Interview with Laura Jayes, Sky News
25 November 2020
Subject: Energy and climate policies, New South Wales's Electricity Infrastructure Roadmap, and the Narrabri gas project
LAURA JAYES: Joining me now is the Energy Minister, Angus Taylor. Angus Taylor, thank you for your time. Joe Biden couldn't have been more clear. He said unambiguously and explicitly that climate change will be at the centre of his presidency. Does this put any more pressure on Australia?
ANGUS TAYLOR: Laura, we welcome the United States to the Paris Agreement. They haven't been parties to the Paris agreement as we have, and of course, we welcome them to it as they sign up, which they clearly will. That's good news and we'll work with them very closely on a range of different issues. Look, Joe Biden has said he's going to double down on carbon capture and storage, which is great news. It's a technology which is developing and being deployed very, very rapidly. 58 projects across the world. Almost half of those in the United States. The biggest one here in Australia. And we'll work closely with them on that technology, hydrogen technology, gas, of course, is an important part of this story.
LAURA JAYES: Yes.
ANGUS TAYLOR: And the fastest growing gas region in the United States is in Pennsylvania, where Joe Biden comes from. And he heard a very clear message from Pennsylvania during the election campaign that that was important to their economy.
LAURA JAYES: Yeah.
ANGUS TAYLOR: I'm very confident he will back in the gas industry in the United States. So these are lots of areas for us to work very closely with the United States. They’re obviously an important strategic, crucial strategic ally for us, a good friend of Australia, and they'll continue to be on this issue, as with many others.
LAURA JAYES: You didn't mention renewables there, but Joe Biden has also made it very clear that he's a big fan of renewables. John Kerry in his speech earlier this morning explicitly said that he will be asking allies to do more. I assume that includes us?
ANGUS TAYLOR: Well, we're investing in renewables four times faster than the United States, Laura. So we really look forward to the United States playing catch-up on this. We’ll work with them closely across a whole range of technologies. We're leading the world in the deployment of household solar, for instance, one in four houses in Australia. And the great challenge for us and the United States as we do this is to make sure we have enough dispatchable generation in the system, which is why I mentioned the importance of gas and hydrogen. They play a crucial role in doing that and working together with other allies across the world, countries across the world, to make sure we get balance in our energy systems, that we have the technologies that are working, and that we can actually bring down emissions without taxing people, without raising the price of electricity, without imposing costs on consumers and economic burdens. And that's what we all want to see here, Laura. That is, we will not get there globally unless we are able to do that. Because countries like India and other parts of the developing world will not, will not impose big economic burdens on their populations. We can't expect them to.
LAURA JAYES: Yeah.
ANGUS TAYLOR: And that means technology, not taxation, Laura. That's our focus. That's been the United States’ focus. Technology is absolutely central to the United States economy and has been for a long while. So we look forward to working with them very closely.
LAURA JAYES: This seems like a very good segue into some comments that Matt Kean has made in recent days. He says he's on the side of consumers when it comes to cheaper energy and has accused you of being on the side of vested interest.
ANGUS TAYLOR: He hasn't done that, you should actually have a look at those comments very carefully and you know what-
LAURA JAYES: Okay.
ANGUS TAYLOR: I’m not getting-
LAURA JAYES: It seemed like a veiled reference to you.
ANGUS TAYLOR: Well he hasn't said that, Laura. He hasn't said that so please be accurate. But what I will say, I'm not getting Christmas cards from the big energy companies, because we've held them to account. But we also need to make sure that state governments are doing the right thing, and premature closure of coal-fired power stations will raise the price of electricity. We've seen it in Victoria with Hazelwood, where we saw a very sharp increase in wholesale prices, a near doubling of wholesale prices as a result of a coal-fired power station leaving without replacement. Our point to the New South Wales Government is we've got to make sure anything that any state government does avoids that premature closure, and doesn't freeze out investment. We need to make sure that the important projects like the Newcastle gas peaker that AGL is working on or the Tallawarra gas generator that Energy Australia’s working on, we need to make sure those projects happen and aren’t frozen out by state government policy. So we'll work closely with the New South Wales Government to make sure that happens. We need to make sure their policies are in line with lower prices, affordable energy, jobs in manufacturing. That's our focus, as well as bringing down emissions. And they're coming down very fast, Laura.
LAURA JAYES: I wonder who you thought he was referring to when he accused, perhaps not you, but someone of being on the side of vested interests as well. And I would ask you, Matt Kean keeps on saying that he has modelled this. He is not budging when it comes to the plan, even though he has been urged to do so. What is wrong with his modelling?
ANGUS TAYLOR: Well we haven't seen it, so I can't answer that question. I'll tell you what I will say though, is that any state government that has a plan for coal-fired power stations to leave prematurely or where that's the unintended consequence of their plan, will raise prices. We've seen it in South Australia, we've seen it in Victoria. And so, we're resolute in making sure that closure of power stations is not premature, that they’re replaced with firm dispatchable energy which keeps the prices down.
LAURA JAYES: Okay. But just on that point-
ANGUS TAYLOR: And so, that's our position. I was just-
LAURA JAYES: He has said that four of New South Wales largest five coal-fired generators are scheduled to close within the next 15 years. Is that a reasonable time frame?
ANGUS TAYLOR: They’re scheduled closure dates. What I'm talking about is premature closure and not replacing. Look, we've got one coming up - and this is a good example - Liddell in New South Wales scheduled for 2023. Our position has always been very, very clear - either life extension or replacement. AGL doesn't want to pursue life extension so we've said replacement. Now, we've got two generators that are being planned. They’re well-progressed. Indeed, I know prior to the New South Wales Government’s announcement that they were well advanced in their plans. We've said that we'll fill any remaining gap through Snowy.
LAURA JAYES: Yep.
ANGUS TAYLOR: And we want to see those proceed. Now, they've put those projects on hold. Both companies. We'd like to see them go ahead. We must see replacement. You know, we've seen this before. We've seen this movie before several times, Laura. We know what happens. You were around in the press gallery when Hazelwood shut, the prices went up.
LAURA JAYES: Yep.
ANGUS TAYLOR: It's very simple. We can't see that. Look, this is a clear proposition. I don't think there's any ambiguity or uncertainty on our position, the reasonableness of that position. And I'm also confident we can work with the New South Wales Government to make sure we get the right outcome here.
LAURA JAYES: Just very quickly, on Narrabri, final approval was given to the $3.6 billion project yesterday. It's very controversial. All gas extracted from this, I understand, is going to be for domestic use. Is it financially viable? Is it financially viable without Government intervention?
ANGUS TAYLOR: We're not subsidising Narrabri. This is, they're getting on with it. It’s great news. More supply, lower energy prices. That's not controversial, Laura, that's good news and it's good news for Australian manufacturers. 850,000 people work in manufacturing in this great country, many in New South Wales, of course. Gas is crucial for manufacturing, for energy, but also for feedstock, for producing critical goods like fertiliser, which happens in Newcastle, of course reliant on gas. So it's good to see more gas coming on. More gas, more supply equals lower prices. That's how markets work, they always have. There's some out there trying to defy gravity, arguing that that doesn't happen. Well, that's what does happen in all commodities. So it’s just fantastic to see-
LAURA JAYES: Well that was Malcolm Turnbull, do you dispute that?
ANGUS TAYLOR: Well, there's lots of people who've been running around saying that. It just makes no sense. So, look, more supply, downward pressure on prices, more jobs in manufacturing. Jobs at Narrabri, 1,200 jobs during construction. $120 million for a community fund. Very strict conditions on water in particular, which is good news. Let's get on with it. These are the sorts of projects that drive jobs and recovery as we come out of the pandemic.
LAURA JAYES: It has been a long time coming, indeed. Angus Taylor, thanks for your time.
ANGUS TAYLOR: It has.
Minister Taylor's office: 02 6277 7120