SPEECH: Federation Chamber – BILLS – Appropriation Bill (No. 1) 2017-2018 – Consideration in Detail

Jun 15, 2017

Mr CONROY (Shortland) (18:23): I refer to this budget’s failure to provide additional funding to the Emissions Reduction Fund and I would like to ask a few questions around the abatement task for this government. According to Australia’s emissions projections document, Australia’s emissions in 2030 will be 592 million tonnes of CO2. This makes the cumulative abatement task between 2020 and 2030 to achieve the inadequate minus 26 per cent target, 1,055 million tonnes of CO2. How does the government plan to meet this task? The government claims the Emissions Reduction Fund, as currently budgeted, will lead to $50 million tonnes of abatement post 2020. They also claim that the National Energy Productivity Plan will provide around 100 million tonnes of abatement, despite the fact that most of the plan is just talk.

The model underpinning the Finkel report argues that the Clean Energy Target will contribute around 126 million tonnes of cumulative abatement. And that is if the minister actually manages to grow a backbone and stand up to the members for Hughes and Warringah. That leaves an abatement task of 779 million tonnes. To bridge this gap with the ERF would require massive funding. At the current ERF average price of $11.83, and without even allowing for inflation, this is a fiscal cost of $9.2 billion.

My first question to the minister, and I ask that if he does not know the answer he take it on notice, is: are there any other measures being considered to help achieve the 2030 target or will you add $9.2 billion to the already ridiculous cost of Direct Action?

My second question is: when will you announce additional funding for the Emissions Reduction Fund?

Turning to the 2020 target, official government documents show that Australia’s actual emissions in 2020 will be 577 million tonnes of CO2. This is actually 4½ per cent above the minimum target of minus five per cent. The only way we get to the cumulative abatement target for 2020 is through the projection improvements, which I will return to; carryover of credits from Kyoto period 1, thanks to Peter Beattie and Anna Bligh; and the hopeless Emissions Reduction Fund that the Clean Energy Regulator said was not tested for additionality and the Prime Minister said was a fig leaf for doing nothing and was fiscal recklessness on a grand scale.

The minister’s own department, in their projections document, state that projections have fallen due to lower electricity demand; worse-than-expected agricultural conditions due to drought; lower manufacturing output due to industrial closures; the closure of Hazelwood power station; and lower-than-forecast emissions from land clearing. The minister is claiming credit for a revision in our abatement task—in other words, because they have killed manufacturing, particularly the automotive industry; the drought reduced cattle production; consumers are responding to higher electricity prices by reducing electricity demand; and Hazelwood is closed. So we will probably achieve the minus five per cent target but then we will have an economic structure of plus 4½ per cent, which will make reaching the 2030 target so much harder.

I have three questions to the minister and ask that, if he does not know the answer, he takes them on notice. Firstly, has any country or the UN questioned the additionality of the Emissions Reduction Fund and therefore the legitimacy of the abatement claimed? Secondly, do the latest revelations from the Clean Energy Regulator around additionality demonstrate that the Emissions Reduction Fund is a giant fraud? Thirdly, how can the government be proud of reaching the minus five target, if we do reach it, through the de-industrialisation of Australia and the drought?

Mr Ramsey: You would know about de-industrialisation.

Mr CONROY: Mate, you’ve presided over it for the last four years.

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