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Interview with Tom Connell, AM Agenda, Sky news

29 May 2020

Tom Connell

Subject: Greenhouse emissions, Paris targets, electricity and gas prices, LNG exports, Technology Investment Roadmap.


TOM CONNELL: Energy Minister Angus Taylor, thanks very much for your time, patiently standing by there. So, emissions down 0.9 per cent - drought was a factor though, to helping that out, if you like, and we don't want a drought every year - is it a pretty gradual process still, these emissions coming down? Would you have liked to see this figure, more rapidly coming down?

ANGUS TAYLOR: Look I think it's coming down at a good rate and a sensible rate, in line with our strategy- policy of technology, not taxes, Tom. And, of course, the important point here is the trend line is down. We saw a 4.5 per cent reduction in the electricity grid, which is a very big number, and that's creating its own challenges, but all of this is happening at the same time as we've seen very significant reductions pre-COVID in the wholesale price of electricity and gas. And so, that's good news. You know, we're getting the trifecta here: lower gas prices, lower electricity prices and lower emissions. That's what technology, not taxes is about. It's about actually reconciling a strong economy, with falling emissions. That's exactly what we're seeing.

TOM CONNELL: So, what we obviously need to see - the whole economy transforming over time, to be lower emissions. If you look at construction and commercial sectors, they're actually increasing in the past year. Is that part of the economy not transforming yet and why not?

ANGUS TAYLOR: Well, the really critical thing you see in the data is that domestic emissions - emissions for domestic consumption, goods and services, we use here in Australia - have been falling rapidly and for a long while. In fact, we've already beaten our 2030 target, right now, we've beaten that target. Where we've seen, of course, the other effect going on, is our exports, which have been growing dramatically. We've created the biggest LNG export, liquefied natural gas export industry in the world in about a decade. And of course, that's reducing emissions in Japan, in Korea, and in China, but it does have an impact on our emissions. It's good for the world, but it makes life harder for us. So, that's been the challenge and that's important. At the end of the day, we want to strengthen our export sectors, we want to strengthen our economy. We think we can do that in a way which is consistent with bringing down emissions, and that's about technology not taxes. It's working, Tom. It will keep working, as long as we're sensible and we keep our eye on the main ball, which is getting people back into work, a strong economy coming out of COVID-19, lower cost of living, lower prices at the same time as technology bringing down our emissions.

TOM CONNELL: Just on gas and the role it will play; fugitive emissions continue to increase, so 10 per cent of our national emissions come from this now. You mentioned how it's good for the world. Is there a bit of a question mark about that? I mean, how low emissions is gas as part of a long-term future?

ANGUS TAYLOR: There's no question mark at all. I mean, it's very clear that countries that are using gas are actually dramatically reducing their emissions. We see it in the United States indeed, where the United States despite that it's actually getting out of the Paris Agreement, I mean, its emissions are coming down rapidly and gas has been absolutely central to that. We see it in the UK and other countries in Europe. So, we know gas is a very important part of this story. Good news with gas in Australia is prices are coming down, so that's very good for Australian manufacturing. We need those lower wholesale prices being translated through into long-term contracts. But this is good for emissions, it's good for affordability of energy and it's good for the manufacturing sector. And, you know, that's why we think gas is an important part of the mix - not the whole mix - but an important part of the mix in the coming years.

TOM CONNELL: A story today saying that you're already ruling out an increase to the Paris target at the next meeting, which happens next year. Is that a decision that's been taken by the whole Cabinet? And what's it based on?

ANGUS TAYLOR: We have a strong target. We have a pre-existing target which we set many years ago and we're already on track to meet and beat it. We'll beat our 2020 target by 411 million tonnes. That's almost a year's worth of emissions, as of December last year and every year since we've been in Government, Tom, we've improved our position. Now we seek to meet and beat targets. Other countries, they'll set targets and they don't meet them. They struggle. We go the other way around. We set a target, we beat it, and we try to beat it by as much as we possibly can. That's what we're doing with the 2020 target and we'll do the same with the 2030 target.

TOM CONNELL: On that, though, the IPCC says a 45 per cent reduction is needed across the board by 2030 if we're to meet the 1.5 degrees, which Australia has signed up to, and obviously different countries do different things. But by Australia sticking to its target, are we effectively saying to other countries you have to do more to get there?

ANGUS TAYLOR: Look, Tom, we've got a strong target already and we seek to meet and beat it, as we always have. So, we'll absolutely smash our 2020 target, and very few countries are in this position. I mean, if you look at New Zealand or Canada, their emissions have essentially not gone down since 2005. We're already way down on that level - about 14 per cent down. Very few countries that can boast our performance, and what we always seek to do is meet and beat targets and deliver, and that's exactly what we are doing. The key to that is technology not taxes. Lots of people would love to tax our energy sector, raise the cost of living, do damage to our export sectors, but frankly, that's not our approach. We've got the track record - we're going to keep staying the course.

TOM CONNELL: Okay. When you say meet and beat though, do you think there's any way we'll get to 45 per cent? Again, this is the IPCC number they say is needed by 2030. Can you envisage any future where Australia would reach that anyway, even if it's not set in stone?

ANGUS TAYLOR: The way you divvy up what each country does in the world, of course, what matters here, is it what it is, but what matters here is the global outcome, and of course, everyone has to do their bit. The truth is that we are doing far more than many countries in the world and we will keep doing far more because we are good at using technology. We can do it without damaging our economy. In fact, we can do it strengthening our economy in areas like energy efficiency. There's very few countries in the world that are even close to us on the way we're using household solar on people's roofs. So we'll continue down that path and we'll continue to deliver, Tom.

TOM CONNELL: So just to clarify on the comments today around here's our target, this is what we're taking to next November's meeting - the one that's been pushed back to Glasgow - that's a process, has that gone through Cabinet? That’s all signed off?

ANGUS TAYLOR: Tom, I'm not going to speculate on the long-term strategy, which we have already flagged many, many times, that we'll take to Glasgow, which is now going to be set at the end of next year, not the end of this year. The Technology Roadmap is crucial to that and the long-term strategy, of course, will be an outcome of that. And we'll have more to say about that long-term strategy in the coming months. But our 2030 target is very clear, it has been for a long while. And our performance is the key. Other countries don't perform like us. Delivery is what matters here. You can set whatever target you like, Tom, but if you don't deliver, then you don't get the outcomes you need and that's the Australian approach.

TOM CONNELL: Right. So when you mentioned the Technology Roadmap as well, I mean, once that emerges and we figure out the technologies and what they might deliver, that could theoretically, couldn't it feed into a situation where you say we're easily going to beat that. We'll set a new target of 32. I mean, that's on the table, isn't it?

ANGUS TAYLOR: Tom, I know you would love me to announce every last detail of the long-term strategy which will be done for November [inaudible] year, but I'm not going to do that today. I'll just make the same point - our approach and principles are very simple: deliver technology, not taxes; don't weaken the economy; don't do all the things that the other side of politics have constantly wanted to do in this area to damage jobs, economy, incomes.

TOM CONNELL: Angus Taylor, appreciate your time today. Thank you.

ANGUS TAYLOR: Thanks for having me, Tom.