Speech to ACCI Business Leaders Summit

ACKNOWLEDGEMENT OF COUNTRY

As we meet today on the lands of the Ngunnawal and Ngambri people, let us speak with honesty and acknowledge that the cause of reconciliation has recently suffered a setback.

But let us all resolve to ensure it is no more than that – a setback – and that we will continue to push on the long path to reconciliation because it is too significant and too important to be cast aside.

INTRODUCTION

Thank you to Andrew for inviting me to speak here today.

As you know, the Parliamentary agenda is very jam packed, but I was keen to accept your invitation.

That’s because I regard ACCI, and engagement with you and your members, as very important.

We’ve worked closely now across several portfolios over the years and I enjoy our engagements.

But frankly, our most important work is happening right now –

In the next couple of years there is much more to do.

The economic transformation required by the path to net zero –

To set our nation up to take advantage of the job and investment opportunities and become a renewable energy superpower.

Some of you will have already heard this theme in this morning’s session – with the discussion about the importance and opportunities of our natural advantages of critical minerals.

Building on this –

After a busy 18 months of Government, today I’d like to give you a sense of some of the Government’s upcoming priorities – firstly in climate change policy, and secondly in sovereign manufacturing related to renewable energy supply chains.

CLIMATE CHANGE STATEMENT

When we were elected to Government, we came with a clear direction, but we didn’t pretend to have all the answers.

We have restored a collaborative approach to climate policy –

Respecting climate science.

Working with business –

With industry –

With unions –

With the climate movement –

With other levels of Government –

And across the Parliament.

And this includes restoring the role of the independent Climate Change Authority.

Today, I can announce that I’ll deliver the Second Annual Climate Statement to Parliament later this month.

The Statement is a requirement under the Climate Change Act that we passed last year.

When we were legislating Australia’s emissions reduction targets of 43 per cent by 2030, and net zero by 2050 –

We also wanted to ensure ongoing accountability for their achievement by the Government of the day.

That’s why I and my successors now must front up to Parliament each year with this Statement.

And it’s why each Annual Statement is informed by advice from the independent Climate Change Authority that is made public.

And why each statement will also include the Government of the day’s latest emissions projections, showing whether or not we are on track to meet our targets.

When we came to Government, the CCA had been hollowed out.

It had been starved of funding and staff, with less than ten staff, to around 62 now –

And was not consulted, nor asked for any advice on the former Government’s so-called Net Zero by 2050 Plan.

With an additional funding of $42.6 million over four years, the appointment of three new Board members, and reforming the requirements of the Climate Change Act –

We’ve restored the CCA to its rightful place in Australian climate policy-making.

The rightful place is advising Government in an open and transparent way.

The Government has now received the CCA’s advice for this year.

We’re considering it before the CCA releases it publicly alongside my Annual Statement.

And that consideration by Government is important.

Because while the CCA has been re-empowered, it hasn’t replaced the role of the Executive in climate policy.

Democratically-elected Government remains responsible for policy and accountable to the Australian people for its outcomes.

And while we listen carefully to the CCA, we also listen to others, like the business community and other stakeholders.

Because it is elected Government that is ultimately responsible for getting the economic settings right.

To deliver climate and energy policy that is ambitious, but can be achieved in a way that delivers future competitiveness and growth.

In broad terms, this year’s CCA advice supports what the Government has always said about our emissions reduction targets.

That they’re ambitious, but achievable.

And that more work needs to be done – as has been rightly acknowledged by the Treasurer in recent weeks.

In recent months, it’s become fashionable to claim that our targets are too ambitious.

Now, it’s true that targets are easier set than met, particularly as we face the global economic impacts of the pandemic, Russia’s illegal war in Ukraine, and now conflict in the Middle East.

But at best, these criticisms miss the point of a target.

Like any corporate target, our emissions reductions ambitions are designed to lift effort across the economy, not reward business-as-usual.

And at worst, criticisms that our ambition is too high, and calls for us to just give up now, are the latest tactic of the deniers and the delayers.

The same politicians who once denied climate change, and then claimed to have a plan to act on it –

Now say action is too hard.

This is the latest tactic of the group climate scientist Michael Mann has dubbed climate “inactivists”.

Outright climate change denial isn’t fashionable anymore.

And so people have moved on to other attempts at delay and distraction, all designed to stop climate change action, no less than the deniers themselves.

“It’s all too hard.”

“You’re going too fast.”

“We need nuclear.”

… they are all just variations of the same theme – an attempt to delay our most important economic transformation.

But we in the Government understand that in fact getting this transition to happen more quickly but also in a more orderly fashion is the key to our future economic prosperity.

It’s also vital for energy reliability.

Our coal-fired power fleet, as it ages, becomes more unreliable.

The last new coal-fired power station was built in 2009.

For context, that was the same year US Airways Flight 1549 landed in the Hudson – some fourteen years ago.

And due to a decade of Liberals and Nationals fighting over energy policy and the existence of climate change, which we still see today – we’ve seen gigawatt upon gigawatt of dispatchable power leave the grid since then without replacement.

We need new energy sources to come on more quickly for the sake of reliability.

Just this week it was confirmed that a unit of our largest coal power station Eraring – 25 per cent of its capacity - is non-operational and will remain out of action until the end of this month.

And as AER Chair Clare Savage says, increasing outages at coal plants are having an impact on prices – and I quote:

“We've also seen very unreliable coal plants. We've seen a lot of outages at our coal plants.”

Simply saying “it’s all too hard” won’t maintain the reliability and affordability of our energy system as coal ages and exits.

Call me old fashioned, but I think that’s a pretty critical responsibility of any party of Government.

It won’t keep industry competitive as the world decarbonises, or seize the opportunity to become a renewable energy superpower.

And it won’t make a responsible contribution to global efforts to avoid the most dangerous warming.

DOMESTIC MANUFACTURING AND THE PATH TO NET ZERO

Getting our policy settings right and setting targets accordingly is a significant part of the picture, but it’s not the only part.

One of the key challenges in the transformation underway isn’t just how quickly we can get on with the job –

It’s the physical restraints which are a reality worldwide.

Competing for finite resources in a tight supply chain.

For wind turbine components, for battery manufacturing, for electrolysers.

In 2020 and 2021, there was a worldwide vaccine race in response to the COVID-19 crisis.

Sovereign vaccine manufacturing was one of the most sought-after capabilities in the worldwide response.

The then Australian Government assessed our vaccine manufacturing and has taken steps to bolster our defences for any future pandemics – investing in a domestic mRNA manufacturing facility in Melbourne.

Recognition that in a health crisis, we want our own capacity to respond.

The same applies to the current climate crisis.

The International Energy Agency’s latest renewable analysis shows global renewable capacity is expected to increase by almost 75 per cent between 2022 and 2027.  

Our 82 per cent renewable energy target is broadly in line with like-minded countries.

Renewable energy capacity in the United States is forecast to increase in line with their target of 100 per cent carbon pollution-free electricity by 2035.

In Canada – they’ve set a target of 90 per cent renewable and zero emissions energy by 2030 and 100 per cent by 2035.

In Ireland – a target of 80 per cent renewables consumption by 2030.

In Germany – 80 per cent renewable electricity by 2030.

The good news is that we can be well-positioned to take advantage of this demand, with the right policy settings for renewable energy supply chains.

Take solar as an example –

In 2023 global investment in solar power is set to eclipse oil investment for the first time.

China has invested heavily in solar PV – around $US50 billion over the past decade, or ten times total European investment over the same period.

And as the IEA notes, governments in the United States, Europe and India have begun to prioritise solar PV supply chain diversification -

Implementing policies such as India’s Production Linked Incentive scheme and the US Inflation Reduction Act to provide direct financial incentives for domestic manufacturers to increase their competitiveness with Chinese ones.

We’ve been working through our plans to support the industries at the heart of realising our potential as a renewable energy superpower – being comprehensive in our thinking – because we know getting it right is critical.

But we know that to achieve net zero, the world needs more reliable supply chains to meet surging demand for solar panels and Australia has what it takes to be a major supplier, especially of advanced solar panels.

We’ve put 60 million solar panels on roofs in Australia in the last ten years.

One per cent of them have been made in Australia.

As Professor Renate Egan, the co-chair of the Australia-India Solar Taskforce said –

“…we need Australia again to back ourselves. This is what we missed 20 years ago. We can take it now.” 

And we have long been a leader is solar technology, with more than 80 per cent of today’s global solar PV manufacturing using technology developed in Australian laboratories. 

While we’ve been a global leader in solar PV deployment and innovation, we rely too heavily on overseas supply for our solar panels, which poses major risks due to production concentration and vulnerabilities in the supply chain.

The International Energy Agency estimates 1,300 manufacturing jobs could be created for each gigawatt of solar PV production capacity, meaning a domestic solar PV supply chain could create tens of thousands of jobs in Australia. 

We have the intellect and local talent. 

A couple of weeks ago the Prime Minister and I announced $11 million in support for SunDrive –

An investment that will help SunDrive scale up its advanced production line to make enough copper metallised PV cells for around 15,000 household solar systems each year.

The first mass produced solar cell in Australia in more than a decade – which also happen to be the most efficient in the world.

But we believe this is just the beginning and we’d like to see clean manufacturing businesses like SunDrive grow and thrive in Australia.

Another positive development in the last few weeks was the news Quinbrook Infrastructure Partners plans to build a polysilicon plant in Queensland to supply solar panel manufacturers.

Set to be among the world’s largest and first to rely heavily on renewable energy to produce silica.

And of course the great Australian company Tindo has been flying the flag for solar manufacturing in Australia through the years, and I believe they too can grow and expand.

The potential is there across the board.

We will continue to look at mechanisms to support clean energy manufacturing, so that more of what we need to continue Australia’s energy transformation is made in Australia.

SKILLS AND WORKFORCE

But more resilient supply chains isn’t the only challenge we need to work through.

I know this is a concern shared by ACCI.

In their recent report, The Clean Energy Capacity, Jobs and Skills Australia note that:

The clean energy supply workforce will likely need to grow from approximately 53,000 workers today to 84,000 by 2050.

Australia will likely need 32,000 more electricians in the next seven years –

And close to two million workers in building and engineering trades by 2050.

We are set to see strong growth in the hydro-electricity generation, wind generation, solar generation, battery storage, and offshore wind generation sectors –

Construction is also likely to grow because much of the activity to build the necessary transmission infrastructure is in the civil construction sector.

Engineers, plumbers, construction managers, telecommunications workers -

The opportunities are significant. As are the challenges.

That’s why clean energy and the net zero transformation of the economy has been identified as a core priority of the National Skills Agreement –

A $12.6 billion investment by the Commonwealth to deliver skills for critical and emerging industries.

CONCLUSION

As I said at the start – there’s much to do, and we remain focused on the monumental task at hand.

And we know we can’t – and won’t – achieve the transformation alone.

But the opportunities if we get it right are enormous –

And the consequences of a failure to act are disastrous.

For our climate. For our future. But equally – for our economy.

The jobs of the future are there for the taking –

The investment in clean energy manufacturing and renewable energy –

It will go elsewhere if we don’t establish the right policy settings to capitalise on our natural advantages.

I look forward to continuing to partner with those in this room on the path forward.