Press conference with NSW Minister for Climate Change, Minister for Energy, Minister for the Environment, Minister for Heritage Penny Sharpe

CHRIS BOWEN: Well, thanks for coming. The massive renewable energy transformation that’s underway in this country will only be successfully managed by Governments working in partnership. And today I’m very pleased to join with our friends in the New South Wales Government to announce the next stage in our partnership.

New South Wales has been successfully rolling out renewable energy through their LTESA scheme, and today I’m announcing the first of the Commonwealth-supported capacity investment mechanisms which will complement the work that’s being undertaken by the New South Wales Government.

As was agreed last year between myself and the State and Territory Energy Ministers, the capacity investment mechanism will be federally underwritten options which will underpin billions of dollars of investment across our country in dispatchable renewable energy. Criteria to be supported will it has to be renewable, it has to be dispatchable – ie, it can be called upon when the grid needs it. It needs to include a storage to include that it can be dispatched to our energy grid at times when the wind isn’t blowing and the sun isn’t shining.

So today Penny Sharpe and I are announcing a joint program where to add to the existing 380 megawatts that’s being auctioned by the New South Wales Government, the Commonwealth will support an extra 550 megawatts of dispatchable renewable investment through our capacity investment scheme, a process that which will work side by side with each other.

This will bring the total megawatts under auction to over 900 – very close to a gigawatt. And that is more than would power half a million houses – indeed, almost two-thirds of a million houses across New South Wales and, indeed, across Australia.

Now the New South Wales process is already oversubscribed. There’s lots of interest in it and, therefore, the Commonwealth program will support bids which are very worthy but would have missed out if it was just left to New South Wales alone.

So we are acting quickly. We are beginning the process today. We intend to make the concluded announcements by the end of September as to who will be supported. And this will see dispatchable renewable energy rolling out by 2025. This, of course, is very important. AEMO has identified reliability gaps later in the decade. The work that Penny and I are announcing today will ensure that that reliability gap disappears in terms of the work that we’re doing together in New South Wales.

So I want to just say in conclusion what a delight it is to work in very close partnership with a Minister of the energy and the commitment of Penny Sharpe, who has brought to her portfolio a laser-like focus on ensuring that the rollout of dispatchable renewable energy is the number one priority when it comes to energy for her Government, as it continues to be for our Government. We’ll continue to work closely together.

I do say that I’ll be making further announcements in coming months about partnerships with other States. The next States to participate in our capacity investment mechanism will be South Australia and Victoria. Discussions with Lily D’Ambrosio and Tom Koutsantonis are at a very advanced stage and I’ll be making further announcements with them in coming months. But today I’m delighted to launch the New South Wales element of the capacity investment mechanism, which will work alongside the process that’s already well underway under the management of the New South Wales Government.

PENNY SHARPE: Thanks, Chris. I’m delighted to be here to be part of this announcement and really thrilled that New South Wales is the first cab off the rank. We have an incredible opportunity to transform New South Wales’s electricity system over the next – in coming decades. But we know that there are challenges with that. In New South Wales we’re dedicated to making sure that we do this as quickly as possible, not just because it’s the cheapest and best way to deliver energy to our community and to our households but also it’s required for us to meet our emissions reduction targets and our great responsibility to meet and take our responsibility seriously when it comes to climate change.

But what we know here with the Commonwealth Government that is serious about the challenge, who’s dedicated to the task, that together we can amplify the work that we are doing. We can make it easier for businesses but, more importantly, we can get more dispatchable, firmed infrastructure into the ground much, much faster. And it means that we’re going to have that batteries and it means that we’re going to have pumped hydro and it means that the community can be absolutely confident that we’re making this transition as quickly as we can and that we know that any gaps and the bumps along the way have been smoothed out through this process.

So, look, I’m just really delighted to see when the Commonwealth and State works together we really triple the impact of what we’re having. I’m delighted to know that we’ve had about 10 times the interest of what we were going to have, but as a result of this strategy we now will be able to triple the amount of energy that’s possible and really make sure that we’re turbo charging this transformation, something that we all need to do, something that we’re absolutely dedicated to, but something that will make the difference into the future.

CHRIS BOWEN: Thanks very much, Penny. Questions? On the phone?

JOURNALIST: Thanks, Minister. It’s Chloe from Channel 10. I just wanted to ask you about the other energy bill relief, the rebates, that come in from the 1st of July. Can you just explain how will that rebate actually be accessed by families and businesses? Is it automatic? Do they have to apply for it? Can you just explain how it works?

CHRIS BOWEN: Well, Chloe, for families that already qualify for State rebates, State-based rebates – and these vary across the Commonwealth so it will vary from jurisdiction to jurisdiction – they won’t need to apply. So if you’re already qualifying for relief through a State-based system that will apply automatically. If you’re one of the households which is receiving additional relief, then there’ll be processes in place and advertising will go into – I should say Government communications will go into ensuring that people know the process that they need to go into.

The vast majority of people are covered by the existing arrangements. A strong majority are covered by the existing arrangements. For those that will need to make an application, we’ll provide further details about how they can do that.

JOURNALIST: But will people know if they are eligible to apply?

CHRIS BOWEN: Yeah, I think people will know if they are already covered by a State scheme. And certainly for those that aren’t covered by an existing State scheme we’ll make information available to them as fully as we can to enable them to know what they need to do to access it.

JOURNALIST: And welfare advocates say that it’s not enough that Australians will still have to choose between heating and eating this winter. Can you guarantee that Australians won’t be faced with that tough choice?

CHRIS BOWEN: Well, what the Albanese Government has done working in partnerships with the States is to provide real relief. Now, that relief comes in two ways: firstly, we took the controversial decision to apply caps to coal and gas, opposed tooth and nail by the Liberal Party in Canberra, but it's been absolutely essential to providing bill relief. And then recognising that that wouldn’t be enough, to provide real direct relief to households. And that means that bills which would have gone up by close to 50 per cent are going up by much less than that, and in some instances are going down for those who receive the rebates. Going down compared to what they were last year. That’s a pretty significant turnaround – from increases of around 50 per cent to actual bill reductions for those receiving the rebates is something which is meaningful and makes a big difference to people.

JOURNALIST: That’s all from me thanks, Minister.

CHRIS BOWEN: Okay. Thanks, Chloe. Got a question in the room?

JOURNALIST: Yeah, sorry, got here a little bit late. But with the Waratah super battery, can you give some idea of the capacity of it, like how many homes it can power and for how long?

CHRIS BOWEN: Waratah.
 
PENNY SHARPE: Well, it’s – [indistinct].

CHRIS BOWEN: Separate announcement.

PENNY SHARPE: Separate announcement. Yes, this isn’t about the Waratah battery. So what we’re talking about is the new tenders that are coming forward.

JOURNALIST: Yep.

PENNY SHARPE: And so we’ve just done the first lot, so the new tenders that are going out means we can triple the capacity in relation to that. So that is mostly about batteries, but it’s not the Waratah super battery; that’s a separate project.

JOURNALIST: The capacity investment scheme?

CHRIS BOWEN: Yeah.

JOURNALIST: So on that one, this is tender level. How important is it that we actually advance these beyond that? Because we can consider tenders forever. We need to be advancing projects, approving them and building them.

CHRIS BOWEN: Well, it is very important, but the timeline that Penny and I have announced is very fast. We’ll be making further announcements by September. So here we are, you know, at the end of June and we’ll be announcing results by September. As the way these programs go, that’s pretty quick. Pretty quick. And then we want to see actual rollout by 2025, which also, when you consider the supply chain constraints, labour force constraints, just generally approvals, how long it takes to get some of these projects up, it is ambitious but very achievable.

PENNY SHARPE: That’s right. I mean, New South Wales is really in the race to get 12 gigawatts done by 2030. We’re a third of the way there. This announcement today gets us 1 gigawatt there straight away. It’s really important. But the timing is important. And this is why the working together is so essential in relation to this project because without the Commonwealth we’d only have about 330 megawatts. We’re now heading to 930 – a material difference. We know there’s an enormous amount of interest when it comes to investors and proponents who want to do projects in New South Wales. And the underwriting and the work of this scheme with the Commonwealth means that we’re tripling what we can do.

JOURNALIST: Why does it take so long? If there’s such great interest, why will it take until 2025 to have projects completed?

CHRIS BOWEN: Because you’ve got to get planning approvals, you’ve got to get supply chain access. So some of these materials come from overseas. The rest of the world is doing this too. We’re competing with every country in the world in the renewable revolution. Then you actually have to roll it out. So, here we are mid-2023. I’ve got to say 2025 in the greater scheme of things is pretty quick.

JOURNALIST: And will this keep the Government on track for its net zero commitments?

CHRIS BOWEN: It’s a very big part of it, absolutely. Alongside everything else we’re doing.

PENNY SHARPE: If we don’t do this we won’t get there.

CHRIS BOWEN: Yeah, absolutely.

JOURNALIST: If I could just ask about carbon offsets. Your colleague Tanya Plibersek has expressed some concerns about carbon offsets and said that people should have the book thrown at them that are doing the wrong thing. I was wondering if you shared those concerns?

CHRIS BOWEN: Of course. Anybody not complying with the rules will be dealt with. But I’d also point out that, of course, we have announced and are implementing a major re-writing of the rules around carbon offsets. All the recommendations of the Chubb review, led by Professor Ian Chubb, supported by the Honourable Dr Annabelle Bennett, Dr Stephen Hatfield-Dodds and Ariadne Gorring has recommended a range of changes, including accreditation of carbon offset providers and regulation, which we’ve adopted. A new independent committee led by a full-time chair, which we’ve adopted, and we’ll be making further announcements about that in due course, about appointments. But all that is being done because carbon offsets are important. It’s also important they be dealt with with full integrity and under our Government they always will be.

JOURNALIST: So you’ve probably seen there’s stricter oversight required. But what are your specific concerns with carbon offsets?

CHRIS BOWEN: Well, my specific concerns are to ensure that they’re properly implemented. Now, we just had a very full review that recommended changes to the human-induced regeneration method, recommending abolition of the voided deforestation method, which we’ve adopted. New auditing which we’re doing. Any method has to be fully compliant with the rules. But carbon offsets also play a very important role.

I was driving in this afternoon and I saw an advertisement to support carbon offsets on the freeway, to support carbon offsets in the Indigenous community. I mean, this is really important stuff. Savanna burning, a method which works to support Indigenous communities who understand how our savannas should be burnt to minimise carbon emissions wouldn’t be happening without carbon offsets – would not be happening. That work would not occur. Our Indigenous First Nations communities would not get the support to do that work without carbon offsets. So it’s very, very important, but, of course, integrity of the system is also vital.

JOURNALIST: Obviously there’s community benefit from offsets. Are they actually effective at reducing emissions overall?

CHRIS BOWEN: Yeah, and they have to be. They have to be. I mean, in many senses at this point they’re the net zero.