Matter of Public Importance - Energy


Senator IAN MACDONALD (Queensland) (16:51): It is always interesting to hear what the Labor Party might do, what they might talk about. We have heard what the Labor Party's policy was in 2015 and 2017. In both years they were in opposition and they could not do anything. But what the previous speaker forgot to mention was the Labor Party policy in 2009. That was the time when the Labor government approved the construction of three LNG plants in Gladstone for export. In 2015, and now in 2017, they talk from opposition—when they do not have to do anything—about other policies. But if you go back to when they were in government and could do something about it, were they doing what the Labor Party is now talking about? No. They were issuing licenses for LNG plants for export only. The problems that the previous speaker and other Labor speakers have identified is really one of the Labor Party's own making. It is so typical of the ALP. They have all these wonderful suggestions and great policy ideas now that they are in opposition and do not have to deliver. But, when they had the ability to do it, what did they do? They issued licenses for export only. Perhaps, if there are other speakers in this debate, they might address this.

The potential shortfalls of domestic gas have been addressed by the Prime Minister. As most senators know, the Prime Minister held urgent meetings with the gas producers to try and resolve the issue without the government intervening. The Prime Minister then acted very decisively on 27 April and announced the introduction of Australian Domestic Gas Security Mechanism. Given the abundance of gas resources in Australia, Australians do expect to have their gas needs met; notwithstanding that the Labor government had licensed these gas producers for export only. It is unacceptable for Australia to become the world's largest exporter of LNG but not have enough gas to meet Australian households and businesses. The mechanism takes effect from 1 July. It will apply across all LNG producers and will operate alongside other key gas market reforms currently underway, including the Australian Competition and Consumer Commission gas market transparency work and the peak supply guarantee given by gas producers.

It is a targeted and temporary measure of last resort and is designed to restrict LNG exports in the event that supply is unable to meet domestic market need. Any restriction or offset requirements would only be placed on export operations that are in effect drawing down supply in net terms from the domestic gas market. LNG companies required to operate under restrictions will have flexibility to find commercial solutions that meet their domestic market responsibilities, such as swapping cargoes out of portfolios or on the spot market. All LNG companies will be treated the same.

As senators know, the exposure draft of the mechanism was released on 5 June, and the government is currently in the process of considering feedback from states, territories, gas producers, exporters and consumers, including the large industrial gas users, before finalising the regulations and guidelines. Hopefully, that will address the subject of this debate on why gas is more expensive in Australia than it is in Japan. Of course, it is a bit simplistic to compare one with the other. As Senator Williams pointed out, you must compare apples with apples in this debate, and I am not sure the debate as proposed does that.

I was interested in the previous speaker's comments about the union that supports the gas workers—the AWU, I thought he said. They have been in favour of some domestic gas regulation for some time. I wonder why the AWU did not make that a condition of the money—the huge donation—they gave to Mr Bill Shorten when they got the money from the industry super funds. Remember the $53 million they got from the Australian super funds? That was the retirement nest-eggs of mums and dads and these super funds gave it to the AWU, which in turn passed it on to the Labor Party in a much publicised event in which the AWU gave that money to Mr Bill Shorten. If the AWU were worried about domestic gas reliability, perhaps when they initially gave the large sums of money to Mr Shorten for his election campaign they should have made it a condition that the Labor Party would do something about the gas market when they were in government. It is okay to say anything when you are in opposition, but take a look at what they did when in government.

This whole debate, of course, is about cheaper electricity—cheap power. Australians simply cannot afford the sort of luxury that you see in Victoria, where the Victorian government—the Labor government there—with oodles of gas sitting under the ground has banned even exploring for gas. That sort of thing does push up the prices. As Senator Williams said before me in this debate, it is a matter of supply and demand. If you cut off the supply, obviously the prices go up, and Labor governments in Victoria are cutting off the supply by stopping even exploration for gas. In Australia we used to be so lucky, because, of all of the nations in the world, we had the best reserves of high-quality coal, and we used to use them during the forties, fifties and sixties to produce cheap power, which I know for certain brought one Korean zinc company to Australia to manufacture their zinc here. Why? Because we had the cheapest form of power. It was reliable. It was always there. It was good quality coal. We were fortunate as a nation to have that high-quality coal. But we have the Labor Party running around with their mates in the Greens saying that 'coal' is a dirty word—that we cannot have it. I am delighted that, first of all, we have an unexpected ally in Dr Bob Brown, the former leader of the Greens political party, who said that the coal-fired thermal power was the best centralised option we have. I do not often agree with Dr Bob Brown, but I certainly think he was on the mark when he made that very forthright and forward-thinking comment.

I come from a part of Queensland where there are unlimited quantities of high-quality black coal. What needs to happen for Australia—for all those people who cannot afford electricity at the rate we are going in Australia because of Labor-Greens policies over the years—is that we need to get that coal out of the ground and use it to create cheap power for Australians. We are exporting it to other countries, including Japan. That might answer the question of why Japan has cheaper electricity prices than Australia—because they are using Australian black coal to create power that is very inexpensive, comparatively. What we need to do is start using that coal resource we have. Think of the jobs it would create for the miners. I can never understand why the CFMEU is so opposed to it. They have clearly become ideological, rather than being about looking after the jobs of their workers.

I am delighted to see that Mr Tim Nicholls, the leader of the Liberal National Party in the Queensland parliament, made a firm commitment just last week to have, within 100 days of his election as Premier, a coal-fired power station, finally, with all of its approvals and hopefully based somewhere in the north of Queensland. I look forward to that. I know the Labor mayor of Townsville, Councillor Jenny Hill, joins me in welcoming that initiative. It will be great for the north, it will be great for Australia, and the sooner it happens the better. I wish the LNP leader in Queensland, Tim Nicholls, all the very best in his campaign and urge him to bring cheap electricity to my constituents in the state of Queensland.

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