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We Need to Talk About Energy!

This week has been dominated by energy issues. Major energy users were asked to switch off or limit their usage. Households and businesses were openly told to leave energy retailers, by the retailers themselves. And commentary from the sector and others says there is a growing risk of collapse in the system with a number of companies potentially about to go under.

There are a bunch of reasons for this current crisis. Firstly, several coal powerplants are having trouble either getting coal or keeping their plants online. Some have maintenance issues; others are having trouble getting trains through to supply them. Secondly, domestic gas pipelines are running at or near capacity, while significant volumes are contracted to head offshore without sensible domestic supply guarantees. Thirdly, the price of both coal and gas have increased dramatically thanks to the war in Ukraine as Europe in particular tries to source energy from anywhere but Russia. This will be an ongoing factor in the energy market, even after the war and Australia is well placed to help fill this need. Fourthly, several gas and coal projects, including some completely designated to domestic supply, have been held up in red and green tape for a decade meaning no new supply is coming online. And finally, the transition to renewable energy has been delayed by a number of factors, most notably over a decade of climate wars and inaction by the Federal Government. It also of course costs a lot and takes time to build these facilities and connect them to the grid.

We all know gas and coal cannot be just switched off overnight. Hydro, hydrogen, wind, solar and batteries are not yet to scale, not yet readily available and dispatchable, and in a lot of cases aren’t built or connected to the grid. The most likely and arguably the best option we have available as the market transitions and that new technology comes online is gas. Minister Bowen held an emergency meeting of the nation’s energy ministers this week and they have agreed to forge ahead with plans to pay baseload energy providers to maintain extra capacity to fill periodic shortfalls in supply. The imposition of a domestic gas reserve for future and expanded gas fields, and rejigging the domestic gas trigger activated by price, not supply are also on the cards.

But ultimately, there is no short-term win or solution. The transition is going to be difficult and very likely it is going to be expensive. We will continue to push to keep costs down and increase reliability, including through the transition, but particularly into the medium and long term. Interestingly, as an aside, the ACT is one of the only jurisdictions where prices are holding or even falling and we are at 100 percent renewables already – so maybe there is some hope that once the system is up and running it can work well.

The final point I wanted to raise was the nuclear option. The Nationals are pushing hard for nuclear to be considered and the broader Coalition seems to be somewhat on board. The cost of establishing a nuclear generator, even the smaller or mobile ones, is incredibly high. We do hold huge reserves of uranium, but just building the plant would take decades to pay off. There would also be significant social license obstacles and community concern for nuclear. My concern is not necessarily for the safety of the plants (although it is an obvious risk) given the technology has progressed along way.

My concern is for the waste. Fission produces unstable elements which can have a half life of over 24,000 years for some (like plutonium). In the US, they use a series of pools and crates to store spent fuels, but even though it has been debated for decades they still do not have one single long-term storage facility (you can read more here https://www.nrc.gov/reading-rm/doc-collections/fact-sheets/radwaste.html). Maintenance and security of these facilities would be critical to ensure they didn’t leak into the ground or fall into the wrong hands. And, is burying the problem really a good solution or are we just handing on a problem for people to handle for potentially hundreds if not thousands of years into the future? Fusion on the other hand produces very limited to no unstable elements and does not risk meltdown like fission plants, however the technology is still relatively new. According to the IAEA, they are hoping to have the first prototype plant online in 2040 with power generation towards the end of the century. So we are a fair way away from being in a position to rely on fusion.

You can find out more here if you’re interested https://www.iaea.org/topics/energy/fusion/faqs.

CEO Report

What a whirlwind couple of weeks it has been! A new government, a new opposition, an energy crisis, economic headwinds, rising inflation and cost of living, falling house prices, a forgotten pandemic and a continuingly challenging international environment.

The new Government has its work cut out for it.

I have written to the new Prime Minister and Ministers to congratulate them on their appointments and let them know where NIC stands on a number of issues. I have also asked for meetings with the Ministers and have issued invitations for them to meet with NIC members in the near future.

Tanya Plibersek has been sworn in as Minister for the Environment and Water, and Murray Watt has been appointed Minister for Agriculture. Chris Bowen and Jenny McAllister take on the Minister and Assistant Minister for Climate Change and Energy roles. Linda Burney and Malarndirri McCarthy are the new Minister and Assistant Minister for Indigenous Australians. There are six new Ministers in the Infrastructure, Regional Development and Communications portfolio - Catherine King, Michelle Rowland, Madeleine King, Kristy McBain, Carol Brown and Anthony Chisholm – and I’m just awaiting confirmation on which of these Ministers will be responsible for water infrastructure. Finally, Ed Husic is the new Minister for Industry and Science and Tim Ayres is the new Assistant Minister for Manufacturing.

NIC extends our congratulations to the Ministers and very much looks forward to working with them to secure the future of the irrigated agriculture sector which is feeding and clothing Australia and the world.

The new Opposition has also been appointed under the leadership of Peter Dutton.

I have also written to the Opposition Leader and the Shadow Ministry to congratulate them on their appointments and to request meetings to discuss NIC’s policy priorities.

David Littleproud continues in the Agriculture portfolio and has been elected Leader of The Nationals, while Perin Davey takes on the Shadow Ministry for Water and Emergency Management and has been elected Deputy Leader of the Nationals. Jonathon Duniam has been elevated to Shadow Cabinet has Shadow Minister for the Environment, Fisheries and Forestry, and is joined by Ted O’Brien as the Shadow Minister for Climate Change and Energy, supported by Hollie Hughes as Assistant Minister for Climate Change and Energy. Julian Lesser is the new Shadow Minister for Indigenous Australians. Sussan Ley has been elected Deputy Leader of the Liberal Party and is the new Shadow Minister for Industry, Skills and Training, while Michelle Landry has taken on the role of Shadow Assistant Minister for Manufacturing. Finally, there are also six Shadow Infrastructure, Regional Development and Communications Ministers: Bridget McKenzie, Sarah Henderson, Susan MacDonald, Andrew Gee, Anne Webster and Tony Pasin.

NIC extends our congratulations to the Shadow Ministry on their appointments and again looks forward to working with them to progress issues and address challenges in the irrigated agriculture sector.

The Machinery of Government changes have commenced. There is a new super Department of Climate Change, Energy, The Environment and Water which we will work closely with, as well as the Department of Agriculture. The existing water agencies will move under the new department as well as the policy and legislative functions which have been in the current Department of Agriculture, Water and Environment. It remains to be seen on whether the Government will in fact revive the National Water Commission and potentially create the new Water Markets Agency, or whether it folds a number of these processes into one agency – for example the Inspector-General of Water Compliance – and whether these agencies assume the responsibilities of the Productivity Commission and Australian Competition and Consumer Commission in regard to water. The energy regulators and agencies will also move across to the new super department, where necessary.

With all of this in mind, there is a significant amount of change in Canberra. Committee appointments will soon be made and we will map out our stakeholders and start building/rebuilding connections to engage. It will take several weeks for Ministers to recruit staff and for the Parliament to be sworn in and get working. At this stage, I’m hearing the last week of July will be a sitting week and hopefully we will get an understanding of the sitting schedule for the rest of the year. There will also be a new Budget delivered around 25 October and we will engage in that process.

In other news, the South Australian Government delivered its Budget last week. The Budget included $2 million for the establishment of a Commissioner for the River Murray in South Australia. MDBA has put out projections for ‘wet and wetter' conditions across the Basin. There’s been articles published this week discussing the possibility of La Niña remaining active. Given three back-to-back weather events have resulted in 80% crop losses in some areas and lettuces at $12 a head, other significant rainfall events may continue to put upward pressure on prices and may affect crop yields. ABARES have released figures to show agricultural trade is at record levels, while noting projections are excellent for winter crops. You can find out more about these in the Useful Links section below.

Finally, I wanted to mention the River Reflections Conference which was held in Mildura last week. I attended and had the opportunity to meet with a number of key stakeholders from the MDBA, CEWH and DAWE, as well as important representatives from First Nations communities, environmental interest groups and the business and tourism sectors. It was an extremely positive conference with participants again reiterating the need for collaboration, not conflict to progress future water policy. Minister Plibersek also made an address (on her second day in the job!) outlining some of her key priorities going forward. We’ve included the link to the video below.

As always please feel free to get in touch if you would like to discuss any or all of this update, or on any other matter.

All the best.

Cheers, Isaac

Position Vacant: Public Policy Officer

NIC is currently recruiting!

We are on the lookout for a new Public Policy Officer to join our team in Canberra.

The successful candidate will be responsible the development and management of NIC’s Water and Energy Policies. The candidate will advise the CEO, Board and Council on relevant public policies, including political announcements and how those policies may impact the irrigated agriculture sector. The candidate will engage with politicians, their staff, the public service and other relevant stakeholders to gather information and share NIC positions to help shape public policy. The role will also be responsible for drafting submissions to government inquiries and helping to prepare the CEO and Chair for committee appearances. The candidate will also be responsible for coordinating the Agriculture Energy Taskforce – a group of the peak agriculture organisations in Australia – including managing meetings and policy for the Taskforce. Finally, the role will also have research, stakeholder engagement and some administration functions supporting the Council.

The successful candidate will ideally have experience in public policy and/or politics. They will preferably have experience in water, energy, environment and/or agriculture policy, but it is not essential. The candidate will have an understanding of Australia’s political and parliamentary systems, and of Government Departments and Agencies. The candidate will have exceptional communication skills and a high level of organisational and research skills.

Please feel free to share with your networks or to apply! You can find out more here:

LinkedIn: https://www.linkedin.com/jobs/view/3087572674

Seek: https://www.seek.com.au/job/57132485?type=standard#sol=bca87ad5ea6b0252cb3113383caf1ce47f03332d

NIC General Meeting - Nagambie

The NIC meetings and field trips are coming up next month!

The meetings and tours will be held between 20 and 22 July at the Nagambie Lakes Regatta Centre, 66 Loddings Lane, Nagambie. Please book your accommodation. More details on the program will follow.

Please also mark your diaries with the NIC AGM and General Meeting scheduled for 19 and 20 October at East Hotel, Canberra.

Irrigation Australia & ICID International Congress

A reminder the Irrigation Australia Conference is on 5-7 October and the world’s largest irrigation event for 2022 the International Commission on Irrigation and Drainage’s International Congress is on 3-10 October.

Both events will be held in Adelaide. They should be great! Hope to see you there.

You can find out more here: https://www.icid2022.com.au/

Useful Links

• NIC – Congratulates One Basin CRC

• NIC – Congratulates New Government

• NIC – Welcomes New Ministry

• Government – New Ministry List

• Opposition – New Shadow Ministry List

• NFF - Record Exports Conceal ‘Cost of Farming’ Crunch

• Furner – Collaborative Strategy to Grow Queensland’s Horticulture Sector

• Watt - New Ag Minister Gets On Farm As New Figures Show Bumper Year Ahead

• Griffin - Groundbreaking Program for Private Land Conservation

• ABARES – Planting Conditions Lift Prospects of Third Straight Year of Record Winter Crop Production

• ABARES - Record Ag Exports Defy Disruptions

• PM - Statement at Annual Leaders Meeting Jakarta

• Davey - Davey to Take on Shadow Water Role

• ABA – Australians Can Bank on Growing Ag Sector

• AFPA – Gas Prices will Contribute to Higher Fruit and Vegetable Prices

• Husic – Address to Science and Technology Australia Gala Dinner

• Kelly - Plan to Rebalance Precious Groundwater Resources Released

• NCC - NSW Must Deliver Robust Climate Ready Water Resource Plans as a Matter of Urgency

• SA - Budget Delivers Climate Action and Biodiversity Protection (including $2 million for Commissioner for the River Murray in South Australia)

• Tierney – Following the Flowers to First Nations-Led Agriculture

• MDBA – Sir Angus Houston’s Address to River Reflections

• MDBA - Sand Slug Choking Murray River Could Impact Water Delivery Within 10 Years

• MDBA - Wet and Wetter Conditions in Store for Most of MDB

• Kuestenmacher - MDB Communities Could Reap Benefits of Post-COVID Population Shift

• Toole - NSW $145 Million to Rebuild Northern rivers Water Infrastructure

Video

Tanya Plibersek addresses the River Reflections 2022 conference on the first full day in her new role as Environment and Water Minister.