E&OE….
Topics: Clean Energy Finance Corporation, Shenhua Watermark mine approval
FRAN KELLY:
The Federal Environment Minister Greg Hunt joins us. Minister good morning, welcome to Breakfast.
GREG HUNT:
Good morning Fran.
FRAN KELLY:
The Government has ordered the CEFC, the Clean Energy Finance Corporation, to focus on emerging technologies. Are you trying to starve wind and small scale solar of public investment?
GREG HUNT:
No, not at all. We've just completed the Renewable Energy Target legislation. That's going to lead to a doubling – a doubling of large scale installed renewable energy. The household sector is likely to be two to three times larger than was planned when the Renewable Energy Target came through, and is progressing exceptionally well.
The gap, as was set out by the clean energy sector at the time, was the large scale solar and emerging technologies. That was actually set out in a letter that was tabled in the Senate, so it's a very odd story that's suddenly emerged because we've done exactly what we said we would do.
FRAN KELLY:
Well what are emerging technologies? I think this might be where the confusion is. What are emerging technologies?
GREG HUNT:
Well firstly there's large scale solar, whether it's parabolic or trough, whether it's some of the forms of storage such as molten solar that are associated with it. You then have tidal, you then have run-of-river, you have geothermal, so you have an enormous number of technologies.
This was the very purpose – the very mandated purpose for which the Clean Energy Finance Corporation was set up. It was what we said that if it remains it should focus on. It was also the reason that the ALP set it up; to deal with technologies which were not being able to compete and advance. This should be something that is seen as very positive thing.
FRAN KELLY:
Who could not get access to private lending, and Mark Butler told us earlier it's still very difficult, even for wind, to get adequate access to private lending.
GREG HUNT:
Well actually the clean energy sector has made it clear that with the Renewable Energy Target settled at 23.5 per cent, not 20 per cent, they expect that there will be a very major flow on in terms of investment. The whole point is that we have a Renewable Energy Target, that is a mandated target which means that it has to be met.
The sector has repeatedly said that if the target is settled and the phantom credits which were left over from the ALP are soaked up, then they believe that there will be significant investment. They think that they can, not just reach the target, but they're in a position to exceed the target. So…
FRAN KELLY:
Okay, you don't support – the Government doesn't support the Clean Energy Finance Corporation, you've tried to abolish it, you couldn't. Now you're limiting where it can invest, you're also limiting the risk profile it can adopt while demanding higher dividends so it's going to have to invest in riskier projects like tidal and geothermal and yet you're limiting its risk profile.
FRAN KELLY:
Why isn't all this seen as just a backdoor way of nobbling the corporation?
GREG HUNT:
Well I just respectfully and categorically disagree. The- let me ask you a question.
FRAN KELLY:
But you have instructed all those things.
GREG HUNT:
What was the purpose of the corporation?
FRAN KELLY:
To boost the degree of clean energy in our energy mix.
GREG HUNT:
No it was to focus on emerging and innovative technologies- those that were otherwise not able to compete and so it doesn't actually add to the stock of renewable energy, the analysis that my department…
FRAN KELLY:
Well how can you say that, given it has invested in wind, how can you say it hasn't been integral in that?
GREG HUNT:
Well let me give you an example, it invested in the Macarthur Wind Farm which already existed. How does that add to the stock of renewable energy?
FRAN KELLY:
Well it's about developing it I presume.
GREG HUNT:
Well it was already in existence…
FRAN KELLY:
Yeah…
GREG HUNT:
It was already approved, you can go onto Portland, you can go onto Taralga where there's already been commitments made. So the purpose of it was never to invest in projects that were already financed or in many- in the case of Macarthur, under development.
The purpose of it was to focus in innovation so we're actually focusing it as we've said publicly both over a long period of time and in the letter to the Senate which was not just released but it was tabled before the Senate on emerging and innovative technologies. Whether it is tidal, whether it is large scale solar, whether it is looking at molten salt storage for solar. These are precisely the sorts of things that are exciting and add to the work that's done with the Renewable Energy Target, so…
FRAN KELLY:
What about small scale solar, have you directed the CEFC to not invest in small scale solar? It's just funded a major project with Origin Energy that would prioritise rooftop solar for community groups, people don't own their own homes, people that can't afford or have the access to install rooftop panels. Is that not a good idea?
GREG HUNT:
So what Senator Cormann has done has said to deal with matters which are not mature and not commercial and so in other words he's saying the purpose of was always intended was to deal with large scale solar, to deal with emerging technologies, to deal with energy efficiency so I'll let them, the Minister define the scope and limits of that, but remember…
FRAN KELLY:
But can you define that for us? I mean it's not commercial I guess to be providing small scale solar to people who can't afford it. It's about giving people access to cheaper energy. The Prime Minister said yesterday again the Government wants to reduce upward pressure on power prices, rooftop solar is the way to do that isn't it?
GREG HUNT:
Well if rooftop solar were of itself completely cheaper then it wouldn't require any subsidies so you've just said of course that it's lower cost but of course by definition…
FRAN KELLY:
But it does give people cheaper power prices, you know that.
GREG HUNT:
It does come with a subsidy; it's a subsidy from those that don't have to those that do have but having said that the Renewable Energy Target we made no change to the small scale solar. It's expected- it was initially expected to deliver about 4000 gigawatt hours of energy. It's now expected to be somewhere in the 10, 11 or 12,000.
So it'd be two to three times larger so it's progressing extremely well there are innovative activities being undertaken by the private sector now and I don't think it's unreasonable that if taxpayers' money is being expended with very strong credential requirements that it's focused on above all else the purpose, intent and goal of the body when it was created…
FRAN KELLY:
Did the crossbenchers understand this when you made that deal with them that it would also include a ban on small scale rooftop solar?
GREG HUNT:
Well we set out in a letter that was in fact negotiated with them precisely the three things of large scale solar, and people should be excited about large scale solar, emerging technologies and energy efficiency…
FRAN KELLY:
Okay.
GREG HUNT:
… those things were set out through an extensive discussion laid out in a letter tabled before the Senate it's probably the most public process that could ever be undertaken and gone through and I think that's the right way to do things and to focus on filling the gaps because there will be a very significant volume of renewable energy created both large scale and small scale and this is now providing for the next wave which doesn't necessarily advance under Renewable Energy Target.
FRAN KELLY:
It's quarter to eight. Our guest is the Environment Minister Greg Hunt. Minister, in the short time we have left can I ask you about the approval notification for the Shenhua Watermark mine…
GREG HUNT:
Sure, sure.
FRAN KELLY:
Barnaby Joyce says it's ridiculous to have a major mine in the midst of Australia's best agricultural land and he says the existing mine just 40km away, is the Whitehaven Coal mine has already breached the aquifer, water is pouring into the mine according to the Minister. Some bores are lower, others are dry. Were you aware of this when you signed off on Shenhua mine?
GREG HUNT:
Look let me say this that I will look at any claims in relation to that. But both of these projects are Labor projects, whether it's the…
FRAN KELLY:
With respect Minister we're dealing with the here and now. You gave it the approval after looking at the water issues last week.
GREG HUNT:
I'll deal exactly- there are 17 stages in dealing with the Shenhua mine. It's not on prime agricultural land, it's actually banned from that under law. I think it's very important to correct that statement that you made. Secondly, it was a New South Wales Labor land planning decision and I know that Barnaby has always had concerns about that New South Wales Labor land planning decision.
We have to deal with the Federal matters which are simply confined to the questions relating to matters of national environmental significance. We've had the legal advice, six scientific studies and the departmental advice. It comes in that they say that less than one in one-thousand parts of available water would be used. It's not just one or two, three, four and even five…
FRAN KELLY:
So you're confident? Minister I'm almost out of time, I have to ask you are you confident that this mine is safe then for the agricultural land nearby?
GREG HUNT:
The advice that I have could not be clearer. It's some of the strongest advice. I actually met with the Independent Expert Scientific Committee. I didn't just ask them in relation to the additional questions we put from the community, I asked them my own questions but also asked whether there was any other concern. We implemented every recommendation. Under the law there is simply no other decision that a Federal Minister could have made.
That's because this isn't a discretion like the New South Wales land planning which was entirely at their discretion whether or not they open it up. The Federal Act is clear and prescriptive that if the scientific advice, the legal advice and the departmental advice all line up and we put in place the toughest conditions in Australian history, no federal environment minister could have reached a different decision.
FRAN KELLY:
Alright just very briefly then. Barnaby Joyce is the Agriculture Minister. He is still speaking out against it. Should he, under cabinet solidarity, cabinet rule, stop?
GREG HUNT:
No look he's got a long standing commitment which predates being a Minister. It wouldn't be reasonable to expect him to suddenly pretend that he doesn't have those views and his views are primarily against the New South Wales Labor land planning decision. He's a really good man. He's an honest and decent man and I want to stick up for him.
Some people have tried to pretend there's a conflict. He would have preferred a different decision but he's also been aware that the Federal Act isn't a discretionary act, that the real discretion here was the New South Wales Labor decision to open up the land and that's been a longstanding view of his and he's utterly, utterly honest and of good faith and I think we should applaud that.
FRAN KELLY:
Greg Hunt, thank you very much for joining us.
GREG HUNT:
Thanks very much.
FRAN KELLY:
Greg Hunt is the Federal Environment Minister.
(ENDS)