will deliver environmental, social and economic impacts that must be avoided. The well-founded and exhaustive analysis in this country and elsewhere shows that it will be both more effective and cheaper if we act to interdict as many of the consequences of climate change global warming as early as we possibly can. Without question, the starting point for all of this is the phenomenon of climate change. The scientific evidence for the existence of climate change, and for the contribution that we are making to it, is irresistible. On that point I note where the Garnaut climate change reviewupdate 2011, from May, states:

Since 2008, advances in climate change science have broadly confirmed that the earth is warming, that human activity is the cause of it and that the changes in the physical world are likely, if anything, to be more harmful than the earlier science had suggested. I have replaced the premise of the 2008 Review that the reputable science was right 'on a balance of probabilities', with the premise that it is 'beyond reasonable doubt'.

That view is shared by 89 developed and developing countries, representing more than 80 per cent of global emissions and approximately 90 per cent of the global economy, which have pledged large cuts to their emissions under the Cancun agreements. All those countries accept the science; they accept the environmental, social and economic imperative; and they believe that a shared commitment to reducing the concentration of greenhouse gases in the atmosphere is essential for our shared future.

Australia accepts its part of the challenge. With approximately 1.5 per cent of global emissions, there are only 10 countries who contribute more greenhouse gas to the atmosphere than we do, and of course we contribute the most on a per capita basis. I note, from an opinion piece that appeared in Monday's Australian by Adair Turner, the chairman of the UK Committee on Climate Change, that Britain's commitment to an 80 per cent emissions reduction on 1990 levels by 2050—which has been law since 2008—will deliver a reduction in Britain's per capita pollution from 14 tonnes to two tonnes per person by mid-century. By contrast, Australia's emissions are currently 27 tonnes per person. It is absolutely right that a country like Australia, with a strong and well-developed high-carbon economy and with a tradition of making key contributions to efforts that require international cooperation, now play its part in the urgent global effort to address climate change.

The simple facts are these: climate change can only be addressed by concerted global action, Australia is a significant contributor to the problem and Australia is a country that is more susceptible to the worst effects of climate change than many other nations. The reality, then, is that the only argument worth having on the issue of climate change concerns the nature of the Australian response to climate change.

Unfortunately, that is not the only argument we are having. There are those—including a number of those opposite—who do not accept the science, do not accept the economics and do not accept the logical and moral imperative for Australia to be part of a coordinated global response. Such people clearly do not accept the evidence that has been gathered and analysed by the Intergovernmental Panel on Climate Change, NASA, the CSIRO, the Australian Academy of Science and the Australian Bureau of Meteorology, among others.

Of those who acknowledge that the world has warmed and is continuing to grow hotter decade by decade, there are some who believe that this is simply part of the earth's natural climate variation. They do not accept that human activity has anything to do with global warming. To take this position, you have to turn away from the accumulated evidence and the near-universal recognition of the phenomenon of climate change and our part in causing it. You need to move beyond scepticism, which is healthy, and into conspiracy theories, which are not. You have to turn away from the science and turn instead to the something-for-everyone kaleidoscope of the worldwide web, wherein fragments of all kinds of half-baked pseudo-science cluster about in threads of self-reinforcing delusion.

It is a matter of common sense and a measure of both good judgment and good governance to heed the advice of the scientists and the economists when their evidence and their analysis demonstrates that acting now and acting to reduce the emission of greenhouse gases through a market mechanism is the most cost-effective approach to the clear and pressing danger of climate change.

That is the position taken by the OECD. It is the position reached through the exhaustive green and white paper processes that this government put in place. It is the position that has been expressed in the following terms:

Managing climate change will be one of the great challenges of the 21st century: it represents an important economic shift, and will require a portfolio of responses.

In Australia's case, we are moving toward the progressive pricing in of the cost of carbon into the way our economy operates. This is 'big history' in the making—perhaps the most significant economic decision in a generation.

That is well said, I think, and in 2009 it was the considered view of Greg Hunt, the opposition spokesperson on climate change. Of course, it is also the view of their former leader, the member for Wentworth, who said:

You won't find an economist anywhere that will tell you anything other than that the most efficient and effective way to cut emissions is by putting a price on carbon!

At a time when many Australians bemoan the lack of political cooperation in the national interest, it is a shame that we no longer have a bipartisan commitment to tackling climate change. Nevertheless, the government is determined to act in the national interest, and with these bills we have set out a comprehensive portfolio of responses that addresses the need to reduce carbon emissions and does so on a low-impact, least-cost basis using a carbon price that is fixed for three years before making the transition to a floating price under an emissions trading scheme.

Under the Clean Energy Future package the price of carbon emissions will be paid by Australia's largest polluters, and liability will be assessed under the National Greenhouse and Energy Reporting System, which has been in operation since 2007. The independent Climate Change Authority will advise on the setting of pollution caps and will monitor international progress with an eye to adjusting those caps towards greater reductions as the global momentum gathers pace. This will secure emission reductions of at least five per cent on 2000 levels by 2020, which means an effective reduction of projected emissions by 23 per cent. It will be the framework through which we achieve an 80 per cent reduction on 2000 levels by 2050.

The funds raised by the carbon price will underwrite a massive investment in renewable energy and energy-efficient technologies; it will buffer households from the expected small impact of the price flow-through into the general economy; and it will support jobs in sensitive industries. The Clean Energy Finance Corporation will administer $10 billion in finance and equity support to turbocharge our burgeoning renewable energy industry, and the Australian Renewable Energy Agency will manage a further $3.2 billion as it coordinates the research and development and commercialisation of clean energy technologies. Treasury modelling predicts that the carbon price will drive around $100 billion in investment in the renewables sector over the period to 2050, which will transform our energy sector and create a considerable number of jobs. Not only will these jobs be in new industries but jobs will also be supported in traditional industries such as construction, electrical services and steel making, to name just a few. Simply put, our clean energy plan is good for jobs.

Unfortunately, it is clear from reports this week in the Financial Review that the uncertainty surrounding the coalition's opposition to these bills is directly hurting our economy, by placing an additional cost on new investments and the creation of jobs. For instance, AGL Energy Ltd. chief economist Dr Paul Simshauser made clear that Australian companies are putting off their investments and those who are proceeding are paying more. He said:

Project financing in Australia has become a bit more problematic. We're a bit of an anomaly globally. The only thing we could put it down to was we were having one of the most ferocious debates in the world on a price of carbon.

This was further reinforced by Martijn Wilder of Baker McKenzie, who said:

Until the opposition makes it clear what its actual policy is, there will be uncertainty.

It is critical, therefore, that the parliament passes the clean energy legislation and provides certainty to business—so that they can start to invest in our clean energy future.

The modest price impact on householders of having a carbon price in the economy, according to Treasury modelling, will be 0.7 per cent. The increase in assistance to age and disability pensioners, carers, students, single parents and job seekers will be 1.7 per cent—and it will be permanent. The weekly price impact on the average household will be $9.90; the compensation provided to the average household will be $10.10.

All this is designed to ensure that a cost incentive exists for the largest polluters and for any business with an indirect carbon cost component in their product or service while at the same time ensuring that low-income households are fully protected. It will put a price signal into the economy that will drive emission reductions in the name of cost reduction, and give low-carbon products, services, and processes an appropriate competitive edge. Taken all together, this reform will create a lower pollution and lower carbon economy; it will create a stronger, more sustainable energy profile; and it will foster innovation.

These features of the package have been spoken to in great detail by many of my colleagues, including the Minister for Climate Change and Energy Efficiency, Greg Combet, whom I congratulate. I also take this opportunity to congratulate, for the Mount Everest of work that has gone into this momentous reform: the former minister for climate change, Senator Wong; the parliamentary secretary, Mark Dreyfus; the staff of the ministers; and the Department of Climate Change and Energy Efficiency and Multi-Party Climate Change Committee.

I want to finish by noting that, in the community I represent, there is a considered and longstanding desire to see the Australian government take action on climate change. As I speak in support of these bills, I feel very strongly that I am supporting a policy approach that accords not only with the scientific and economic logic and with my principles but also with the carefully reasoned and strongly felt views of the people I represent—the people of the Fremantle electorate. Every day I receive more emails from constituents that encourage me to support this policy, that urge me to be a part of positive and necessary change. Of course, I also get emails, letters and calls from people who worry about the effect this reform will have on their personal circumstances, but in many cases when the detail of the policy is explained those people also accept that this reform, though confronting for some, is a step we need to take, and a positive step.

Back in 2008, one of the most significant community events that I hosted in the first 12 months after I was elected to represent Fremantle was a climate change forum. It was attended by nearly 200 people, and it was clear to me then just how much interest, engagement and passion there was for a policy response to the problem of climate change. Earlier this year, when the Prime Minister and cabinet attended a community forum at South Fremantle Senior High School, there was a delegation from the Australian Youth Climate Coalition, and they presented the Prime Minister with a card that thanked her for taking the necessary steps to safeguard Australia's climate, energy, environmental and economic future.

In Fremantle, the potential for a clean energy future is being embraced as I speak. As I drive through the suburbs of my electorate, street after street shows the proliferation of photovoltaic cells on the roofs of houses, and in the space of four years these solar panels have gone from being a relative rarity to being commonplace. There should be no surprise in that, because we have supported the installation of something like 150,000 solar PV household units since coming to government, after the Howard government managed only 12,000 in 11 years. White Gum Valley, a suburb in my electorate, has the largest take-up of 'green power' in the Perth metropolitan area. Carnegie Wave Energy, located in North Fremantle, has conducted a successful commercial trial of its wave energy technology off Garden Island, which produces emission-free power and emission-free desalinated water. A company called Quickstep developed its new and less expensive carbon fibre production process, with all the fuel efficiency benefits this will offer, at its factory in Coogee, not far from my electorate office. The City of Fremantle was the first carbon-neutral local government in Australia, and this year the City of Cockburn was a winner in the 2011 National Awards for Local Government for its greenhouse gas emission abatement, sustainability and climate change program.

All these individual and community efforts, these business endeavours and these local government actions are part of a change that has been in progress for several years. This change, which included a change in government in 2007, has seen Australia ratify the Kyoto Protocol and now sees us join the dozens of countries around the world with firm emission reduction targets, and a market framework for decreasing our reliance on carbon and for increasing our efficiency, innovation, and use of renewable energy.

The Clean Energy Future is a bright future, but it is a long way off, and it will need to be hard won, which is why this package of reforms in the long-term national interest is a quintessential Labor task. There has not been a more significant reform debated in this place this century, and I am proud to be here to speak in favour of these bills.