Legislative Council

QUESTION WITHOUT NOTICE: New fossil fuel power stations in SA

November 28th, 2017

On 28th November 2017, Mark asked the Minister for Climate Change a question about new fossil fuel power stations in South Australia.

The Hon. M.C. PARNELL: Tomorrow is the final day for public submissions in relation to two new private gas-fired power stations in South Australia, which have a combined capacity of 720 megawatts. If we add the government's own proposed new 250-megawatt gas-fired power station we can see that there are now 970 megawatts—nearly a gigawatt—of new fossil fuel generators proposed for South Australia to pollute the environment and exacerbate climate change.

The two coming up for a decision soon include AGL's proposed Barker Inlet power station and an Alinta proposal for a power station at Reeves Plains, which is about 50 kilometres north of Adelaide. To put these new fossil fuel generators into context, they are together nearly twice the size of South Australia's biggest wind farm, the one at Snowtown. The AGL proposal is to replace the ageing plant at the Torrens A power station. So, rather than retiring redundant fossil fuel generation and moving to renewables and storage, AGL's plan is to replace it with more fossil fuel generators.

The Alinta proposal at Reeves Plains is a new peaking plant of 300 megawatt capacity. According to the proponent it is likely to achieve an emissions intensity of half a tonne of CO2 per megawatt hour of energy produced. Alinta estimates that the power station will operate approximately 1,400 hours per year, and they anticipate the gas turbines would typically run for a duration of no more than four hours, although this would be substantially subject to market conditions. Of course, there will be nothing to prevent them from running for as long or as often as they want, provided they can make money. On Alinta's own figures the plant will produce 210,000 tonnes of CO2 per year, which is equivalent to around 45,000 additional petrol or diesel cars on the road.

My questions are:

1. As Minister for Climate Change, what role did the minister play in supporting these new fossil fuel power stations, which are being sponsored by the Department of the Premier and Cabinet and the Department of State Development?

2. Was the minister consulted about the climate change implications of these projects?

3. Does the minister think that building new fossil fuel generators is the best way to achieve climate objectives, such as the Carbon Neutral Adelaide initiative?

The Hon. I.K. HUNTER (Minister for Sustainability, Environment and Conservation, Minister for Water and the River Murray, Minister for Climate Change): I thank the member for his most important question, because it allows me to again put on the record the absolute lack of action, in terms of climate change, by the federal government. Let's understand what the now NEG proposal put up by the Prime Minister and minister Frydenberg—

The Hon. D.W. Ridgway: I don't recall him asking about the federal government.

The Hon. I.K. HUNTER: It is the federal government that sets these policies. The federal government sets the policies—or does not, in this case—

The PRESIDENT: Order! The minister will not respond—

The Hon. D.W. Ridgway interjecting:

The Hon. I.K. HUNTER: The Hon. David Ridgway is a little bit prickly about this, Mr President.

The PRESIDENT: Order! The minister will not respond to the Leader of the Opposition—

The Hon. D.W. Ridgway interjecting:

The PRESIDENT: —and the Leader of the Opposition will desist immediately.

The Hon. I.K. HUNTER: They don't have a policy in this state. What is the Liberal Party's policy on climate change and energy? It is to remove the state's renewable energy target and hand over control to the federal government, that does not want one. That is their policy, that is the policy that the Hon. David Ridgway is out there trying to support: 'Let's take away the state renewable energy target, let's take it away and give all responsibility for it to the federal government.' What is the federal government's proposal? It is not to have a renewable energy target, it is to have an NEG, a national energy guarantee, which backs in coal, backs in fossil fuels, and stops any more investment of renewable energy across the country right through to 2030 and thereafter.

The other thing about this policy that is not understood is that it will stop South Australian householders putting new PV solar-generating panels on their own homes. This is what the commonwealth policy that has been floated by the Prime Minister and by Josh Frydenberg, the Minister for the Environment, for goodness sake, proposes to do. It is actually going to put a handbrake on renewable energy installation across our country while it is backfilling with coal and gas-fired power stations. That is the signal they are sending to the market through their so-called NEG.

So, when we come to the proposal of what is happening to South Australia, these are being led by initiatives of the federal government. They have control of the market mechanism, not South Australia. What happened to our control? The Liberal Party sold it. They sold our power stations. They sold our electricity system to overseas interests, taking away any control whatsoever the state government has over the electricity market in South Australia. For the first time, this state government has now bought back into energy by purchasing our own state-owned power plant.

Even before we sign the documentation to buy that, the Liberals are out there proposing that it be sold again. That's their next policy on energy. Anything the state government invests in energy policy and security and reliability for this state, they are going to go out and sell. They are going to flog it off again because they don't believe that the state government should have any role in setting energy policy. They don't believe the public should have control over energy. They don't believe we should have sustainability and self-sufficiency of our energy supplies in this state, because in their hearts they are rank privatisers, and that's all they can do.

I have spoken before in this chamber about my very deep fears that if they ever get their hands on the Treasury benches, they will be privatising SA Water. We know from their record they have already privatised ETSA. Before we even inked the cheque to buy back a little bit of our security and self-sufficiency in power supplies, they have promised to sell it.

Let's understand clearly where the levers are. What the Liberals want to do in this state is take the other control, the state-based renewable energy target, that this state government has established and give it away to the commonwealth to run, which means there will be none, because the commonwealth Liberal and National parties don't believe in renewable energy targets. They don't even believe in clean energy targets which were set up by the Chief Scientist at the behest of Malcolm Turnbull. What he found out very quickly was that he is being held captive by the coal interests in the Coalition who won't let him have one; they won't let him have a clean energy target. What he wants to do now is to have—

The Hon. P. Malinauskas: Weak as water.

The Hon. I.K. HUNTER: Absolutely; weak as anything. What he wants to do now is fall back to the fourth best position, the NEG. All the NEG will do—

Members interjecting:

The PRESIDENT: Order! Will the Leader of the Opposition and the Minister for Health desist. The minister is trying to answer a question. Allow him to answer.

The Hon. I.K. HUNTER: What we have seen so far is that the policies that are in place at a federal level which control the market signals that go to that sector of the economy are saying, 'We haven't got any policies for you other than our 2030 plan to put a handbrake on all renewables.' There will be a tiny amount.

What is not often not understood—and I make this point again very strongly—is that Malcolm Turnbull's plan for the NEG will stop any more renewable being invested in this country and it will stop private householders investing in renewable rooftop solar energy, because that's not what the Liberal-National Party Coalition in Canberra see as the future. They do not see renewables as the future.

I come back to the question asked by the Hon. Mark Parnell. Once again, he misunderstands how we transition to a renewable energy grid. We have had this debate in this chamber previously. The Hon. Mark Parnell, in the traditional way of the Greens, says we should go cold turkey, turn off all of the fossil fuel generating facilities that we have. Never mind if that crashes the grid because we don't have sufficient renewables in the system.

We have a much more realistic approach. We know that you need to transition your economy if you want to go into renewable energy. We have made commitments, which we are now seeing delivered.

Members interjecting:

The PRESIDENT: Order! Minister, take your seat.

Members interjecting:

The PRESIDENT: Order! The next time we are interrupted, on either side, you will lose a question and I will put it straight to the crossbench. They are sitting there patiently waiting to put their question, only to be sidetracked by listening to some—

An honourable member: To the rubbish.

The PRESIDENT: Well, it's his answer. The honourable minister, will you complete your answer as soon as possible, please.

The Hon. I.K. HUNTER: I have quite a bit of answer to give, Mr President. The challenge, which the Hon. Mr Parnell doesn't want to understand, clearly—well, at least in this chamber—is that when you need to decarbonise your electricity sector, you need to transition it away from coal. You can't do that in one big jump. You need to send a signal to the industry about what your intentions are so they can plan for the future, because the investment that is required in this plant and equipment has a 20 to 30-year time frame for the level of that investment. You can't do that overnight. You certainly can't do that overnight in a planned way that is going to keep your electricity flowing through the grid.

Experts have, for a number of years, said that gas has a role to play in this transition, particularly as we perfect the renewable energy technologies, such as battery storage, and integrate them into the grid system. Gas generally has a much lower emissions profile than coal—something else the Hon. Mr Parnell will probably confess to in a private conversation but not here in the chamber in question time, clearly—and is regarded as a cleaner energy source than coal. For example, as the federal government's own Climate Change Authority has noted, over one-third of Australia's greenhouse gas emissions arise from the electricity sector.

It puzzles me as to why the federal government, which understands that there is technology in place to transition our electricity sector away from fossil fuels into the newer technologies and do some of the heavy lifting to get to the Paris goals that were set and signed up to by Prime Minister Turnbull, wants to put the handbrake on that and say to the energy production sector, 'No, we won't require you to do this extra heavy lifting to help decarbonise our emissions in this country. We are now going to move that responsibility out of the energy sector, where there are already technical solutions to these problems, out to the transport sector, out to the agriculture sector, out to the manufacturing sector,' where there aren't the same sort of cost-effective solutions already in play. Why would the federal government do that? I don't understand.

The electricity sector can bear most of this heavy lifting because we have the technology and, guess what, Mr President? The technology is cheaper. Renewables are cheaper than fossil fuels. We can do this in a planned and structured way over time, but the federal government says, 'No, we're not going to do that anymore. We're going to force the other sectors in our economy—

Members interjecting:


The Hon. I.K. HUNTER: —where there aren't these solutions, certainly aren't cheap solutions to do more of the heavy lifting.' The federal government's de facto answer for supporting the NEG will be that agriculture has to pick up the slack and reduce more emissions. It will be manufacturing that will have to pick up the slack and reduce more emissions. It will mean the transport sector will have to pick up the slack and reduce more emissions. That is what the NEG is all about and that is something you are not reading about, and certainly the Hon. Mr Ridgway won't be telling you that because I doubt he even understands the first part of it.

The same data that I referred to from the Climate Change Authority shows that brown coal makes up about 19 per cent of energy generation but accounts for about 35 per cent of the sector's emissions, while black coal generation is about 43 per cent and accounts for about 53 per cent of the sector's emissions.

The role of gas in the electricity sector has also been recognised by many people as being incredibly important in our transition to a renewable energy structured grid. Indeed, it has actually been recognised as such by the Greens party. I am advised that modelling released by the Greens in the lead-up to the 2016 federal election, as part of their commitment to 90 per cent renewable energy by 2030, showed that gas will continue to play a role both leading up to 2030 and in subsequent years. Their own modelling that their federal Greens party has relied on says that gas will continue to play an important role in that transition. Maybe the Hon. Mark Parnell didn't get a memo. Maybe he didn't; we will give him the benefit of the doubt.

The PRESIDENT:  It is the last week of our parliamentary term. There are a number of people who want to ask questions, so could you please bring your answer to a conclusion.

The Hon. I.K. HUNTER: Indeed, Mr President. I will sum up by saying this: the challenge facing our country and indeed our state is the lack of national leadership and a coherent national policy when it comes to the electricity sector. Both the business sector and community groups are calling for the federal government to drop the ideological opposition to climate change and renewable energy and help to fix a broken National Electricity Market. I call on the Greens to drop their ideological position of going cold turkey overnight because it is just plain stupid and it won't work.

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