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Thursday, 12 December 2002
Page: 8039


Senator ALSTON (Minister for Communications, Information Technology and the Arts) (12:05 AM) —I move:

That this bill be now read a second time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows

The Renewable Energy (Electricity) Amendment Bill 2002 amends the Renewable Energy (Electricity) Act 2000 to clarify key definitions in the original legislation and to provide for greater efficiency and effectiveness in the administration of the legislation.

The implementation of the legislation by the Office of the Renewable Energy Regulator has revealed a number of minor deficiencies in the operation of the legislation which, collectively, need to be addressed to ensure the maintenance of the integrity of the legislation and the full achievement of its objectives.

The amendments contained in this bill are administrative in nature and relate to the following:

· The clarification of definitions including those related to eligible renewable energy sources, components of a power station, relevant acquisitions of electricity and penalty charges.

· The capacity of the Renewable Energy Regulator to vary decisions including those related to energy acquisition statements, energy shortfall statements and the 1997 eligible renewable energy baseline for an accredited power station. This action may be at the Regulator's own instigation or that of the liable party and will be exercised in a limited number of circumstances;

· The introduction of information gathering powers to underpin the monitoring, auditing and compliance requirements of the Renewable Energy (Electricity) Act 2000 and to bring this legislation into line with similar pieces of Commonwealth legislation;

· The extension of authorised officers to include officers appointed by the Commonwealth and by State and Territory governments;

· The capacity of the Renewable Energy Regulator to suspend entitlements, including the accreditation of a power station, in a number of limited circumstances;

· The inclusion of administrative review provisions covering decisions by the Renewable Energy Regulator to take action to vary or suspend.

The clarification of definitions is particularly important from the standpoint of investors in renewable energy. The amendments will provide greater clarity about what is an eligible renewable energy source, what is an accredited power station and what is a relevant acquisition of electricity. Similarly, the capacity to vary or amend documentation or decisions meets a pragmatic need of the Regulator to address mistakes made by participants or to respond to changing circumstances, additional information or the results of monitoring and compliance actions.

The power to gather information and documents will allow the efficient administration of the legislation and is a means by which informed decisions about the participants in the trading of renewable energy certificates can be made. Information will be confined to that which is relevant to the operation of the Renewable Energy (Electricity) Act 2000.

With the renewable energy target ramping up sharply in the coming years, it is highly likely that there will be considerable growth in the number of accredited power stations and the amount of renewable energy certificates that will be traded or acquitted. The administrative load for the Office of the Renewable Energy Regulator will greatly increase and in order to meet this demand, provision will be made to allow the appointment of Commonwealth officers or employees of State and Territory Governments to operate as authorised officers for the purpose of the Renewable Energy (Electricity) Act 2000 and therefore exercise the power to monitor compliance with the Act. The Act already provides that in order to be appointed as an authorised officer, the person must have sufficient maturity and sufficient training. As officers or employees of Australian governments, these authorised officers will be subject to the strict public service requirements for conduct and behaviour.

The suspension of an accredited power station is particularly important to ensure that the owners and operators of these businesses conduct themselves in a manner in keeping with the objectives of the legislation. A power station's accreditation can be suspended in a range of circumstances including where a power station contravenes or is suspected of contravening a law of the Commonwealth, a State or a Territory or where the Renewable Energy Regulator is reasonably of the opinion that a gaming arrangement has occurred. Gaming involves generators manipulating their output to increase the quantity of renewable energy certificates able to be created without increasing renewable generation, and the powers foreshadowed in this bill ensure that such action cannot pose a future threat to the integrity of the legislation.

Decisions by the Renewable Energy Regulator to vary or amend decisions or assessments or to suspend entitlements under the Renewable Energy (Electricity) Act 2000 will be subject to review by the Administrative Appeals Tribunal.

This bill, with its suite of administrative changes, is being introduced now to ensure that there is as little delay as possible in providing certainty to both the power generation industry and the renewable energy industry on the operation of the renewable energy trading system. Such certainty will enable these industries to make the type of strategic investments needed to achieve this Government's challenging target of an additional 9 500 gigawatt hours of renewables-based electricity—an amount, I am informed, that is equivalent to the residential electricity requirements of a city the current size of Sydney.

The Renewable Energy (Electricity) Act 2000 was a world-leading piece of legislation and a number of countries have identified it as a model for promoting renewable energy through a market-based trading system. While the measure has been in operation only since 1 April 2001, I am pleased to be able to report that its implementation is already delivering significant benefits. To date nearly 150 power stations have been accredited and they encompass a wide range of fuel types.

Small and large producers are included in the trading scheme, and there are strong indications of investor confidence in the renewable energy sector, with many projects proposed for development including a substantial number of wind energy projects.

The amendments that I am bringing forward today in no way impact on the Government's commitment to conduct an independent and thorough review of the Renewable Energy (Electricity) Act 2000 as mandated under section 162 of the current Act. The legislation and the mandatory renewable energy target are a critical plank in this Government's greenhouse response and equally a significant and important step towards achieving sustainability in energy supply. As such, changes to the policy underpinnings of the Renewable Energy (Electricity) Act need to be made in an informed rather than a reactionary manner, having regard to all participants in the market and noting the importance of a stable investment environment for the uptake of renewable energy technologies. It is my intention that the policy review of the Renewable Energy (Electricity) Act 2000 commence in January 2003 and be conducted in a timely, open and transparent manner.

In the meantime, administrative changes are required to the Renewable Energy (Electricity) Act 2000 to improve the efficiency and effectiveness of its operation.