Interview with Paul Gough, ABC Adelaide

PAUL GOUGH: And welcome to the morning program the Minister for Climate Change and Energy, Chris Bowen. Appreciate your time this morning. Must be pretty busy.

CHRIS BOWEN: My pleasure, Paul. Always happy to chat about important issues.

PAUL GOUGH: Why are you here in South Australia, Minister?

CHRIS BOWEN: Well, because South Australia has got a very important role to play in our Future Made in Australia Policy. And, in fact, South Australia is already home to two great Australian companies – Tindo and 5B – which have a presence here but have been doing it tough in international circumstances in relation to manufacturing when other countries have been supporting renewable energy manufacturing. And they stand to be very important players in our Future Made in Australia plans, and I’m going to visit both of them and have a look at their operations and talk to them about how we’re going to roll it out today.

PAUL GOUGH: And the Solar Sunshot program was revealed a month or so ago, and there was criticism at the time saying that overseas China are likely to be able to do it more effectively and cheaper. What do you say to that?

CHRIS BOWEN: Well, I think that criticism is misplaced and, frankly, misunderstands what we’re trying to achieve here. We’re never going to compete with China on wages – let’s be very clear about that. But we can compete with China on other things, including our innovation ecosystem, with our natural resources as well, and our ability to harness the renewable energy in Australia. So, we are competing in a different way with China. And, you know, let’s be frank – China is an important topic in this conversation. At the moment 99 per cent of our solar panels come from overseas. One per cent of them come from Australia – i.e. Adelaide; Tindo is the one per cent of solar panels that are being manufactured in Australia over the last year. We’ve put 60 million solar panels on our roofs in the last decade. We need to put another 60 million on in the next six years. And I don’t really think it’s sustainable or a good idea to have one per cent of those made in Australia on an ongoing basis.

PAUL GOUGH: What percentage would you think we are likely to be able to have manufactured here?

CHRIS BOWEN: Around 20 per cent in ideal circumstances. And, of course, you know, we have never said that we can make all we need here or that we can make every bit of the supply chain or, you know, do everything. And, indeed, what we want is a more diverse supply chain. We want to be making more things here. We encourage and welcome other countries making more things. Whether it’s the United States, India, Vietnam, Indonesia and they support us and we support them. And diversifying the supply chain is very important so we have other options, but also sovereign capability. I mean, we lived through a pandemic where sovereign capability reared its head really quickly. We need to be able to plan sovereign capability, and the energy transformation we are in the middle of is the key discussion in that sovereign capability piece.

PAUL GOUGH: One of the things I’ve seen on our text line whenever we’ve had the discussion on solar panels is the disposability, the recyclability. Where do we go with that? Because there are, as I said, a lot of feedback of people saying they’re seeing a lot of dead panels and what do we do with them?

CHRIS BOWEN: Look, I think there’s two issues here, Paul. There’s good faith and genuine concerns that people have on your text line, and then there’s some people who use that argument to try and, you know, just delay action and deny the need for action. I have sympathy for the first stream, not for the second.

But on the first, look, there are issues that we need to address, but let me say this: the things inside solar panels can be recycled, just as batteries and wind turbines. You know, most of it can be recycled. There’s a challenge in extracting the material, but there are around six Australian business who’s are doing it today. And it’s growing increasingly commercial as the industry develops. And, you know, you could run that argument about cars, you know, in the 1920s, and say, “Oh, what are we going to do with all these cars; they’re only going to last 10, 15 years and then they’re going to have to be destroyed”. You could run that argument then. Of course, industry and the economy responds by developing plans for recycling. We have government plans for recycling of renewables, but, I mean, even more importantly, the private sector has well-established, well-developed plans.

There’s a bit of misunderstanding in some quarters about how long these things can last. People say, “Oh, they only last 10 years.” Well, they can last much, much longer than that. But, yes, of course we need to have plans for recycling. And the good news is for your listeners, a very small proportion – a very small proportion – of the renewable energy, whether it be batteries or solar panels or wind turbines, will end up in landfill. The vast majority can and will be recycled.

PAUL GOUGH: My guest is Minister for Climate Change and Energy, who’s here in South Australia today, Chris Bowen. And we’re glad that he’s available to be with us today.

Hydrogen. Now, of course, we’re not just looking at solar, but there are lots of different strands to how we move forward with energy. And the South Australian Government have got some pretty big plans for the hydrogen industry. Have we seen the end of the Federal Government’s commitment, or is there more money going to be available?

CHRIS BOWEN: Well, firstly, I should say you’re 100 per cent right – I mean, the Malinauskas Government is doing just a first-class job on green hydrogen. They are in many senses not leading the country but leading the world. And we want to work with them, and we do work with them. I’m seeing Minister Koutsantonis today, and the South Australian Government deserves our partnership.

Now, we have a range of policies on green hydrogen. We have the hydrogen hubs, of which South Australia has one, and we also have the Hydrogen Headstart which we are opening another round. And I envisage and anticipate South Australian projects bidding into that. And I imagine and anticipate the Malinauskas Government will continue to get runs on the board, and we’ll be keen to partner with them where we appropriately can.

PAUL GOUGH: What does South Australia have to do to get more investment along these lines?

CHRIS BOWEN: Well, I think the challenge is the same as for everywhere: there’s a global race for capital. I think South Australia and Australia are both doing very well in that race by the way, but the key is the sort of support that we’re seeing in our federal budget, which is – you know, we’re very clear that our Federal Government investments, as big as they are, are going to be a small minority of the investment. I mean, what we’re interested in is unlocking and unleashing the private sector investment by really two things, Paul. De-risking and reducing risk where we can. And, you know, Hydrogen Headstart is a good example of that where we take projects which have huge potential but, you know, they’re at early stages of development and they need a bit of risk support to help the boards make the investment. And then there’s the stable and certain policy environment. And, again, that’s what Peter and Tom and the Prime Minister and I have been working hard on delivering. And renewable energy investors tell me from around the world they see that in Australia and they respond very positively.

PAUL GOUGH: What about transmission infrastructure? Is that something that’s prohibitive? Is that something we need to be really looking closely at?

CHRIS BOWEN: Well, we’re doing it. I mean, it’s absolutely essential. There’s no transition without transmission. The way that the energy system when it’s based on renewable energy works is very different to the old, traditional fossil fuel renewable energy. The energy has to move around the country much more efficiently. Every country in the world is doing this; Australia is not alone in building transmission, new transmission. There hasn’t been much transmission built in Australia over the last few decades. We have a lot of catching up to do. We’re doing that. Our Rewiring the Nation Policy is important there. There are challenges as you do that, of course. But, you know, it’s absolutely essential. And it doesn’t – you know, it’s not an optional extra. If you are going to have a net zero energy system ultimately then you need to be building that transmission.

PAUL GOUGH: One of the stories that I came across – I think it was in the last 18 to 12 months – was a company, I think they’re from Queensland, who are drilling for white or gold hydrogen, where they’ve access to the Eyre Peninsula and KI and they’ve come back with, well, they’ve said really positive results. What are your thoughts on white hydrogen?

CHRIS BOWEN: Well, I mean, I think that’s sort of naturally occurring. It will have a role to play, ideally, I mean, I hope it does. But I don’t think we can sort of just rely on it. Green hydrogen will be, I think, the main source of hydrogen in the decades to come. But that sort of – I’ve seen it described as gold hydrogen as you said, may play a role. And if it does, obviously that’s great. But, yeah, green hydrogen – which for our listeners, so we don’t, you know, fall into jargon – is that hydrogen which is made by renewable energy. So it’s just – hydrogen is a way of storing energy. That’s what it is ultimately. It’s just a different form of battery, if you like. But it’s storage of energy which can be transported. You can take it around the world and it can be stored for as long as you like.

PAUL GOUGH: Yeah I had to go scrambling through the dictionary looking at all the different colourings and what they mean.

CHRIS BOWEN: Yeah, there’s aqua and all sorts.

PAUL GOUGH: Yes. My guest on ABC Adelaide Mornings 891 is the Minister for Climate Change and Energy Chris Bowen.

Now, Peter Dutton’s got a bit of a different idea. He’s looking at a nuclear future. And Local Member for Stuart James Stevens has speculated that Port Augusta could get a reactor. What are your thoughts along those lines?

CHRIS BOWEN: Well, firstly, I think it would be good for James Stevens stopped speculating and started announcing. I mean, it’s been a long time since the Liberal Party said they would have a nuclear policy, and we’re still waiting – still waiting – for details and the sites. And I think those communities deserve to know. You know, if the Liberal Party is planning on a nuclear reactor for Port Augusta they should front up and tell them.

But more broadly, nuclear is the wrong answer for Australia. It’s a risky answer for Australia. It’s slow to build. You know, prohibitively slow. We are in the middle of a transformation. We don’t have time to stop and then just, you know, say, “Well, let’s develop a nuclear regulatory regime and we don’t have a nuclear power industry in Australia so we’ll start from scratch.” It would be 2040 at lightning speed before we would see any nuclear power in Australia, likely later than that. And it’s the most expensive form of power available. Renewables is the cheapest. Then comes gas, then comes coal, then comes daylight and then eventually comes nuclear.

So it’s very much a risky plan for Australia. And by risky, I mean this. It means keeping our coal-fired power stations open for longer, which is risky because they are ageing, they are unreliable, they break down a lot. And they are the biggest risk to our reliability. So if you’re saying let’s slow down the renewables and the storage and the transmission and keep the coal running while we’re waiting for this pipe dream of nuclear, that is a recipe for reliability disaster.

PAUL GOUGH: I mean, is there some hope – and I think as taxpayers we all hope that there is – for some sort of bipartisan, some sort of getting together? Is there any chance the Coalition will get on board with this, do you feel? Do you have a hope for that, Chris Bowen?

CHRIS BOWEN: Not while Peter Dutton is the leader, no. I mean, I’d love it if we could, to be frank. You know, I would compromise. I think it would be good for the country. I mean, the United Kingdom, for example, has a much more bipartisan energy policy. I think it would provide more energy certainty, investment certainty. But when you’ve got an opposition which is, frankly, you know, has plenty of climate change deniers still in it – not a majority but enough to veto good policy; you’ve got Matt Canavan and Barnaby Joyce and Antic wandering around spouting climate change denial, and you’ve got an Opposition Leader who is just not on board for action on climate change. He’s mentioned climate change four times in his 24 years in parliament, and those times haven’t been calling for more action, let me tell you. You know, in different circumstances maybe I could see some scope for bipartisanship. But under current management in the opposition, alas and unfortunately no.

PAUL GOUGH: Will the tax incentives that are provided to green hydrogen make the industry commercially competitive, or is there still some risk around this, Minister?

CHRIS BOWEN: Look, the tax incentives will – yes, I believe that they will make enterprises in Australia commercially viable when you compare them with the regimes available in the United States. I mean, you know, frankly, we’ve seen some – we saw some potential projects leave Australia and go to the United States. So these are projects – green hydrogen is going to be made; it’s just a matter of what country it’s going to be made in. And these production incentives puts us on a more even keel with the United States. It doesn’t match the United States dollar for dollar; we don’t need to because of our other advantages. Nobody has suggested to me that we do. But I’ve seen very, very strong – very, very strong – and positive responses from the market and the industry, the hydrogen industry to our hydrogen policies and moving to make the green hydrogen in Australia as a result of those policies.

PAUL GOUGH: Now, gas is still a big word that’s bandied around, and the government’s recent concession around that industry still playing a role beyond 2050. Does that in any way undermine your vision on green energy?

CHRIS BOWEN: No. And, I mean, look, there’s extremes in the gas argument, and both of them are equally unhelpful, frankly, and equally inaccurate. You know, you had the previous government’s gas-led recovery. You’ve got the Greens saying no new gas. Both are, I think, unrealistic. Gas – look, what’s the role of gas? Well, firstly there’s 5 million homes in Australia that use gas for heating or cooking. And, you know, there is no prospect of that changing overnight. Secondly, there are industries that rely on gas. You know, and green hydrogen will come forward and replace it eventually, but that’s a long process. You know, cement making and steel making and other things. And then, finally, Paul, the role of gas in our energy system is important, and this is perhaps the most important of the argument, because when you move to renewables – we’re getting to 82 per cent renewables by 2030, that leaves 18 per cent fossil fuels, and gas is very important there because it is so flexible.

Now, coal, once you turn a coal-fired power plant on it’s on; you can’t turn it off. Same with nuclear. Whereas gas, you can turn it on and off now, for a new one, at two minutes’ notice. Now, if you’ve got a renewables system and you’ve got plenty of storage and plenty of transmission, but you still need that backup – and the thing about gas is people who don’t like gas in the system I say this: well, you might say it’s high emissions. I tell you what – there’s no emissions when it’s turned off. And if we need to turn it on at short notice, you know, to get us through an evening peak or to get us through a night where we’ve had, you know, much lower than expected renewables, that won’t happen very often. But geez, when you want it, you need it, it’s like an insurance policy. You hope you don’t use it very often, but you really need to know it’s there. And that’s the key role for gas.

Now, gas is depleting in the Bass Strait. We’re getting less and less gas from the Bass Strait. That means you have to have an honest conversation about the needs of the gas industry, the needs of our energy system for gas and saying, well, look, those two extreme arguments, neither of them are quite accurate. You know a lot people would like to say, “Oh, you know, we don’t need gas at all.” Well, actually, when you’re in the middle of this very ambitious policy agenda that we are implementing for 82 per cent renewables, gas has a role to play.

PAUL GOUGH: Minister, thank you very much for your time today.

CHRIS BOWEN: My pleasure, Paul.

PAUL GOUGH: Safe travels through South Australia as well.

CHRIS BOWEN: Thank you very much.