Subject: Carbon Farming Initiative and Carbon Pricing
STEVE MARTIN: As I said, Mark Dreyfus is Parliamentary Secretary for Climate Change, Energy Efficiency, Industry and Innovation is on the road, but he is with us on the phone. Mark Dreyfus, good morning to you.
MARK DREYFUS: Morning, Steve.
STEVE MARTIN: You've heard of - I think what Chris had to say. How many farmers have you got involved in this or looking at this? What's the interest like for it?
MARK DREYFUS: There are farmers right across Australia that are looking at this, but I'm actually on the road today coming up to look at Peter and Christine's Forster's farm at Bullock Hill, because it is the very first environmental planning project in Victoria under the Carbon Farming Initiative.
STEVE MARTIN: As far as the scheme itself, how widely do you expect it is going to be used?
MARK DREYFUS: We think that the Carbon Farming Initiative is going to provide opportunities for farmers and landholders right across Australia as more methodologies get approved. We've already got this methodology for environmental planting, but there's also a methodology for management of manure in piggeries.
And I went up to Young in New South Wales just before Christmas, to have a look at the first Carbon Farming Initiative piggery project in Australia, which is a bit different, of course, to the one Peter and Christine Forster are doing with their environmental planting. Managing the manure means that you capture the methane that's produced from effluent ponds.
And at that piggery in Young, they're using it to not only generate electricity, but generate carbon credits and this is the carbon price in action. You're getting carbon credits generated from managing land in particular ways and earning an income stream for farmers.
STEVE MARTIN: How many different methodologies, as you call them, are going to be developed over time? What - are there others that are being looked at?
MARK DREYFUS: We've got seven methodologies approved already. There's another forty in the pipeline. They've all got to be examined vigorously. Examined for scientific integrity, to make sure that they are actually producing real reductions in carbon pollution and subject to that scientific checking, they will be approved.
As I say, there's quite a number in the pipeline.
STEVE MARTIN: Are they - I'm just wondering again, Christine and Peter have put this in and as you say, they're the first. How quickly do you expect other farmers to start undertaking these projects? Are you hearing about a lot of others who are preparing or in that stage of getting approval? What's the take up rate?
MARK DREYFUS: [Inaudible] there's has been a lot of enquiry at the Department of Climate Change. People enquiring how they can do their own project. There's been a lot of interest from land care groups. There's already a large environmental planting project up on the Atherton Tablelands. This one's the first in Victoria.
As Christine explained, very well, I might say, this is a project that is taking place on marginal land. On land that wouldn't otherwise be productive. It's producing an environmental improvement for her farm and at the same time, earning income credits, earning an income stream over time.
STEVE MARTIN: While there are others ones that have been approved that - you've pointed out the one in Atherton Tablelands and this one in Victoria, I wonder if you get a sense some farmers, some on the land are sitting back and waiting to see what happens at the federal election this year.
MARK DREYFUS: Well, they shouldn't be, because we don't think that in any way the carbon price is going to be touched, no matter what the outcome of the election. The carbon price scheme is working. It's been smoothly implemented and none of the nonsensical predictions, none of the fear campaign that was run by Tony Abbott, running around the country last year, has come to pass.
All of those things that Tony Abbott said, scaring pensioners, scaring industry, saying that jobs were going to end and that the economy was going to crash, not one of those predictions has come to pass. Instead, what we're seeing is the carbon price working. This is a scheme that'll continue. I might also say that there's been an indication from the Federal Opposition that they support the Carbon Farming Initiative, as they should.
STEVE MARTIN: Speaking of the carbon price, carbon emissions, there's reports in the papers today, I think in The Australian newspaper, that carbon emissions from the electricity sector have dropped quite sharply, about eight-point-six per cent, since the introduction of the carbon price. By consequence, that means the Government's going to collect a lot less tax from that sector this year than forecast.
Is that indicating that the carbon price is a success or a failure, because it's not raising the revenue you forecast?
MARK DREYFUS: It's really important to understand that the purpose of the carbon price is to reduce carbon pollution going into the atmosphere; reducing the carbon pollution that traps heat that causes world temperatures to rise, causes the climate change that we are trying to tackle.
What you're seeing there, in a reduction of emissions from the electricity sector, is the carbon price working. It was not intended that this be a revenue raising device. Its purpose is to provide a price incentive, a price signal in the economy, so that particularly in the electricity sector, but also in other industries, people will look for different ways of producing their products.
In the case of the electricity, generating electricity and what's happening there is that there's been a boost in investment in renewable energy and a reduction in carbon intensity in the way in which electricity is produced.
STEVE MARTIN: Speaking of renewable energy, you're also heading to Challicum Hills wind farm today, is that right?
MARK DREYFUS: That's right. That's a fifty-three megawatt project that's run out there by Pacific Hydro and I'm having a look at their project.
STEVE MARTIN: In terms of the expansion of wind farms, Mark Dreyfus, how do you see that playing out over the next few years? Challicum Hills is ten years old. What do you see happening with that?
MARK DREYFUS: We think there will be continuing investment in wind farm electricity generation throughout Australia. Unfortunately, because of very restrictive planning policies that have been introduced by the Baillieu Government since they came to power at the end of 2010, there won't be a great deal of investment in wind energy in Victoria.
That's a matter of great regret to the Federal Government. It should be a matter of great regret to the whole of the Victorian community, but some very good opportunities for investment in wind farms, for the creation of wind farms and a contribution from wind to electricity generation in Victoria is not going to be taken up, because of what seems to us to be unduly restrictive policies adopted by the Baillieu Government.
STEVE MARTIN: Do you have a time in mind when governments will be able to stop subsiding renewable energies, when they will compete head to head against some of the more traditional energy generation methods, such as coal or such as gas fired power stations?
MARK DREYFUS: Well, that's the direction that we're heading in. We've seen progressively - particularly in solar - falling prices of the cost of generating solar, the cost of using wind and obviously that's the desirable end that we should get to a position where it's cheaper to generate electricity using the power from the sun, cheaper to generate electricity using the power of the wind or some of the other experimental technology. But that's still in experimental stages, like geothermal [inaudible].
STEVE MARTIN: Do you reckon that's five or maybe ten or fifteen years away?
MARK DREYFUS: I don't think I'd like to put an exact estimate on it, but what we have learned with improvements in technology is that they very often happen a great deal faster than anyone has predicted.
STEVE MARTIN: Mark Dreyfus, while we're talking about this sort of technology, do you believe governments have been too quick to change some of the feed in tariffs, some of the subsidies to households, rather than business, that have made things like solar installation in some states, in some areas, a bit hit and miss for people? People never really know what they're going to get back and in that way, it discourages some people from taking up solar.
MARK DREYFUS: I think what we have learned and it's not just in Australia, but in a number of European countries is that it's important that we have evenness of government policy settings. That we don't have stop and start. That we have predictability for industry and certainly, we've got both Federal and State Governments involvement in this area, but certainly Federal Government policy, our intention has been to get predictability and evenness, so that industry can make decisions knowing that the settings are going to remain there in place.
We've just had the report of the climate change authority on the renewable energy target and again, the Government's intention very much there is to keep that renewable energy target steady, to keep our policy settings in place, so that they are predictable and that industry can make decisions in confidence, make investment decisions knowing the way that directions are going, but you're right, to point to the fact that we've had a degree of movement jumping around in some State Government policy settings in recent years that does make it difficult for industry to make confident investment decisions.
STEVE MARTIN: All right. Just finally, before I let you go, are you happy with the Prime Minister's decision on Nova Peris?
MARK DREYFUS: I'll be very pleased to see Nova Peris join the Labor team in the Federal Parliament. It's long past time that Labor had an indigenous representative in the Federal Parliament.
STEVE MARTIN: Even at the expense of someone like Trish Crossin?
MARK DREYFUS: Well, I'd pay tribute, as has the Prime Minister, to the tremendous contribution that Trish Crossin has made in her fifteen years in the Federal Parliament.
STEVE MARTIN: Is tribute kicking her out?
MARK DREYFUS: I'd pay tribute to the work that Trish Crossin has done. No one has a permanent position in the Australian Parliament. We have to be elected at each election to the Australian Parliament and I don't think anyone would suggest that it is a job for life. But what I would say is to compliment Trish on the work that she's done over the past fifteen years, particularly very important work that she's done as the chair of a number of Senate committees.
STEVE MARTIN: Mark Dreyfus, thank you.
MARK DREYFUS: Thanks very much, Steve.
STEVE MARTIN: Mark Dreyfus, Parliamentary Secretary for Climate Change, Energy Efficiency, Industry and Innovation on the road today and heading to our area to Ararat to look at this Carbon Farming Initiative project and also off to the Challicum Hills wind farm.