Federal energy minister Chris Bowen has dismissed reports of row-backs on clean energy and EV spending amid talk of a crunch of spending in the upcoming budget and apparent panic-buying from consumers because of the spike in global oil prices.
Over the past two weeks, media reports have suggested further changes to the home battery rebate, a rollback of EV support measures, and even an end to government spending on clean energy projects, reported in the Nine papers on Sunday.
Bowen called a surprise media doorstop ahead of a speech to the Climate Week event in Sydney on Monday, mostly to calm fears of supply shortfalls for petrol and diesel, and to say that speculation on clean energy spending was wrong – well, most of it, anyway.
“Giles, I found that story in the Sun Herald yesterday (about the end to government spending on clean energy) quite extraordinary,” Bowen said.
“It said there’s going to be no new big funding for renewable energy. You might as well say there’s going to be no big new funding for hospitals or schools. We’ve had record investment in all those things and that investment will continue. It will continue.
“I understand it’s budget time, it’s not my first rodeo. People are going to engage in speculation. The vast majority of the speculation I read in the newspapers is wrong. The day the budget will be revealed by the Treasurer will be budget night.”
The federal government has already announced major changes – and an extra $5 billion – for the home battery storage rebate, but those spending estimates may still be under pressure from the extraordinary uptake of home batteries, driven at least partially by a desire not to be held hostage by fossil fuelled energy companies.
The government is also under intense pressure from conservative media, which includes just about every major news source in Australia, to scrap the FBT exemption for EVs – despite the massive benefits it still afford to diesel utes and freight.
Australia’s response in the most recent fossil fuel price crisis – after the Russia invasion of Ukraine – was to subsidise fossil fuels to deflect the cost on consumers. The coal purchase subsidy in NSW was just one example.
Bowen is now pushing the line that it is Australia’s greater uptake of renewables (now at 51 per cent of supply), and of EVs, that is minimising the impact this time round triggered by the US and Israeli assault on Iran.
“The last summer we used 1.5 terawatts (hours) of gas,” Bowen said.
“In the summer of 2022 we used 2.7 terawatts (hours) of gas. I mean, that means while gas supply continues to be important, and has important impacts on pricing, nevertheless, the progress we’ve made on things like batteries and electrification mean that we are better prepared.
“Likewise, the same sort of planning we put in place for things like petrol and diesel, as we transition to more EVs, and the fundamental point that Giles made is correct, it’s important that we ensure good supply of petrol and diesel, but there are some in politics who argue that this crisis shows we should be more reliant on petrol and diesel. How they make that leap of logic is beyond me.
“The way you move away from fossil fuel use is to build renewable energy. We just hit 51 per cent of renewable energy in the grid. We’re seeing continued strong pick-up of renewable energy in this quarter. That’s the way you transition away from fossil fuels, as the COP has decided to do, and that’s what we’ll continue to do.”
Later, in his speech, Bowen notes that the production of renewables could not be halted by events overseas.
“The one form of energy which Vladimir Putin or a Middle Eastern crisis cannot interrupt is the flow of sun and the flow of wind …. and that is one of the reasons why we entered this crisis better prepared than before.”
Bowen insisted that, despite reports of panic buying and a lack of supply to regional towns, there were sufficient reserves of petrol and diesel in Australia.
“There’s absolutely no reason for panic anything,” he said. “Panicking full stop; panic buying, panic anything. Because unlike previously when … petrol and diesel reserves were held under (former energy minister and now Opposition leader) Angus Taylor in Texas, they’re held now in Geelong and Brisbane for easy access.”
But Bowen did concede there had been a spike in orders, which he described as a demand issue, rather than a supply issue.
“I have been speaking to the industry this morning. They’ve confirmed to me that every single contract is being honoured. Every contract for demand that has previously been ordered, for diesel, petrol or anything else is being honoured,” he said.
“There has been a big spike in extra orders over and above contracts, spot orders if you like, the spot market. And inevitably, when you’re seeing a huge increase in demand, they’re having trouble keeping up with that.
“This is not a supply problem, but we’re seeing a huge spike in demand. We’re talking to the industry about how best to manage that, openly and cooperatively with the petroleum and diesel industry, government and industry working together.”
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