Interview with David Speers, ABC Insiders

INSIDERS HOST, DAVID SPEERS: Chris Bowen, welcome to the program.

MINISTER FOR CLIMATE CHANGE AND ENERGY CHRIS BOWEN: Thanks for inviting me on, David.

SPEERS: So is the target of reducing emissions by 43 per cent by 2030 now looking more difficult to achieve?

MINISTER BOWEN: Well, it's never been easy, but we are by and large on track, and you know, last year I released all the forecasts. But in relation to the figures you just mentioned, I'd describe them as mixed. We had a couple of releases of figures this week; renewable energy for the first quarter, very strong, very encouraging, very pleasing. But those emissions figures that you referred to for 2024, obviously there are some areas that are encouraging, like industrial emissions, way down and lower than 2021, for example, transport continues to be a challenge. And I guess I'd say, David, that it's a reminder that when we do take action, it can work, like industry. Traditionally a lot of Australia's emissions reductions come from the land sector, and as La Nina's coming to an end, that has reduced, and it's a reminder that we need to do more. So take transport, for example. Now our new vehicle efficiency standards only came into force on 1 January, for example. I wouldn't pretend that they've yet had an impact. It was a controversial issue at the election with a choice for the Australian people, where we said we'll keep going, the Liberals said they'd stop. So these are the sorts of things that we need to keep going on to ensure that we can achieve and will achieve a 43 per cent emissions reduction, which I'm very confident we can and will.

SPEERS: And part of that, of course, is having 82 per cent renewables by 2030.

MINISTER BOWEN: Yep.

SPEERS: A lot of people in industry say one of the problems they're facing in rolling out renewables is the approvals process, the environmental approvals to get big wind farms, solar farms up. Is that something that you'll fix?

MINISTER BOWEN: Well, firstly, let me say again, we're making good progress there; 15 gigawatts added since we came to office, that's three Snowy Hydro schemes added in capacity since we came to office, so there's a lot happening. On planning approvals, yeah, we are continuing to work on that. I guess there's a couple of things; we've put more money into the environment side of my portfolio to get faster approvals or rejections; faster, yes or no as is appropriate. We're also working with the States, only about 20 per cent of renewable applications come to the Federal Minister for approval. We're working with the States, and we have Renewable Energy Transformation Agreements with every State except for Queensland, and part of that is ensuring that the planning system is fit for purpose at the State level, and I'm working very closely with my State Energy Minister colleagues to ensure that's the case, and they're making good progress as well.

SPEERS: Okay. So you will hit the 2030 target in your view?

MINISTER BOWEN: Well, on both targets. If you look at 82 per cent, again very encouraging figures in the last quarter.  We're now at 46 per cent renewables in the last quarter last year and 43 per cent in the first quarter this year; it moves from quarter to quarter, and again, 15 gigawatts, that's three Snowy Hydros added since we came to office, and a big pipeline of investment coming through. So, yes, the 82 per cent target does have challenges, I've never suggested that it's a linear line and it all happens easily, or it's all automatic. But with the right policy settings, which we do have, and the right approach from government, yes, we can continue to be on track, facing headwinds and challenges from time to time, of course, but we're seeing very strong investment figures.

SPEERS: I want to ask you about the next target, which will be the 2035 climate target that you need to set in the coming months. When will you announce that and how ambitious should we expect you to be?

MINISTER BOWEN: Well, let's deal with the ambition first. It will be ambitious and achievable; it's got to be both those things. And David, in Australia, we have, if I say so myself, I think world's best practice for setting of the climate target, it's based on our Climate Change Act. Together with the United Kingdom we have a very, what's well regarded around the world as the best process with independent advice which comes to me and then I take to the Cabinet, and we work through, and that advice, if the government hasn't followed it, is released and it's transparent for all to see; released either way whether we follow it or not. That's really good process. Now, the UNFCCC has asked countries to set their targets by September. Of course, that's what we'll do, but we won't do it a day before we're ready, not before I've received the advice from the Climate Change Authority, which they're still working on, then I'll consider it, take it through Cabinet, and it will be transparent for all to see.

SPEERS: One of the reasons why the Climate Change Authority, and its Chair, Matt Kean, has delayed the advice is because of Donald Trump. Now he's pulled out of the Paris Climate Agreement and his administration boasts about driving a dagger through the heart of climate change religion. Does this also change your thinking about where Australia should go with its target?

MINISTER BOWEN: Well, it is one of the things that the Climate Change Authority's asked for more time on, 'cause it's got implications across the board. If the Inflation Reduction Act falls, then that means there's less reductions in the cost of capital, but also that capital's got to go somewhere, and Australia will be a welcoming and inviting home for that renewable energy investment.

SPEERS: But on the 2035 target, does Donald Trump change your thinking?

MINISTER BOWEN: Well, it's again, it's one of many, many factors that the Climate Change Authority is thinking about and the Cabinet will think about when we put it in, when we put it through, because, you know, we do need to consider international circumstances. About the United States, I mean let me make this point: the United States is around 12 per cent of emissions globally, that's a lot, but it doesn't mean that the rest of the 88 per cent of us stop doing things. So we do take into account the United States, but fundamentally, fundamentally, our government will always act in the Australian national interest, and that means seizing the economic opportunities which come from action on climate change, building our capacity for renewable energy. Net zero, for example, has been endorsed by the vast majority, the majority of the world's emitting countries, Australia included, and it remains in our economic best interests, as the Morrison Government   you heard it here first, I agree with the Morrison Government   as the Morrison Government pointed out, it's very much in Australia's economic best interests.

SPEERS: But just on that, if the US is walking away from net zero, and the others aren't doing enough when it comes to climate change I know you've been looking at the option of Australia imposing a carbon tariff, or a carbon border adjustment mechanism as the Europeans are looking at. What's your thinking on that at the moment?

MINISTER BOWEN: Well, we've been, again, clear that we want to ensure Australian industry is best placed to complete in a decarbonising world, and Australian industry has a lot to bring to the table, as the world's investors and consumers and insurers and boards require decarbonisation plans, and we're been working with industry, you know, big industry to ensure that's the case. Now in relation to how we can best compete, as you know, I commissioned Professor Frank Jotzo last year to advise the government. He's made public consultation papers, those paper make clear he thinks the settings are right in the short term, but there are things we can think about in the medium to long term, and obviously that's something I'll continue to progress this term with my Cabinet colleagues, looking at how we do that, how we can best ensure that Australian industry, as it decarbonises, can compete.

SPEERS: So a carbon tariff is still a prospect.

MINISTER BOWEN: Well, I would   you know, I think, I'd urge against sweeping generalisations about policy settings, and you know, what could be the case is obviously we look at particular sectors first, around cement and lime are places that we've looked at in particular, but again, I'm not going to get in front of the process. We asked Professor Jotzo to look at this, he's been doing excellent work consulting Australian industry very heavily. You know, I've had lots of meetings with steel makers and cement makers about these things over the past 12 months, for example, getting their feedback, and we'll have more to say during the course of this term.

SPEERS: All right. Speaking of tariffs, I need to ask you about Donald Trump's decision, his announcement yesterday that he's going to increase the tariff on steel and aluminium imported to the United States to 50 per cent. How will Australia respond to this?

MINISTER BOWEN: Well, we'll respond by standing up for Australian industry, as the Prime Minister, the Trade Minister, and all of us have done all through. This is not the act of a friend, and we'll call that out. The United States is not acting as a friend of Australia in this move, but we'll continue to make the case. An observer, an impartial observer would say the United States hasn't been entirely, you know, consistent with every comment they've announced, and sometimes the policy has changed. We'll continue to advocate for a change in policies to support Australian industry.

SPEERS: Yeah, indeed, it might change again in the coming weeks. But would Australia consider a challenge in the World Trade Organisation over these tariffs?

MINISTER BOWEN: Well, let's not get ahead of ourselves. I'm sure we will consider all options available to defend the best interests of Australian industry.

SPEERS: So that is an option?

MINISTER BOWEN: Well, self evidently it's an option, but I'm not going to pre empt.

SPEERS: Okay.

MINISTER BOWEN: you know, discussions. The first port of call is to make the strongest possible representations at all levels to the United States, and hope that we can avoid the issue in the first place.

SPEERS: Let's come back to climate though. Now if Donald Trump is influencing the decision on the 2035 target, you said Cabinet would consider, you know, what he's doing on climate as you set your 2035 target. Do you understand the Coalition also now wanting to look at, revisit the 2050 net zero target?

MINISTER BOWEN: No. No, because net zero is the essential starting point. Let me make three points. I've already made the point about United States being 12 per cent of emissions. That's point one. Point two, net zero by 2050 was set out by the IPCC as the minimum action required to avoid the catastrophic impacts of climate change. I mean if you're not for net zero you're for the catastrophic impacts of climate change. We've got to remind ourselves of the why. And then the third point is that this remains in Australia's economic best interests. When Scott Morrison gave Australia the policy of net zero by 2050, he pointed out it would be economically beneficial for Australia and for Australians, and he was right to do so, and even if it wasn't an obligation, it would remain the right economic policy for Australia. Dan Tehan used to think that when he was Trade Minister, I hope he still thinks that as Climate Change Shadow Minister, but it is very fundamentally the case. I understand a political party after an election defeat reviewing policies, and maybe the how, but not the why, and not the whether. What the Liberal Party is showing really here is that they are not comfortable with modern Australia and the economic challenges facing modern Australia.

SPEERS: All right.  Well, given your firm commitment there to net zero, let me move to the decision your colleague, the Environment Minister's approval, the conditional approval during the week of an extension of the North West Shelf gas project. This will extend this gas project from 2030 out to 2070. How does extracting gas for another 40 years help Australia reach net zero?

MINISTER BOWEN: Well, again, this facility that Minister Watt, against the very strict criteria of the environmental approvals legislation, has approved, against that very strict criteria that he's legally obliged to consider, is responsible for about 1.4 per cent of Australia's emissions, it's our 13th biggest facility, 13th biggest emitting facility behind 10 coal fired power stations and two other gas facilities, for example, so it's significant, but should also be seen in that broader context, and the things that we've just talked about

SPEERS: But those coal plants will be gone by 2050.

MINISTER BOWEN: Yeah.

SPEERS: This will remain.

MINISTER BOWEN: And this will be legally obliged and required under our Safeguard Mechanism to meet net zero by 2050, it already is; it's already obliged to be reducing its net emissions today, and it is. And again, I mean we referred to some of those reductions in emissions that we're seeing partly because of our safeguard reforms which cover this facility. Now of course we've always said gas has a role to play for Australia and the world, it's a flexible firming support for renewable energy, there's lots of heavy industry that currently relies on gas, and you know, we're working very hard to see green hydrogen come up as a replacement, but it's not there yet.

SPEERS: No.

MINISTER BOWEN: So we have to take an approach here which reflects the realities but also does not for a second step away from our obligations or our ambitions.

SPEERS: Well, I was going to ask you about how the Safeguards Mechanism applies to this project, because extending it beyond 2030, what happens; does Woodside need to get this project down to net zero emissions somehow itself?

MINISTER BOWEN: Yes, yes, in effect, all the facilities covered, more than 200 facilities covered by the Safeguard Mechanism are obliged to have a pathway to net zero by 2050.

SPEERS: So how do they do that; should they use renewables to turn the gas into energy?

MINISTER BOWEN: They have options, and those options include on site emissions abatement, and you know, there are investments that they can make, and partly the whole idea of the Safeguard Mechanism is to send the message to the boards to say, "Hey, you know, you should start investing in on site emissions abatement here because we're going to require you to buy offsets if you don't", and it sends that signal, and that is already having an impact. If the first year of operations of the safeguard reforms that we put into place we've seen on site emissions reduced by an equivalent amount of around 30 per cent of Australia's domestic aviation. Now that's the first year. Now, there's a long way to go, I'm not saying it's all done, I'm not saying it's all easy in all cases, but we are starting to see the impact of the sorts of policies, the well calibrated, well designed, careful, balanced policies of the first term, and as I've indicated in answer to your first question, more to do in the second term.

SPEERS: Well, this extension of the North West Shelf project now makes the much bigger Browse Basin gas field to the north more viable to develop because it would use the same infrastructure. If that were to get the green light, the Browse Basin, that would have a big impact on Australia's emissions, wouldn't it?

MINISTER BOWEN: Well, they are separate but related approvals.

SPEERS: Yeah.

MINISTER BOWEN: So Minister Watt has not approved that.

SPEERS: No.

MINISTER BOWEN: Browse, you're right, there's connections, but it is 900 kilometres away, it has its own challenges to overcome, both in terms of economics and environmental approvals, they're quite separate matters. I do think this is a very legitimate debate, I understand people have very

SPEERS: But there'd be an emissions impact is the question; there would be an emissions impact for Australia.

MINISTER BOWEN: Well, of course there would be, but again, Browse would be covered by all our existing domestic legislation and requirements. Now when we introduced that, it was very controversial, the Opposition opposed us, the approval

SPEERS: So it would have to be net zero as well.

MINISTER BOWEN: There were people who, in the industry, who opposed me and the government about introducing those reforms, and yes, as I said, the safeguard reforms puts our big emitters on a pathway through reductions of 4.9 per cent a year on a pathway to net zero by 2050.

SPEERS: Does approving gas projects, extending North West Shelf, for example, make it harder for you in trying to win the Global Climate Summit to be hosted in Australia next year? You want to host the COP summit. Do these sort of gas approvals make your task of winning votes harder?

MINISTER BOWEN: Well, decisions like that are always going to be controversial on both sides, domestically and internationally, I don't deny that, but we'll always set Australia's domestic policy in Australia's domestic best interests, not because of a COP bid or anything else.

SPEERS: Right.

MINISTER BOWEN: Now in the COP bid, you know, we're getting very strong support, I'm very pleased with the amount of support; there's a great opportunity for our country, restores Australia's leadership in climate against the bad years of the decade of denial and delay, shows we're back in a very meaningful way, and gives

SPEERS: You'd need to get Turkey out of the way though, wouldn't you, out of the race.

MINISTER BOWEN: Yeah, we're in yeah, and yes, there's two bidders, Adelaide and Ankara, Turkiye and Australia, and we're getting very, very strong support for our bid, I'm hopeful that it's resolved very soon, because the South Australian government and we have a lot of planning to do to deliver a conference which knocks it out of the park, is our intention for Australia to showcase ourselves as a renewable energy powerhouse, to highlight the jobs opportunities for a traditional fossil fuel country like ours, that we can and will embrace the transition, and we have things to share and things to learn

SPEERS: Okay, but - 

MINISTER BOWEN: the rest of the world.

SPEERS: The issue is we're still a gas powerhouse as well, and we're going to be a gas powerhouse for some time to come. Can I just finish with a question on gas, and that's the idea of an East Coast Gas reservation, which has been talked about a bit over recent days. Is that in the government's thinking, or can you just use the existing mechanism that you have to keep more Australian gas here?

MINISTER BOWEN: Well, let me make just a few brief points, David. We've already added a lot of domestic gas that was necessary, 640 petajoules for the reforms Madeleine King and I have been responsible for. That's a much moral effective delivery of domestic gas than the boondoggle the Coalition took to the last election. Now we've made clear we've got a number of policies that are up for review, it's about, you know, they're coming to their review time, the gas mechanism, the Gas Code, et cetera, we'll look at those and see what more can be done. The Prime Minister's made clear when we need to do more, we will do more, but let's be clear, we've not only thought that Australian gas should be provided to Australian industry and Australian households, we've acted on it and delivered, again, not always uncontroversial, opposed by some in the sector, opposed by the Opposition, but absolutely vital to ensure a supply of gas to our small number of gas fired power stations, to heavy industry that needs it, and to those Australians who use gas to heat their homes.

SPEERS: Okay. But you're not going to do anything retrospective as the Coalition proposed at the election.

MINISTER BOWEN: Well, no, we have a very clear matter of principle that we don't agree with sovereign risk, we don't agree with retrospective policy actions.

SPEERS: Okay.

MINISTER BOWEN: We act accordingly to and I think that should be uncontroversial, that is good governance.

SPEERS: Chris Bowen, thanks so much for joining us this morning.

MINISTER BOWEN: Thanks.