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Tuesday, 14 February 2017
Page: 949


Mr FRYDENBERG (KooyongMinister for the Environment and Energy) (15:31): The only reason we are dealing with this MPI today is that the member for Port Adelaide thinks the best form of defence is offence, because, if you had the record Labor has on energy policy, you would not have the gall to come to this dispatch box. When Labor were last in government electricity prices increased by more than 100 per cent. We had the dreaded $15 billion carbon tax, which Australians did not want and did not need. We had more than a dozen different policies. Who could forget the citizens assembly, cash for clunkers, the emissions trading scheme or the carbon tax? The list went on and on. They were very poor policies.

Now, from opposition, they have a quadrella of policies which are only going to send electricity prices higher and undermine the stability of the system. First and foremost, they have a 50 per cent renewable energy target by 2030. When they put that in their policy document they said there would be no details released until October 2017. Then, when the Leader of the Opposition fronted up to the Press Club the other day, it was the issue that did not get spoken of other than a single reference to renewables, with no detail about his policy.

They have a 45 per cent emissions reduction target by 2030, nearly double what we have taken to Paris—a target which will cost hundreds of billions of dollars to meet. They have an emissions intensity scheme, which Penny Wong, the Leader of the Opposition in the Senate, when she was climate change minister in 2009, described as a 'mongrel of a policy'. She described it as a smokescreen and as being no credible alternative. Then of course they have a policy to close Australia's 24 coal-fired power stations. They come up in question time today and ask about the Tomago aluminium smelter, but the Tomago aluminium smelter and others like it would not survive if we did not have coal-fired power. What about the member for Shortland? He is a shadow assistant minister, and he has a policy, which he has to defend, that includes the forced closure of Vales Point, which is in his own electorate.

Mr Conroy: No, it doesn't. Don't mislead the House.

Mr FRYDENBERG: It does. The Australian Energy Market Commission modelled the forced closure policy, and then the member for Port Adelaide has referred to that. I can tell you that the many hundreds of workers at Vales Point would not be too happy with the member for Shortland. As Graham Richardson said, Labor are trying to 'out-green the Greens', they have a farce of a policy on 'a wing, a hope and a prayer' and it is going to sell out pensioners and blue-collar workers—the blue-collar workers you are expected to defend.

Let us get the record straight as to what occurred in South Australia. We have had four blackouts in nearly as many months. Last September, 1.7 million people lost power. We had blackouts in December, January and now in February. Embarrassingly and humiliatingly, the member for Port Adelaide described those blackouts as 'mere hiccups'. If I was working for one of those companies or was one of those 3,000 workers at Olympic Dam, owned by BHP, in South Australia, I would not call that a hiccup. If I was one of the 1,500 workers at Arrium in Whyalla or one of the hundreds of workers at the Port Pirie smelter, owned by Nyrstar—if I was one of those hundreds of workers or thousands of workers affected—I would not be describing that as a mere hiccup. If I was one of those people stuck in an elevator or imprisoned in their homes or stuck in the gridlock of the streets when the lights went out, I would not be describing this as a hiccup. Nor would I be describing the fact that South Australia pays electricity prices which are more than 40 per cent above the average across the national electricity market as a headache.

The Labor Party's policies have effectively led to these blackouts, because they have left the South Australian system a lot more vulnerable. In fact, since the closure of the Northern power station last May, which the Labor Party say has nothing to do with renewables—which was absolutely disagreed with by Alinta in their statement at the time—we have seen nearly a doubling of the reliance on the interconnector, ironically, supplying brown coal-fired power from the Latrobe Valley into South Australia.

South Australia has become a lot more vulnerable. The intermittent power that South Australia is now relying on for more than 40 per cent of supply does not always have predictable levels of supply. The quality as well as the quantity is different from baseload generation, particularly coal but also gas and hydro. It does not have the same characteristics of FCAS and inertia that you get from a spinning turbine and the consistent 50 hertz voltage that you get with baseload power.

One day, in the June-July period of last year, wind supplied 80 per cent of South Australia's power, but on another day it supplied just one per cent of its power. When the lights went out last Wednesday, it fell to supplying just two and a half per cent of the South Australia's power. That was a 95 per cent drop on the power that was being supplied by the wind farms earlier in that day. And it is that level of volatility, without the necessary storage, which this reliance on intermittent power creates.

We are taking very seriously our responsibilities to get more stability into the system. That is why we have tasked Chief Scientist Alan Finkel to produce a report, and that is why we are investing record amounts in storage—battery storage, and, as the Prime Minister talked about, pumped hydro. Some of the programs include: the virtual power plant in Adelaide, connecting 1,000 businesses and homes with batteries and solar PV; the work we are doing on a copper mine in Western Australia in order to take out diesel from that operation and replace it with solar; and the work we are doing in pumped hydro with the Kidston goldmine in Queensland. More than $150 million worth of projects have been invested in by ARENA and CFC with battery technology.

Of course, we want to push the states to lift the moratoriums and the bans on gas development because we think this is vital as a transition fuel, with about half the emissions of coal. And we need to get more gas out of the ground—for example, in the Northern Territory, where the Labor government has a moratorium in place. The Northern Territory has about 180 years' worth of supply to meet Australia's domestic gas needs. Imagine if we could get that out of the ground.

The other target we are taking on is the Labor states' high renewable energy targets, which not only are leading to bad investment outcomes but also will not improve the environment: a 50 per cent target in South Australia; a 50 per cent target in Queensland, remarkably, with only 4½ per cent of their power today coming from renewables; and a 40 per cent target in Victoria. I am very pleased to say at this dispatch box that our Victorian, South Australian and Queensland Liberal and Nationals colleagues have banded together to reject those targets once they get into government.

We take our emissions reduction targets very seriously, and those on the other side of the House need to know: when they were in government, they were projected to miss their 2020 target by more than 700 million tonnes. We, according to the last projections, will beat our 2020 target by more than 220 million tonnes. Whether it is energy productivity, or whether it is our Emissions Reduction Fund, which has been able to achieve 178 million tonnes of abatement at just over $11 on average, or whether it is what we are doing in other parts of the portfolio with the renewable energy target and the work of the Clean Energy Finance Corporation and ARENA, we are doing a lot in a lot of areas to meet our emissions targets, and we will beat our 2030 targets, as well as beating our 2020 targets.

I just want to finish by saying that the member for Port Adelaide has been playing a very dangerous game in the last week. He—unfortunately, because he is a very endearing bloke and means well—has got wrong and misunderstood the role of AEMO. Secondly, he has misunderstood the true powers of the states to direct AEMO, and the lack of power of the Commonwealth to direct AEMO. Thirdly, he has also sought to blame the government for not saying that the South Australian blackout last September had anything to do with the severe storms. We were up-front at the time. And today at the dispatch box he also sought to imply that there was load-shedding for residential customers. That is not correct, and he knows the truth.