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Economics Legislation Committee
Office of the Chief Scientist

Office of the Chief Scientist


CHAIR: Do you wish to make any opening remarks?

Dr Finkel : No, I'm happy to take questions.

Senator GALLACHER: Dr Finkel, I want to go to your Independent audit of NOPSEMA'S consideration of exploration in the Great Australian Bight. I know that that's a publicly available document. Interestingly enough, most of the audits I read are from the Australian National Audit Office, and they actually have 'recommendations' rather than 'opportunities'. You have characterised some opportunities for NOPSEMA and, I think, the government. Can we step through some of those opportunities? Your executive summary, if people are looking for a succinct and short version of the report, is exceedingly clear and unambiguous. I want to walk through some of the opportunities that you see. In the first opportunity, you say:

NOPSEMA could enhance transparency during the assessment and decision-making process …

What does that look like? Has the agency accepted that? They will be here later on tonight. Do you get formal feedback where the agency says, 'Yes, we've looked at all of those opportunities. We note, accept or reject'?

Senator Canavan: I'll let Dr Finkel talk about the report, but, just to inform the committee: yes, NOPSEMA and the government have accepted all of the recommendations—

Senator GALLACHER: Opportunities.

Senator Canavan: Or opportunities. We're in the process of implementing those.

Senator GALLACHER: All of the opportunities in their entirety?

Senator Canavan: Yes.

Senator GALLACHER: Excellent. If you can briefly summarise in your words where these opportunities are.

Dr Finkel : The essence of what we found is that NOPSEMA is really a first-class regulator that takes into account all the requirements of the environmental regulations, takes into account the latest scientific evidence and takes into account the relevant issues that have been raised through community submissions. It has a highly skilled workforce that is assigned to do that in a very organised way. We found that their organisational credibility was very high. But the process is not all that visible to the community. When things aren't visible, people suspect that there's something that is being hidden, even when there's not.

We recommended that at certain touch points there should be more visibility. It's already there when the environmental plan is being considered. The applicant has to publish that and there are 30 days for communities to submit against that environmental plan. But then it goes into NOPSEMA, and NOPSEMA takes into account all of the community's submissions. The applicant has already addressed them in the final version of the environmental plan. It may be that if all goes splendidly well NOPSEMA would approve the application straightaway and publish its approval. But, realistically, in very, very complicated environmental plans and applications like this, there are, for perfectly legitimate reasons, questions that will come from the regulator asking for further exploration or additional clarity from the applicant around their environmental plan in this case. Those questions are not made available to the public. The reasons for an extension or a temporary pause on proceeding are not made clear, and people suspect that something is not right. We recommended that at those points NOPSEMA should publish a summary—not word for word on every single question in detail—of what the main issues were, for the public to have some understanding of the main issues.

Senator GALLACHER: I've had briefings with Geoscience Australia and NOPSEMA. There seems to be a feature of where we talk about fracking or drilling that the scientists and the people who take into account the environmental consideration seem to lack that explanatory process which settles the arguments, so to speak. There is not as much clarity as there should be—is that what you're saying?

Dr Finkel : The process is very robust. It's just that they're not inside NOPSEMA, so they don't get to see it. It's not practical for everything that NOPSEMA does to be published. But NOPSEMA, for example, doesn't just look at the scientific information that is on government websites. They look at the best and latest available scientific information that should have been referenced in the environmental plan. Even if it weren't, they would look at it. There is no issue with the depth of the review that goes on; it's just a question of the people knowing that it has gone on and understanding that, if NOPSEMA has gone back to the applicant with a request for them to either resubmit or clarify certain issues, at critical points—not all the time—NOPSEMA should publish a public summary.

Senator Canavan: Senator, I certainly accept and agree with your proposition there, although I would say it's not primarily NOPSEMA's job to make those explanations to the broader public. Their job is to focus on regulating safety and environmental matters to the highest standard. The primary people responsible for that are the broader industry and proponents who are suggesting these projects. I note that in Dr Finkel's report he also identified an opportunity: that titleholders or those seeking to conduct drilling activities or other exploration activities could themselves explain some of the risks better—in particular, the oil spill modelling processes. They're obviously very complex, but they're often prone to misinformation and miscommunication. I have also written to the industry asking them to take on board Dr Finkel's opportunities that have been identified and see what they can do to improve.

Senator GALLACHER: Clearly our community is such that people can hold any view they like and they can represent that at any Senate hearing or any forum that's open for them to do that. I've been party to inquiries where several witnesses have said, 'No matter what the science says, we're against it.' I think there's evidence that there might have been 30,000 submissions to NOPSEMA, in a form way, which they have to deal with. We'll ask them later on how they actually do that. But clearly there's a high degree of organised activity against fossil fuel exploration and drilling. So it becomes really difficult for a regulator to cut through in that environment. Is there anything in your opportunities that makes it easier for them to do that?

Dr Finkel : Not on that specific issue. The regulator does cut through. They are responsible for looking at every single one of those 32,000 submissions. They are responsible for analysing them to categorise them. There's a lot of repetition, of course, in many of those submissions. They have to in particular take note of submissions from people who are deemed to be relevant persons but they also have to take notice of relevant issues from the general public. They've got the staff. If they don't have the staff, they contract in extra people to do it. They work their way through it. They summarise the issues. It was a huge workload for them in this particular case; 32,000 is not the norm. My understanding is that typically for an exploration licence application and environmental plan for an application there would be fewer than 10 objections than, say, in other states. But this is the first time since 2003 that an application to drill in the Great Australian Bight has taken place. And of course people's level of concern and awareness across a broad range of environmental issues have matured enormously or changed enormously in that time. So it was all very new for the South Australian public.

Senator GALLACHER: I think it's probably not as well-known that NOPSEMA has a role when we're decommissioning sites too, which can be just as environmentally contentious, particularly in respect of Bass Strait and the like.

Senator Canavan: They'll be able to speak at length at that if you like, Senator. It's a relatively new area of regulatory assessment too, because the oil and gas sector as a whole across the world is roughly only about half a century old, so we are starting to get to the first time when some large offshore platforms are being decommissioned around the world. So they're doing a lot of work on that at the moment, but that question will have to go to NOPSEMA.

Senator GALLACHER: In summary, you've found them to be a relevant organisation undertaking their duties within their legislative framework and at their upper end of performance.

Senator Canavan: Yes.

Senator GALLACHER: All of the opportunities have been picked up by the government?

Senator Canavan: We've agreed to all of them. I've written to NOPSEMA and APIA—in APIA's case, asking them, obviously, to consider the opportunities. In NOPSEMA's case, I've issued them with a renewed statement of expectations. They will inform soon and update their statement of intent on their website. They fully agree to the changes, so they'll be implemented in due course.

Senator GALLACHER: In finishing, most of us on this end of the table have received various levels of interactions from the opponents of 5G. Are you aware of any scientific or any other evidence that would give us concern about the 5G spectrum?

Dr Finkel : You're asking about health impacts of the 5G spectrum?

Senator GALLACHER: Yes.

Dr Finkel : I have not specifically looked at that for 5G, but I have looked at the health impacts for electromagnetic radiation for mobile phones, up until a couple of years ago, and for overhead powerlines. A vast literature exists; tens of thousands of studies have been done. The World Health Organization has done a meta-analysis of all of those studies and can't find any consistent evidence of problems or concern.

When looking at something like that, I think you have to look at two things. You have to say, 'Is there a hypothesis of how there could be a health impact of electromagnetic radiation, the radiofrequency waves?' and then you've got to say, 'Is there any evidence?' And there is no hypothesis for how electromagnetic radiation could interact at the single-cell level to do any chromosome damage or any long-term damage. The only way that electromagnetic radiation interacts with tissue is: if it's intense and it's very close, at magnitudes much higher than you would get from a phone, you can get some local heating. But, in terms of long-term health benefits, as far as I've seen from where I've looked, there is no mechanism or evidence of a problem. It could be argued that, with 5G, the wavelengths are shorter, and shorter wavelengths are more likely to interact with DNA and chromosomes, but, compared to the molecule in a cell, in the nucleus, they're still gigantic, and they don't interact.

Senator GALLACHER: Is this an area where the scientific community is looking for someone with a hypothesis or is it just business as usual?

Dr Finkel : As far as I'm aware—and I've not been looking at it specifically—there is ongoing scientific research into the potential health impacts, and consistently the evidence is that there is not.

Senator GALLACHER: So you'd be happy to have a 5G phone?

Dr Finkel : I would be very to have a 5G phone—near my ear or in my pocket.

CHAIR: You are on the Hydrogen Strategy Group.

Dr Finkel : I'm leading it.

CHAIR: Sorry; you're chair?

Dr Finkel : Yes.

CHAIR: We've been hearing about a hydrogen economy for quite a long time now. What's the strategy group doing? Can you just give us a brief update?

Dr Finkel : Just the context there: there was a group called the Hydrogen Strategy Group, which I chaired, and it prepared a briefing document, or a vision statement, for the COAG Energy Council—that's the energy ministers. That was submitted in August of last year. As a result of that, the ministers invited me to come back in December of last year with a proposal of how a national hydrogen strategy could be developed. In December they agreed that that should take place, and so a new group was formed, called the COAG Hydrogen Working Group, which I also chair. It has been working all year to develop a national hydrogen strategy.

The premise here, worldwide, is that, over the decades—we're not talking about transition that will be significant in a small number of years but over several decades—there will be an increasing shift towards zero-emissions electricity as our primary energy source, in order to decarbonise. Whilst that's terrific and electricity is very versatile, it's not always convenient. Mostly it is. Maybe 80 or 85 per cent of our energy needs could be met through electricity, as electrons, but sometimes you need a high-density transportable fuel, and that's more convenient in the form of a gas or liquid, similar to what we've got natural gas or with petrol. But, if you want a zero-emissions high-density transportable fuel, the obvious candidate is hydrogen, because, when hydrogen is burnt, you get the energy that you want, and the only by-product you get is water vapour. So there is enormous interest from most countries in Europe, from big states in America like California and from our Asian neighbours. Our historic trusted trading partners Japan and Korea are very, very interested in hydrogen as a product that they would import, ultimately in replacement of fossil fuels, to help them decarbonise their economy.

For Australia, that means there's an opportunity for us to look at hydrogen for its export potential and also for domestic applications. The critical thing is: where does hydrogen come from? You can't go anywhere on earth and drill a hole and find hydrogen gas in the same way that you would find natural gas. You have to produce it. You could argue it's not an energy resource; it's a manufactured product. There are several ways of producing it. The way that most people are interested in—but it's not the only way, by any means—is from water. Water is H2O. You can separate water into the 'H' and the 'O', the hydrogen and the oxygen, by passing an electric current through it. If the electricity comes from solar or wind or hydroelectricity, or, frankly, if it comes from nuclear electricity, you've now got zero-emissions electricity splitting water into hydrogen and oxygen. The oxygen could be released—that's not a problem. The hydrogen could be compressed, put into pipelines, used directly for domestic purposes or liquefied and turned into liquid hydrogen and exported to countries that have an interest in bringing in a zero-emissions fuel.

We're looking at how Australia can capture the opportunities and be a significant exporter as well as an experienced domestic user of hydrogen. To do that, the strategy is developing a framework that will optimise the conditions to make it easy for industry, state governments, federal governments, consortia and others to build the hydrogen industry.

CHAIR: All right; I'll leave it there. Senator Patrick.

Senator PATRICK: In relation to the conversation you were having about 5G, I would have thought, noting it's been rolled out internationally, that there would have been a number of papers internationally and that places like Europe would have looked at it from a regulatory perspective. Is that the case?

Dr Finkel : I don't know. I've not been asked to look at it. The last time I looked—and it was for personal reasons, before I was Chief Scientist—at the question of health impacts from electromagnetic radiation, either from overhead powerlines or from telephones, because they're both using electromagnetic radiation, just at different frequencies, I found that there were a vast number of studies, many meta-analyses. The most significant was one done by the World Health Organization for the United Nations, which looked at over 20,000 individual studies, and the conclusion was that there were no health impacts of electromagnetic radiation from phones or from overhead lines. That doesn't mean to say that from time to time you won't find a problem where a community is suffering from an unusually high number of cancers or some other disease and they happen to be a community that's located close to a high-voltage powerline. But, when you do the statistical analysis across many, many countries, it just turns out to be a statistical aberration. I cannot say with confidence that 5G is not different, but I cannot see any logical reason why 5G would be worse. You could make the argument that, because 5G is using ever-shorter higher frequencies and therefore ever-shorter wavelengths, you're getting down to the point where they might interact at the molecular level, but, even at the higher frequencies and shorter wavelengths of 5G, those wavelengths are still very large compared to the dimensions of the nucleus.

Senator PATRICK: Obviously electricity would have quite a large wavelength.

Dr Finkel : The wavelength of electricity is huge; it's many kilometres.

Senator PATRICK: What is it at 5G? The antenna would tell you that size, wouldn't it?

Dr Finkel : It's as high a frequency as the phones; you are talking about metres getting down to a few centimetres.

Senator PATRICK: It's down to the size of an antenna tip.

Dr Finkel : Yes, but a few centimetres is still gigantic compared to the size of the atoms in the molecular DNA structure.

Senator PATRICK: Thank you for that.

Ms Kelly : But, Senator Patrick, I would note the Department of Communications and the Arts does monitor those International studies and the state of research in the area. I know that because I've been to a briefing with them. So they would be up to date with all the most recent research in relation to the issue.

Senator PATRICK: Yes, and so there's no need to repeat a study that's been done by a reputable body overseas, because the Australian environment is not going to change anything in regard to the effect of an electromagnetic wave, one presumes?

Ms Kelly : The Department of Communications and the Arts is absolutely across all of those and would have answers for all those questions, and it's their responsibility to monitor and remain up to date with all of that research.

Senator PATRICK: Thank you.

Senator SINODINOS: Chair, just to follow on from your questions about hydrogen, there was a project we were undertaking in the Latrobe Valley. I think you might be responsible for that, Minister.

Senator Canavan: I think you might have had a significant role in that project, Senator Sinodinos. Are you putting a pitch in for the naming rights?

Senator SINODINOS: No! But can you tell us what progress there is with it?

Senator Canavan: I might start. Both Dr Finkel and I were at a sod-turning event earlier this year for the Kawasaki Heavy Industries project—or the Hydrogen Energy Supply Chain project, which is its more formal title. It's a joint venture, if you like, between the Australian and Victorian governments and Kawasaki Heavy Industries from Japan. They have their own consortium, with a number of players involved from Japan. It's a complex project. It's a supply chain project, as per the name of it. It is seeking to construct a pilot plant for the production of hydrogen from brown coal in the Latrobe Valley. It's one of the other methods that Dr Finkel was mentioning for the creation of hydrogen. It's real innovation, I suppose, will be that it's a world-first shipment—or, my understanding is that it's a world first—of liquefied hydrogen by vessel to another country.

I was in Japan a few weeks ago, and things are tracking well. A ship is being built—the world's first such ship—to carry that liquefied hydrogen. It's expected to leave Japan later this year, and I think the plan is that by late next year or early the following year will be the first shipment. I think that's the idea of that.

So it's going very well. Dr Finkel, did you have any further things on that?

Dr Finkel : No, you've described it very accurately. It's a major endeavour, as the minister said. It's a pilot project—in fact, it's really a proof-of-concept project. They will make a commercial decision whether to proceed or not probably in 2022 or 2023. But if they do, it would be very large scale. The essence of this is, as I said before, that the way most people talk about making hydrogen is from water, but you can make it from fossil fuels. You can make it from coal or you can make it from natural gas. If you make it from coal, it's a process called gasification; if you make it from natural gas it's called steam methane reforming.

Today, that's a significantly cheaper way of making hydrogen than from electrolysis. But the long-term consideration is that if it's going to be imported by countries from 2030 onwards then they're going to expect that it's clean hydrogen in the sense that the vast majority of by-product—carbon dioxide—that comes out of the process will have been captured and sequestered.

Senator SINODINOS: And that's part of this project, isn't it?

Senator Canavan: Yes, I should add on that point that there is a related project called the CarbonNet Project. It is separate from the Hydrogen Energy Supply Chain project, but it's an initiative, again, between the Australian and Victorian governments to find suitable locations in the Bass Strait for carbon sequestration. The project was not initially aimed to benefit the Hydrogen Energy Supply Chain project but, obviously, there are other carbon emission activities in the Latrobe Valley which could benefit from such a sequestration location. But the idea now is, if this project is to proceed to a commercial phase, that it will be seeking to piggyback off the work that CarbonNet is doing to find that location.

Good progress has been made there. It's primarily the Australian and Victorian governments doing that work. We're hopeful of finding suitable locations, given that it's an oil and gas basin in a former way, in some instances. I'll correct the record if I'm wrong, but I think that Sumitomo Corporation, a Japanese company, has just come on board to help us out on that as well.

Senator SINODINOS: Very good—good luck with that. I'm sorry Senator Roberts isn't here! I know he'll be missing this.

Senator Canavan: This brings everyone together! There's coal, there's sequestration—

Senator SINODINOS: The whole shebang!

Dr Finkel : We love all things. It's all good stuff.

CHAIR: Thank you, Dr Finkel, and safe travel home

Dr Finkel : Thank you, Chair.