Colin Boyce

I rise to resume my contribution to the Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024. We were talking about Stanwell Corporation in Gladstone, which is proposing to build a liquefied hydrogen and gaseous hydrogen production plant in Gladstone. This is in conjunction with several international consortiums—among them, Iwatani, Marubeni and Keppel. Recently we've understood that the Japanese Kansai Electric Power Company has withdrawn from the proposal. You would have to ask yourself: why is that? They continually quote the same things—the economic cost of producing hydrogen, liquid hydrogen, and transporting hydrogen. We've seen other companies, such as Fortescue, Origin, Woodside, Krupp steel—the German steelmaker—and so forth also withdraw their support from these huge proposed hydrogen projects, purely based on the economic costs of them.

With respect to the Gladstone proposal, Stanwell Corporation is proposing to make an 800-tonnes-per-day liquid hydrogen facility and also to produce 1,200 tonnes of gaseous hydrogen. They also intend to build an ammonia plant there. The problem with all of that is that, if you actually analyse what their proposals are, they are going to be enormous. Global installed hydrogen liquefaction capacity is around 355 tonnes per day right now. The largest plant currently in operation has a capacity of 34 tonnes per day. The all-time largest hydrogen liquefaction plants were constructed at NASA during the 1950s and 1970s, and most recently-constructed plants are small in comparison. Nonetheless, even if specific energy demand of liquefaction can be significantly lower, the capital costs of liquefaction are still a significant part of the overall cost of liquefaction—even for larger plants. It is estimated that the capital investment consists of around 40 to 50 per cent of the specific liquefaction costs of these plants.

We know that the largest liquefaction plant is at Cape Canaveral, at the Kennedy Space Centre—34 tonnes a day. What Stanwell is proposing is to build a plant that's capable of producing 800 tonnes per day.

The storage capacity at Cape Canaveral is about 800 tonnes, so you would imagine that Stanwell would be proposing to build its storage capacity for at least 10 days production; therefore, we would need to have a storage capacity of something like 8,000 tonnes. The reality of this project is that it could possibly be 10 times bigger than the liquid hydrogen facility at Cape Canaveral at the Kennedy Space Center right here at Gladstone. That then raises questions of the enormous capital cost involved in doing this, like why is that these large international companies are withdrawing their support? As I have said before, Fortescue, Origin, Woodside, Krupp Steel in Germany and now Kansai—a Japanese electric company that was part of this original consortium—have now withdrawn their support and it is all over money, the economic cost of it.

Saul Kavonic, energy analyst at MST Marquee, said 'green hydrogen economics are so uncompetitive that even with generous government subsidies and a captive buyer, it still struggles to work'. For me, I would ask the question: why is the federal government supporting a Queensland government GOC along with the previous state government investing millions and millions of taxpayers' dollars in projects that are economically unviable? We have people living in cars, people living in tents, families that can't send their children to sporting practice yet here we have governments continually wasting money on what is clearly economic madness.

The government's Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024. proposes to bring about a regime where they will give tax credits to try and alleviate the cost of producing things like liquid hydrogen and gaseous hydrogen and, once again, the numbers simply don't stack up.

I want to talk about another point—that is, First Nations procurement—which I outlined earlier in my contribution. We know from the documents that Stanwell has put before the EPBC office that already there have been agreements for reparations and inclusion of First Nations people and so forth in these projects. In the documents it says that memorandums of understanding agreements have been made; however, these agreements will not be made public because of their sensitive nature. Well, I take great exception to that. This is taxpayers' money we are dealing with, with both state governments and the previous federal government, who are dealing with a Queensland government GOC with taxpayers' funds. Why can't we be transparent and accountable about who is doing these deals with the First Nations proponents? What exactly are they and how much money is involved? This is, once again, why I call for Aboriginal corporations to come under Australian corporate law so that we can see where all of this money is going, who is making these deals and the numbers involved.

As I've outlined, these projects are economically not sound and green hydrogen as a viable alternative into the future is a long, long way off. We just simply do not have the technology to do that. The World Steel Association in their fact sheet have said the world produces about 70 million tonnes of hydrogen right now. Three-quarters of that hydrogen is produced from natural gas, about one-quarter produced from coal. If we were to change that and produce that 70 million tonnes of hydrogen through green energy and so forth using wind turbines, solar panels and batteries, the amount of energy required to do that would be 3,600 terawatts hours of energy—renewable energy. That is more than the entire generating capacity of the EU.

So, once again, I would question building an 800-tonne-per-day liquid hydrogen facility in Gladstone, 1,200 tonnes a day of gaseous hydrogen, building ammonia plants and so forth. How many wind turbines, solar panels and batteries will be required to be installed in Central Queensland to make this thing work? It simply doesn't make economic sense, and that is why I and the coalition do not support this bill.

Meryl Swanson

A Future Made in Australia is the flagship policy for the Albanese Labor government, but, more importantly than that, this $22.7 billion investment guides and positions us towards a shared goal of rebuilding our nation's domestic manufacturing base and also participating in a new global economy that is upon us right now. If we are not fleet footed, sure footed and front footed, we will be last in this global race. We have everything we need to be part of it, and we must lead the way. We are going to be securing good jobs for blue-collar workers. We're going to be part of this emerging world market for new forms of energy like hydrogen.

The Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024 is a vital element of ensuring the success not only of this policy but, quite frankly, of our country in a world that is ever hungry for energy and ever innovating. We have the critical minerals. We have the things that are absolutely required to take us on this journey. This is the way of the future, and it is the future of Australia. We must be part of it. We know our short-term and immediate policy initiatives have been strong and effective: tax credits for every taxpayer, energy bill relief and cheaper medicines, just to name a few. Through these measures, we have put more money back into the accounts and pockets of every Australian taxpayer, and that counts. This piece of legislation is going to help secure the future of our economy.

We know we can't click our fingers and arrive at the finish line in that global race straightaway. We know that things take time. But, like all good governments, we have put in the hard yards to build responsible policy. We're now building long-term policy, and we are future focused, and that's what these production tax credits are about. They are about saying to companies, 'We are going to give you a credit because you are paving a new way and charting a new course for our future.'

Yes, some of the technology is still emerging, but we have to be part of it. We can't get left behind. Our government has been clear and transparent about our ideals, our intentions and our aspirations in designing a road map for a more resilient Australia, and we saw this during COVID. We saw very clearly that there is a delicate balance between trading with the rest of the world and having that trade reduced by something like a viral pandemic. We do need a certain amount of resilience in our own manufacturing sector, so we have to strike that incredibly important balance between what we can mine and manufacture here and what we, importantly, trade with the rest of the world. This is what smart governments do. We don't turn our back and face in one singular direction. This is a multifaceted, multidirectional and, quite frankly, multitechnology world that we live in, and we must be part of it.

For many decades, we were considered world leaders in energy, and we still are. We keep the lights on in places like Tokyo, Taipei and Beijing with our incredible coal, which is mined in places like my electorate and that of my friend and colleague the member for Hunter, and we know that that's an enormous part of our current energy mis. But we also know that, as the Minister for Resources has said time and time again in this parliament, the road to net zero runs through the Australian resources industry, including things like critical minerals. This bill is going to deliver targeted economic investments in key industries such as renewable hydrogen and critical minerals, and it's going to unlock private investment. I couldn't be prouder to support this bill today, and I just say to those opposite: get on board, because we cannot be left behind in this race.

Long debate text truncated.

Summary

Date and time: 11:19 AM on 2024-11-28
Allegra Spender's vote: No
Total number of "aye" votes: 73
Total number of "no" votes: 61
Total number of abstentions: 17
Related bill: Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024

Adapted from information made available by theyvoteforyou.org.au