Event: Jennifer Westacott interview with Natalie Peters and Michael Pachi, 2GB
Speaker: Jennifer Westacott
Date: 8 October 2017
Natalie Peters, co-host: Joining us on the line to explore the energy crisis further is Jennifer Westacott, the chief executive of the Business Council of Australia. Now, the business council represents the largest companies in the country, including some of the energy providers, and it's also one of the groups backing this WTF campaign. Jennifer, thanks so much for your time this Sunday evening.
Jennifer Westacott, Business Council chief executive: Thank you very much.
Natalie: So do you agree energy is one of the biggest, if not the biggest, issues facing Australia?
Jennifer: Absolutely. This is a huge issues. It's a huge issue for families, as you've said, it's a huge issue for businesses, particularly small business. We've really got to come together as a country and try and sort this out.
Natalie: The poll we mentioned shows that power bills are putting pressure on 70% of households. Business are no doubt also worried about the pressure on their operations. Have you put a number on how many it's affecting, or what the impact is at this stage?
Jennifer: We haven't put a number on it, but every business I talk to, whether they're a small business or a big business, they say, "Look, these rising energy costs are really starting to hurt us." And, you know, you'd know from getting your own bill, and people listening Getting their own bill, particularly from winter would know, hey, that's very different to the bill I got last year. So it's really starting to pinch, and as I said, we've just got to try and sort it out as a country.
Michael Pachi, co-host: Well, Jennifer, who do you think is to blame here? Government policy or do the power retailers, some of whom are your members, do they need to shoulder some of this responsibility?
Jennifer: I think we need to go back and say, how did we get into this mess? And I'll be honest with you, we got into this mess because of some really poor policies in the past. We've had this mish-mash of green schemes, our renewable energy target that was really, really poorly thought through that has put prices under pressure and energy short in South Australia. We haven't been able to work out how to get the renewables to work with the base flows, you haven't got reliability. We've had, you know, how many starts have we had a carbon scheme that made it very difficult for people to make long-term investments.
Look, you can see the retailers coming to the table, trying to sort this out with government. Everyone's got to shoulder some responsibility here, but I really do have to put a fair bit of this on historic government policy, both from the commonwealth and from the states. The states have locked out their gas resources. We've got, as you've said, heaps of gas in this country. We ought to be able to be an export superpower, because that brings jobs and a lot of economic activity to the country, and look after domestic uses. We've got enough of that, and you've got states with these crazy moratoriums on gas.
Natalie: Well, Jennifer, we'll get to the export issue in just a moment, but you mentioned green schemes. The survey shows that most individuals are motivated to save energy by cost, rather than the environment. Do you think the environment's been too much of the focus on policies by government, given what real Australians are worried about day to day, which seems to be cost, not environment?
Jennifer: Yeah, that's a really good point. I think what's happened is we've tried to do things not in a joined up way. What I mean by that is we've done climate policy without thinking about electricity costs, and then we try and fix electricity costs not being cognizant of the fact that you've actually got to kind of resolve the fact that we've set this carbon target.
So we need to solve them together, but there's been a lot of focus on green schemes, a lot of focus on the renewable energy target, and of course we've got to make sure that we achieve our environmental obligations, but not by making our energy unaffordable. Not by ruining one of the best things we had going for us as a country.
Michael: Jennifer, let's have a look at the gas issue, and there has been a bit of a stash over gas supply. I'm interested to know how we can actually reach a compromise on this issue, which is a realistic compromise.
Now, the federal government is calling for more gas to be extracted in New South Wales and Victoria, but many people, including our very own Alan Jones, he argues, "Why should we damage prime agricultural land when the country does have an abundance of the resource?" Surely there is an argument to make sure there is enough gas for the domestic market before we do sell it overseas.
Jennifer: Well, we've got to get both things in balance, haven't we? Because you think about the fact that, you know, the amount of economic activity that's created by us being an energy export superpower, and we should be one of those. And then we've got tremendous resources. Look, I understand the issue about making sure we don't trespass on prime agricultural land. But every state has had one of their chief scientists work out where it's safe, and we should listen to them, and the state should work very carefully to make sure that where it's safe to extract, we extract it. Because it's crazy that we're sitting on these resources in Victoria or in New South Wales, where we could safely extract it, and of course we've got to make sure we preserve those prime agricultural sites. So I think we can actually get the balance right; we've just got to sit down and work it out.
Michael: Well, New South Wales, Gladys Berejiklian, the premier, is saying that New South Wales has the balance right, but Victoria is more of a problem because they put clamps on fracking and also on extracting gas in a more conventional way.
Jennifer: That's right.
Michael: So is Victoria more of a problem than New South Wales?
Jennifer: I don't think there's any doubt about that. I mean, look, I think New South Wales could actually do more, and of course they've got to do that in an environmentally responsible way, and they've got to, as you've said, take account of that prime agricultural land. But Victoria has put a ban on conventional gas. I mean, people can't have it both ways. They can't stand up and say, "We want our manufacturing sector to thrive, we want our small businesses to thrive, but we're not going to take steps to unleash some of the resources that we've got sitting in our state borders." And we've just got to kind of come to terms with that.
One of the things I'd like to see is that we end the blame game here. I mean, everybody has got something to be accountable for here. We've got to get people together and try and work it out as a county. This is one area now where we've really got to put politics to one side, listen to that survey that you've quoted, listen to the people of Australia, listen to the small businesses and the big businesses who are hurting here and say, hey, let's put the national interest in the front here.
Natalie: And how open do you think that these decision-makers are to new solutions, ideas put forth by everyday Australians? Where do you think we'll find this solution?
Jennifer: Well, I think we're going to find it through business, through ordinary Australians. I think there's a great initiative. Because some people, common sense sometimes doesn't prevail in policy making. Australians are great at common sense. Let's see some common sense solutions coming out of the community. I'd love to see them, talk to people about them, sit down with people, maybe put them together with some of the big businesses and hear from ordinary Australians what they think are some of the solutions.
Natalie: And what do you think is the solution?
Jennifer: Well, I think you've got to have a kind of comprehensive approach. And what I mean by that is ... What we've got at the moment is that we're talking about one project here, and another project there. We need a comprehensive solution. So the first thing we have to think about is security. Okay, have we got all the rules right to make sure that we can secure our supply? Reliability. How do we keep capacity in the system? How do we make sure we've got the right capacity in the system? How do we make sure we don't lose capacity? So Hazelwood came out very quickly, and that caught everyone by surprise.
And then we've got to think about affordability. How do we bring supply into the system? And that's where the gas situation comes in. And then we've got to think about how do we meet our emissions reduction target? And that's got to be practical common sense ideas and making sure that we leave room for all technology. You know, one of the big mistakes we've made here is to try and say coal is bad, wind is good. We've got to stop that conversation. We've got to make sure that all of the technologies and all of the resources that are available in this country are on the table as part of the solution.
Natalie: Jennifer Westacott there, the chief executive of the Business Council of Australia.