Public statement June 27, 2023

I’m delighted to welcome the contribution by NSW Liberal Senator Andrew Bragg in today’s Australian Business Review and back his plea that electrification is not turned into a culture war football.

But let’s start by blowing the whistle on his jab at the efficacy of the May budget, at least with respect to the $1.7 billion committed to households and small business to assist with electrification. The initiatives these support – weather-sealed homes, more efficient appliances, and the use of rooftop solar - are all, by design, anti-inflationary.

I welcome the Senator’s willingness to explore the opportunities and the constraints facing the further efficient electrification of Australian households. Many of us have been in training for 25+ years, at least since Australia signed the Kyoto Protocol in 1998. Since then, Team Australia has spent time exploring options. Groups and organisations such as the Grattan Institute, ClimateWorks, RACEfor2030, the Productivity Commission, the Business Council of Australia, along with the various Councils for Smart Energy, Energy Efficiency, Property, Green Building, Climate, etc. all know what needs to be done. We now just need to get on and do it.  No more talk fests. No more inquiries. No more delay.

Here’s just a few examples of actions we can prioritise now:

  1. Prioritise upgrading community and public housing. Not only would this assist our most vulnerable, but we would directly save on energy bill subsidies and indirectly on healthcare costs.
  2. Expand the Mandatory Renewable Energy Target so it takes in the provision of energy storage. This can be done relatively easily through a change in regulation and would see a swift delivery of all sorts of storage to market, particularly behind the meter.
  3. Bolster the Greenhouse and Energy Minimum Standards Amendment (Administrative Changes) bill 2023 to make sure that all new significant household appliances sold in Australia are ‘flexible management’ enabled so that householders can choose whether to connect their homes to the grid and export excess solar that’s generated in the daytime or store it onsite as hot water, in electric vehicles or in other household batteries for later use at home.
  4. Legislate to update fuel efficiency standards so car dealers provide efficient, electric models for purchase in Australia – both new and used.
  5. Update our tax system to disincentivise behaviours that harm the economy or environment and incentive ones that help with an orderly transition and improved economic competitiveness. Why not revisit the former Prime Minister John Howard’s cap and trade emissions trading system or look at clawing back on negative gearing for landlords that fail to upgrade the homes they rent (from an average of 1.7 to 5.0 stars)?

With respect to gas, a sensible central path can be walked which involves:

  • Ensuring that any new home is not required to be connected to gas;
  • Providing incentives for households to move off gas water heating, cooking and space heating when existing appliances break or become obsolete; and
  • Regulators pricing network service charges to benefit the customer rather than the networks’ shareholders.

Finally, it’s important to help householders invest their super into the assets and enterprises that will continue to be prosperous into the future; this is particularly important for young working Australians who won’t retire until 2060 or beyond.  This will mean revisiting the part of the YourFutureYourSuper laws that see superfunds needlessly gaming portfolios against performance benchmarks that potentially drive investments into stranded assets such as new gas and coal. There are many other more meaningful benchmarks (the Transition Benchmark or the Paris Aligned Benchmark for example) that could supplement APRA’s review and that could see some of the $3.5 trillion of private wealth sitting in Australian superfund portfolios flow into companies that are part of the climate solution.

Senator Andrew Bragg