Senator John MADIGAN (Victoria): During the last 12 months, many people have shared their concerns with me about industrial-scale wind farms in their neighbourhoods. They include farmers, conservationists, Landcare members, field naturalists and others. In my experience, most of the people upset by inappropriate, industrial-scale wind farm developments are not climate change sceptics. They are not deriding the need to reduce carbon emissions but rather trying to bear witness to the reality of industrial-scale wind farms in their neighbourhoods. The have learned that wind turbines are not a neutral technology. Large-scale wind farms can and do cause a range of serious problems. The planning of wind farms must be done very carefully. Without due care, inappropriate wind farm developments adversely impact the people living nearby, can severely damage the biological environment and impair the visual landscape. In order to assimilate these truths, based in common sense and sound conservation principles, we must stop thinking about wind farms in an ideological way and start paying attention to the facts.
When politicians and government officers embrace the orthodoxy that ‘wind farms are intrinsically good in all situations’, their decision making becomes distorted. They stop seeing and hearing the facts. Their critical faculties become impaired as do the assessment processes under their control. Whole communities of people and wildlife are now being stranded by processes that are not working properly and are not assessing the facts in an objective, impartial manner. A striking example of this orthodoxy is the highly controversial and totally inappropriate wind farm proposed for Bald Hills in South Gippsland. This proposal was approved in 2004-06 by the Commonwealth and Victorian governments after a contracted battle starting in 2002. The site for the erection of 52 large wind turbines, up to 135 meters tall – that is, 52 turbines each taller than the Sydney Harbour Bridge – is right in the middle of a significant wetlands and flora conservation area on the South Gippsland coast. The site directly abuts the Cape Liptrap Coastal Park, the Bald Hills Nature Conservation and Wetlands Reserve and the Kings Flat Nature Conservation and Flora Reserve.
Mr Acting Deputy President, I seek leave to table a 1982 letter from the then Victorian Department of Conservation, Fisheries and Wildlife Division to the local Shire Secretary. It supports the Shire’s application for National Trust funding to purchase land parcels to help establish and extend these nature conservation areas. I quote from the letter:
… without doubt – this land – can readily be converted to a wetland of great importance to a wide range of waterbirds. The location is on a flyway used by many species between eastern and western Victoria and will attract many birds as it will be one of the few wetlands in this region. …
The proposed wetland is close to the Tarwin River and Andersons Inlet, both important feeding grounds for water birds and will create a safe roosting and breeding site which, at present, are very scarce in this region.
After thirty years of continuous efforts by local people and organisations to protect this high value conservation area, home to numerous species of birds, the message from today’s Victorian and Commonwealth governments is: ‘Bad luck. Who cares if an established roosting and breeding site becomes unsafe? Who gives a damn about birds, wetlands and flora conservation when we’re in the business of approving wind farms?’ Who gives a damn, indeed? Who cares about the 296 recorded bird species living, roosting, breeding and flying around Bald Hills, Anderson’s Inlet, Cape Liptrap and Waratah Bay? Who cares that 21 are threatened species in the Cape Liptrap area; 31 are listed species under the Flora and Fauna Guarantee Act; 97 are listed as migratory under the Environment Protection and Biodiversity Act and that two of these are listed as endangered, including one critically endangered and one vulnerable; 40 are listed under the Chinese-Australian Migratory Bird Agreement, or CAMBA, for short; 45 are listed under the Japanese-Australian Migratory Bird Agreement, or JAMBA, for short; and three are listed under the Bonn Convention on Migratory Species?
Mr President, I seek leave to table a list of the 296 bird species identified in this South Gippsland area and their status under state, Commonwealth and international laws and agreements. It was prepared in 2006 by local conservationist and wind farm objector, Mr Andrew Chapman.
Is the Commonwealth environment minister, Tony Burke, concerned that the continuing government approval of the Bald Hills wind farm is causing Australia to breach its international obligations to protect migratory species listed under JAMBA, CAMBA and the Bonn Convention? I have written to Minister Tony Burke expressing my concern, asking him to ‘call in’ this project and stop it. I have also advised him that I have written to the Japanese and Chinese governments about Australia’s apparent breach.
I now stand beside that long list of objectors to the Bald Hills wind farm development, running to many hundreds of individuals, as well as the following organisations: the Australian Conservation Foundation; the Westernport Bird Observers Club; Bird Observers Club of Australia; the Prom Coastal Guardians Inc.; Tarwin Landcare Group; the National Trust of Australia; the Victorian National Parks Association; Parks Victoria West Gippsland District; South Gippsland Conservation Society; Tarwin Valley Coastal Guardians; Latrobe Valley Field Naturalists Club; Australian Plants Society Victoria; Kilcunda-Powlett River Foreshore Committee Inc.; South Gippsland Shire Council; and Inverloch Residents and Ratepayers Association.
Back in 2004 the Victorian assessment panel heard so-called expert evidence from an environmental consultancy firm hired by the then wind farm proponent. The consultants identified only 81 bird species, using field surveys conducted between 8am-ish and 5pm-ish. These observation times do not happen to coincide with the hours kept by many birds. The consultants limited their observation to 24 days, in the 12 months of a long drought period. A conflicting opinion made to the panel by another expert witness was that eight to 10 years of bird survey work was needed to develop a robust understanding. The panel criticised the consultancy’s reports, concluding:
This is a body of work that is approaching the threshold beyond which it cannot be used for effective, rationally based public decision making.
… at this stage insufficient information to allow proper assessment against the criteria of no impact on species listed under the Environment Protection and Biodiversity Conservation Act or the Flora and Fauna Guarantee Act.
Regardless, the then Victorian Minister for the Environment, Mary Delahunty, approved the wind farm proposal. When the federal environment minister at that time, Ian Campbell, intervened to ‘call in’ the proposal on bird protection grounds, he found himself on the end of a good public kicking by the then Victorian Attorney-General, Rob Hulls. Here we have dodgy assessments approved by some politicians pushing the belief that wind farms are intrinsically good in all situations. Anybody who gets in the way is stomped on.
Since 2006, the original proponent has sold on its approval to build the wind farm to a wholly owned subsidiary of Mitsui and Co. Will a wind farm at Bald Hills significantly reduce Mitsui’s carbon footprint? Mitsui and Co. are joint owners and operators of five coal mines across Queensland and New South Wales, exporting coal to Japan and elsewhere as fast as they can dig it up and ship it out. Mitsui are major developers and exporters of gas, part owners of Woodside offshore petroleum and other developments. Mitsui were party to the catastrophic failure of the BP rig in the Gulf of Mexico. In the 2011-12 financial year, Mitsui and Co. energy businesses generated some $A20.78 billion in income. On their website, Mitsui describe some of their energy business goals:
Our Energy Business Unit 1 aims to maintain a well-balanced energy resource portfolio and to enhance its trading and marketing activities while establishing a stable supply system to meet growing energy demand.
Mitsui’s core oil and gas assets for exploration, development and production are based in the Middle East, South-east Asia, Oceania and the Americas. In Oceania, we have operations in the Enfield and Vincent oil fields. In the coal business, we have been developing and expanding our coal mining holdings in Australia, and have been increasing total production volumes. We are pursuing the stable supply of nuclear fuels in view of the long-term need for nuclear power generation. We are also pursuing development of non-conventional energy resources including shale gas/oil, and new technologies such as commercialization of clean coal technology.
I may be just a blacksmith, Mr President, but Mitsui does not sound too concerned about reducing the carbon footprint of its energy businesses. Quite the opposite. A wind farm at Bald Hills will not reduce Mitsui’s carbon footprint. However, it may mislead some people by green-washing the fact that Mitsui’s carbon footprint seems to be getting bigger.
I would like to conclude with some comments drawn from submissions made by a local South Gippsland ecologist called Lucas Bluff. In his 2004 objection to the Bald Hills wind farm he said:
The effects of climate change on the living world are very difficult to predict. However, the changes will be dramatic and they are already beginning to occur. Species will need to disperse freely in order to survive the effects of climate change.
He cites a number of scientists, already expressing concern about species being driven harder by climate change to migrate ‘through landscapes that human activity has rendered increasingly impassable’.
The pressures of climate change on species are driving them away from the heat. We saw evidence presented last week of tropical fish species appearing in Tasmanian waters. We need to think about the same plight of migratory birds: more birds moving south along their flyway and directly into the proposed Bald Hills wind farm. I call on the federal government and Minister Tony Burke to intervene and to stop this harmful project.
The PRESIDENT: Is there any objection to the tabling of the document? There being no objection, the document is tabled.
Senator Sean EDWARDS (South Australia): It seems our moons are in alignment between Victoria and South Australia, Senator Madigan, because I too rise on to speak on wind energy. You could probably head it: ‘Blowing away the spin of renewable energy developers pocketing taxpayers’ cash – the money-go-round’. I have a different take on the same issue but, nonetheless, I think we are probably talking from the same song sheet.
I rise tonight to talk about the proliferation of wind farms in South Australia and the adverse impacts they are having on my home state. I do not come to this issue from a perspective of whether or not there is a health impact from the noise of turbines or blades, rather that Australians are paying dearly for this renewable source of power. More than half the wind power installed to date across this nation has been in South Australia. Proponents of wind farms claim these are now generating 31 per cent of the electricity from 534 turbines in South Australia, but they never acknowledge this growth is being driven artificially.
Renewable energy certificates have enabled the developers of wind farms to maximise their returns because of the Gillard government’s commitment to 20 per cent of Australia’s electricity coming from renewable sources by 2020. Electricity retailers are legally required to purchase a set number of large-scale generation certificates each year. One LGC equals one megawatt hour of generated renewable energy electricity. The market price for LGCs can fluctuate daily and has varied between $10 and $60 in the past. The end result is that South Australians are paying the highest electricity prices in the nation. Power charges have risen by more than 40 per cent since 2007 and are expected to increase by another 30 per cent over the next two years.
I have welcomed an academic’s critique of wind farms because consumers and taxpayers need to know how much this form of renewable energy is costing them. I refer to the statement of the University of Adelaide’s climate change professor, Mr Barry Brooks, who said:
There’s no guarantee that building wind farms will bring down power prices. It certainly hasn’t to date …
Wind costs a lot of money to build and then it has to be financed and then paid off and when the wind’s not blowing it has to be backed up by something like gas. It’s not cheaper than gas or coal right now; it would be more expensive …
It’s not going to bring down the cost … the overall trend is clearly that power prices are going to go up.
Senator Madigan, you would strike a chord with those comments. These remarks by Professor Brooks highlight that wind energy has its limitations. They are a factor in why South Australians are being charged some of the most expensive electricity prices in the world, behind only Denmark and Germany. Apologists try to blame sharply rising power charges on the need to replace ageing poles and wires, but infrastructure costs do not account for all of those increases.
Wind farm developers have concentrated on South Australia because of the benevolent planning guidelines of the Rann-Weatherill Labor governments, unmatched by any other Australian state. These planning policies have allowed turbines to be erected only one kilometre from houses with no rights of appeal by landowners. It is extraordinary stuff! Because of tougher regulations in Victoria, three developers want to erect 220 turbines along the Limestone Coast, not far from you, Senator Madigan, in the south-east. These projects are known as Woakwine, Green Point and Allendale East – I am sure you know them. However, a development assessment panel of the Goyder Council at Burra in South Australia’s mid north have held out. They rejected the 41-turbine Stony Gap wind farm proposal submitted by the power company, TRUenergy. But TRUenergy said it had strong grounds to appeal against the decision – a first under the state government’s wind farm legislative reforms.
The five-person panel from the Goyder Council voted three-two against it on the basis of health concerns relating to noise. But TRUenergy said its application met all the state planning requirements. I am sure it did. It is appealing against the decision in the Environment Resources and Development Court. TRUenergy has also applied to the Clare and Gilbert Valleys Council to add six turbines to its Waterloo wind farm near Clare, my home town.
On 3 August, what was said to be the biggest wind farm in South Australia was announced – the $479 million Snowtown II project, involving 90 turbines with blades a record 108 metres long. A major player in the proliferation of wind farms in South Australia is Pacific Hydro, a company under the control of trade union industry superannuation funds that have close links to the Gillard government. Pacific Hydro operates the 27-turbine Clements Gap wind farm near Crystal Brook and now wants to erect 42 turbines at Keyneton, east of Angaston, which is close to the iconic Barossa Valley. It also has a $350 million plan to develop the Carmody’s Hill wind farm at Gulnare, north of Clare, 170 kilometres from Adelaide.
The company has targeted wind power projects to take advantage of the large-scale renewable energy certificates and taxpayer subsidies that it and other promoters are getting from the Commonwealth. The Clean Energy Council, which is the umbrella organisation for the renewable energy companies, conveniently overlooks that, without the certificates and taxpayer subsidies, wind power would be twice as expensive as coal or natural gas. One critic of wind farms has claimed that a three-megawatt capacity wind turbine that generates at the most $150,000 worth of electricity a year is eligible for guaranteed subsidies of $500,000 a year.
[Senator Madigan interjecting—]
Senator EDWARDS: That is right, Senator Madigan; you are right across this as well. On those figures, the Clement Hill wind farm is worth $13.5 million a year to Pacific Hydro and $21 million to Keyneton once its turbine blades are turning in the wind. By law, electricity distribution companies have to take power generated from renewable energy before either coal or gas, except for times when the wind does not blow and, if it is too hot or too breezy, the wind turbines are switched off. A renewable energy company relies on the certificates to bump up whatever it gets from the distributors from the sale of wind generated electricity, and one ex-union heavy has worked out how best for consumers and taxpayers to direct their money to his organisations.
The chairman of Pacific Hydro is Garry Weaven, a one-time assistant secretary of the Australian Council of Trade Unions, who decided that going into the superannuation industry was a much more lucrative career choice than that of a federal Labor MP. Pacific Hydro is owned by Industry Super Holdings through the IFM Australian Infrastructure Fund. IFM, or Industry Funds Management, which Mr Weaven was the founder of, manages assets with a total value of $29 billion for around five million fund members. Unions claim they do not control these industry funds, pointing to 50 per cent employer representation on the boards, but it is the union, Labor-linked officials who call the shots.
Besides Garry Weaven in Industry Super Holdings, other notable officials are: Bernie Fraser, the former chair and Treasury secretary under Labor PM Bob Hawke, also appointed as a Governor of the Reserve Bank; Anna Booth, former secretary of the Textile, Clothing and Footwear Union and currently chair of Slater and Gordon, the law firm where the Prime Minister used to be a partner; and Anne De Salis, a former staffer to Paul Keating. Four of the seven have an identifiable Labor background.
Mr Weaven has said the investment in Pacific Hydro was an excellent decision. That is an understatement. Renewable energy certificates are giving tremendous returns to the companies involved, but it is at everybody else’s expense. Industry SuperFunds took out a double-page spread on pages 2 and 3 of the News Limited state newspapers on 20 August – only yesterday – and these paid ads make the point that Industry SuperFunds have pioneered direct investment in long-term assets like wind farms. Also, the industry-union superannuation funds will soon have more money to invest in wind farms with Labor, increasing the superannuation guarantee from nine per cent to 12 per cent by 2020. These funds have perfected the money-go-round.
According to Ray Evans and Tom Quirk in the July Quadrant article ‘The Ruinous Privileges of Renewable Energy’, it is said the union super funds have $3 billion invested in Pacific Hydro, almost 10 per cent of their entire portfolio, and that Pacific Hydro would collapse if the mandatory renewable energy target scheme was repealed. Now, the state government has approved the $900 million proposal to put up 105 turbines at Hornsdale, between eight and 24 kilometres north of Jamestown. The application was lodged on 26 October last year, not long after then Labor Premier Rann eased restrictions on the development of wind farms to give backers more certainty, while removing third party appeal rights.
The promoter, Investec Bank, sure knows how to influence the right people. It sponsored the Wallabies–All Blacks rugby union Bledisloe Cup test match in Sydney on 18 August. On its website, Investec is offering a 5.3 per cent guaranteed return on fixed deposits for 90 days. That is much more generous than what Australia’s big four banks or even government bonds are offering. Investec Australia, chaired by the respected businessman David Gonski, is obviously relishing the financial benefits of renewable energy certificates. The Greens-Gillard government has expanded the framework and the investment bank is taking advantage of the commercial opportunities. It already has two wind farms in Western Australia and Victoria.
In South Australia, nearly 1,300 megawatts of wind power have been approved and are awaiting construction. Hornsdale alone will account for up to 315 of those megawatts. Boosters of wind farms brag about how much they have expanded in South Australia, yet they want electricity consumers to ignore how much power prices have increased. No matter the excuses, the two are inextricably linked – and taxpayers and consumers are being gouged. This has prompted SA Liberal shadow planning minister, Mr David Ridgway, to chair a parliamentary inquiry into any link between the number of wind turbines and the enormous electricity bills in South Australia.
Cameron O’Reilly, chief executive of the Energy Retailers Association of Australia, revealed what has been going on. He stated:
Reserving 20 per cent of generation through the Renewable Energy Target for technologies like wind has undermined the principles of an electricity market based on marginal cost. Investors would quite rightly cry foul if the RET were abandoned.
We are paying more for our power because of the influence of the renewable energy proponents on the federal and state Labor governments and the Greens.
South Australia has an average electricity price of 28.6c per kilowatt hour. Yet the Clean Energy Council claims that renewable energy, specifically wind, is only responsible for two per cent of consumer’s bills. Excuses include an upsurge in rooftop solar panels, the South Australian electricity network is big in area and extra network costs due to the additional spending required to upgrade ageing poles and wires. But these factors do not camouflage the part played by renewable energy certificates. Renewable energy should not be dependent on subsidies forever to sustain the wind farm industry.
This form of renewable energy is a long way from being a baseload supplier of power when it is needed most at peak demand. Wind only contributed 60 megawatts during maximum demand in the summer of 2011, although at times during the week either side of that maximum demand output reached 873 megawatts – in other words, when the power is most required, you cannot depend on wind farms to supply it. It is all very well for wind farm developers to be talking up the potential of their industry, but there is a lack of transmission lines with spare capacity to take the energy generated from additional wind farms.
Those pushing for the expansion of the wind farm industry point to possible areas that could be developed along the Yorke and Eyre peninsulas and on Kangaroo Island. However, these areas have plenty of wind but do not have much spare transmission capacity. ElectraNet, the transmission network service provider, stated in its annual report last year that the capacity to export such energy was limited because of the restrictions of the interconnector, and this was already particularly noticeable during period of light load and high-wind conditions – in other words, the wind farms are generating excess power at times when there is reduced demand within this state and it cannot be sent elsewhere because of limited transmission capacity, so it is not being used.
The proponents of the wind industry want the government to fund the development of greater transmission capacity within South Australia plus a connector interstate to offload that unused green power. It is all very well for wind farm developers to be talking up the potential of their industry, but there is a lack of transmission lines with spare capacity to take the energy generated from additional wind farms. The wind farms are generating excess power at times when there is reduced demand within this state and it cannot be sent elsewhere because of limited transmission capacity.
There has been pressure for the renewable energy certificates to be wound back since the carbon price was introduced on 1 July at $23 a tonne. For renewable energy to be anywhere near the price comparable with either coal or gas, the carbon price would need to be more than $50 a tonne and over five times what the unregulated world market in Europe is trading at right now. The only guarantee is that the price of electricity will keep on increasing.
In South Australia, the average yearly household electricity bill has gone from $770 in the mid-1990s to more than double that at about $1,600 today. This is the time for all Australians to put this matter at the forefront of the political agenda, lest we slip further behind in cost of living terms and business competitiveness. Renewable energy certificates might have been needed to kick-start a fledgling wind power industry but not anymore. As we can see by the topics raised in this adjournment speech, wind energy in both South Australia and Victoria is on the political agenda, and I urge the government to undertake an urgent review.
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