Interview with David Speers, ABC Insiders

DAVID SPEERS: Chris Bowen, welcome to the programme.

CHRIS BOWEN: G'day, David.

DAVID SPEERS: So, can you just clear this up? Will a Toyota Hilux cost more to buy under your plans?

CHRIS BOWEN: No, that hasn't happened anywhere else in the world, and why would it happen in Australia? And you don't have to take my word for it - when the previous government tried this in 2015 and 16 and 17, Paul Fletcher, who was driving it, was very, very clear he made the point that the price of utes has not up in any other country in the world that has done it, including the United States, and that utes have remained as popular after the introduction of vehicle efficiency standards than before. This is just a ridiculous scare campaign from Peter Dutton. Peter Dutton is arguing that Australians deserve less choice and should be paying more for more petrol. He can make that argument if he wishes. The government chooses to make the argument that it's about time Australia catches up with the rest of the world and gives Australians better choices.

DAVID SPEERS: A lot of those other schemes, though, overseas that you mentioned, did start very gradually. The US one didn't really ramp up for some years and eventually then over a decade, we did see car prices going up higher than the inflation rate. Do you acknowledge that this is a bit different, what you're proposing here, an immediate impact?

CHRIS BOWEN: Well, I've made a couple of points, David. Firstly, our scheme actually in 2025, is less onerous than the FCAI, the peak group body's voluntary standard. We are requiring less of them than they purport to be doing themselves is less onerous in 2025 than Paul Fletcher's scheme was because we have designed it carefully. I'd make the other point. The only advantage, and I mean the only advantage of Australia coming so late to this, when the United States did it in the 1970s, for example, is that car companies have had all this time to develop more efficient models, including EVs, but not limited to EVs. So, the technology now exists and the car companies aren't making them. That wasn't necessarily the case in the 1970s or 80s when other countries were doing it. So that does give us some -

DAVID SPEERS: But for utes and four-wheel drives, there aren't that many alternative electric options available, are there?

CHRIS BOWEN: Well, there are some, and they are improving every day. This is all about choices, David, and what we're not doing is saying we're going to phase out any particular type of car. Some other countries and certainly some other manufacturers or some car manufacturers are going down that road. We're not. We are saying Australians have paid $4 billion more for petrol since 2016, when the previous government scripted, tried it to their credit, but then scripted to their discredit than they would have if the previous government had followed through with their promise to deliver vehicle efficiency standards. So, we're going to deliver them.

DAVID SPEERS: But has any country attempted what you're suggesting, a 60 per cent reduction in emissions in just five years?

CHRIS BOWEN: As I said, David, every country has different approaches.

DAVID SPEERS: Has anyone done this?

CHRIS BOWEN: Well, as I said, we are coming at it very, very late. Very, very late. So, we have other options. We put our preferred option out there, Catherine King and I, for consultation. As I said, starts are very slow because we are, as I said, less onerous than the peak car group's purported voluntary model. So, we are requiring them to do less than they say they will do. We're required them to do less than Paul Fetcher and Josh Frydenberg wanted them to do.

DAVID SPEERS: But it doesn't sound like anywhere in the world has asked them to do as much in five years as you are.

CHRIS BOWEN: And then we want them to improve because we have so much catching up to do, David. It was on your programme here two years ago, almost to the day, that Josh Frydenberg, the then Treasurer of Australia, Liberal Party Treasurer of Australia, said the Liberal Party has always been committed to fuel efficiency standards because they reduce running costs for motorists and they reduce emissions. Now the Liberal Party has gone so backwards under Peter Dutton's watch and so negative that they now oppose our policies and they oppose their own. Well, we are just going to get on with the job. Every big reform can be subject to a scare campaign. Any big reform worth doing is subject to a scare campaign. That's been the case for reforms in Australia over the last 40 years. This one is no different, but it's an important reform.

DAVID SPEERS: Let's look at what the industry is saying. Most of them, apart from the electric car makers, are worried about the scale of ambition here. Toyota and Mazda say it's too ambitious. Nissan says it wants a delay. Isuzu says if brands can't lift prices, they might leave the market. Even Hyundai says the start date of January is probably asking too much of industry. Are you listening to that feedback?

CHRIS BOWEN: Well, I'll make again a couple of points, David. Firstly, I don't quite agree with the premise of your question. If you look at what Hyundai, Kia, Volvo, Volkswagen and this week, Nissan have said, they all support option B –

DAVID SPEERS: With changes.

CHRIS BOWEN: - which is the government's preferred changes.

DAVID SPEERS: Not unamended.

CHRIS BOWEN: Well, their fundamental starting point is that they agree with our preferred model and indeed the majority of submissions that Catherine King and I have received either agree with our preferred model or call for us to go harder and faster. But I'd make this point too, and maybe I could just look 30 seconds in the future and predict you're about to ask me what our response to the consultation will be on various options, which would be unedifying viewing for our viewers because I'm not going to get into announcing things.

What I will say is the principle - Catherine and I chose to consult. We didn't have to. We could have just introduced this legislation. We chose to consult because we want to make sure we've hoovered up all the good ideas about how to implement this. So, where an idea has been made to us sensibly, we will consider it sensibly, in good faith to help the implementation of what is a big and complicated policy space. If people come along and say, listen, we understand why you're trying to do this, and here's our idea as to how you could do it most easily and how, whether it's dealers or other people, how we could most sensibly comply. Of course, where it's been designed to help us implement this and enhance the implementation. Of course, we run, the Prime Minister runs, and Catherine and I take an approach of consultation, of careful collaboration with industry. We are not going to be sort of bullied out of proceeding with a policy which is in the best interest of the Australian people and nor would the Australian people want us to. And again, if Peter Dutton wants to go to the next election saying Australians should continue to pay more for petrol, like they have $4 billion more since the government he was a member of [indistinct] in 2017, that's a matter for him to take it that far.

DAVID SPEERS: Pick up on what you've just said there. You are willing to make sensible and good faith changes. Have you heard sensible and good faith suggestions through this process?

CHRIS BOWEN: Again, I'm not going to sort of start ruling in or out or making announcements. But, yes, of course, there have been people of goodwill, both in the industry and elsewhere who said, we agree with your ambition, we agree with what you're trying to do, and here's some ideas about how we think the implementation could be done as smoothly as possible. Of course, that's been my approach in every portfolio I've had. That's Catherine's approach. You work with people to achieve the government's objectives.

DAVID SPEERS: And I fear what sort of answer I'm going to get here, but nonetheless, I'll ask it.

CHRIS BOWEN: I just predicted it. I might have just predicted the answer and the question.

DAVID SPEERS: One of the suggestions is you should, like the US, does include more energy efficient air conditioning and other technology in the vehicle. Would you do that?

CHRIS BOWEN: Well, there's various views out there about credits, super credits, they're called in various forms. Again, I'm not going to get into that in any detail. Catherine and I are working through the submissions. We'll have more to say. We will take a sensible approach, but we will be

DAVID SPEERS: One more though, the big four wheel drives, like the Ford Everest and the Land Cruisers and so on, that are classed along with the small runabouts, would you put those with the utes that are in the light commercial vehicle class rather than the passenger vehicle class?

CHRIS BOWEN: So, you're right, David, we have had two classes of vehicles, passenger and light commercial, because we recognise that tradies and other small businesses have special needs. That's why we were less onerous on those types of vehicles, even less strict than the United States standard on those types of vehicles. But again, if people have sensible suggestions about where the lines are drawn, we'll consider it in good faith.

DAVID SPEERS: Okay, so you might class - the Everest is the same as the Ford Ranger, I think, in their drivetrain, so you might put them in the same class.

CHRIS BOWEN: Let's not go down the road, you asking me lots of questions, which I can give the same answer to every time.

DAVID SPEERS: Just the big picture, though. Are you willing to budge on the overall ambition here, which is a 60 per cent reduction in emissions in five years?

CHRIS BOWEN: Australia has a lot of catching up to do and Australian motorists have been missing out on choices and so we want to deliver those better choices as soon as is practical. And that is the approach we'll continue to take. That's why we're doing this. We're not doing this for fun, we're not going out looking for a fight. We are looking for ways to improve the best interests of Australian motorists. That's why -

DAVID SPEERS: Do you have to hit that emissions reduction, which is, I think, 100 million tonnes by 2035? Do you need to achieve that here or is there some wiggle room on that?

CHRIS BOWEN: Well, the fuel efficiency standards play not much of a role in our 2030 targets because Australian cars stay on the road for so long and because we're not starting until 2025, it's only about 6 million tonnes between now and 2030. Of course, it makes 100 million tonnes contribute mission by 2035. But we are doing this for better choices, for lower running costs and for fewer emissions and better health, because better atmosphere, fewer particulates in the air is better for Australian's health. This is win win win.

DAVID SPEERS: Let's turn to nuclear energy. You might have just heard, the Opposition says experts are telling them you could have a nuclear power plant up and running within ten years in Australia. Is that right?

CHRIS BOWEN: Tell him he's dreaming. I don't know what expert he's talking to. I mean, I just heard you talking about Europe's experience, I could point to the United States experience. United States with a very developed regulatory regime, with a very developed nuclear industry, the nuclear leader of the world. The average build time of a nuclear power plant in the United States has been 19 years. Ted O'Brien thinks he can do it in Australia from ten with a starting standing start, no regulations, with a ban, not only nationally, but in the three most popular states. I mean, throw in the Opera House and the Harbour Bridge and you might sell him something.

DAVID SPEERS: The ban that we have on nuclear energy, if the idea of nuclear energy is so prohibitively expensive, takes too long, why do we need the ban at all?

CHRIS BOWEN: Well, David, I hear this argument about I'll just lift the ban and let the market sort it out. Well, the market hasn't sorted out in any other country in the world. Every country in the world with nuclear has required massive transfers of taxpayer wealth to the nuclear constructors. Now, if we were to go down that road in Australia, we'd really be sending the signal that we're prepared to do that, that we are prepared to use taxpayers money to subsidise the development of the nuclear industry.

DAVID SPEERS: In fairness, though, Minister, I mean, the government's building Snowy 2.0. You have the scheme, the Capacity Investment Scheme that subsidises renewables. We don't know how much that's costing.

CHRIS BOWEN: Well, very different approaches. I mean, you look at the - now, the Opposition has scrapped their small modular reactor policy after we've been [indistinct] for two years. There is no such thing as a small modular reactor. They've scrapped it and gone for large. The poster child of large nuclear reactors is Hinkley C in the United Kingdom, which is very, very late and has come in at $86 billion for a three gigawatt, just over three gigawatt nuclear power plant. Now, coal in Australia is about 22 gigawatts. Do the maths. I mean, this is eye watering. Eye watering amounts of government taxpayer subsidy that would be required to make this stack up. Maybe Peter Dutton is prepared to do that. We're not.

DAVID SPEERS: But if you lifted the ban now, surely you could go to the election sometime early next year and say, look, no one's interested. We lifted the ban twelve months on, not a jot of interest. Wouldn't that strengthen your argument?

CHRIS BOWEN: Well, again, it would send mixed signals and it would send the signal that the government's somehow interested in sending subsidies. I've had no one knock on my door to say, I want to build a nuclear power in Australia, but I've had plenty of the world's biggest renewable companies through my door. This is not happening. There's a myth that this is happening elsewhere in the world - it's not. Australia has the best renewable resources in the world. It would be a massive economic own goal to give up utilising those resources and to go down this nuclear fence.

DAVID SPEERS: But it is happening in other parts of the world. The Coalition often make this point. And you were at the COP summit in Dubai, where I think it was 22 nations signed up to a pledge to triple nuclear capacity to, along with renewables, meet their net zero targets.

CHRIS BOWEN: Well, triple by 2050, 22 countries, whereas 123 countries pledged to triple renewables by 2030, just six years away. And, David, if you look at the amount of nuclear that's been added in the last year, it's 1 per cent of what's been added in renewables. The world is moving to renewables in a massive way. We added more renewables in the last calendar year across the planet than the entire capacity of the world's nuclear fleet that had been built up over decades.

DAVID SPEERS: What about the example Peter Dutton often gives of Ontario, the Canadian province where he says there's a lot of nuclear, 60 per cent nuclear, and their bills are a lot lower than they are here?

CHRIS BOWEN: It's a cool story, isn't it? It's just not true. It's the only problem with it. I mean, two things about Ontario. One, what Mr. Dutton doesn't tell you is the Ontario state government subsidises energy bills in Ontario by $6 billion Canadian a year. If he's planning to do that, he better tell us sometime soon. Secondly, look at Quebec, the province next door to Ontario, which is 98 per cent renewable. Their power prices are less than half what they are in Ontario, which is predominantly nuclear. The problem is, with all of Mr Dutton and Mr O'Brien's claims on nuclear, when you put scrutiny on them, they crumble like a [indistinct] in a blender. They just don't stack up.

DAVID SPEERS: Just while you're in fact checking, though, the other figure that he's been using this week, that the renewables and the poles and wires required under your plan is going to eventually cost $1 trillion. What is it going to cost?

CHRIS BOWEN: I really don't know where Mr. Dutton gets that claim from. He's making it up. Here's a tip - if you're an electrician, go around and quote for some work in Mr. Dutton's house, because he'll pay whatever - he'd be paying $100 million a kilometre for transmission. I mean, you could build the transmission towers in gold and do the wires in pearls and it wouldn't cost that much. I really don't know what Koolaid he's drinking or he's come up with those figures.

DAVID SPEERS: What is the cost?

CHRIS BOWEN: Well, the best guide to the cost is AEMO's integrated systems plan, which, if you like, looked at this in 2024 dollars, in current dollars, looked at the total cost out to 2050 of the entire generation, storage and transmission and came up at 121 billion.

DAVID SPEERS: All right, and a final one on household builds. The next couple of weeks, the Australian energy regulator will release its default price ruling for the coming financial year. So, from July, as Minister, what do you think should household prices, retail prices, go down?

CHRIS BOWEN: Well, this, of course, we will see this in a couple of weeks. You're right, David. This is of course what Angus Taylor changed the law to hide before the last election when it showed a 20 per cent increase. I'm not going to get out in front of the Australian Energy Regulator, who's independent, but me and the State Ministers have provided our feedback to the regulator in the normal course of events as to what should be prioritised. You would expect us to have prioritised consumers and we have, me and the state colleagues. I think you will see, again, I'm not going to preempt, but I think you'll see a few things playing out. You'll see the impact of our coal and gas caps, you'll see the impact of cheaper renewables, and you'll see some of the pressure coming off from international markets. So, we'll all get to talk about it in a couple of weeks. I'm not going to preempt the work of Clare Savage, the very fine Australian Energy Regulator.

DAVID SPEERS: But it sounds a bit like, Minister, you're expecting prices to come down, as you promised at the election they would.

CHRIS BOWEN: Well, I'm not here announcing the default market offer. It will be released in a normal public and transparent manner. I won't be changing the law to hide it like Angus Taylor did, and it'll be out there for all to see in a couple of weeks and perhaps we can have a chat about it then. But there are certainly indications that what we are doing is providing what we want it to, which is, of course, more relief to consumers.

DAVID SPEERS: All right, Chris Bowen, thanks so much for joining us.

CHRIS BOWEN: Pleasure, David.