Chris Bowen, Minister for Climate Change and Energy, next week heads to COP28 in Dubai, leading the Australian delegation. He joins the podcast to talk about the meeting, which he hopes will be easier than last year’s.
Well, I want to see a big step forward. Now, at the last COP we were just flat out, and it was a bit of a surprise to all of us, frankly, flat out, me and like-minded ministers, just defending what was agreed at Glasgow. We didn’t really get the chance to argue for a big step forward.
Bowen is somewhere between hopeful and cautiously confident that at COP28 there’ll be some progress:
If a listener wants to see a step forward and strengthening of efforts and more work done, well, I’m hopeful and, you know, perhaps even edging towards quietly confident that we might be able to pull that off. But there’s a lot of work to go yet and a huge amount of effort.
On Australia’s prospects of hosting a COP with our Pacific partners, Bowen says global uncertainties are muddying the waters:
We’re bidding for 2026. Now, this is a very opaque – even as the lead bidder, I find the situation opaque, […] COP is currently dealing with who’s going to host next year, 2024 hasn’t been resolved. Again, because of that very complicated and difficult geopolitical situation that has very clearly infected the decision about who’s going to host next year.
On the government’s Climate Statement released this week, which contains the latest emissions reduction projections, Bowen says he is confident Australia can reach the 43% reduction target by 2030:
There’s plenty of challenges. But I am confident, quite confident, that we can. And we have to. So 42% [projection in the Statement] is good. It was 30% when we came to office. It lifted 40% last year and up to 42% this year. So we’re edging very close now to the 43, which is our target. And there are various government policies which have not yet been included, like Hydrogen Headstart and any decarbonisation from the National Reconstruction Fund.
Asked about the issue of nuclear power, which will be part of the Coalition’s energy policy, Bowen again categorically dismisses it as a realistic possibility for Australia:
Nuclear power for Australia is a fantasy wrapped in a delusion accompanied by a pipe dream. I mean, it just doesn’t make any sense.
Below is a transcript of the interview, from Chris Bowen’s office.
CHRIS BOWEN AND MICHELLE GRATTAN TRANSCRIPT
E&OE TRANSCRIPT PODCAST INTERVIEW THE CONVERSATION FRIDAY, 1 DEC 2023
MICHELLE GRATTAN: Chris Bowen we’ll get to the COP meeting later. But can we first unpack where we’re up to in the energy transition? The Government has recently admitted things are not on track for your target of having 82% of our electricity generated by renewables by 2030. How much difference will the expansion of your scheme to underwrite investment in renewables make, and why has it been difficult to attract adequate investment?
CHRIS BOWEN: Well, Michelle, I think the best way of characterising and explaining our current situation is we’re doing well but not well enough. And we have huge interest in Australia as an investment destination for renewable energy. I mean, I’ve had a cavalcade of global chief executives and chairs of big renewable energy companies from around the world through my office over the last 12 months. And most tell me – some say we are the most interesting, the best market in the world, some say we’re in the top three, but there’s huge interest. But what we weren’t seeing is fast enough translation of that huge pipeline to final investment decision and planning approval and connections.
So we have good potential and, you know, great interest and lots of, you know, very serious and real projects in the pipeline now under development, but not hitting final investment decision and not hitting the planning system and getting through the planning system, the sort of various planning systems, state and federal and AMO connection approval fast enough.
And so the Capacity Investment Scheme is designed to really provide that really welcoming and reassuring environment to global investors, and it will attract that investment, and even more than attract, it will confirm and hasten the investment that we’re already seeing and ensure that we are on track for that very important target, a target that’s important for emissions, for costs and for reliability.
MICHELLE GRATTAN: But, of course, that doesn’t necessarily speed up the actual approval process, does it?
CHRIS BOWEN: Well, it does. It does ensure we get to the final investment decision more quickly, which then gets it to the planning system more quickly. And, of course, the CIS auctions was a very important part of what we announced, a major part of what we announced, but we also announced other elements, including most particularly Renewable Energy Transformation Agreements with the States and Territories. And that’s really to ensure that the goodwill – and there is very goodwill between me and the state and territory Ministers and the Governments – translates to ensure that our policies are working hand in glove to ensure the transition is working as quickly as it can.
Now, that can include – it will include the reliability schedules, which we might come to. It will also include transformation schedules, which is, well, how is what we’re doing underwriting the investment working with your state planning system? You know, we don’t want to – I’ve been very frank with state ministers when I was consulting them and briefing them on all this. You know, we don’t want to underwrite all this investment and then find it stuck in your state planning system, for example. And so we’ll work with them on the transformation schedules, which may involve some states looking at their planning systems.
And let me be very clear, Michelle – that doesn’t mean being, you know, more lax or getting rid of conditions. Because some – not every renewable energy investment is in the right place at the right time. But it does mean getting to yes or no more quickly. And if the answer is going to be no from the planning system, let’s get there much more quickly so that then the developer can move on to other projects and the community can have reassurance. And if it’s going to be yes, let’s get there more quickly as well.
And, you know, Tanya Plibersek and I are looking at the federal environmental approvals. Tanya in particular has been looking at that. But the bulk of renewable applications goes through the state systems. And so we will work with the states to see where sensible and where states can do better I’m sure that they will want to.
MICHELLE GRATTAN: Now, on the question of reliability, you and the market operator, AEMO, have talked about how gas could be essential in balancing supply, yet the investment scheme that you’ve expanded excludes gas, and gas isn’t supported by all of your State colleagues. How do you expect to resolve this obstacle?
CHRIS BOWEN: So, let me – let’s just step back a moment and talk briefly about the role of gas in the transition, because it is important. Now, people say, “Oh, gas isn’t low emissions.” Well, that’s true. I don’t regard it as a low emissions fuel. But I tell you what – when a gas-fired power station isn’t turned on it is low emissions. And the beauty of gas-fired power stations is that you can turn them on and off, which you can’t do with coal. You know, coal‑fired power stations are burning away all day every day whether we need the energy or not. And gas-fired power stations won’t do that. That’s why I see a bigger role for gas-fired power stations going forward so that when we don’t have enough renewable energy in the system AEMO can turn a gas-fired power station on and off really quickly, which you can’t do with a coal-fired power station. When it’s turned off, as I said, it’s zero emissions.
Now, in terms of the role that gas plays – no, gas is not included in our Capacity Investment Scheme. It is included, for example, in the New South Wales LTESA scheme, which complements our federal scheme. But I’ve got to tell you, Michelle, gas isn’t the only option compared to renewable energy bids. But the role of gas will vary from state to state and territory to territory.
Now, as I said, we don’t think – we don’t need to underpin gas through the Capacity Investment Scheme. That’s not to say that there isn’t a role for gas, and states will come at that and the private sector will come at that in different ways. There’s the Tallawarra gas-fired power station, which is nearing completion. That’s by and large private sector money. A small government contribution, but mainly private sector money. States have got some gas‑fired power stations which will reach the end of their natural life. They, when they’re writing their reliability schedule with us, can, you know, consider what role gas-fired power – new gas-fired power will play in that. Every state will have a different approach to reliability and working with the private sector.
I make no apologies for pointing out gas has a role to play, mainly to be that flexible back-up to an 82 per cent in the first instance renewable energy system. But that doesn’t mean the commonwealth needs to underwrite that gas. That means we do respect and encourage its role to underpin this massive transformation to 82.
MICHELLE GRATTAN: Also on gas, Victoria is running out of it. Now, this week you announced securing additional gas from Queensland for the domestic market. How do you see that gas getting from Queensland to Victoria. The pipeline capacity appears pretty limited, and there’s been little progress with shipping facilities.
CHRIS BOWEN: Yeah, we do have a very substantial pipeline network. But it does come under pressure from time to time. It does get full. One of the issues we had the winter before last – you’ll remember that crisis – was that we were getting gas to the South as fast as we could through that pipeline. That pipeline was full at key points. But I don’t see that as a major challenge.
The major challenge, frankly, is, Michelle, that gas use in Australia is declining, that gas production is declining more quickly. I don’t think a lot of Australians sort of have looked at the fact that Bass Strait is depleting quite rapidly, so we’re getting less and less gas out of the Bass Strait, which means we need to fill that gap. And anybody who says we don’t need to fill that gap needs to explain what they would do about it.
Now, they might say electrify more. Well, we have a gap even with our electrification policies. They might say stop exporting. Well, I’m sorry, there’s a constitution which means that the Commonwealth government can’t come in and rip up, you know, written and signed contracts for exports. So we’ve got to fill that gap.
Now, we are doing things with AEMO and through the state and territory energy ministers about gas storage and there’s various facilities around and we’ve given AEMO more powers. There are various proposals for gas import terminals. And you are correct, I think you’ve sort of correctly identified that those import terminals aren’t actually – mainly they’re about bringing in gas from overseas. They’re probably a misnomer. They are about bringing gas in from around Australia to various points.
But, yeah, from time to time our pipeline comes under pressure, but that isn’t the main pressure. The main pressure is working out where we get this extra gas from. And that’s why the deals that we’ve announced this week – and it was disappointing the Greens moved to disallow the gas code which has seen these deals come forward to ensure that this new gas is for domestic supply – have been important and will continue to be important.
MICHELLE GRATTAN: We should note that that disallowance, of course, didn’t succeed.
CHRIS BOWEN: Correct, it didn’t.
MICHELLE GRATTAN: Now, in terms of the – apart from investment and the issues we’ve canvassed there what are the main remaining barriers to achieving this clean energy transition in the immediate term? Community opposition to wind farms and to the new grid seems to be right up there. How do you think you’re going with this, and if, in the end, the community opposition is just overridden, will this leave a sour taste in these communities that could translate electorally, do you think?
CHRIS BOWEN: So, let’s look at this issue. I think - with community what we call social licence, community support is really important. It’s never going to be unanimous. You’re never going to get, you know, a hundred per cent agreement to anything let alone big, new installations of renewable energy or transmission. But I look at it this way: there are very genuine and valid community concerns which need to be taken on board and worked through on the various projects. There are also politicians who are, in effect, climate change deniers, like Barnaby Joyce and Matt Canavan, who whip up some of that concern for their own political purposes. I have very, very little respect for that approach to politics from them. But I have real respect for the genuine concerns in communities.
The community consultations sort of regime that’s been in place for many years that we inherited – and it’s not actually – this is not mainly a criticism of the previous government; more just an observation over many, many years that our community consultation regime was not fit for purpose for the major sort of works that we have underway. So we have begun the process of reforming that. I’ve changed what’s called the RIT-T rules on transmission, for example to improve them. I’ve also asked Andrew Dyer, who’s the Energy Infrastructure Commissioner, to advise me and states on what more we can do better on community engagement.
We – I see it in different ways. You know, nobody can force a solar farm or a wind farm on a farm or a rural property that doesn’t want it. That doesn’t – that regime doesn’t exist. Where a farmer either sells or leases their land for one of those purposes it’s because they’ve made a decision they want to because they like the non-drought-dependent income, you know, the income that comes on even if there’s a drought on. But that doesn’t mean we shouldn’t work with communities to ensure broader community support. As I said, it’s never going to be unanimous, but we will do our best to try and get that better engagement and real community benefit as well. I don’t want to see communities say, “Well, the country benefits from this, but we don’t.” I do want to really community benefit as well.
MICHELLE GRATTAN: Now, households obviously are stressed at the moment on the cost of living issues more or less across the board, but particularly their power prices. How do you see power prices playing out over the next couple of years? What will be the general trajectory, do you think?
CHRIS BOWEN: I think we’ll certainly – you know, I’m encouraged by the fact that wholesale prices are down so much. Wholesale prices have at various points been 71 per cent lower than the same time last year. Now, before your listeners say, “We don’t pay wholesale prices,” I know that, and I respect that. But they do flow through to retail prices in due course to a degree. There are sort of various inputs to retail prices, and wholesale prices are a big one. And there’s two reasons why wholesale prices are down so much – one is the government’s coal and gas caps which we legislated, and the other one is renewables have been performing really, really well in the grid, which has been dragging down prices. In fact, prices have been negative for big chunks of many days, and that sort of puts downward pressure on wholesale prices, which will ultimately mean there’s downward pressure on retail prices.
And the more orderly and the faster we can get this transition, the better prices will be and the more orderly the world energy situation is – and, you know, I’m not here to predict what’s going to happen in Ukraine or the Middle East, but statement of fact – the more orderly the world energy market is the better it is for our energy prices as well.
MICHELLE GRATTAN: You released a climate statement this week, and that showed we’re close to being on track to meet the target of reducing our greenhouse gas emissions by 43 per cent below 2005 levels by 2030. Are you now confident that we can achieve that target?
CHRIS BOWEN: I am, Michelle. I am. I mean, I’m not complacent about it. There’s plenty of challenges. But I am confident, quite confident, that we can. And we have to. So 42 per cent is good. It was 30 per cent when we came to office. It lifted 40 per cent last year and up to 42 per cent this career. So we’re edging very close now to the 43, which is our target. And there are various government policies which have not yet been included, like Hydrogen Headstart and any decarbonisation from the National Reconstruction Fund. So – because they’re a bit hard to quantify at this point in their detailed design. But they would hit next year’s update. So I am confident we can get to 43, but there’s plenty of challenges along the way. We just can’t take our foot of the accelerator.
MICHELLE GRATTAN: You’ve been very sceptical about nuclear power, and that’s obviously going to be part of the Opposition’s climate policy. Why not lift the ban on nuclear and let the market make the decision? Is this just because of internal feelings in the Labor Party. You’ve said it would be a distraction to do that but that’s a bit hard to get your head around, I think.
CHRIS BOWEN: Well, firstly, of course, I mean, nuclear power for Australia is a fantasy wrapped in a delusion accompanied by a pipe dream. I mean, it just doesn’t make any sense. Now, in terms of the legislative ban, which, of course, we didn’t put in place – the Howard government put in place – I think two things, Michelle. I do believe it would be a massive distraction, it would make the time and effort of the Parliament, and I just – we don’t have time for that sort of distraction. It is an attempt at a distraction. It is – the deniers and delayers have now moved on from, by and large, straight climate change denial to coming up with distractions. That’s what they do. They do it for a living. It’s, “What can we do to distract now from the need to move to renewables?”
Secondly, it would send a very confusing message to the market. I mean, government signals are really important. Now, nuclear energy is not commercial for Australia. It’s not going to be commercial for Australia. The National Party has now admitted – you know, David Littleproud in a moment of honesty admitted that it couldn’t happen to the late 2040s. We don’t have time to the late 2040s. And even just not on emissions do we not have time; we have a reliability problem now. I mean, the biggest threat to reliability in our grid is coal-fired power stations not working unexpectedly. That’s happening a lot. You know, AEMO and the governments of Australia deal a lot with coal-fired power stations which are just not working all of a sudden. We’ve had two units at Eraring, one of the biggest power stations in the country, out of action for several weeks, for example. Now, it’s been okay. Of course, we’ve got very benign weather conditions, but it would be highly problematic if we didn’t have benign conditions.
Now, so we don’t have time to muck around till the 2040s while we work out what sort of energy to introduce. We need more energy in the system now to replace the coal-fired power and buttress unexpected coal-fired power generation outages. We don’t have time to wait until the 2040s. It’s just a massive distraction, and I’m not going to waste the time on lifting the legislative bar which is going to have absolutely no impact.
MICHELLE GRATTAN: Let’s turn to COP, which you’ll be departing for in a few days. What will be your message to those who say that Australia should move faster on climate issues and should stop coal mining and even the gas extraction? How do you reconcile domestic progress with our role as one of the world’s largest fossil fuel exporters?
CHRIS BOWEN: You know, Michelle, when I go to an international meeting, I’ve got to say the conversation is a lot different to the domestic conversation. Those sorts of issues, frankly, are just seen very differently internationally. There’s just a huge amount of respect for Australia’s role now. We are seen now as a very constructive partner, and Ministers understand that every government is dealing with a complex transition, and they understand it because they’re dealing with it themselves.
You know, Michelle, there are two types of countries in the world: there’s countries that export fossil fuels and there’s countries that import fossil fuels. They’re the only two types of countries at the moment. You know, everybody either exports or imports the stuff. So, you know, other ministers understand that we’re all dealing with a complexity. And I say to ministers who are importers of fossil fuels, I want to help you in your transition to net zero. I want to help you by exporting more renewables to you.
So this whole idea that Australia is somehow seen negatively is just not reflected in any conversation I have with international counterparts. Everybody’s on the same page. You know, the outgoing New Zealand Minister for Climate Change said recently the Albanese Government’s done more on climate change in one year than the Ardern government did in five. And that’s pretty reflective of the sort of feedback I get from my international colleagues.
MICHELLE GRATTAN: There will be a debate at COP about whether nations can agree to phase down or phase out fossil fuels. Does Australia have a firm position on this?
CHRIS BOWEN: I certainly support a strengthening of global mitigation efforts, which is what that conversation is about. You know, I’d be very pleased if we got to that level of the conversation. I do note that some countries have already said they won’t support the phase out of fossil fuels. I chair the Umbrella group of Ministers and, you know, I’ll be seeking to get as common a position as possible across the board on exactly what we should be arguing for our strengthen mitigation language. I’ll be meeting with them. The Umbrella group is Australia, New Zealand, Canada, the United States, Israel, Ukraine, Norway. And we have – I want to see that we come to that discussion with a good, position on mitigation. As I said, some countries have already said that they oppose a phase out of fossil fuels, including I’ve seen the African group of negotiating Ministers. So I think that will be a difficult conversation, but we’ll be very constructively trying to find a way to strengthen the language.
MICHELLE GRATTAN: Now, day one of COP, which is, of course, already underway, has seen a breakthrough agreement on a loss and damage fund to compensate poor states for the effect of climate change – Germany, America, the UK and others have made commitments already. Will Australia make a commitment to this, and can you give us any idea of the amount?
CHRIS BOWEN: So it’s good. We’ve been, again, very active in that conversation. We’ve had a representative on the committee which has progressed this over the last 12 months, and we’ve been talking with the Pacific. I’ve had, you know, some key red lines, including ensuring that the loss and damage fund will work for the Pacific. I’ve made some points about the donor base as well.
We have – our focus has been on until this point the Green Climate Fund and the Pacific Resilience Fund that we’ve announced that we will make contributions to both of those. I welcome the progress on loss and damage, but, you know, it’s not the only conversation about global finance at the moment. And I’ll have more to say about how we’ll interact with all the different funds, but particularly a focus on the Green Climate Fund and the Pacific Resilience Fund, as the work continues on getting the loss and damage fund up and running and the rules very well understood.
MICHELLE GRATTAN: I think there’s general agreement that the world really isn’t moving fast enough to deal with the threat of global warming, the implications of it. What do you think can be achieved out of this particular COP meeting?
CHRIS BOWEN: Well, I want to see a big step forward. Now, at the last COP we were just flat out, and it was a bit of a surprise to all of us, frankly, flat out, me and like-minded Ministers, just defending what was agreed at Glasgow. We didn’t really get the chance to argue for a big step forward. We’ll be arguing for a step forward.
Having said that, Michelle, just to, you know, for the listeners, this is an international negotiation that works on consensus – i.e., it doesn’t take many countries to veto anything. It’s pretty easy to block action. So if a listener says, “Well, I want to see this COP, you know, finally resolve what we’re going to do on climate change and, you know, solve the problem and take such a huge step forward that we don’t need further international conversations,” I think they’re going to be disappointed. If a listener wants to see a step forward and strengthening of efforts and more work done, well, I’m hopeful and, you know, perhaps even edging towards quietly confident that we might be able to pull that off. But there’s a lot of work to go yet and a huge amount of effort. And this COP also meets in a difficult geopolitical environment, which does affect the conversation a little. You know, the situation in Ukraine and the Middle East does just make these conversations just that much harder. But, anyway, we’ll be in there arguing for a step forward and we’ll see how we go.
MICHELLE GRATTAN: So do you think it will be a more positive meeting than the last meeting?
CHRIS BOWEN: Well, I certainly hope so. And there are some signs, you know, the agreement, the Sunnylands agreement between China and the US is actually a big deal. That sort of augers a little better compared to where we were at the G20 climate meeting, which I represented Australia at which was very disappointing where some countries blocked action. So I’m a bit hopeful, but I’m also – I’m also very realistic that I’ll be spending some all-nighters with my international colleagues, you know, really just trying to find a way through.
MICHELLE GRATTAN: Remembering one earlier meeting – be very careful of the language.
CHRIS BOWEN: (laughs) I’ll try.
MICHELLE GRATTAN: Just on China’s position, can you elaborate a little on that? And should China be doing more on climate?
CHRIS BOWEN: Well, look, I mean, China is the world’s biggest emitter, so of course we want them doing as much as possible. Now, you know, on the upside, they are also the world’s biggest renewable energy investor. I mean, you know, they’re putting in more renewable energy in the world – you know, each year than pretty much many other countries combined. So that’s on the upside. Obviously, their target is lower than ours or other countries. So, you know, obviously the more they can do, but basically we need the world’s biggest emitter really leaning in to the international conversations. And it’s no secret, you know, they haven’t previously been as leaning in as we would like them to be. I take the Sunnylands agreement as a big positive sign. I pay, you know, due credit for that to them and the United States. That’s a big deal. It does give me some hope. But, you know, I’m also – I’ve been around long enough on the ship; it’s not my first rodeo. It’s not done until it’s done.
MICHELLE GRATTAN: Just finally, negotiators are hoping for an announcement on Australia’s bid to host a joint Australia-Pacific COP meeting. Which year are we now aiming for, and do you think we’ll see this clarified?
CHRIS BOWEN: We’re bidding for 2026. Now, this is a very opaque – even as the lead bidder, I find the situation opaque, the process, because it’s not sort of written down in a constitution. And, in fact, the world currently is dealing with – COP is currently dealing with who’s going to host next year, 2024 hasn’t been resolved. Again, because of that very complicated and difficult geopolitical situation that has very clearly infected the decision about who’s going to host next year, which is not resolved. So I imagine that will be the main focus. The world will say, “Hang on, let’s sort 2024 out before we sort 2026 out.”
So, look, we’ll see how we go. It’s a good opportunity for Australia. I’ll be constructively talking to my colleagues about how we resolve the situation going forward. But, you know, as to any predictions about how it’s best resolved, I’m not in a position to make any.
MICHELLE GRATTAN: Chris Bowen, thanks very much for talking with us today. We hope you get a bit of sleep in Dubai during that COP meeting.
CHRIS BOWEN: I will, Michelle, but I just can’t guarantee what time of day it will be. It might be – it might be an early morning sleep after all-night negotiations, that’s my experience. But, anyway, we’ll see how we go.
MICHELLE GRATTAN: Good travelling. Anyway, that’s all for today’s Politics Podcast. Thank you to my producer Ben Roper. We’ll be back with another interview soon. But goodbye for now.