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Thursday, 28 February 2013
Page: 1264


Senator BOSWELL (Queensland) (10:51): I have listened to Senator Ludlam carefully, and what he is saying as I understand it is that, if you subsidise something so much, it becomes cheaper and therefore it will give out a cheaper product in the end. If I could put it this way, if the government completely built every house, paid for it and put it on the rental market then of course your rent would be less than for someone that had to build a house and get a return on his investment. That is what Senator Ludlam is saying in a nutshell: the government pays for it—well, the government does not pay for it; the cost gets passed on—the product becomes cheaper and therefore eventually you will not have to pay for it or it will cost less. That works if there is a subsidy on it. If Senator Ludlam can tell me that renewable energy does not need a subsidy, he has got the strongest convert he will ever get. But unfortunately renewable energy does need to be heavily subsidised, and that subsidy is being paid for by industry in Australia.

That is not the subject of the Renewable Energy (Electricity) Amendment (Excessive Noise from Wind Farms) Bill 2012. The subject of this bill that is presented by Senator Madigan and Senator Xenophon is to consider the health issues and the effects on the communities and lifestyles that people are forced into as they live in the vicinity of these particular wind farms and solar energy farms. It is not something I have followed closely, but I have heard and listened to people that say they have definitely been affected, and I think this bill deserves support. I hope the coalition will support it.

But I think there is a bigger effect than that. That is a huge effect, but the effect this is having on prices, the cost of industry, the cost of business and the cost of jobs has to be taken very seriously into consideration. I have here a list of industries that are paying a renewable energy tax and a carbon tax, and I have a list of these people that were paying these taxes in July. I will not mention their names, except for the people that have said that I can. There is a car hire business. You would not think a hire car business would pay much renewable tax or carbon tax. In July they paid $440 of carbon tax and a renewable energy tax of $291. Multiply that out. This is for a very small car hire business. The combined carbon tax and renewable energy tax comes to $8,772 a year. That is a domestic industry. It is a small industry. It probably has an office and not much else. So those self-employed people that drive those cars have to front up for a tax bill of $8,772 every year.

I have another one here called Urangan Fisheries. Urangan Fisheries is owned by a friend of mine called Nicky Schulz. He started off fishing when he was a kid. In fact, he went out fishing in a sailing boat and then developed a fishing business and then, from that, developed an export industry. It employs 60 or 70 people. I asked him to do his carbon tax sums. He said he would in July. In July his carbon tax was $1,967.75 and his renewable energy tax was $1,294.87. So multiply that by 12 and he is up for $39,151.44 in carbon and renewable energy tax. Nick Schulz is a fisherman who worked his way up to be a fish processor, and his product goes on the export market. Because of the high dollar he is having tremendous trouble meeting the market—getting his product away. He has three or four boats of his own, and a number of other fishermen come in and use his facilities to process their fish. He has to meet a high dollar and then pay $39,000 for the privilege of having a carbon tax and a renewable energy tax. How do people compete? How can he compete? How can he sustain his business, which is basically export, when these taxes are inflicted on him? He is having a great deal of difficulty doing it.

There is another one, a Queensland ice distributor. I knew these people. Ithaca Ice Works, as it is known, is run by the Mee family—Jimmy Mee. There have been three Jimmy Mees: I have known his grandfather and his father, who is about my age, and now the son runs Ithaca Ice Works. It is a family business, probably employing 20 or 30 people. They are forced into paying a carbon tax of $4,676.72 for July and a renewable energy tax of $3,093, which comes to $93,236. That is renewable energy and a carbon tax. To say, as Senator Ludlam did, that a carbon tax and renewable energy are not costing anything is just absolutely wrong. They are costing industry a fortune.

I have another one here: a small poultry farm paying $8,446 in combined renewable energy and carbon tax. I can go on and on and on. There is a fairly significant hotel on the Gold Coast paying $13,057 a month in carbon tax and renewable energy tax of $9,209 a month—a total of $267,192. These people are struggling. The tourist industry is struggling because of the high dollar. They are fighting to stay in the game, and then a renewable energy cost and a carbon tax are inflicted on them, and then they have to compete against much cheaper nations for the tourist dollar. It is just hurting them. It is a killing field out there. Twenty-seven thousand jobs have been lost in the manufacturing industry. I am not suggesting it is all because of the carbon tax and the renewable energy tax, but they have taken a toll.

If we want to have a manufacturing sector in Australia, we have to take all this into consideration. It is not only the wind farms; it is the same with other technologies like solar—especially rooftop—which continues to enjoy generous subsidies via the Renewable Energy Target scheme. Australians are paying for energy sources that achieve nothing environmentally and only work to drive power prices higher every year. RET is costing Australia $5 billion a year, not far behind the $9 billion carbon tax. The RET in its current form is unacceptable, and one reason for that is that it was originally a fixed target, but now with 20 per cent by 2020 we are paving the way for around 20 to 28 per cent of power to be sourced from renewables by 2020. We put a target figure of 20 per cent, but, because of the dwindling demand for energy across Australia, AEMO's annual energy and maximum demand forecast in 2012 was significantly lower than the 2011 estimate. Matt Zema said:

We have not seen electricity use drop this much since the National Electricity Market (NEM) commenced.

Energy use in the large industrial sector was expected to decline three per cent between 2011-12 and 2012-13. That is expected to fall even more over the next five years.

You would think with a rising population and a demand for more jobs that our energy use would be going up. Instead, jobs are being cut, factories are shutting down and electricity consumption is falling—all thanks to the sky-rocketing prices that have resulted from the carbon tax and RET. Reducing the LRET to 28,000 gigawatt hours would make it a true 20 per cent target rather than the 41,000 gigawatt hours target that represents around 26 or 28 per cent of the forecast future demand. Power companies, businesses and industry have all flagged a significant cost saving that could be made by doing this. It is chilling to think what the Australian situation could be in 2020, with 26 to 28 per cent of power coming from renewables. Right now around 10 per cent of electricity generated in Australia comes from renewable sources. Of that, seven per cent is from hydro while three per cent is from wind and solar. The Productivity Commission estimated that the abatement of one carbon tonne cost $60 for wind sources and between $473 and $1,043 for solar sources. Hydro is reliable and relatively cheap, but wind and solar are costing us too much and we do not gain anything environmentally.

Just last week the Queensland Competition Authority announced the biggest hike in household electricity prices in years. The typical customer's annual bill went up by $253. Solar rooftop subsidies and the carbon tax were named as the big culprits. Make no mistake—wind and other renewables are just as bad. The cost of RET now stands at 60 to 70 per cent of the cost of the carbon tax. This will only go up as the annual renewable target goes up. The QCA's findings were not isolated. IPART has already reported the average cost of RET compliance for a typical electricity customer will be $102 per household, which is a nearly five per cent increase on the previous year. It is not only householders who are suffering under the wind and solar power induced RET burden; energy retailers have been forced to pass on the cost of overpriced renewable generated electricity to their customers or to shoulder them themselves. Origin Energy will cut 350 jobs by the end of this year, mostly in Queensland and Victoria, on top of the 500 jobs it has already cut this financial year. There were the 500 or so jobs cut last year by Ergon Energy, which has long pinpointed RET and the government's carbon related policies for pushing up prices. If the power companies are struggling with the cost of renewables, it is their business customers who are really bearing the brunt of this destructive policy. I have brought into this chamber several examples of the hundreds of thousands of dollars RET along with the carbon tax is costing Australian business. As long as 2020 renewable target stays in place, these huge Greens influenced imposts will not go away. One large industrial user in Queensland predicted a $5.78 million electricity bill this year—$1 million tied to the carbon tax and $495,000 tied to RET. Over a quarter of its bill will come from the carbon tax and RET combined. The RET alone represents almost 10 per cent of the power costs.

We all rely on our experience in this place. Senator Di Natale is a doctor and he brought forward his views on renewables. Before I came into this place I sold hardware products and represented various factories in industry. I know how they work and I know who they employ. I know the value of people having a job and I know the value of low-income earners having a job. Unfortunately we are seeing 27,000 people losing their jobs—not because of the high dollar but because of the high renewable energy and carbon tax costs. They are the people that the Labor Party should be supporting—the lowest paid people and the people on Newstart who get $38 a day—and they have been told to go and find a job. I do not know where these jobs are, because every day you see industry closing—300 jobs at Amcor the other day, Pentair, Origin Energy. If factories are not closing, they are moving to New Zealand, like Heinz, which is shutting down some lines here and moving to process tomatoes and beetroot in New Zealand because the costs are too high here.

When manufacturing businesses make the decision either to close or to turn into distributing businesses, buying products from China or America and distributing them and going from perhaps 300 jobs to 60 jobs, they are announcing that renewable energy and the carbon tax are pushing them out of business. It is the underprivileged, those on low incomes, who are paying the price. They are the processors, the people on the production lines; they are the people who work in factories. They are the people out in the west, where the Labor Party are at the moment, trying to say, 'We support you.' Well, they do not support you. They are keeping you out of jobs. Pentair, the pipe manufacturing people in Western Sydney, had to close down. A couple of hundred jobs went there.

If the Prime Minister is sincere, she will go out there and try to recognise the problems that people from Western Sydney have. They do not live in the eastern suburbs; they live in the western suburbs and they have been traditional Labor Party voters. But, because of the high carbon tax prices and the renewable energy tax, businesses are shutting down every day. Amcor shut down just the other day. There are 700 jobs going from various businesses. I do not think 27,000 is a realistic figure. The Food and Grocery Council said that 7,000 jobs have been lost from the food processing industry, with 350 businesses having shut down.

These are not the people who live in eastern Sydney or on the North Shore; these are the people who live out in the western suburbs. They want a job. They want the dignity of having employment. But you have given them $38 a day and said, 'Go and get a job.' Well, there are no jobs out there; they have been shut down. All the Labor Party have done is come up with an industry policy that has put more cost on businesses. They are trying to embed in business a public servant who is supposed to tell them what to do and how to source local government product. Businesses know where the cheapest product is. That is how they live—by sourcing cheap products to make their product and put it on the market.

Every day we see the government come up with some stupid thought bubble, some stunt that says that business will pay: 'We will shift the cost onto businesses and they will pay.' Businesses cannot pay any more. They have had it up to the neck. They are going underwater, they are closing down and they are shifting offshore. We are going to see a diaspora of Australian manufacturers and Australian food processors right around the world because they cannot live in Australia with the high dollar and the high costs. It is completely closing down. I think the Prime Minister would understand that you cannot just keep putting costs on businesses and expecting them to employ. If you do that, the inevitable is going to happen; they are going to shut down, turn into distributing companies, import their product from overseas or shift overseas and export back into Australia.

A carbon tax and a renewable energy tax are just luxuries that Australia cannot afford to pay. A renewable energy tax does not achieve the lessening of carbon. A carbon tax gets carbon out of the air but renewable energy does not. Therefore, I will support this bill of Senator Madigan’s. I think he should be commended for bringing it before the Senate.