Event: Jennifer Westacott interview with Stacey Lee and Nikolai Beilharz, ABC Adelaide
Speakers: Stacey Lee host, ABC Adelaide; Nikolai Beilharz host, ABC Adelaide; Jennifer Westacott chief executive, Business Council of Australia
Topics: Renewable energy; power prices; energy transition; manufacturing; Strong Australia Network

E&OE

Stacey Lee host, ABC Adelaide: In the studio with us is Jennifer Westacott the chief executive of the Business Council of Australia, thank you so much for coming in.

Jennifer Westacott chief executive, Business Council of Australia: You are very welcome.

Stacey: Now you're in Adelaide for a big lunch that's happening today and there are a few things that are going to be discussed. One of those is South Australia's clean energy future and what that looks like. How important is a clean energy future for a state like SA, when we've been hearing for weeks now that many people here, on this station, and people in Adelaide are struggling to pay their bills and the increases?

Jennifer: Sure, well what we're doing in Adelaide today is part of our Strong Australia Network, which is all about promoting key places across Australia. We've got lunch with the Premier, with Mike Henry, the CEO of BHP, with Sam Dighton, from the Committee for Adelaide and myself, with 250 people talking through these sort of issues.

But to your question, why does a clean energy future matter? Well, if you don’t get there your economy will not be competitive. So, if you go to the negative side of this, 47 per cent of Australia’s exports are carbon intensive. You've got capital markets around the world, moving billions, trillions of dollars actually, towards clean energy investment. This is about shoring up the future, making sure that we take the carbon out of manufacturing, take the carbon out of energy consumption, so that we can make sure that we can compete in a clean energy world. Now what is really crucial is to do that in an orderly way. To make sure we are doing that in a coordinated way and South Australia really seems to have got that coordination right. And then making sure that we are taking action to firm the system and obviously keep prices down. But the evidence is pretty clear that new renewable energy is cheaper than new coal. So, we've got to kind of come to terms with the reality of the world here.

Stacey: Yeah, we keep getting told that and I think a lot of South Australians after the statewide blackout, were really aware of that. And we got the big battery. And I think we were one of the states that had the biggest uptake of rooftop solar after that happened, because everyone realised, oh, renewables, it's where we go, that's what we were told. But we had the biggest increase in power prices - well, we will from the first of July here in SA - and you kind of think, is it cheaper?

Jennifer: Well, it's cheaper in terms of wholesale production. What's caused all the problems with pricing is that we have as a country just not got coordinated. We've had a stop, start approach to climate change schemes, we've had a real lack of investment by industry, that lack of investment flows through to prices. What we have to do is get a stable policy setting, not just in states like South Australia, but across the country. So that companies can start investing in new transmission, new technology and making sure that we're putting downward pressure on those prices. But as part of that we've got to remember there's another side to the energy story, which is the competitiveness of our economy. We will not be in manufacturing if we can't reduce the carbon emissions in our manufactured goods. Now, manufacturing is a huge part of the South Australian economy. Still a big potential for Australia. But one of the things that can make us more competitive is to reduce the carbon emissions in everything we produce. That on a world stage will start to make Australian products more competitive, because they are less emissions intense. So, it's that longer term vision that we need to be thinking about. And we also need to be super honest with people about the transition, we need to be super honest about the technologies that work, super honest about the technologies that are not proven, and steer a course as a country and get this thing done.

Nikolai Beilharz host, ABC Adelaide: So, what does work, what's not proven?

Jennifer: Well, I think this sort of battery stuff is good in certain locations. But the idea that batteries are going to kind of power up every home, that technology is not at scale yet. Hydrogen is not at scale yet. And obviously there's a terrific hydrogen plan here in South Australia and we've got to stay the course on that. Nuclear is proven, but of course people don't want to talk about it, at least we could get the regulatory settings right and wait for that technology to change. South Australia has been probably the only state in Australia that's been open to at least having a conversation about it. Gas works. Gas is proven. Gas is the transition fuel. It's vastly more emissions efficient than coal fired power. We have got to just be practical and realistic about what's going to work.

Stacey: You mentioned hydrogen there and we've got to stay the course. But it hasn't been proven yet. Why do we have to stay the course?

Jennifer: Because these things are like, everyone knows in the science world that we're sort of five or six steps away from getting this to be able to be put into major construction or major mining facilities. The question is on storage and transport, transport is obviously the hardest thing to do. But this is a technology when you do all of the reading on it that if we could break through, then it would transform the power system in Australia and obviously give us an incredible export advantage. So why wouldn't you stay the course? In the US …

Stacey: It's expensive. It is an expensive gamble.

Jennifer: It's not a gamble. I think it's one of those things where you say why didn't we stay the course on solar panels? We lost that advantage to China, we didn't back it in and now 90 per cent of solar panels are produced in China, what could possibly go wrong? So, we need to be backing some of these things in but at the same time managing that transition in a careful way, going with the proven technologies. But not for a minute doing what we've done in the past as a country, which is to say we'll leave that for somebody else to sort out and then find out we actually don't have a competitive advantage. And all of the experts say we should really look at hydrogen. We've got a big problem though in that we can't compete. So, the United States has got this Inflation Reduction Act. It's sucking money out of the rest of the world. We are not competitive as a country for many reasons, tax, regulation, we need to fix some of those things and then see if we can get that investment. But we ought to have all the cards on the table. We shouldn't be ruling things out in what is going to be a complex technology transition. Because suddenly someone makes a breakthrough, like they did with solar panels, and everyone says, oops, we gave that away.

Stacey: It's such a big conversation and unfortunately, we don't have time to get into any more detail Jennifer Westacott. But thank you so much for coming in we appreciate your time.

Jennifer: You're very welcome. Thank you.