Interview with Tom Elliott, 3AW

Tom Elliott
Interview discusses emissions targets, economic modelling, Emissions Reduction Fund, carbon capture and storage

TOM ELLIOTT:  Alright, well, back to the carbon tax. We had a caller, Peter, before the news who said what Julia Gillard tried to introduce 11 years ago was not a carbon tax and he called me a Liberal stooge and a parrot of Tony Abbott. Anyway, we played, some audios just a few minutes ago of Julia Gillard in 2010 agreeing that it was a carbon tax. Anyway. But we spoke just after the 4 o'clock news, so about an hour and 20 minutes ago, with Richard Dennis, Chief Economist at The Australia Institute. He's looked at the government modelling that takes us towards net zero by 2050, and he says there is a carbon tax or maybe a carbon price, which amounts to the same thing buried within it. He said it was $24 a tonne. Anyway, for a right of reply, the Federal Energy Minister, Angus Taylor, joins us now. Mr Taylor, good afternoon.

ANGUS TAYLOR: G'day, Tom. Thanks for having me.

TOM ELLIOTT: Look, I haven't gone through the modelling and the detail that either Richard Dennis or you have. He says, and other people have written this too, says that there is a carbon price embedded in the model. Is that true? 

ANGUS TAYLOR: Well, it's wishful thinking for someone like him. No, there are no taxes or penalties in our plan. That's not what we modelled either. What we do have is a voluntary, targeted incentive that we already have in the Emissions Reduction Fund. So, if you're a farmer and you can get your carbon emissions absorbed into your soil by regenerating your soil, there's an incentive to do that today through the Emissions Reduction Fund. In fact, it was put in place by Tony Abbott a number of years ago. That's current policy. That's what we modelled and that supports sensible emissions reduction in a very targeted way but it sure as hell ain't a carbon tax. 

TOM ELLIOTT: Well, maybe not a carbon tax, but he says there is an assumption buried within all the whole thing, in the model, saying that it is assumed that there will be a price on carbon of $24 a tonne. Now, how you get there, we can debate that but, I mean, is there that assumption? 

ANGUS TAYLOR: No, no, there's an assumption of a voluntary, targeted incentive, which we have now. This is modelling current policy in the Emissions Reduction Fund. 

TOM ELLIOTT:  But if it's voluntary, why would anybody bother? I mean, if you said to me: ‘Tom, would you like to pay $5 for a litre of petrol?’ I'll just say: ‘No, I'm not going to do that’, and that will be the end of it. 

ANGUS TAYLOR: We're not targeting you with this - this is already happening. So let's suppose you're a farmer. You can regenerate your soils in a way which can absorb carbon, and you can get an incentive now under the Emissions Reduction Fund for doing exactly that. And why would you do it? Because it's profitable for you to absorb more carbon into your soil. You also can improve your productivity while you're at it. So farmers are doing it now today. 

TOM ELLIOTT: Yeah, okay. I mean, how does this all lead to no net zero emissions? I mean, do we just hope that lots of amazing technology gets developed? 

ANGUS TAYLOR: It's happening now. 

TOM ELLIOTT: I don't see how volunteering to reduce one's carbon output and getting some assistance from the government is going to lead to the whole economy not producing net emissions. 

ANGUS TAYLOR: It's not, it's not, and that's not what we're proposing in the plan or in the modelling. So only 10 per cent of the abatement by 2050 will come through that source. The vast majority is coming because we're seeing really substantial reductions today, happening, and continuing to happen, in the cost of emerging technology. So I'll give you an example. Solar has come down 12 per cent a year in cost for 50 years, Tom and it's continuing to come down. It has been continuing to come down. Now we're seeing that with a whole series of technologies, and those technologies have been modelled, and that's driving the vast majority of the abatement. Now, we know carbon capture and storage, and soil carbon are additional sources that will require a modest incentive, which we're doing now, as we speak, through the Emissions Reduction Fund. 

TOM ELLIOTT: Okay, so what you're really saying is that the real work in terms of carbon emissions, or to be honest CO2 emissions, will be done by existing technologies, like solar getting cheaper, and cheaper, and cheaper, and new technologies emerging? So the idea that you'll need to put a price on carbon and people will adjust their behaviour, that's not going to drive this. You're saying it's all about new and emerging technologies.

ANGUS TAYLOR: There are targeted technologies that will require a very modest incentive. So soil carbon is one of them, it's happening today. Carbon capture and storage, I think I've talked to you on your program about that in the past. Santos has just committed a $220 million project out of Moomba on the back of the Emissions Reduction Fund, which, as I say, was put in place by Tony Abbott and Greg Hunt a number of years ago. So there's some technologies that will rely on that incentive. About 10 per cent. It's very targeted, it's voluntary and that's in complete contrast to what Julia Gillard did when she put in place a whole of economy - or most of the economy - carbon tax, that raised the price of everything. That's not what we did with the Emissions Reduction Fund.

TOM ELLIOTT:  But, look, we're going to run out of time, but, I mean, are you confident that it's one thing to say: oh, look, we can do this with soil, and Santos has got a program here, and solar will get less expensive. But to take an entire economy the size of Australia, which depends heavily on fossil fuels, you know, whether it's transport, or heating the home, or generating electricity, which doesn't get talked about much, but it should, are you honestly confident that in a couple of decades we can get all of that down to net zero, just relying upon technological improvements? Because that's what I'm hearing.

ANGUS TAYLOR: That's the majority of it, is technology improving, and the answer is yes. It's three decades. The technologies have seen billions and billions, hundreds of billions of dollars of investment across the world. The costs are coming down at a rapid, rapid pace. There's a lot more work to do. Australia's playing a leading role in this, and I am confident that we'll look back in 30 years' time and say it wasn't a tax that did it, it wasn't government telling people what kind of car to drive that did it - it was just sensible technologies. You look back at the technology we had 30 years ago in this country, back in 1990, you and I can remember that, Tom. It was pretty different from what we're talking on today, the mobile phones of today. Technology changes a lot.

TOM ELLIOTT:  Yeah, it's true. Alright. Well, so it means most of us don't really have to do anything. We'll just wait for all the new gadgets to appear in the shops. Thank you for your time. Angus Taylor, the Federal Energy Minister.