Wednesday, 29 May 2024
Motions
Energy policy
Motions
Energy policy
David DAVIS (Southern Metropolitan) (10:37): I move:
That this house:
(1) notes that the federal government’s Future Gas Strategy, released on 9 May 2024, diverges significantly from the Victorian government’s Gas Substitution Roadmap, including in the importance it accords to the freedom of choice of consumers to use gas, as shown under guiding principle 4, which states that ‘Households will continue to have a choice over how their energy needs are met,’ whereas the Gas Substitution Roadmap seeks to deny choice to consumers by having already banned gas connections to developments requiring a planning permit, including new estates, and banned rebates on gas appliances; and
(2) calls on the Victorian government to urgently review its Gas Substitution Roadmap in light of the strategy released by the federal government.
There is a spat that has occurred between Minister D’Ambrosio and Minister King, and it is both a stylistic spat in the sense that there are obviously personalities involved, but there is substantive basis to that spat too. The fact is that these two Labor ministers are at odds. The federal minister has got very significantly different views from the state minister here, Ms D’Ambrosio. Ms D’Ambrosio has been in charge of the energy portfolio now for 10 years, and what we have seen is chaos ensue. There have been no new gas exploration licences committed to by this government since it came to power. We have a looming shortage because the state government has failed to bring on new gas and failed to provide the gas that is needed for industry, for households, for businesses. I want to be quite clear here that we see a significant role for gas, which is about choice for consumers in their households. It is about the importance of having gas available for small businesses. It is also about the importance of the role of gas for those gas-intensive industries. Some of the hard-to-abate industries that use gas both as an input but also as an important energy source need gas as a support. We have started to see the risk coming to the fore of Victoria losing significant businesses – significant gas-using businesses but also others, because the cost of gas has been escalating because the state government has failed to bring on supply.
The Victorian government has tried to do everything it could. It had the moratorium going forward, but then it said, ‘We’re going to have scientists look at this.’ They gave them narrow terms of reference. They came back and said, ‘Well, inside our narrow terms of reference there’s not much, but we know from what industry says that there are enormous amounts of gas available in this state.’
We know even as recently as yesterday the head of Cooper Energy made clear points about the availability of gas in this state. The Age, of all papers, counterpoised her comments – Jane Norman’s comments – with the comments of the Victorian minister, and they could not have been more stark in their contrast. They could not have been more stark in their intent. It is clear that gas is available. The industry experts tell us that gas is available. I have just come back from Perth, where I was at the Australian Energy Producers Conference and Exhibition. There were almost 3000 delegates at that conference. I went to many workshops and presentations, and it is clear that gas can be got into this state to underpin the ongoing role for gas in reaching whatever transition we are able to achieve by 2050. The target is there, and we will need gas as part of that even beyond 2050, because it is net zero, and it may well be that gas plays a role in firming and peaking energy generation well beyond that time.
We understand the inherent challenges with renewables. Renewables are clearly going to play a bigger role, but there is clearly an inherent challenge with some of the renewables in ensuring that the intermittency is managed by power sources. In this case in my view the most significant of them will be gas. If you presume, as this government has announced and as has been announced publicly, that the first of our coal comes off in 2028 and then again further in 2035, there will be a need for some additional capacity to actually make sure that we have got a viable system that goes forward into the future.
This has been recognised by the federal government, and I actually think there is a lot to commend that federal paper. Not everything in it I would agree with, and I would quibble with certain matters, but there is a lot to commend it. On the other hand you have got the stark decision of the Victorian government to try and close down gas at every turn. They have already got gas banned on new estates. We know that that is beginning to have an effect. I met with senior officials from Wodonga council the other day, and there are clearly impacts already occurring on industrial estates where gas has been provided to the edge of the estate, often with public money, significant public resources, and now the ability to connect into that estate is under threat. That is true with residential estates too. It is true with the government’s decisions on banning appliance rebates. We know the government actually wants to go further and they want to ban gas appliances full stop. So when your gas appliance breaks, you will be banned from replacing it with a new gas appliance. That is where they want to go. We know where Lily D’Ambrosio wants to go. She is a hard ideologue, who is determined to ban gas, to force gas out, and she thinks that this is a better way forward.
We do not agree with it, and of course there are perverse outcomes here. If you shift from gas now to electricity generated by coal, you will have a higher carbon dioxide footprint than you would otherwise. There is a perverse matter that is operating here in Victoria now. But looking at the longer run, the federal government has, I think for some of them through gritted teeth, realised that gas is going to be an important part of the future, that gas is going to be an important peaking or firming part of the future with electricity generation. But I would also argue that it is more than that, that it is important for households to have access to gas. There are cultural matters. There is also a series of basic system theory points that would, say, let us make sure that you have got a proper set of arrangements in place so that if one part of the system is in trouble, you are not left with nothing at all.
A member interjected.
David DAVIS: That does seem to me to be common sense as well. The state government has been peddling information that electrified properties are in some way cheaper. Even at the Public Accounts and Estimates Committee the other day the minister had the solar house there. I know Acting President Galea was there, and he will have the solar connected to the electrified house but not connected to the gas house. Where is the replacement cost for all the appliances? When you put the replacement cost in, the economics of it shift massively. Gas appliances are cheaper, and there is another point: most of the gas appliances, more than 50 per cent, are made in Australia. A much smaller percentage, perhaps as small as 5 per cent, of the electricity appliances are made in Australia. We are de-industrialising through this process. We are de-industrialising, we are exporting our jobs, we are sending them overseas, we are sending real, good-paying manufacturing jobs overseas with this strategy.
Members interjecting.
David DAVIS: Look, I had somebody in my office the other day who had received a federal government grant on evaporative air conditioning and ways forward on evaporative air conditioning. The Lily D’Ambrosio model says you do not have gas in the winter and evaporative air conditioning in the summer – you have a single reverse-cycle air conditioner up there. But of course the evaporative air conditioning is about a quarter of the energy use of the heat pump model. So through the whole summer period, you are pumping out more carbon dioxide because the usage of the reverse-cycle air conditioner is much greater. Now, there is nothing in the government modelling that deals with these sorts of shifts, nothing at all. The government modelling is dodgy. The government modelling is not up to scratch. The government modelling, in simple terms, compares apples and oranges as it were, in the old-fashioned parlance. They are not an even comparison, and they do not include solar in the right way because many gas houses have got solar. It might surprise the minister, but a lot of houses with gas have also got solar. There is no rule that says that if you have got a gas property, you cannot put a solar panel on your roof and you cannot use the solar to lower your costs.
The point here is the state government’s Gas Substitution Roadmap is in chaos. We know that groups like the Victorian Chamber of Commerce and Industry and the Australian Industry Group are terribly worried about what it is doing to the industry. We notice that groups like Seeley are now leaving the state. Even the tomato manufacturing and canning operations in Echuca are looking to leave the state because of the issues of costs and gas. These are very, very real issues.
The federal government laid out a number of principles, and I think it is worth – I am conscious of my time here – laying out some of the principles:
Australia is committed to supporting global emissions reductions … and … zero emissions by 2050. Gas production and use must be optimised through the transition and residual use must be abated or offset to achieve this economy-wide commitment.
Gas must remain affordable for Australian …
consumers. We know what has happened in Victoria: gas went up 22 per cent last year and electricity up 28 per cent. There were massive increases in costs for families. Affordability is a real problem.
David DAVIS: Your government, the Labor government of which Ms D’Ambrosio is the minister, has got an absolutely chaotic way forward here. They have not laid out a sensible, reasonable way forward on this. Costs have gone up –
Tom McIntosh: Well, what’s yours?
David DAVIS: Well, we are saying there is a greater role for gas. We are saying: go out and search for gas. We are saying we would give gas exploration permits, and you have not. You have not given a single permit for exploration since 2014. The last permit was given in 2013 under the previous government. You are asking what we would do; well, I am telling you what we would do.
The ACTING PRESIDENT (Michael Galea): Order! Please speak through the Chair, Mr Davis.
David DAVIS: Acting President, I have been provoked and I should not take the bait.
I quote:
New sources of gas supply are needed to meet demand during the economy-wide transition.
We could not agree more – that is the federal government’s principle. They say:
Reliable gas supply will gradually and inevitably support a shift towards higher-value and non-substitutable gas uses.
This is federal principle 4:
Households will continue to have a choice over how their energy needs are met.
No, they are not going to ban gas in households. They are not going to ban gas, like we have got in Victoria –– draconian, almost Stalinist stuff to actually ban –
Members interjecting.
David DAVIS: Almost. It is pretty heavy, isn’t it – banning the choice of gas, banning rebates.
Tom McIntosh: On a point of order, Acting President, I think Mr Davis needs to tone it down little bit – like, quite substantially.
Renee Heath: On the point of order, Acting President, that is not a point of order.
Tom McIntosh: I do not want to start going into your use of the word ‘Stalin’, but I think you can just tone it down a bit, mate.
The ACTING PRESIDENT (Michael Galea): There is no point of order.
David DAVIS: Principle 5:
Gas and electricity markets must adapt to remain fit for purpose throughout the energy transformation.
Point 6:
Australia is, and will remain, a reliable trading partner for energy, including Liquefied Natural Gas … and low emission gases.
They go on to talk about things that the Commonwealth government can do, but there are things the state government can do. I do not disagree with the essence of some of these principles. I think they are on the right track compared to where the state government is. It is for that reason that I have brought this motion. It is a very simple motion: it says the federal government’s paper came down, we have got a state government Gas Substitution Roadmap, they are at loggerheads – they are butting heads – and we have got two different strategies heading in different directions. I think the federal strategy is the better strategy, and I have made that point clearly and publicly and widely. But I think now, because the federal strategy has come down, whatever the spat, whatever the personal feelings of the minister here, she needs to get over herself, get over her spat with Madeleine King and actually then settle down and review the Gas Substitution Roadmap in the light of the new federal strategy, which heads in a different direction. It says we do need gas for part of our transition. It says that transition requires gas – it requires more gas and it requires new sources of gas. It requires gas also to support electricity generation for peaking – for supporting the inevitable fluctuations of the renewables that are coming into the system.
Tom McIntosh: You’ve stopped talking about base load now. You’ve figured that out.
David DAVIS: I have always talked of it.
David DAVIS: I tell you what: you ought to go and talk to your minister and you ought to say, ‘Let’s tear up the road map and let’s produce a document that is more consistent with the federal document, that is not butting heads with the federal document.’ Let us get Lily D’Ambrosio to step back, get over her ego, actually go and sit down with Madeleine King, have a discussion and talk to the gas industry. The gas industry – and I have talked to many of them – actually think Lily D’Ambrosio is way, way out of her depth and way out of where the state should be. Lily D’Ambrosio needs to go and talk to the gas industry and actually reformat this Gas Substitution Roadmap. She needs to work with the industry and with the federal government to devise a sensible plan. Hence my call for an immediate review.
Others might say – and I am anticipating perhaps what my Greens colleagues might say – they prefer the Gas Substitution Roadmap to the federal program. They may also point to other deficiencies in the Gas Substitution Roadmap. Either way it would lead to a sensible position to review that Gas Substitution Roadmap in light of the new federal material and the new federal decision. They are very important decisions that have been made by the federal government, and some of them I am sure were ideologically not easy, but they do recognise the facts. They recognise that the facts have changed. As Madeleine King said, these need to be fact-driven, analysis-driven matters, not ideological matters. We do not need the heavy unadulterated ideology that has driven these energy steps in Victoria. That is the point. In that circumstance, I would say this is a very moderate motion recognising the two different approaches, which are now at loggerheads, and in light of the federal document I think the state government needs to go back to the drawing board, talk to industry and review its paper.
Tom McINTOSH (Eastern Victoria) (10:57): I very happy to stand and speak against this motion. I am glad that we have a good-sized audience to sit here and listen to this and get a very good understanding that the Liberals have not changed in 2½ decades when it comes to action on climate change. Mr Davis stood over there and talked about ideology, ideology, ideology. We know where the ideology is absolutely fixed. It is fixed to the far right of your party.
Members interjecting.
Tom McINTOSH: I am going to come to the topic, but I want to start with principles. I want to start with principles and values. That is where I am going to start. Last year temperatures around the world were up by 1.5 degrees. We are heading to that becoming the new average, and then we are heading to 2 degrees. We do not hear you lot talk about that, because you are ideologically opposed to dealing with the science.
We are no longer talking about future generations, we are talking about generations right now. We are talking about weather events that come through and smash our farmers. Our consumers go to the supermarket, and they are paying for that with their groceries when they go to the supermarket. We know that insurance bills are rising. Because of these weather events, insurers are having to raise the costs. It is Victorians, it is Australians and it is people all around the world in these events that are suffering. What do you lot do when something like that happens? When freak winds come through, you blame renewables for the fact that powerlines are snapped in half. You will seize any opportunity to muddy the water. I will come to the politics a bit later on, but all you want to do is muddy the water on this debate. I will go into nuclear when we get down there in a little bit. If we want to talk about energy policies and we want to see differing of opinion between a federal and a state party, we cannot even get two of you on that side to agree on what your energy policies are, let alone the feds and the state.
This side has been very, very clear for a very, very long time. We acknowledge the science of climate change, and we will act on it. The state has had –
Bev McArthur: Oh!
Tom McINTOSH: What are you ‘oh’-ing about? Climate change is the science that we have to deal with, and we are getting on with doing it. We have been fortunate to have abundant sources of energy, being coal and gas in this state, but we know we cannot go on using them, and with gas we know that the volumes of gas simply are not there. You are sitting over there talking about extracting more gas. Where are you going to get it from? Where are you going to get this gas from? We have surveyed the state; we spent $40 million surveying the state and the volumes of gas that we once had are no longer there. The comments you were making before about the fact that people are already being hit by these gas bans, that the boogieman is coming in to rip out the gas plates from people’s houses, it is all utter hyperbole. Let me just say that. It is the planning for new residential homes that have not even been impacted yet, yet you are screaming bloody murder about all these things that are happening. Basically every point you touched on in your contribution, Mr Davis, was just this sort of wound-up – words that I cannot use in here.
We are getting out in front and protecting consumers because as those gas supplies dwindle – and we know if we are talking about 180 petajoules or something per annum that we need and our supplies are diminishing as our wells, particularly those off Gippsland, are diminishing and the wells have to close – then we need to get on the front foot to ensure that we do not have whether it is Victorian households or industry needlessly paying huge amounts of money for gas when there is the opportunity there to electrify. We have had a solid policy and delivery of renewable energy projects. We are now at 40 per cent of the grid coming from renewable electricity and in just 11 years that will be 95 per cent.
Now, we acknowledge there will be a need for peaking from gas and there will be a need for industry to use gas, and that is why it is important that we conserve what we have for where it is needed, unlike those opposite who want to bury their heads in the sand, show that conservative brand of politics where you do not get on and face up to challenges or issues that come. You just wish things would be the same forever. You just look in the rearview mirror rather than looking through the windscreen, and that is all you ever do on that side.
We acknowledge the problem. We see there are solutions. Mr Davis is talking about only 5 per cent of heat pumps being made in this country. That is why we are getting on – if you want to talk about federal politics – making things in Australia, supporting massive new industries that are going to support this state and this nation to move to renewables to move to net zero. That is what we are laying out. We are seeing all around the world the massive investment, whether it is in America, whether it is in Europe, the Inflation Reduction Act. These different policies that are being put in place are seeing massive industries stimulated: China, electric vehicles, 50 per cent of their vehicle market. Of course Mr Morrison and his spin team told everyone that it would be the end of the Aussie weekend. The tradies I talk to say if they get to have 80 to 90 kilowatts in the back of their utes and charge all their batteries on it, when they pull up at a campsite, they will not need a powered site – you just pull up and you are there, you are self-sufficient, you do not need to lug generators around. You do not need to do all that. SES units are using battery operated jaws of life. Electric is where things are going.
So rather than stick the head in the sand, let us have a look at where we are going, prepare for it and ensure that we do not have consumers paying far, far more than what is needed down the track unnecessarily. This dream Mr Davis has about the fact that there is this abundance of gas that we are being denied from accessing is absolutely bizarre. So I think what the people of Victoria want is they want the Liberals and they want the Nationals to come clean on what their energy policy is. I know there has been an abundance of policies over the last 20 years. You could probably write a kids’ book on the magical journey of the coalition energy policies changing every six to 12 months. Is it fracking? Do you want to go in and rip up farms? Do you want to go in and rip up farms and poison the aquifers to get the gas out? Is that your plan? Is it nuclear? Do we want to be burying that nuclear waste on farms? Do we want to be risking our pristine farmland by having nuclear reactors?
I follow the energy space quite clearly, but I am losing track of where you all are, where your feds are, where the Nats are and where the Libs are. I cannot keep up. Between small modular nuclear reactors that you used to think existed and were great, and then realised, ‘Oh, no, small modular nuclear reactors don’t exist anywhere in the world. Maybe we actually have to have something that’s real and substantial,’ and now it is large-scale nuclear reactors. It has taken probably 18 months just to try and land what your position is on nuclear. How on earth do you think you are actually going to build nuclear reactors if your own parties cannot agree on what it is? And what are the state Liberals going to do? Are you going to regulate for nuclear in this state? Tell the Victorian people what you want to do.
Mr Davis, you stood there with Mr Pesutto last week and said there was no intention of it. The Nationals had their conference in Bendigo, and we are led to believe that they are backing nuclear in all the way. The fault lines between the Liberals and the Nationals are running very, very deep, and the people of Victoria deserve to know where your fracking will go, where your nuclear reactors will go and if you have a plan at all for energy in this state.
Melina BATH (Eastern Victoria) (11:07): Let me read into the Parliament’s Hansard some comments from some of the major energy producers – energy powerhouses – in this region. We have got Beach Energy chief executive Brett Woods. Brett has said:
Beach encourages governments to work together to ensure that approvals are timely and efficient as well as showing leadership to explain the important role of gas in supporting renewables, supporting jobs in existing industries and providing a more affordable and reliable source of energy.
Australian Energy Producers, a lobby group for the gas industry – no shock – accuses the Victorian government of creating uncertainty, uncertainty that will slow investment and the development of new projects. The energy producers say:
The state has abundant onshore gas supplies. But they will not be developed until the government provides a policy and regulatory environment that can give confidence to gas companies to invest in exploration and development.
This is Peter Kos, the group’s director. There is nothing with greater clarity than that.
I have heard arguments today, and I thank Mr Davis for bringing this motion forward. It is a very important motion for my electorate of Eastern Victoria and the gas fields in the Otway and Gippsland basins. But there has been such rhetoric it is comical from those on the other side. From 2014 to 2021 this government banned – ideologically banned – onshore natural conventional gas, and we are paying the price. We are paying the price for that. Onshore natural gas – indeed the only licences for fracking actually occurred under a Labor Party. I am just putting that on the record.
We know that there has been a huge ongoing spat between Minister D’Ambrosio and the federal resources minister, Minister King. How uncomfortable must this be for members in this Labor Party, for members of Parliament who are highly stressed for their local communities – for families who are struggling to pay their cost-of-living normal bills, struggling to pay their electricity bills, struggling to pay their gas bills on any given day? And we have seen the Essential Services Commission talk to the increasing gas prices in recent times of up above 20 per cent. In the last 12 months we have seen that impact. A 20 per cent increase when there is a cost-of-living crisis, when rents are going up, only adds to the pain that our local people on the street in our communities are feeling. Then you also have certain communities where of course because of the Labor Party’s ban on gas appliances in new buildings – new homes and apartment blocks – the impact that that is having is also on jobs in our fine state. These things can only compromise opportunity, compromise investment and create another rod for (a) the taxpayer and (b) families and those who are living very close to the poverty line.
Over my time we have spoken a lot about gas in the Gippsland region, and I know – and we have heard it referenced today – that the then Premier about eight years ago decided to have an inquiry, put $40 million on the table, had some geologists et cetera, and I am sure they are very fine, but their terms of reference were very narrow. Indeed you cannot find extensive pathways and deposits if you are not enabled through their actual terms of reference to have a look. But even at the time, this Victorian gas program, this narrow focus, said that there is going to be anywhere around 830 petajoules of commercially feasible onshore conventional gas. That was back in about 2021 the government knew that. Developing gas would supplement Victoria’s diminishing domestic supplies and support regional jobs and economic development over a number of years.
We on this side, the Nationals and the Liberals, support economic development and regional jobs. The production of resources could generate millions of dollars and create up to 6500 jobs in the life span, and the south-west and Gippsland would be the main regions to benefit. Well, even this inquiry, this report that had a limited focus, is saying there is gas out there. You have Beach Energy, you have other key market stakeholders, saying that there is energy trapped underneath our Gippsland Basin and Otway Basin, and this has to be a pathway forward.
We know there is a target – and we support that target – of net zero by 2050, and gas has to be part of that transitional arrangement. We see when there are incidents – high weather situations and storms and the like – and for whatever reason there is a compromised state, gas peaking plants kick in. That is the truth – gas peaking plants kick in. If this government has such a bent to shut down industry and ward off investment, then they are only going to get worse and we are going to see blackouts. Indeed we had the Australian Energy Market Operator speak only recently about the inevitability of blackouts moving forward. I care about jobs in the Latrobe Valley, I care about jobs in Eastern Victoria Region, and this is an opportunity for those jobs. We see the federal government, we see its gas future strategy, and it has come out with many opportunities and many comments that we can actually abide by – in fact we endorse them. But then we have this ideological government, this Lily D’Ambrosio – she is against anything that is sane and sensible. We know that she was a driver in the closure of our native timber industry. Guess what that does – it captures carbon. It stores it. Over 35 per cent of any wood, dressed timber or the like, is stored carbon, and it renews that and renews that and renews that. That is actually sensible policy. This government, through the now energy and former environment minister, has been the architect of so much pain in our gas strategy, in our environmental situations, in our job losses, and now this gas strategy of the government is just underhand.
We see the government in its own substitution road map talk about hydrogen. Well, hydrogen is one thing that we really like talking about in Gippsland and in the Latrobe Valley. In fact there have been huge investments: one, by the feds; two, this still current government – opportunities there; and through a Japanese consortium about gas via coal. They have come on board and said it is viable and they are looking for pathways. They are looking to invest $2 billion in this pathway. This government is saying hydrogen, but it is picking winners and losers. What we say, what I say, is that this government should be agnostic about the technology and work towards environmental outcomes – work towards net zero by 2050 but work towards sustainability of supply. I do not say ‘cheap supply’ anymore, I just say ‘reliability’ and ‘affordability’ of electricity supply and energy supply. There does need to be a mix.
This government is po-faced about its opportunities. It is shutting down gas when there is a world-class natural resource both onshore and still offshore. This government should not be casting it aside. It should be for the sake of families, for those on the poverty line, for jobs in my region, for jobs in the Otway Basin as well and, not only that, for manufacturing. We do see that Qenos is looking to exit, we do see that Seeley is exiting, and tomato producers in areas like that of my dear colleague Gaelle Broad in the north there are looking to exit because they simply cannot afford to do business without a secure gas supply.
One final thing: in the Latrobe Valley we have got energy from waste from the paper manufacturer ready to go, ready and roaring. That will reduce the gas supply, because it is heavily dependent on gas.
I support this motion. I thank Mr Davis for bringing it forward.
David LIMBRICK (South-Eastern Metropolitan) (11:17): I like talking about gas, but one of the things is that this government has been dragged along by the Greens and these environmentalists into this sort of doomsday cult mentality. They act as though, ‘If we only tax a little bit more and if we get dragged along to provide more corporate welfare for the renewables industry, somehow Victoria will change planetary weather systems’. I can tell you this: whatever change we make, it is not even a rounding error in the scheme of things. But even worse than Labor getting dragged along by the Greens is the coalition getting dragged along by Labor – everything that Labor do, they do to try to scare the coalition into doing stuff.
They did it with the fracking ban. Coal seam gas was banned; rather ridiculously it was put into our constitution to ban it. What an absolutely ridiculous thing. I imagine there are many MPs on the Labor side who even thought that was ridiculous. And now we have this silly pointscoring thing of trying to scare the coalition about the fracking ban, which they do not want to do. I tell you what: I do. I want coal seam gas. I want the gas to flow because I care about Victorians more than sacrificing the prosperity of Australians and Victorians because of some negligible impact on climate change. It is absolutely crazy.
We have got to start putting Victoria first, and the way to do that is by letting energy be produced, not having bans on coal seam gas, not having bans on nuclear energy and not having these stupid scare campaigns to try and scare people that the Liberal Party wants to put nuclear reactors everywhere. I wish they would say that; I wish they would, but they have not. I wish they would say that they support coal seam gas, but they do not. But I do. What we need to do in energy is to let all technologies be on the table, and this idea that we are going to get rid of gas while we have got renewables is absolutely ridiculous. Even Labor acknowledges this. We need gas peaking plants to make up for the fact that wind and solar do not produce all the time. The idea that we are going to have these massive batteries that will take over from gas is just fantasy. It is never going to happen. The batteries will only work for stabilisation, they will never replace gas. It is not going to happen. No-one in the world has done it, right?
If you want to decarbonise, we already know how to do it. If we look at the countries that have done it, they have done it with a combination of hydro and nuclear. No-one has done it any other way. Some countries have done it because they have got massive hydro systems, but we cannot – you know, I do not think the Greens are going to start wanting to build more dams in Victoria. People were talking about pumped hydro a while ago, until they started looking at the maps where you could build hydro and found it involved flooding national parks and this sort of thing. I do not think anyone is going to be supporting that any time soon. But coal seam gas – we need more exploration permits, we need more gas to be produced. Otherwise we are going to end up deindustrialising this state and we are going to end up with large power prices. All of these scare campaigns about coal seam gas and nuclear – let me tell you, the people in Frankston and Dandenong, they are not going to be worried about that when they get their power bills or when the lights go out. What they care about is trying to get by day to day and pay their bills, pay their gas bill, pay their electricity bill.
And another thing, this ban on new gas has got nothing to do with electrification and this sort of thing. What Labor is worried about is the gas supply, and they want to restrict consumption of gas in this state because they are worried, because they have screwed up frankly. They have screwed up the gas production, and they want to reduce the number of consumers. Reducing the number of consumers, as we can see, could mean factories shutting down – that is one way to do it. Stopping people cooking with gas is another way to do it.
Another thing – and there has been research into this; I know that the state government has been funding research into it, but they do not seem to be very interested in implementing it – is mixing hydrogen into the gas supply. I have spoken with scientists who are doing research into this. One of the big problems is you need to test all the appliances first to see what sort of level of hydrogen they can handle to make sure they are safe. You need to test every gas appliance on the market.
A member: How many years would that take?
David LIMBRICK: Well, they are already doing it.
Members interjecting.
David LIMBRICK: They reckon 10 per cent easily. They reckon 10 per cent is no problem, probably 20 per cent. 10 per cent is no trouble is what I have been told when I have spoken to scientists working on this. You can put 10 per cent into the gas supply.
A member interjected.
David LIMBRICK: Yes. Let us do it. And we will be producing gas out east, hopefully, once the Japanese consortium starts producing it to send to Japan.
David LIMBRICK: They are making it out of coal, yes. I will take up the interjection from Dr Mansfield. Yes, they are making it out of coal, but so what? Who cares? We do not care. There is some idea that coal is bad, fossil fuels are bad. Fossil fuels are what made Western civilisation rich and prosperous, right? This idea that –
David LIMBRICK: Maybe the Greens are willing to sacrifice the prosperity of Victoria for a negligible impact on global climate change, but I am not. What we want is maximum energy production, maximum prosperity and cheap energy for this state so that we can re-industrialise and start having factories set up here instead of closing down.
Jacinta ERMACORA (Western Victoria) (11:23): I appreciate the discussion so far; it has been very interesting. I want to thank those opposite for this opportunity to inject some facts and reality into the Victorian coalition’s discourse on gas. Those opposite surely are aware and have even been given advice, like the rest of our nation, that the way we produce energy around the world is dramatically changing. In Australia and indeed here in Victoria we simply need to face head-on that our historical methods of energising our businesses and homes are no longer fit for purpose. What once were cheap and plentiful sources of fossil gas are now declining.
Gas is increasingly expensive. Victorian residential customers are now paying $500 more for gas than they did less than two years ago. That is an increase of 35 per cent. Yet those opposite propose to do nothing about energy prices for Victorian families. Minister for Energy and Resources Lily D’Ambrosio said:
We’re ensuring Victorians aren’t locked into expensive fossil gas prices and sky-high energy bills for decades – helping them switch to efficient electric appliances that will deliver significant bill savings.
This is a proactive and pragmatic response from a government that is developing a strategy based on the facts, and new gas production in Victoria will not happen at sufficient scale or speed to change the overall trajectory of the sector. I am sure others will say this in this debate on this side, but this debate really is about geology not ideology. I ask Mr Davis: why is it that the opposition have no credible plan to reduce energy bills for Victorian households and businesses? Why does the opposition have no credible plan to maintain secure gas supply as we transition? Do not come to me with a problem; come to me with a solution.
Those opposite seem to be running with this narrative that somehow there are restrictions on gas exploration in Victoria. This is not the case. The only activities that are banned are fracking and coal seam gas, and that ban I will point out here was passed in a bipartisan way after a great deal of stakeholder consultation and certainly robust debate.
A member interjected.
Jacinta ERMACORA: Yes, they have forgotten that. What I need to know and what my regional community needs to know is: do you intend to overturn the fracking ban? Because if you do, then farming communities and the water industry need to know. I do not want to see agriculture compromised like it has been in New South Wales or our groundwater polluted by gas in the south-west of Victoria. Groundwater towns in the south-west of Victoria include Portland, Port Fairy, Port Campbell and partially the city of Warrnambool. That is a huge economic, social and health risk to the south-west community, so we need you to be up-front about where your plan is, what you are going to do, how you are going to implement it. Tell us your plan. If so, you must be open and transparent with Victorian farmers and the broader community. And if this is not what you intend to do, it would be very helpful if you would indicate how else you intend to deal with the gas shortages and rising costs for gas as a result.
Of course the question brings to mind nuclear. We have the longest lead time, the science is not even in. It is completely banned federally and by the state. It is the most expensive solution. There is incredible toxic waste that is completely unresolved in the nuclear debate, and of course high risk to –
A member interjected.
Jacinta ERMACORA: I think there is a massive difference between producing nuclear medicine and nuclear energy – a massive difference. And there is a high risk to communities who live nearby to nuclear power plants. You only need to look as far as Europe and Japan for that.
As the facts stand today, conventional onshore gas exploration is permitted and is occurring. The moratorium on conventional onshore gas exploration, which was introduced by the former Liberal government, with our support, was lifted in 2021. There is nothing stopping a proponent from seeking an exploration permit in Victoria. The program investigated a suite of scientific research to better understand the potential for new offshore and conventional gas discoveries and the risk, benefits and impacts of allowing exploration and production. This program has assessed the feasibility of additional onshore underground gas storage in the area of Port Campbell, which is in my electorate. The program included an extensive, proactive and phased community and stakeholder engagement program with Warrnambool city, Corangamite shire and others in the region. The result of this research was that the lead scientist found:
There are currently no proven and probable (ready for imminent development) onshore conventional gas reserves in Victoria.
This is a fact. I will remind those opposite that the Gas Substitution Roadmap Update published in December last year is very clear. Transitioning Victoria off fossil fuels cannot possibly happen overnight and our efforts will take years. We know it will be more difficult to cut for some users more than others, but the fact is we must start now. We must do this in a methodical way, assessing each segment of gas users individually and doing what works best.
As the future moves to a world using renewable energy to combat climate change, we are transitioning to homes that are all electric. In fact electric homes are now cheaper to run than dual-fuel homes – of course. Significant numbers of our businesses will also find electrification makes economic sense. However, there are some gas users who need to continue using gas for the foreseeable future, including industries using fossil gas as feedstock or for high heat applications. Even in those cases the gas substitution agenda will help them. By assisting those who can switch away from fossil gas, we free up supply for those who need to keep using it, which is why getting Victorian households off gas is a sensible priority.
Households are responsible for half of Victoria’s gas use every year, and the evidence is clear that the best way to reduce household energy bills is to go all electric. Of course we recognise that going all electric in one hit is not feasible for everyone. That is why through the Victorian energy upgrades and Solar Homes programs the Allan Labor government delivers thousands in up-front discounts and incentives for specific appliances, such as efficient electric reverse-cycle air conditioners or hot-water heat pumps, so that Victorians can get their electrification journey started step by step. This is all part of a bigger picture plan being meticulously overseen by our minister for energy, Minister Lily D’Ambrosio, and a big part of the jigsaw puzzle coming together to transform our energy, including the SEC and how it will be an important tool to bring together our objectives. Publicly owned businesses will also play a role in helping homes make the switch to electric appliances, and the SEC will be piloting their new services in coming months. I fully do not support this motion.
Renee HEATH (Eastern Victoria) (11:33): I rise to support Mr Davis’s motion. It is evident that the Labor Party is split down the middle when it comes to energy policy and when it comes to gas. The federal minister for energy acknowledges that gas must be in the mix and must be there on the way in the transition to renewables. However, the state Minister for Energy and Resources and the state Labor Party in general are saying the opposite and eventually want to ban it altogether. One party – two completely different views, and it is causing chaos in Victoria.
The feds seem to have some common sense, I must say, when it comes to gas, yet the state team are completely blindfolded by ideology and so blindfolded that they cannot see and weigh up the facts. They quote that renewables are going to bring energy prices down and they quote that they are the cheapest form of energy; however, the facts say something different. The countries with the highest share of renewables in their electricity supply have the highest prices in the world, and those nations with the lowest share have the lowest prices in the world. Some examples of that – the lowest energy costs in the world are in places like Russia, Saudi Arabia and Korea, and the highest prices are in areas like Spain, the Netherlands and Germany. Those with the highest renewable rates have the highest costs.
I am for the environment, I am for cleaner energy and I am for cheap energy, but I also am somebody that is for honest narratives. Do not tell people you are going to make their bills cheaper in the midst of a cost-of-living crisis and then go and do the complete opposite. Observations here in Australia and overseas show that replacing controllable energy supplies with necessarily intermittent wind and solar have catastrophic effects on cost. I find it bizarre that in Victoria we are always saying we are in the midst of an energy crisis when in Victoria most of the time we are literally standing on top of resources that are able to power the world. I want to say that I am not anti-renewables, but I am pro cheap and pro reliable energy.
Victoria has not always been in the situation where we are now. In fact Victoria used to be the land of opportunity. It used to be a place where you could come and you could have a business that would thrive. You could provide for a family on one income, and businesses could do well. A lot of this was because of our reliable, cheap energy, but the fact is we have moved so far away from that. Victoria has not always been the most highly taxed state in the country. It has not always been the most in-debt state in the country. We have not always had more debt than Queensland, New South Wales and Tasmania combined. Once upon a time this was a place people could come to prosper and get ahead. One of the reasons we were able to do that was because of our cheap, reliable energy. Cheap, reliable energy allows businesses to thrive and families to move forward and even prosper on one wage.
But my, how things have changed, and this seems to be because there is a lot of conflict in the Labor ranks. State Labor is at odds with their federal colleagues, who know that gas must be in the mix. Gas plays a vital role in the transition to cleaner energy. It is much cleaner than coal, it would cut emissions by roughly half and we have the resources to do it. Labor continually talks about the gas shortage, but the reason there is a shortage is because they have not undertaken any gas exploration in the last decade. Gas is available, and industry experts are telling us that it is – they are backing that up. Where there are frailties in a renewables-dominant energy system, that needs to be compensated by some dispatchable power in the form of gas. It is well known that we are rich in resources and we can provide cheap, reliable energy. The only thing that is stopping us from doing that is ideology from the other side.
In the interests of time, and to give Dr Mansfield a decent run on this, I just want to say that this motion is a practical one. It is asking the house to look at the Future Gas Strategy. It is a move in the right direction. It is a move looking at facts rather than fiction, looking at what actually is practical rather than just focusing on a positive narrative that may not be the truth in reality. Labor always talks about cheap energy, yet under Labor the bills continue to rise. I am for clean energy, but I am about being honest and pragmatic about it. We need gas in the mix, and I commend this bill to the house.
Sarah MANSFIELD (Western Victoria) (11:39): Where to start – the fossil fuel lobby and their spin doctors are clearly doing an excellent job. The Greens will, perhaps unsurprisingly, not be supporting this motion. We are a party who has climate action at our core. Gas is a fossil fuel, and fossil fuels are the leading cause of climate change. Every day there is another news story about a devastating climate event somewhere in the world, and many have occurred in our own backyard. Every day there is another story about how records are being broken – year upon year, each year being hotter. Every day we read a story about how climate scientists are distraught that their very worst predictions are coming to bear – they are unfolding. The climate crisis could not be more real, and yet we are still having debates not only about whether there is a role for fossil fuels but about opening up more fossil fuel projects. This is insanity. It is beyond comprehension.
The Future Gas Strategy demonstrates that Labor at least federally has also fully succumbed to the gas lobby. They are now willing mouthpieces for the lobby’s marketing spin. Their strategy claims gas is essential to reaching net zero – that we may need gas in perpetuity. These are truly unbelievable claims from a party that promised to take action on climate change and to end the climate wars.
Anyone with some basic mathematical skills might be wondering: how can gas be an equation that equals net zero? That must mean there is a significant drawdown of carbon somewhere, because lots of gas emissions need to be offset somehow to get to zero. Well, of course it is the great chimera that is carbon capture and storage. This is how, in Labor’s fantasy land, they justify new fossil fuel projects. ‘Of course, we’ll just pump carbon into the ground or under the sea’ – never mind that this technology is essentially unproven and is definitely non-existent on the scale that is required where it exists. It does not even come close to living up to its promises. Two-thirds of the projects that do exist are actually dedicated to extracting more fossil fuels. I mean, this is a giant furphy.
Carbon capture and storage is a joke, and Labor should be embarrassed that they are even entertaining the idea let alone actively promoting it. Australian governments have spent over a billion dollars on developing carbon capture and storage, and what has it resulted in? Nothing. So according to my calculations, gas – that is, lots of emissions – plus zero, because carbon capture and storage will not do anything, equals lots of emissions. It does not equal net zero.
We know that Victorian Labor have made some positive moves on gas. We have heard about their ban on gas in new developments. It is something the Greens called for for a long time, so we welcome that decision by the Victorian Labor government. But we also know that they are approving new gas projects. There are gas projects going on in Victorian waters off the coast of my electorate, down near the Twelve Apostles, and there are apparently more in the pipeline. They too have succumbed to this furphy that is carbon capture and storage. That is what they base their support of the hydrogen energy supply chain project on – one of the most emissions-intensive projects you could possibly imagine, that gives new life to brown coal, the dirtiest fossil coal that exists.
The gas lobby is also pressuring Victorian Labor. Just in recent days we have heard them calling on them to support more gas exploration. But Victorian Labor has a choice. They too can sell out like their federal colleagues, or they can choose to get out of fossil fuels – like they should. We know that the coalition has long been the party of the fossil fuel industry, and at least they do not pretend to be anything else – they are not even trying. They have been framing this debate around consumer choice, which is the classic Liberal Party play. They are here fighting for choice about a fossil fuel source that has massive negative externalities by accelerating climate change. They are saying consumers should have a right to choose the fuel source. No, they have a right to energy security. That does not mean you have a right to choose what your source of energy is if that source of energy is causing substantial harm to others. We limit consumer choice all the time when there are harms to other people, when it infringes on our rights.
People have a right to a safe climate and a safe future, and I think we should all be prioritising that. Many people across this country voted for Labor at the last federal election hoping beyond hope that they would take action on climate change seriously. What they have shown is that they are no better than the coalition, because both major parties are hooked on fossil fuel donations. That is the truth of the matter. That is what the core of this is. It is true – they are owned by the gas and coal lobbies, and why should we be surprised when we see you out acting like puppets for the industry? What the Future Gas Strategy says is that federal Labor have given up on climate action. They have sold out; they have sold our futures and our children’s futures to the fossil fuel industry. Their way of ending the climate wars is to wave the white flag to the fossil fuel industry and join the coalition.
In any case, we are not going to be supporting this motion. We are the only ones that appear in this room to be genuinely committed to climate action, to genuinely getting off fossil fuels. We need no more coal and gas. When you commit to no more coal and gas and back that up with action, we will believe you. Until then we will continue to push you. We will push you to end all new fossil fuel projects in Victoria. We will push you to take genuine climate action. We are definitely not going to be supporting the push for anything new on this side. I think I will leave my contribution at that.
Michael GALEA (South-Eastern Metropolitan) (11:46): I rise to speak on the motion today and add my voice to the chorus that is already speaking on this debate in this chamber, which has been a most interesting debate to listen to. The first thing I would say is that the action that Dr Mansfield is seeking to see is right there, and it is 10 years of investments, 10 years of targets, 10 years of meeting, beating and achieving those targets. We have the most advanced targets in Australia, amongst the highest in the developed world, and what is more we are achieving them. We are achieving them, and in doing so we are seeing this year the Victorian default offer $100 a year cheaper for Victorian households. That is the result of our continued and sustained investment in renewable energy in this state and the ambition of this government under Premier Allan in particular, and of indeed Minister D’Ambrosio as well. The ambition of this government is not only achieving but smashing renewable energy targets. The action I note that Dr Mansfield wants to see is right there in front of us. The action is happening day by day. We are also doing so in a way that is bringing down power prices for Victorian small businesses and for Victorian households.
Again we have this ridiculous motion from those opposite. Mrs McArthur, I am very disappointed I have not heard you speak on this motion yet, because I feel like I have heard a whole week of talking about gas in our PAEC hearings last week – in fact I think most of your questions on the Suburban Rail Loop portfolio were indeed about gas as well. I know that you are very excited about this, but what this government is excited about is high and achievable renewable energy targets, doing our bit for the planet, and also doing it in a way that provides secure, reliable and cheap energy for all Victorians. That is what we are doing. The proof of both of those things is there for all to see – the proof is there.
What we have, though, in contrast is those opposite throwing up as much as they can, finding any old bit of rubbish to bring into this place to put forward, because they do not have a plan – just as their federal colleagues do not have a plan and did not have a plan for more than a few months at a time when we last saw them in federal government. How many was it – 16, 17, 18 or 19 times? I do not know. They had so many different energy plans. They would come out one morning and announce a great new energy policy, and by that afternoon it was gone, and usually the minister was gone with it as well. No consistency, and that is again what we see from this side. We see it in the motion they put forward today, and we have seen it in the nuclear debate as well that they are so keen to talk about, it seems. Indeed one of the early contributors from the coalition was mentioning that as well. What is that going to achieve? How are we going to get any nuclear power plant in this country built in a reasonable amount of time – firstly – to achieve any of the things that you claim to care about, which is going to take ages and ages, if not absolute decades, to achieve? Secondly, no answer for any of the nuclear waste or the uranium or any of those other issues – no discussion or even contemplation about that. And thirdly, the cost.
I have mentioned in this chamber before, the United Kingdom right now in Somerset is building the Hinkley Point C nuclear power station. The current estimated cost of that project is in the order of A$65 billion to A$70 billion, and that is in a country that already has a nuclear network, that already has experience in building and operating nuclear power plants. If it is going to cost the United Kingdom up to $70 billion to build one single nuclear power plant, how do you expect Australia, with no history of nuclear power plants, with no existing workforces or any other networks or technology infrastructure in place, to be able to do it any cheaper?
A member interjected.
Michael GALEA: You do not care. You do not want to. You are happy for billions and billions – hundreds of billions – of dollars to be spent on building new nuclear power stations. Again I call on those opposite to speak. We hear one thing one day, we hear another the next. We have heard the illustrious Mr Pesutto say he apparently opposes nuclear power in Victoria. I wonder what our friend Mrs McArthur thinks of her party leader saying no nuclear in Victoria – one of the few things he has said something very sensible on. But again we are seeing absolute chaos and division. We are expecting an announcement any week now of Peter Dutton’s dreaded list of doom as to which community is going to have a nuclear power plant inflicted upon it. They would not rule it out in Frankston ahead of the Dunkley by-election. Where will they rule it out? Where in the Liberal Party electorates in this place will they actually agree to? I look forward to Ms Crozier’s contribution. Perhaps she will tell us exactly where in Victoria she would see a nuclear power plant, perhaps exactly where in the Southern Metro Region too.
We have a strong strategy, a strategy that is working, that is delivering results. We are beating and achieving our climate targets, and we are now doing so in a way that is bringing down power prices for Victorians because we know that the cheapest form of energy is renewable energy. It is also the best way for Victorian households, businesses and the broader economy. This is a ridiculous motion. I condemn it.
Georgie CROZIER (Southern Metropolitan) (11:52): I rise in support of Mr Davis’s motion. I will reiterate the motion to the house because obviously those across the chamber have not understood what is happening at a federal level and what is happening here at a state level. The motion states:
That this house:
notes that the federal government’s Future Gas Strategy, released on 9 May 2024, diverges significantly from the Victorian government’s Gas Substitution Roadmap–
The federal minister Madeleine King quite rightly said about her state colleague here Ms D’Ambrosio, once she released the road map and looking at transitioning away from gas, that the Commonwealth’s new Future Gas Strategy, exactly what this motion is referring to, was:
… one “based on facts and data, not ideology or wishful thinking”.
Ms King said “gas will remain an important source of energy through to 2050 and beyond” to avoid energy shortfalls and price hikes on the path to net zero.
There seems to be a clear spat between the federal minister and the state minister. We understand that there is a lot of division between the state and federal ministers on this. But the federal minister is talking common sense, and it is language that the community understands.
Today, in a very concerning report around a looming retail recession here in Victoria, Paul Guerra from the Victorian Chamber of Commerce and Industry spoke about what business requires, and he said:
All this, while business costs have also gone up … businesses are extremely concerned about tax and regulation –
we certainly understand that –
labour and skills shortages and energy security and price.
This argument is absolutely being debated within the community around energy security and price. Every consumer in Victoria knows that their energy bills have gone up. I go and speak to my local traders –
A member interjected.
Georgie CROZIER: You might not – you do not live in your electorate. I go and speak to my people in my electorate. The drycleaner tells me exactly what the electricity prices are. They are struggling. They are working seven days a week to keep that business viable. And this is the disconnect between you, Labor, and what is happening on the ground. This is a huge issue for businesses, as Paul Guerra from VCCI has said, and it is what we are facing here in this state. It is households. It is energy prices that are being passed on through to the consumer at every level. It is something again that Labor do not understand – that when those energy prices get passed on, prices rise. I think we are in agreement that we need to have a sustainable future, but gas has to be, as Madeleine King says, part of that mix. Mr Davis’s –
Georgie CROZIER: You are not a fan of Ms King, Mr McIntosh?
The PRESIDENT: Order! Mr McIntosh!
Georgie CROZIER: You are very verbal about your disgust with Ms King’s federal policy strategy that we are debating today, and it is unfortunate that the Victorian public are confused about your position and then federal Labor’s position. They understand that federal Labor’s position is not based on ideology, and that is what Ms King says about the Allan Labor government and Ms D’Ambrosio’s strategy. It is all over the place, and they are having a public spat.
Georgie CROZIER: Mr McIntosh, I know you are extremely exercised about this failed policy from your own minister that is at odds with the federal minister Ms King. I will repeat it for you, Mr McIntosh, so you hear.
The PRESIDENT: Mr McIntosh, please!
Georgie CROZIER: I say again, this is the federal minister as quoted:
… the Commonwealth’s new Future Gas Strategy as one “based on facts and data, not ideology or wishful thinking”.
… “gas will remain an important source of energy through to 2050 and beyond” to avoid energy shortfalls and price hikes on the path to net zero.
They have a clear plan, Victorian Labor do not, and that is the issue. What we say is that we agree that there needs to be sensible transition and gas must be a part of that plan. We know that you do not agree with that. We know you do not support choice, and consumers understand you do not support choice and they are actually speaking out.
In conclusion to this important debate – because it is about energy security, it is about energy affordability – I commend Mr Davis for bringing this important motion to the house today that needs to be supported if there is a future for Victorian businesses and households in ensuring we have a proper, reliable energy source.
Council divided on motion:
Ayes (14): Melina Bath, Jeff Bourman, Gaelle Broad, Georgie Crozier, David Davis, Renee Heath, David Limbrick, Wendy Lovell, Trung Luu, Bev McArthur, Nick McGowan, Evan Mulholland, Rikkie-Lee Tyrrell, Richard Welch
Noes (17): Ryan Batchelor, John Berger, Lizzie Blandthorn, Katherine Copsey, Enver Erdogan, Jacinta Ermacora, Michael Galea, Shaun Leane, Sarah Mansfield, Tom McIntosh, Aiv Puglielli, Samantha Ratnam, Harriet Shing, Ingrid Stitt, Lee Tarlamis, Sonja Terpstra, Sheena Watt
Motion negatived.
Business interrupted pursuant to sessional orders.