A renewables relationship: Europe and Australia as key partners

Thank you for that warm welcome, and to Christian Egenhoferthe Centre for European Policy Studies for hosting me here today. Thank you also to Marc Vanheukelen for joining me today for this discussion.

I’m honoured to be addressing an institution as respected and important to the discussion about the future of Europe. 

My speech to you tonight comes at the end of my visit to Europe, in which the weather has been cold, and the welcome has been warm.  

Warm because since the change of government in Australia, the climate ambitions and agenda of Australia and key European partners are now closely aligned. 

Warm because Australia and Europe’s different places in the renewable energy supply chain are so complementary and lend themselves not just to cooperation – but to comprehensive and substantial partnership.  

I wanted to come to Europe at this time of year, when governments are grappling with winter in the face of this global energy crisis, because it provides an acute backdrop to our discussions and underlines the importance of the European-Australian energy partnership. 

My message to you tonight is the same as in my bilateral discussions with my ministerial colleagues in Germany, France, the Netherlands, Austria and the with the EU. 

It is a three-part message. 

Firstly –
We agree with you. Renewable energy is the long-term solution.  

I know my country has not been a constructive player in the international drive to renewable energy over the last decade.  

That changed in May last year with an election. 

Australia is under new management, and is determined to play a leading and highly engaged international role in dealing with the challenges and opportunities of this massive energy transformation. 

Secondly – 
Australia and Europe are, and must increasingly be, key partners. 

Europe has huge energy demands to drive its world class manufacturing.  Australia can and will be a renewable energy powerhouse. 

And Australia can also play a role in assisting ensure that, as much as possible, the Indo-Pacific and Europe take consistent approaches on things like regulation and standards for green hydrogen and other renewable innovations, in the best interests of all.

And finally –
The successful conclusion of negotiations of a bilateral trade agreement will be a key moment in taking that partnership to its full potential.

 Around the world, people who don’t support the transition to renewables have been quick to blame clean energy for the current global energy crisis.  

This is of course, entirely disingenuous. 

They are always looking for an excuse to delay the necessary transformation to a renewable economy. 
For the deniers and the delayers, if it wasn’t the energy crisis, they would have another half-baked excuse to oppose renewable energy. 

Of course, governments in Europe have had to take short-term measures to ensure energy reliability. 
I also wholeheartedly commend the EU’s steps to quicken the transition to renewables in the medium term - including through the REPowerEU plan.

In fact, this crisis has underlined the risk of over-dependence on fossil fuels from limited sources. 
Vladimir Putin has weaponised energy and the geo-political crisis has generated much energy instability. 
But there is no geo-political crisis that can stop the sun shining and the wind blowing.

Renewable energy, supported by storage and transmission, is secure energy. 

An important element of this trip is my engagement with Fatih Birol and the IEA.  

I agree with him that – and I quote – “when people misleadingly blame clean energy and climate policies for today’s energy crisis, they are, intentionally or not, moving the spotlight away from the real culprits – the gas supply crunch and Russia.”

While we need to navigate this period of instability in fossil fuel markets, we share the EU’s determination to accelerate the transition to renewable energy. 

Australia and Europe – a natural climate partnership.

The Albanese Government has now been in office in Australia for eight months. 

Restoring Australia to climate leadership, at home and abroad, has been high on our agenda. 

We passed our Climate Change Act through our Parliament, enshrining our emissions reductions targets in law, becoming one of only 38 countries to legislate a net zero target. 

We are well on the way on our journey to lift renewables to be 82 per cent of our electricity grid by 2030.

And we are just getting started. 

We are a medium sized economy with large sized climate ambition. 

Which brings me to my second point. 

Australia and Europe are, and should increasingly be, key partners in this transformation. 

Of course, Australia and Europe share many similarities when it comes to climate and energy. 

Like the EU, Australia is an industrialised, advanced economy.

Like the EU, Australia needs to seize the economic opportunities of a decarbonising world to deliver secure well-paid jobs for our people, and deliver more affordable, cleaner energy.

Like the EU, our share of renewables in our electricity sector is growing at a rapid rate, 32.5 per cent in 2021, with a target to 82 per cent by 2030. 

And like the EU, we are now committed to ambitious climate action, and we understand that real action is a critical part of our foreign policy, and global partnership.

But equally, we have our differences.

And it is actually these differences, rather than the similarities, which make the dividends of our partnership so strong. 

Rather than push us apart – these differences amplify the benefits of partnership and the complementarity of our approaches. 

Europe has a significant demand for energy to power its sophisticated manufacturing sector. 

Australia is energy rich. 

Australia is and will remain an energy exporter. 

Increasingly, that energy will be renewable. 

Our ambition is crystal clear; for Australia to be a renewable energy export powerhouse.

We have some of the best solar energy resource in the world.  

We have plentiful offshore wind, and with our Government putting the policy framework in place we are already seeing rapid development interest.

And we would like Europe to be a key recipient. 

By some estimates, Australia’s renewable energy could generate more than eight times current global energy demand.

To put it another way – 
As one of Australia’s pre-eminent economists Ross Garnaut has argued, Australia could reduce global emissions by as much as eight per cent through zero-emissions goods, far, far, more than the impact of our own domestic emissions reduction and far more than even Europe alone.

We are also home to an abundant supply of critical minerals and rare earths. 

Australia already produces almost half of the world’s lithium, is the third-largest producer of cobalt and the fourth-largest producer of rare earths.

And under our Government, as well as exporting these raw materials to key partners like European countries, we want to add value and export manufactured products critical in the renewable energy supply chain. 

And we are working to achieve high environmental standards in the production and processing of these minerals.

I welcome comments made by President von der Leyen in Davos last week that for cleantech to deliver Net Zero globally, there will be a need for strong and resilient supply chains.  

President von der Leyen correctly said that European economies – and I quote – “will rely evermore on international trade as the transition speeds up to open up more markets and to access what is needed for the industry,” citing a desire to conclude negotiations on trade agreements including with Australia. 

Key agreements I have signed this week further the opportunities for a deepening of our renewables relationship.  

When it comes to renewable exports from Australia to Europe, hydrogen will of course be key. 
Our clean energy partnership with Germany is focused on leveraging our collective hydrogen industry capacity. 

In Berlin, I joined Education and Research Minister Stark-Watzinger to release the HySupply Report, jointly conducted by German and Australian experts which concluded very clearly that the distance between us is no impediment to the development of green hydrogen supply chain between Australia and Germany and that such an export relationship is both feasible and desirable. 

But we went further and announced significant joint funding shared between the German and Australian Governments to develop green hydrogen projects in New South Wales, Queensland and South Australia. 

And at the Port of Rotterdam, which we see as one of the key hydrogen gateways to Europe, my friend Rob Jetten and I signed an important memorandum of understanding to further develop co-operation on green hydrogen development.  

These agreements are important.  

But, an ambitious and comprehensive EU-Australia free trade agreement will buttress these cooperative arrangements and take the economic partnership to a new level, providing new opportunities for our businesses to engage in greater trade and investment activities in renewables.

This is not a one-way street.  

True partnership is based on mutually agreeable exchanges. 

Australia is renewable energy rich.  

But we require significant investment to develop our green energy endowments. 

European investment in Australian renewables is very welcome. 

Investment by European companies already comprises 20 per cent of total solar and wind energy generation projects in the Australian grid.

When José Ignacio Sánchez Galán, the global head of Iberdrola recently visited Australia, he met with myself and the Prime Minister.  

We both had the same message for him: large investments in Australian renewables are very welcome.
Iberdrola is one of the leaders in the Australian market with over 1,000 MW of installed capacity and a commitment to investing €3 billion into developing Australia’s renewable energy sector.

They aren’t alone in seeing the benefits of Australian investment. 

Another example - Neoen owns and operates 16 large-scale renewable energy projects in Australia – over 2000MW. They include five wind farms, seven solar farms and four battery storage facilities. 
One of the reasons we enshrined our emissions reductions targets in law, through our Climate Change Act was to make it crystal clear to potential investors: our pathway to emissions reduction is clear and stable. 

Australia is open for business for investment in renewables.

And all the feedback I have received from investors here and around the world is equally clear: the message has been received and there is huge and renewed interest in Australia. 

This global challenge maximises the need for global co-operation. 

Australia recognises Europe’s strong leadership on climate and clean energy and we want to find ways we can work together to support the Indo-Pacific in the transformation of their energy systems. 

We also have partnerships with Japan and Korea to accelerate the development and deployment of clean energy, building new hydrogen supply chains and finding ways to decarbonise the iron and steel value chain. 

My key point here is that we should work together to ensure a consistent set of language, rules and understanding around hydrogen and other elements of our transition.  

We recognise Europe’s strong links to the Pacific.  It’s clear to me that several European governments are prioritising the needs and opportunities for deeper European involvement in climate and energy in the Pacific, which we welcome. 

Australia has elevated climate partnership in the Pacific as a key element of our new Government’s foreign policy. 

We are bidding to host COP31 in 2026 in partnership with the Pacific because we want the Pacific voice to be brought to the fore of climate negotiations.

Wherever Australia can play a role to accelerate transition and action, we will do so. 

Friends -
In 2019 my country was ravaged by our devastating bushfires. 

Many people I meet with overseas express concern and condolences for these bushfires still, more than three years later.

Around the world, natural disasters are becoming more severe, more common and increasingly unnatural. 

No country, no region, no town, no family, no person is immune. 

And it will get worse, much worse if we don’t act. 

The 2019 bushfires in Australia destroyed approximately 24 million hectares of land, taking 33 lives directly and a further 450 lost their lives from smoke inhalation.

But let me tell you this. 

If climate change is not checked, the climatic conditions which led to those bushfires will be norm by the 2040s.  And they will be regarded as a “good year” by the 2060s. 

We simply cannot let that happen. 

The Pakistan floods, the heatwaves we saw in Europe last summer - they cannot be allowed to become the norm. 

Nor can the myriad of natural, or as I say increasingly unnatural, disasters around the world. 
The science is clear.  

Emissions reduction over the next decade is vital to holding the world as close as possible to 1.5 degrees of warming. 

2030 may sound to some like it is a long time away. 

It is not. 

It is 83 months away. We have 83 months in which to engineer a major transformation in our economies. 

Meanwhile of course, Europe is faced with its own crisis. 

A crisis caused by an illegal and immoral invasion. 
But we are jointly resolved. 

Any reduction of ambition, any failure to stick to our climate targets, any retreat from clean energy – is a win for Russia, because it continues global dependence on the exact energy sources they are holding at ransom now.

It is also the case that renewables are the answer to this crisis in the medium term. 

Renewable energy is cheap. The sun doesn’t send a bill.  The wind does not despatch an invoice. 
They cannot be switched off by a war criminal. 

Of course, the transformation to renewable energy is complex and difficult, and not linear.
But friends, the people do not elect us to do the easy things. 

They expect us, they require us, to do the important and the hard. 

But hard things are best tackled not alone, but in partnership. 

That hand of partnership is what I am offering Europe on Australia’s behalf. 

And I know, from all my conversations this week that the partnership will bear fruit. 

In Europe’s interests.  In Australia’s interests.  In the world’s interests.