Interview with Melinda James, ABC Illawarra

MELINDA JAMES: It's time to say a very good morning to the Minister for Climate Change and Energy Chris Bowen. Chris Bowen, good morning.

CHRIS BOWEN: Good morning to you, Mel. Good morning everyone.

MELINDA JAMES: Okay, so the zone looked a little different to what was initially proposed, which was something we had also been anticipating. So why the decision to reduce its size and push it further away from the coast?

CHRIS BOWEN: Well really, Mel, because we listened and went through all the submissions and our job here is really to sift through and say, "Well, what are the legitimate concerns, the well based concerns that we need to listen to? What's based on disinformation and misinformation and myths" and sift that out.

Whether that is, "Look, climate change isn't real, and we don't need to do anything about it", we see some of that in the submissions, or misinformation about what it means for whales or birds and things like that. These are very legitimate concerns. But there's also disinformation.

And really, I took the view that the concerns about the beautiful part of the world and amenity, that 10 kilometres was too close, was fair enough and valid, and so pushed it out 20 kilometres. That means the zone is about a third smaller than it was going to be, as you said. It's now 1,022 square kilometres, which is quite small for a zone, much smaller than the zones I've declared for Gippsland, for example, or looking at the Bass Strait, much, much smaller. But we still get a lot of power from that, just shy of 3 gigawatts, that's about 1.8 million homes, and of course very important for BlueScope going forward.

So, I think it's a balanced decision, it really strikes the right balance. I'm not under any illusions, Mel, that everyone's going to be happy. There are some people who wouldn't be happy unless it proceeded in full. There are some people who wouldn't be happy if it proceeded at all. But in climate change and energy, in a controversial space like that, you don't have the luxury of making decisions that everyone's happy with, you get a good balance.

MELINDA JAMES: So the decision to shift 20kms out to sea was, what, all about visual impact, was it?

CHRIS BOWEN: Mainly. There are also some shipping issues we took into account and also some further environmental concerns.

Let me just deal with environmental concerns and approvals. Obviously we look at – I look at, things such as whale migration and bird life when declaring the zone. However much of that comes later.

Now, let me just explain the process. I've declared this zone – there's a long way to go. I've declared the zone under the Act. The Act was actually passed by the previous government, the previous Morrison Government passed the Act, to allow offshore wind. It explained the process.

It said, "Well first you declare a zone. The Minister declares a zone after 60 days of consultation". As you know, I didn't think 60 days was enough, so I extended it further. But then the declaration of the zone means that now proponents can make their proposals to me, apply for licences. That's going to be a long process. They have until August to apply but then we take several months at least to work through that. They need to show community benefit, they need to show local jobs, they need to show local content, they need to show ideally a community benefit fund, and the best proposals will win.

Then they have to apply for a commercial licence. So that's me offering a feasibility licence. They then go and do further feasibility checks. Then they apply to me for a commercial licence. And separately they have to go through environmental approvals under the EPBC Act. That is separate to me. That involves a very independent process where they'll have to show their impact on bird life, whale life, other marine life, and show their management plans and get the tick of approval under the environmental approval.

So it's a very considered process. As I said, the previous government put this regime in place. We are acting under that regime, but it is a careful regime which has several stages of approvals. There's not going to be any wind turbines next week, next month or next year. We have a long way to go to make sure we get this right.

MELINDA JAMES: Okay. Well just to follow up on a couple of issues that you raised there. So, as you said there are lots of environmental approvals processes that still need to be gone through. But I'm guessing that if a company can show that they are mitigating any damaging environmental effects to the satisfaction of the Environment Minister and the government, then this decision that you've made means in the future we will see wind turbines off the coast of the Illawarra, yes?

CHRIS BOWEN: Well, we'll see them on some days. On many days you won't see the 20 kilometres, but yes, that's the idea. And that's –

MELINDA JAMES: I guess I meant metaphorically see.

CHRIS BOWEN: I understand. I understand.

MELINDA JAMES: An industry will exist off the coast of the Illawarra?

CHRIS BOWEN: I understand. But yes, that's the case. And a lot of people say why well why the Illawarra? Well the Illawarra is one of six zones around the country, so Illawarra's not alone.

And of course, offshore wind has existed around the world since the early 1990s. I saw some commentary saying this'll be the first wind zone in the world. That's just not right. It's existed in Europe since the early 1990s, Australia's a long way behind. The rest of the world is doing this, the United States is catching up. A lot of offshore wind happening in Asia, for example.

Because there's a couple of advantages to offshore wind. It's very energy-rich, it's very windy off our coast, and it's windy constantly. Unlike onshore wind, which is windy some of the time and not some of the time, offshore wind is pretty much always windy. During the night, during the day, all the time.

Also it's very jobs rich. There are 1,700 jobs in construction and 800 ongoing jobs which will be very much focussed on the Illawarra. Because it's so windy offshore those turbines need more maintenance, and because it's offshore you need ship workers, you need port workers. It's a lot more jobs rich. So it's very good news for jobs.

It's also important for places like BlueScope. You know, places like BlueScope need to show their investors and their consumers that they are reducing their carbon emissions, or they won't compete and survive. And so –

MELINDA JAMES: We did hear though, just briefly, we did hear, so 1.3 million homes could potentially be powered by this zone, but we did hear about how much energy BlueScope is going to need to create green steel, which is many, many, many times more than they require now using the old-fashioned coke method. I mean is BlueScope expected to suck up most of the power from this? What's the situation in relation to energy generation for BlueScope? They're very supportive of this project, how will that play out?

CHRIS BOWEN: Well I mean what – we have some way to play out because now the proponents have to put their licence applications in, and they will be looking at how they can work with places like BlueScope. BlueScope will get power from range of circumstances including, you know, the national energy market, of course they will.

But places like BlueScope, so other places that are making similar things like aluminium, et cetera, in the Hunter, are very much looking at direct, direct purchasing for offshore wind.

That may or may not be something that BlueScope proceeds with, but it gives them options, it gives them the opportunity to look at that option as well as just getting renewable energy from the grid. They need reliable renewable energy. You know, they need to be very constantly powered.

And it's a long process and we're working very, very closely with BlueScope because I want to see BlueScope, which has been there for almost 100 years, be there for another 100. But it won't be unless we get this energy transition right. It's very, very important for Illawarra's jobs.

Now, again, I understand not everyone will like this, but it's been worked through in an open way, unlike, you know, alternative plans like nuclear and other things, but it's been done in accordance with the New South Wales Government's renewable energy zone. The previous Liberal Government put a renewable energy zone in Illawarra, which I welcome, this is very complementary. And also the previous Liberal Government's Federal legislation of offshore wind which we're implementing.

MELINDA JAMES: In relation to BlueScope as well, the South Coast Labour Council has come out and said they're disappointed that you haven't insisted on a local content quota. You did talk about how it will be looked upon favourably, any application for a feasibility licence that includes local jobs, local content, et cetera, Why not a local content for steel, local steel, to be used?

CHRIS BOWEN: Well because I want to make the proponents work hard to show me their best local content plans. I want to – the proponents need to know, and they do know, if they want to get this licence, they're going to need to show me their best possible local content plans. Not just steel but right across, right up and down.

Now there's plenty of offshore wind components that we don't make in Australia. I'd like us to make more and with our Future Made in Australia plans, and the centrepiece of the budget, I have no doubt we will. But there's a journey we're on here and we're working very closely with the unions. I was pleased to see many of the unions, the Electrical Trades Union, the Maritime Union of Australia, come out and very strongly back the decision on the weekend. Because they know this creates jobs for their members and potential members and future generations in the Illawarra. They know that and it does.

Now we'll get good local content plans, but we need to work carefully through. The rest of the world is, as I said, doing this. We're competing with the rest of the world to get this job done and the proponents will need to show me the best possible plans, not just for local content and local jobs but local community benefit right across the board.

MELINDA JAMES: Well, I'm sure people will have an opportunity to have their say at further steps down the process in relation to environmental concerns, et cetera, but really once again the bottom line is we have an offshore wind industry off the coast of the Illawarra from today, don't we?

CHRIS BOWEN: We have a zone now and, as I said, that's how the Act is designated. I saw Mr Littleproud on the weekend say, "Oh, there's not even any environmental approvals yet", well mate, it was your Act which said you declare the zone first and then you invite proposals and then they get environmental approvals. That's the way the process works. Or they don't get environmental approvals. It's not automatic. They've got to show that they can comply with the requirements of the environmental approval Act now that I've declared the zone. They couldn't do that before. You can't build anything until you have a zone declared. Now you have the zone declared, the process can begin, they can put in their feasibility licence applications, then their commercial licence applications and they will also separately have to go to through environmental approvals.

MELINDA JAMES: Well, we'll put that to David Littleproud when he joins us on the program after 7.30.

CHRIS BOWEN: M'hmm, there you go.

MELINDA JAMES: I really appreciate your time this morning, thank you very much.

CHRIS BOWEN: My pleasure, good on you.