Bills

Hydrogen and Renewable Energy Bill

Second Reading

Adjourned debate on second reading.

(Continued from 2 November 2023.)

The Hon. N.J. CENTOFANTI (Leader of the Opposition) (16:30): I rise on behalf of the opposition as the lead speaker on the Hydrogen and Renewable Energy Bill. Before I begin to address the bill properly I would like to take a short moment to express the opposition's concern with the process of this bill, and why we will be supporting the Hon. Robert Simms's contingency motion to refer this bill to a select committee of this chamber.

A bill of this magnitude, in its own right, deserves adequate scrutiny, particularly when the government is spending hundreds of millions of dollars, if not billions, on their hydrogen project. In terms of the opposition, it is an important role of democracy, of course, that the opposition is given a good opportunity to understand bills. Of course, it is an important role of democracy that the crossbench is also given a good opportunity to understand bills, and certainly to consult with stakeholders as well.

This is a technical bill and, again, it is important to be able to scrutinise legislation. It is also an incredibly important piece of legislation, and we need to give stakeholders the opportunity and the ability to raise those issues with the opposition. We, the opposition, have had a number of stakeholders contact us, concerned with various aspects of the bill. Some stakeholders have also been concerned about the forthright nature of this government in its handling of this bill. I note that the opposition has received limited information about the government's consultation process with stakeholders, which is hardly transparent.

I also note that after the committee stage we still have a number of questions that are yet to receive answers. In fact, many would say—certainly on our side—that the committee process has left us with more questions than answers. It has also become apparent that this bill has the potential to affect freehold landholders across the state. However, there has been limited communication, we believe, to the public on this. I will speak to this point a bit later in my second reading speech.

We will be supporting the honourable member's push to have this bill scrutinised by the parliament and, indeed, we hope that the government and the remaining crossbench also support this motion. It is only sensible that the parliament seeks further information by way of stakeholder consultation and that the parliament scrutinises this incredibly important piece of legislation.

The Hydrogen and Renewable Energy Bill will seek to introduce a new system that will allow the state government to declare certain pastoral lands, state waters and prescribed Crown land as a release area, based upon their suitability for the operation of renewable energy infrastructure. These release areas exclude freehold land, the Arkaroola Protection Area, marine sanctuary zones, reserves within national parks, and wilderness protection areas. Once a release area has been declared, a competitive tender process will be organised by the state government for feasibility licences based upon selection criteria.

Five licence types will be created relating to the key stages of renewable energy projects, from the early research and feasibility stage right through to the construction, operation and closure of facilities. These licence types include a renewable energy feasibility licence or permit, which enables exploration for renewable energy, including construction of monitoring equipment. It includes a renewable energy infrastructure licence, which permits construction operation, decommissioning and rehabilitation of renewable energy infrastructure.

It includes a renewable energy research licence, which permits construction, operation, decommissioning and rehabilitation of renewable energy infrastructure for the purpose of researching the capabilities of a technology system or process. It also includes a hydrogen generation licence, which obviously permits construction, operation, decommissioning and rehabilitation of hydrogen generation facilities. Finally, it includes an associated infrastructure licence, which permits ancillary infrastructure, such as transmission, roads and water treatment; and associated facilities, such as hydrogen power plants, ports for hydrogen product export and desalination for hydrogen production.

A further licence type, called a special enterprise licence, has been provided for to facilitate the establishment, development or expansion of hydrogen and renewable energy enterprises of 'major significance' to the economy of this state. The power to grant a special enterprise licence may be exercised to enable appropriate enterprises to proceed where access to relevant land or waters is not able to be agreed upon. It is important to note that a special enterprise licence may be granted in relation to both freehold and non-freehold land, as well as state waters.

This bill really seeks to drive and enable an efficient and flexible licensing and regulatory framework for hydrogen generation and renewable energy infrastructure in South Australia. However, what it does not do enough of is recognise the long-established rights of landowners and of pastoral lessees. Furthermore, several clauses of this bill, we fear, have the risk of significantly compromising pastoral leaseholder and freehold landowner rights.

The argument must be made as to why renewable energy needs to be tied up in this new bill. We can understand why the government may wish to ensure that there is a path available for hydrogen, given their heavy focus on hydrogen and their hydrogen project into the future. This is obviously despite the fact that they themselves have admitted that their plan will not bring down or reduce electricity prices in South Australian households.

However, what we cannot understand is, given legislative arrangements already exist which provide for landholders and renewable energy companies to directly negotiate and enter into a commercial arrangement for the purposes of a landowner's property, or indeed a leaseholder's land in the case of pastoral leases, for solar farms or wind turbines, why the government is removing the ability for parties to enter this commercial arrangement or usurping this process and instead is providing renewable energy companies with the right to access land, establish solar or wind farms and pay compensation based on losses, being damage to lands and loss of productivity or profits, rather than on a commercial basis leading into the future.

This is akin to what we see in the Mining Act, and it seems that the government is intending to treat wind and solar in the same way that they treat minerals. The flaw in this theory, though, is of course the fact that there is a clear difference between the two. One is owned by the state government by virtue of it being a mineral resource under the ground and the other, based on property rights, is owned by the landholder or lessee.

I feel we do need to enter into a bit of common law at this point, because it is my understanding that your property rights comprise the land surface, all those things growing on or attached to your land, obviously except, as previously mentioned, minerals by the terms of a Crown grant and, importantly, the airspace above. By virtue of this, one would then reasonably expect that that would extend to wind and also solar, that is, the sun.

Therefore, it is absolutely reasonable to conclude that wind and solar farms should be able to continue to be established via a normal commercial contractual arrangement between the proponent and the landowner or leaseholder. Instead, what we see in this bill is the Malinauskas Labor government's very clear and deliberate choice to remove the ability for autonomy, for landowners and leaseholders to have their own contracts and to make their own decisions when it comes to wind and solar on the land.

We in the Liberal Party unashamedly believe in individual freedom and free enterprise and that, wherever possible, government should not compete with an efficient private sector. There are numerous current instances of wind and solar farms operating pursuant to a private agreement between a landowner and an operator. Farmers and pastoralists are educated to make their own business choices on their land and should be able to continue to do so. Unfortunately, this will not be so under this new bill, but this is what we have come to expect under this Labor government: a centralisation approach and the usual banter of, 'Trust us, we are the government and we are here to help.'

Another aspect this bill fails in is that there is no legislative requirement for the government to consult with pastoralists or even the Pastoral Board as part of this process. Section 10 deals with the process by which a minister can declare an area of land as a release area, provided it is designated land. Of great concern are the consultation requirements, or lack thereof, particularly in respect of pastoral land. For pastoral land, the only required consultation is with the minister responsible for the administration of the Pastoral Land Management and Conservation Act 1989.

Under the Pastoral Land Management and Conservation Act 1989, the Pastoral Board has been appointed and is responsible for the administration of the act. Therefore, it absolutely should be incumbent on the minister to consult with and take advice from that Pastoral Board in relation to any release areas. Furthermore, consultation with the pastoral lessee should also be mandatory and should occur because there is a proposed declaration.

To not do so would be to give little to no recognition to property rights and the legal interest in the land. Again, the fact that consultation is required only with the minister responsible for the pastoral land management act is troubling. We know that under the Malinauskas Labor government the Pastoral Board and the management of the act has very deliberately been moved away from the Department of Primary Industries and Regions and into the Department for Environment and Water.

For those of us who live in regional and remote areas, we absolutely understand this is a move to characterise the Labor government's priorities, a shift away from its traditional use of livestock grazing and management towards a 'lock up the gate' approach when it comes to pastoral land use. This move was something the Liberal opposition opposed at the time and still oppose. With that in mind, I, on behalf of the opposition, in recent weeks have filed a set of amendments, one of which is to ensure that the pastoral lessee and the Pastoral Board are consulted before declaring release areas or granting a licence.

I also want to touch on the provisions around rent in this bill. This bill fails to provide an explicit mechanism in which pastoral leaseholders can receive additional remuneration or rent for renewable energy projects going on their lease. Pastoral leaseholders will only be eligible for compensation for any economic loss, hardship or inconvenience suffered during authorised operations under this bill. Those additional payments would assist pastoralists in droughtproofing their operations.

However, once an investor is provided with access to designated land, they will be required to pay rent to the state government for the use of that land. I note that the requirement to pay rent to the state government does not apply to freehold land, nor should it, and that rent paid to the freehold landowner remains via a commercial agreement between the renewable energy proponent and the landowner.

So this rent is only applicable to pastoral land and the provisions replace the existing laws on pastoral land, whereby under the pastoral land management act rent is also required to be paid by renewable energy companies. However, this rent is paid into the Pastoral Land Fund, with 95 per cent of the rent to then be paid to either the pastoral lessee or native title holder, the amounts having been negotiated as per access agreement or ILUA, respectively. I think it is important for us to note that currently there are no commercial wind or solar farms operating on pastoral land and therefore there are no projects operating under this part of the PLM act.

However, there are large concerns among pastoralists that if the rent the government charges to these renewable energy companies is too high it will ultimately impact on the amount of rent, if any, that is paid to the pastoral lessee as negotiated under the access agreement, because at present the legislation only states that rent may be paid into the Pastoral Land Management Fund.

The only payment legislated for the pastoral lessee is by compensation for loss of access to the land the renewable energy project takes up. There is no legislative mechanism for lessees to be paid ongoing remuneration for use of the lease land. There is only a legislative requirement for the government to be paid.

I note that the minister in charge of this bill in the other place made some interesting comments in that chamber, particularly that it was his view that pastoral leaseholders do not deserve a proportion of the rent payable by a renewable energy proponent for a project on pastoral land, just compensation for loss of productivity. This is despite assurances made by the department in briefings and the Premier's claim that this would droughtproof pastoral leaseholders. Therefore, the opposition will be moving the same amendments that we moved in the other place, which effectively legislate that rent is payable by a lessee for use of the land in a licence area.

Finally, I want to speak about right to enter, access and compensation. The current bill essentially gives a right to enter any pastoral land without notice or the need to consult with a pastoral lessee when a licence is granted. In doing so, it gives no regard to the biosecurity risk that has the potential to present when it comes to access of that land.

Those of us in regional communities understand how critically important it is to keep out endemic pests and diseases, many of which have serious economic implications. There must be a legislative requirement that any proponent is required to comply with all relevant biosecurity requirements, including any reasonable requirements of the landowner and/or pastoral lessee when accessing land, whether notice is given or not.

Consequently, we have drafted and filed another amendment to that effect. I do not think there is any individual who can argue with the importance of ensuring that biosecurity is of the utmost importance. The government certainly should not, given they currently have just finished consulting on a new consolidated biosecurity act.

As mentioned previously, we have an amendment in the chamber to ensure the minister must consult with the pastoral lessee and the board before declaring a release area or licence, but we also need to discuss compensation for pastoralists. Currently, in this bill, no provision is made for the payment of compensation for the time and costs involved on the part of the pastoral lessee in having to negotiate with the licensee. This is important in circumstances where there may often be a significant asymmetry between the resources of the licensee and the pastoral lessee.

As presently drafted, section 79(3) is lacking in terms of an obligation being placed upon a licensee to pay compensation for costs a landowner incurs—that is, it says they may, not that they must. Given this, we the opposition are bringing forward another amendment aimed at bringing the Hydrogen and Renewable Energy Bill in line with the existing Mining Act by providing up to $10,000 compensation for a landowner to cover reasonable costs of obtaining legal assistance.

I will note, however, that there is some commentary on Hansard around this amendment in the other place, and I note that the government's preference is not to have a cap on the compensation. I am in favour of this, providing that the compensation for legal assistance is provided in situations where it is required by landholders. Therefore, I will flag now that I will be asking some questions of the minister around the government's clause on compensation and, depending on the minister's answers, may or may not move that amendment at that time.

The Malinauskas Labor government has said that we should not worry about many of the matters I have just discussed. They are asking landowners and landholders to trust that these matters will be addressed in subsequent regulations. Again, 'Trust us,' they say, 'we are here to help.' But given their track record on failing promises—ramping being one that springs to mind—I think it is absolutely critically important that these concerns are explicit in the legislation. Therefore, the opposition will be looking to have these amendments supported in this chamber, and I certainly encourage my colleagues in this place to support our amendments going forward.

Primary industries and agribusiness is a huge economic driver of this state. In 2021-22, its revenue reached $17.3 billion, and those industries supported 71,000 jobs. Therefore, it is absolutely critical that this piece of legislation does not negatively impact our primary industries and the regional communities they support, but rather that it continues to achieve the right balance between the direction of the government of the day with the property rights of landholders and lessees living on the land.

I look forward to voting to send this bill off to a select committee, which will ensure that we, as a parliament, have done our due diligence and have effectively scrutinised this bill, because what is absolutely critical for South Australia is that we do not see the burden of this government's push for energy transition fall on regional communities without receiving their fair share of the benefits. With that, I conclude my remarks on the Hydrogen and Renewable Energy Bill.

The Hon. R.A. SIMMS (16:51): I rise to speak on the Hydrogen and Renewable Energy Bill on behalf of the Greens. I should note that I am the spokesperson for energy for our party, so I will speak about the implications for energy policy and my colleague the Hon. Tammy Franks will address the environmental considerations and the impacts for First Nations communities in her second reading speech.

I also indicate, as was alluded to by the Leader of the Opposition, that contingent on the second reading stage I will move to refer this bill onto a select committee for an inquiry. We believe that is a really important step in ensuring that we have a bill, a reform piece, that actually delivers good environmental outcomes for the people of South Australia.

By way of background, when the Labor Party announced their powering new jobs and industry for the future plan, their green hydrogen plan, in the lead-up to the last election, my response at the time—on behalf of the Greens—was to indicate that we were supportive in principle of the concept. Indeed, that has always been our view, but we wanted to see the detail of the legislation and to understand, to make sure, that the government had the energy mix right.

It was with that intention that I reached out to the government on several occasions to seek to understand what they were proposing, even before legislation was brought to the parliament, so that the Greens could be in a position to work constructively with the Malinauskas government and to get a reform piece through this chamber. It is why on 8 June I reached out to the minister directly and requested a meeting with him to discuss the plan.

My office then reached out again on 14 June via email, again on 7 August, again on 21 August, again on 23 August, and then, when we finally got a briefing with staffers, I reiterated on 20 October that I wanted to meet with the minister to discuss the plan. We finally got an audience with the minister last week and I expressed some of the concerns that the Greens had, and we have never received a response to those concerns.

So it is clear that we are a long way off being able to support this legislation. It does not mean that we are opposed to it, but it does mean that we need to apply some rigour, some scrutiny to the government's proposal to ensure that it does not have adverse consequences for our environment, and to ensure that it actually sets our state on the right path in terms of renewables.

For us, there are some significant concerns that we have with the legislation. I will talk you through those. To begin with, I think it is really important that this chamber understands the distinction between green and blue hydrogen. There is indeed a cross-section of hydrogen colours: pink hydrogen, which comes from nuclear sources, or brown hydrogen, which comes from coal. Green hydrogen—that is the form the Labor Party campaigned on in the lead-up to the last election—is derived from renewable energy sources such as wind and solar power and it is made through a process called electrolysis. It is this that the Labor Party allude to in its election manifesto, where the then Labor leader stated in his foreword:

A Malinauskas government will build a 250 megawatt of hydrogen electrolysers, one of the world's largest hydrogen electrolyser facilities.

That is a bit of a tongue twister. It continues:

These electrolysers will create hydrogen from water using green power.

It is this proposition that holds immense promise in the transition away from fossil fuels, particularly in terms of its industrial use, as in the production of green steel in Whyalla. The Greens are attracted to that. I have some knowledge of that issue from when I was involved in a Senate inquiry during my time in federal parliament. I am attracted to that proposition.

Creating a green hydrogen industry in South Australia can accelerate our transition to a sustainable future. The Greens are deeply committed to environmental sustainability and climate action, and we have stated publicly that we are supportive of green hydrogen in terms of reducing our reliance on methane gas in industrial settings. There is the potential for Australia to become a renewable superpower if we focus on green hydrogen and start to build an industry around it.

Certainly, green hydrogen aligns with our goals of reducing greenhouse gas emissions, promoting clean energy and building a greener and healthier future for the community. But there is an important distinction that needs to be drawn between that and blue hydrogen. Blue hydrogen is the cuckoo in the nest of the Labor Party's proposal because it was not part of what they took to the people of South Australia at the last election, but it is part of the proposal for which they are seeking this parliament's support now.

It is really important that this parliament is cognisant of the risks associated with blue hydrogen. Blue hydrogen is produced from methane gas. It is referred to as natural gas, but we know of course that it is not natural in terms of its impact on the environment. The process reforms methane gas to hydrogen, with the carbon waste product being sequestered into the cavity created from extracting the methane gas.

To be clear, it is gas, it is blue hydrogen made out of fossil fuels. It should hardly be surprising then to anybody that the Greens are concerned about blue hydrogen as it locks us into a future reliance on fossil fuels. Furthermore, carbon capture storage could have detrimental environmental impacts, and that is an area of significant concern for us.

On 12 August 2021, The Guardian reported a study, which found that the emissions from producing blue hydrogen are significantly high. Rupert Howarth, a scientist from Cornell University, who authored the paper said:

It's pretty striking, I was surprised by the results. Blue hydrogen is a nice marketing term that the oil and gas industry is keen to push, but it's far from carbon free. I don't think we should be spending our funds this way on these sorts of false solutions.

The Labor Party talks a lot about this being the next gold rush. We want to make sure they are not going after fool's gold, that they are not going to be spending a huge amount of taxpayer money in propping up the gas industry and in doing something that will not actually deliver demonstrable environmental outcomes.

There is no need for blue hydrogen in our state. We have abundant renewable energy resources. Renewable energy is currently meeting approximately 70 per cent of South Australia's total electricity consumption. Green hydrogen can play a role in stabilising the network and reducing industrial reliance on methane gas. However, we do not need to turn to hydrogen produced from fossil fuels to do that.

Over the last six years, South Australian energy ministers have been talking up hydrogen, and as early as 2017 the Weatherill government was touting hydrogen as a key part of its energy plan, particularly for energy storage. Since then the rhetoric has always been around green hydrogen. The Marshall government described hydrogen development as a greenhouse gas free fuel.

In the 2022 election, the Labor Party's policy document, titled the 'Hydrogen jobs plan', committed to building green hydrogen infrastructure. Nowhere in that document is there any reference to any type of hydrogen other than green hydrogen. It was not until late 2022, when the Malinauskas government first started talking about blue hydrogen in their issues paper, that this appeared. Since then, the government has referred to blue hydrogen in 'South Australia's Green Paper on the energy transition', where it states:

As we transition to a net-zero emissions future, the oil and gas industry will continue to play a critical role for South Australia—particularly in the short-to-medium term.

There was a map contained in Labor's election policy, and I will seek leave to table that document.

Leave granted.

The Hon. R.A. SIMMS: The map that was in the election policy document shows the potential for green hydrogen was reproduced in the green paper. However, this time the map identified locations for blue hydrogen in Leigh Creek, Cooper Basin and the Greater Adelaide region. I seek leave to table this document, 'South Australia's Green Paper on the energy transition'.

Leave granted.

The Hon. R.A. SIMMS: The federal energy minister, the Hon. Chris Bowen MP, stated his intentions to support green hydrogen. To quote from the minister in federal parliament, he said, 'The road to green hydrogen does not necessarily go through blue hydrogen.' This is in contrast to the state government's position, where it states:

Blue hydrogen is a potential route for large scale hydrogen production for domestic use or export that is cost competitive using currently available technologies.

There is a clear discrepancy between the positioning of the federal Labor Party and the positioning of Malinauskas Labor here.

We welcome the regulation of the renewable energy industry in South Australia. However, the Greens do not see blue hydrogen as the way forward for our state. We do have sufficient access to wind and sun in South Australia, and we should limit technology to green hydrogen to ensure that we have a clean energy future. There is no need to legislate to allow for blue hydrogen when we could be global leaders in clean energy. Taking a strong position to exclude blue hydrogen would show a clear commitment to our state addressing climate change.

We have declared a climate emergency. What you do when you declare a climate emergency? You do not continue with business as usual. You do not continue propping up the gas industry. Instead, you take dramatic action. I am concerned that what the government is doing here is engaging in a greenwashing exercise.

I am concerned that what the government is doing here is gaslighting the people of South Australia into thinking that this plan is something that it is not. That is why my colleague and I are committed to referring this bill on to a committee inquiry so that we can go through the bill and consider its implications in more detail. Should we be unsuccessful in that endeavour, we will be moving a series of amendments. I will leave the Hon. Tammy Franks to outline the nature of the amendments that she will move, but I will speak briefly to those that I am going to be initiating.

In addition to amendments to remove blue hydrogen from the bill, we will also move to ensure that gas cannot be used for residential purposes. Members will know I have talked a lot about this over the time that I have been in this parliament. It is concerning to us in the Greens that, in contrast to other states and other jurisdictions, South Australia under this government has no plan to move away from gas. Indeed, this is an issue that I have raised with the government. Whenever the minister cares to pick up the phone and take one of my calls, I would make him aware of that, because we are concerned about the fact that South Australia is at risk of becoming the odd man out when it comes to reliance on gas.

Why is it that Victoria has a plan to move away from gas on residential properties, the ACT has a plan to move away from gas on residential properties, but in South Australia there is no such plan, and that is absent in this bill. There is a risk that this bill commits South Australian households to a reliance on gas in the long term, which is totally the opposite to what the Greens have been seeking to achieve. Indeed, it is diametrically opposed to what I had expected the Labor Party would put forward.

The government has also stated their intention to blend hydrogen with methane gas and pump this into homes. While this has been tried in other countries, South Australia's renewable energy abundance means that we are in a better position to electrify our residential energy needs, rather than maintain a residential gas network into the future.

This discussion around hydrogen blend through gas pipelines really requires further explanation because it is a pipedream. It does not deliver environmental outcomes. Indeed, the best that one can hope for, I am advised, is about a 20 per cent hydrogen blend that has negligible environmental impacts. Why on earth would we be spending huge amounts of taxpayer money to potentially deliver hydrogen blend technology to households when we could be ramping up renewables and we could be spending government money on alternatives to gas?

Another concern we have with the bill as it currently stands is that those who are granted a special enterprise licence can be made exempt from any other part of this act at the discretion of the minister. This is an extraordinary power that the Greens are not comfortable with. The submission dated 23 June 2023 from the Law Society highlights their concerns. I quote from that document:

Finally, and of most concern, is the Minister's ability in proposed section 23 to exempt a special enterprise licence from compliance with a provision of the proposed Act. The Society opposes this provision which grates uneasily against the Rule of Law and may give rise to circumstances where a landowner is not given notice and is therefore unable to challenge any decision made.

This is a serious matter that the Law Society have raised, and the Greens share their concern about giving the minister this excessive power.

The final amendment I will move is to ensure that owners of adjoining properties will also need to be notified in accordance with the notice of entry provisions that exist under section 76. The Law Society's submission touches on this point and addresses the rights of adjoining landowners whose neighbouring properties may be impacted by proposed developments. Their submission states:

As a minimum, provision should be made for those adjoining landowners to be notified and consulted. For example, in respect of a windfarm, it is easy to contemplate a proposal where individual towers are placed on the boundary of land far from the owner's dwelling or habitable areas, but directly adjacent to their neighbour's dwelling or habitable area.

Communities can be divided over issues like this, especially in regional areas. The Greens believe that ensuring neighbours are notified is a simple measure that would open up channels of communication and ensure people in the vicinity of a new hydrogen or renewable energy facility are given this information. We want renewable energy to be viewed positively in the community, and a key way to do that is to build community consensus and ensure that people are kept in the loop about what is happening in their neighbourhood.

To be very clear, the Greens are committed to renewable energy. We are committed to ending the reliance on gas across the country. We are supportive of the role of green hydrogen; however, we are concerned about this bill's capacity to fast-track blue hydrogen production. It is vital for us that the future of our planet is protected and that we do not see more fossil fuel projects.

The Greens have been open-minded on this plan. As I indicated in my opening remarks, we were open-minded when the Labor Party announced it during the election. Indeed, I made it very clear that my party was supportive of this proposal in principle, and it is for that reason that we reached out to the minister responsible on 8 June, 14 June, 7 August, 21 August and 23 August and I indicated that I wanted another meeting on 20 October. We have tried to reach out to the government and to work with them on this.

The reality is that they have not been willing to do so. I do not know why, but we now find ourselves in a position where we are not able to support the bill in its current form and where we will be moving to refer it to an inquiry so all the issues that have been raised with us by stakeholders can be ventilated. I hope the parliament will support this sensible proposal from the Greens.

We cannot allow the Malinauskas government to continue to steamroll this chamber to push ahead with significant reforms like this without appropriate parliamentary scrutiny and we cannot allow them through sleight of hand to potentially gaslight the people of South Australia to embark on what could be a smoke and mirrors campaign for a continuation of the gas industry.

The Hon. T.A. FRANKS (17:09): I rise today to speak on the Hydrogen and Renewable Energy Bill, noting that there is a crossover of portfolios within the Greens between myself and my colleague the Hon. Robert Simms. The Hon. Robert Simms, of course, is the lead on this as he holds the energy portfolio, but I hold the Aboriginal affairs and environment portfolios and so will have not only a contribution to make today but amendments that have already been filed to debate.

The first ever hydrogen test station in Australia opened in December 2018. Evoenergy was opened in Fyshwick in Canberra, under the watch of the Greens' energy minister. I am not surprised to see these technologies, which ought to be based on renewable energy, being developed under a Greens government there in that territory. But the Greens know that hydrogen, of course, does come in many colours, many forms—a rainbow of colours, as the Hon. Robert Simms alluded to—and those colours require different technologies to produce.

We cannot go down the path of using fossil fuels at all in any form in the future. The Greens do not support the use of carbon capturing storage techniques for the creation of hydrogen as a fuel, but we do support and encourage the development of renewable energy hydrogen fuels. It is clear that a fuel like hydrogen is a beneficial fuel for the future, as long as it is based on renewable energy, as long as it is not based on carbon capture and storage emissions.

The International Renewable Energy Agency (IRENA) produced a report in September 2018 called 'Hydrogen from renewable power: technology outlook for the energy transition'. That report also makes the point that to achieve the targets in the Paris Agreement, the global energy system must undergo a profound transformation from one largely based on fossil fuels to an efficient and renewable low-carbon energy system.

The report says that over 95 per cent of current hydrogen production is fossil fuel based. Only around 4 per cent of global hydrogen supply is produced by electrolysis. We need to change that balance dramatically so that we are no longer reliant on fossil fuel-based hydrogen production, but we look instead to renewable energy as the basis for that production.

It is being sold to us that this legislation is designed to act as a regulatory framework and to streamline the process for companies wanting to invest in such projects in our state of South Australia, creating a single regulatory process for matters such as land access, native title and environmental impacts. That would be a good thing, but the further we delve into this legislation, and the more we talk to those stakeholders who the government say are happy with this legislation, the more we find there are concerns being raised, the more we also see a failure of this bill to truly balance the rights between those of the state, landowners and future proponents, particularly in my portfolio areas of environment and Aboriginal affairs.

The Greens are not satisfied with the current proposed protections in this bill—or really the lack thereof—and a 'Trust us, we are the government; we will put in the regulations'. This is not good enough and that is not good governance. Renewable power is an essential tool to reduce climate change in future years. However, we do know that biodiversity is our most vital natural defence against climate change. The two go hand in hand.

Our Crown lands, particularly our coastal fringes and riparian zones in agricultural regions, contain the majority of remnant vegetation, providing refugia to hundreds of critically endangered species and stabilising our coastline. These provide linkages to allow species to move in response to climate stress, generating new land to buffer our landscape against sea level rise, sequestering vast amounts of organic carbon, fixing nitrogen from the atmosphere, cleaning water inputs into our oceans, preventing algal blooms, reducing the effects of ocean warming, and providing key nursery habitat for the majority of our consumptive fish species. We cannot get this wrong.

Here in South Australia, we are leading the nation in that reform, so we must set the standard as high as possible. As such, I will be moving some amendments today in this debate to help raise that bar. Specifically, the Greens will be moving an amendment to include the environmental impact assessment criteria within the legislation itself—not leaving it to the minister to decide later on via regulations. That would be the trust that we would need to trust the government.

This is built upon the intergovernmental agreement on the environment and will place specific obligations on the department to take into account factors such as biological diversity, best management practices, feedback made directly by landholders, the greater public interest, and any relevant integrated environmental management system or proposed integrated environmental management system. It is something we have signed up to within this nation, so we see no reason why the government would oppose such an agreement that apparently we have already made.

We believe, in the Greens, that that agreement and those standards should be set in the act, not put in the regulations. There is no reason for these considerations to be left to the power of a minister under those regulations. These will be high-impact projects that have the potential to negatively impact our cherished landscapes, unique wildlife and cultural heritage. It cannot be left to chance as to the attitude of a minister or a government, a future government, on a particular day; it must be set by the parliament. Let us put into law a framework for promoting sustainable development, safeguarding ecosystems for present and, of course, future generations.

Another amendment I will be moving as part of this debate will be to include a general duty of care clause to provide protection against both a risk of harm and future harm, provide additional statutory protections for biodiversity, mitigate the effects of climate change and further protect environmental harm. Our government's role is to protect the long-term interests of the South Australian population, not just mining companies or entrepreneurial types. This legislation is crucial. It must hit the sweet spot between encouraging investment, alternative power generation and protecting our other natural resources assets, climate change adaption strategies and cultural values.

The Greens firmly believe that this cannot be done without the amendments that we are putting forward. We do thank those stakeholders within the environment movement who have reached out to our offices and provided advice as to where they see the flaws in this legislation. Of course, an inquiry would allow the community more broadly to have a much more thoughtful and transparent conversation about where this legislation has further to go.

I note that in terms of the discussions with First Nations groups there were a number of forums and feedback was taken in those forums. In my briefing on this bill I asked, in terms of the feedback given by First Nations stakeholders, what had been the response from government. I was sent a copy of the feedback from First Nations respondents, which I had already seen on the website, and I would say to the government that consultation is a feedback loop.

It is not just allowing people to say what their problems are, it is also suggesting the solutions as the government sees them and then getting a feedback loop going on whether or not the proponents—in this case the First Nations people—agree with that or disagree with it. It does not mean, as a member of parliament, if there is disagreement with what the government proposes that that will necessarily see the Greens either support or oppose the government, but it does allow a proper feedback loop and the transparency and thoughtfulness that this debate deserves.

What I would say is that all the way through the First Nations feedback, I see that Aboriginal groups need funds, resources and good legal advice for equal participation—I do not see that guaranteed here—and there is a need to reform the Aboriginal Heritage Act 1988 and the recognised Aboriginal representative bodies, which are known as RARBs. Again and again this is raised. It needs to be clear that even the amended Aboriginal Heritage Act (AHA) is inappropriate and that until that is fixed up you cannot unscramble some of the problems that currently exist.

I accept that there are ways forward here that the Department for Energy and Mining is progressing with, but time and time again we have seen Aboriginal groups raise a concern about the Aboriginal Heritage Act and its workings, and we have an inquiry that was undertaken by the Aboriginal Lands Parliamentary Standing Committee into Aboriginal heritage which raised some of those same concerns and which has called for reform. I note that I believe we still have yet to see any further RARBs in the last several years and until we see reform of those processes, and indeed recognition of those RARBs, I do not believe that we are hitting the sweet spot that we need to in terms of First Nations groups.

Certainly, with the environment the feedback that we have had is that this is an opportunity that we have to get right. It is better to take a little bit more time and get it right than be left with the legacy of a rushed piece of legislation that did not really respond to concerns raised and did not really do what we were promised on the box, and that is to deliver green hydrogen projects for this state, not the rainbow of other colours.

The Greens certainly will be fighting for the best legislation that we can possibly see, whether that is through an inquiry or through a series of amendments in the committee stage, or a combination of the two. We do hope to see our state flourish, but we need to ensure these protections. With that, I look forward to hopefully seeing an inquiry set up that can report back to the parliament in the new year. It need not take more than a few months and certainly, given we are having a summer break, there can be hard work done by some committee members on that, including the Hon. Robert Simms, my colleague. With that, I look forward to the progress of this debate today.

The Hon. J.E. HANSON (17:20): Hydrogen: does it do what it says on the box? I think that it does—I think that it does. I think that this government really started long ago, on a long run-up, addressing that question. Not that long ago, this parliament, for instance, acknowledged that there was a climate emergency. Not that long ago, the parliament said, 'Alright, we are going to agree with the net zero target emissions by 2050.'

The fact is, in conjunction with those two things we started structuring and encouraging—I think way back before we had this Labor government—the unlocking of renewables in this state. I think there is a great deal of evidence around that that I really do not need to go to, but to achieve these types of things that we are aiming for here we are now going to have to invest quite heavily. We are going to have to invest in, I think the figure is, somewhere around 40 to 50 times more renewable energy sources than what we currently have. That is 40 or 50 times more than what currently exists in the market.

Why do that? 'Carbon abatement' is going to be tossed around a lot more in the world, so we had better start getting used to that conceptual debate. Carbon abatement is coming for the world. Some nations are not prepared for it at all, but this state is. In fact, sometimes you can pick up a newspaper or an article and you can start reading about South Australia. It does not just have to be a newspaper or an article here in Australia, it can be somewhere else in the world. They are reading about South Australia.

The agreements that other nations are signing will mean that they need to reduce the amount of carbon in their production. That puts us very much ahead of a great deal of the world. We are well placed, and indeed we are seeking to take a first mover advantage here. We are not alone in that. There are other places in the world that are doing the same. Indeed, if I look over to Western Australia I can see them moving as well towards export facilities. But more than this, we are well placed to reindustrialise what we do here already, what we do now.

South Australia has everything that we need to make hydrogen. We have abundant wind and solar all year round. We have vast amounts of land. To a lesser extent, to go to some of the comments made in this debate, we have the waters too, but I think it is fair to look at that in a bit of context too. Unlike some jurisdictions, both here and overseas, we are not locked into having to use them. Ocean-based or offshore energy does not have to be something that we have to look at here. It is nice to have the option, but we do not have to. We have massive amounts of onshore facility here, which are far cheaper and are, frankly, less cumbersome, going to some of the debates we have already had in this chamber about offshore wind farms.

We also have the ability in South Australia to use renewables to make a resource, that being hydrogen of course, while others must use something vastly more expensive. Regardless of how you might feel about nuclear, it has vastly more expensive inputs to create. You cannot beat the wind, you cannot beat the sun; that is just a fact.

This makes us uniquely placed. I really cannot think of another state in another nation that is as well placed as us. I am open to someone trying to think of one, but I cannot. South Australia is very unique in the world. We have already started moving down this pipeline. As I have said, we have invested in solar and wind resources: 70 per cent of power in this state right now is being created with renewables.

To give some context to how good that is, we saw wind and solar producing I think around 2 per cent of our power in the early 2000s. Have we moved? Yes we have. We have been the beneficiary of this power generation already, but now we can put it to substantial further use in storage and production tied up in hydrogen. If we do that—and people toss around all sorts of fancy words around this like renewable energy powerhouse—we are going to be this new thing for the world.

The Hon. R.A. Simms: Goldmine.

The Hon. J.E. HANSON: Some people would say goldmine. I will come back to that because that is interesting. I think it is actually better placed these days maybe to put it as a copper mine, the Hon. Mr Simms, but we will come back to that. Nonetheless, it does put us in that position. Is it not fantastic to actually be talking about South Australia around maybe a goldmine, around having an opportunity to lead the world on something? Regardless of how we may feel about how we are leading it, is it not fantastic to be in that kind of position?

Why would we be a powerhouse? Well, here is an example. For instance, right now, we do not need to do much to create certain things we already have. It is not just wind and solar. We have Whyalla, we have Port Pirie and we have Olympic Dam. All these locations have one thing in common and that fact is often lost on many of our interstate colleagues, in particular in the east, and that is that these sites are vital to the opportunity that we have in front of us, that hydrogen and indeed renewables have presented us with.

What all those three locations have in common is they all have a smelter at them. Normally, I could imagine the kind of response you get from people around smelters. They are not often regarded as clean devices, but what they are regarded as is they create something. Everybody knows that. In Port Pirie it is a complex smelter. It is a multi-metals facility. To break that down for what ordinary people might look at, it is very hard to obtain those kind of facilities anymore. It is one of the most complex multi-metal facilities anywhere in the world right now and, critically, it can be converted to hydrogen as part of its production. That is pretty critical.

Whyalla has the last structural steel manufacturing facility in the world. It is one of the largest integrated steelworks anywhere in the world, but it is the last structural steel manufacturing facility in the nation. So what can we do? We can make rail lines, we can make structural steel rail lines: the building blocks for any real economy. In fact, I cannot think of any nation in the world that would not see as part of its future having structural steel as a critical production facility going forward. That is important, because if we are going to use structural steel, structural steel is very difficult to abate. It is very difficult to go to the term that I used earlier on: carbon abatement. In fact, steel is incredibly carbon intensive in how we manufacture it now. It makes about 9 to 14 per cent of the world's total emissions in terms of carbon.

The government has already started acting here too. We chose to have the hydrogen electrolyser in Whyalla. That is not just an election commitment, that is something that we have already acted on and we are moving towards and it is pretty easy now to see why that location was chosen. All these facts are critical to what happens next here: the concept of reindustrialising. Traditional steelmaking, traditional building blocks for how nations are going to make things like glass, steel, concrete—that is all going to change.

Whyalla and the steelworks are the home of a pretty critical other resource which is going to be used if you plug hydrogen into green steelmaking, and that is magnetite. It is literally surrounded by magnetite. You do not have to use hematite anymore; you use magnetite as part of that. I will not go into that here because it is not relevant to this bill, but it is a critical fact to include about why Whyalla is so well placed, why we need to be doing these things. We are replacing metallurgical coal. We are replacing hematite. That is not only going to be a massive carbon reduction but it is also going to be a huge saving.

What does all this mean? We can literally be sending a decarbonised product, a value-added product, once it is in production, to other nations if we choose to instead of just sending them hydrogen at comparatively enormous energy cost, because you need to get it down, depending on what you read, to somewhere between minus 248° and minus 253° to create.

The last smelter is Olympic Dam. It produces its own copper. Copper is going to be a critical resource going forward in the world economy as well. In this regard, it is important that we look at what many of our predecessor governments did here. Both the Bannon and the Tonkin governments sat down and said, 'You are going to produce copper onshore. You're going to value-add to it here.'

They sat down with I think it was Western Mining and BHP, definitely, back in the day, and they had indenture agreements where they had to smelt, they had to value-add, they had to add complexity to your copper resource. In doing so, of course, they helped build the economy we have here now and, indeed, added Port Bonython and the export facility there, which can take our hydrogen, if we were to create it now, out to the world.

Why is all that important? It is important to maintain this industry we already have, because that is going to be crucial in providing us with a standard of living going forward as opposed to just the standard of living we have now. These facilities create enormous jobs, enormous amounts of GDP for this state. They have for a long time, and they should, and I hope they will continue to do so, because that is going to be pretty critical in what comes next.

The reindustrialisation process that we are commencing now by plugging hydrogen into these facilities stacks up fantastically well when you line it up against the alternatives. One is nuclear and a second is standard carbon capture and storage, which other nations—other very high-profile, totally industrialised nations like Japan, Germany, Korea—are doing. It is just not going to place them as well as we are being placed—versus our resources that we have here, like I said; versus the existing infrastructure we have here, like I said; and versus the hydrogen we can create using renewables, all in one place, all in one geographical location, South Australia.

I just do not think there is a chance that you will not see companies of the world looking at the reality of that comparison right now. In turn, it is easy to see how nations will be looking to import what we can make here to continue to do what they do now. They are going to have to reduce their carbon emissions. They are going to need what we can give them, and that creates a transformational opportunity for our state. We could be seeing those companies here, or we could be sending to them what they need to operate overseas, and we can do that all out of humble South Australia.

Is it a goldmine? No, it is a copper mine. It is a smelting mine. It is genius. It is value-adding right here in our state, and we can do it only by doing a few things. One is a legislative framework. We need one that the hydrogen industry has best opportunity to use to roll out to take advantage of the renewables we have in place and to realise the jobs that I have just mentioned that can come with it.

We do this now—we do this for licensing and regulation of the mining and energy resource sectors—but the scale I feel we are approaching with the renewable energies we need to create the amount of hydrogen we want to create, and also to meet those carbon abatement targets, I think makes pretty clear we need some sort of reassessment of our legislative and regulatory framework. It is required.

What we are looking at here is an entire life-cycle approach, if you like, to hydrogen and the energy industry around it, from feasibility to construction, from construction to operation, from operation to eventual shutdown or decommission and, indeed, then the environmental impacts, so the rehabilitation.

I feel like we have been developing the bill that we currently have in front of us in conversation with industry and people since somewhere in the lead-up to the development of, or around the development of, the issues paper which we released in late 2022. That is specific to this bill, but you could have seen this hydrogen aspect coming a long way off. Indeed, as has been referred to by the Hon. Mr Simms, this goes even as far back as Jay Weatherill's commentary around renewable energy. Green hydrogen has long been a goal of what we are aiming for.

In terms of this bill, an issues paper was released in late 2022, and this was particular to specifically addressing our First Nations people as part of that process. The bill was released, and immediately we went out to start to speak with the people and the groups who we were going to have to seek the social licence from, to continue in the creation of the bill.

There is in the structure of the bill an ongoing commitment, so it does not necessarily have to end here with what we are creating. There is an ongoing commitment to review the bill structured into the bill, whenever that commences, so every five years there is going to be a review of what is in it and, indeed, every sequential five years after that, so the consultation if you like does not have to end. We can just keep doing it because we are doing so very much with this bill and it is aiming to be in place and in enactment for so very long.

If we do that effectively, we can see exactly what I think everyone here has already mentioned, and that they want to see, and that is the benefits more equally shared by all South Australians, including those in our regions. They want to see, as the Greens have put, flexible, transparent and consultative licensing and how it is going to be achieved. They want to see the environment be best used and, in turn, gain the best benefit, or for it to be best protected from opportunities which are definitely going to be presented to us as hydrogen continues to become more complex. It is also going to allow, I would hope, for the world's best empowerment and self-determination of our First Nations people.

In this vein, there are no aspects of this bill which remove capacity to minimise the impact of expanding the hydrogen sector and related industry on the environment. The bill does not alter existing environmental or natural resource legislation complexity. The bill will similarly not change how those matters are administered. In this vein, responsible ministers and agencies will not change with the kind of inputs that they have. The powers of said ministers and agencies will not change.

An environmental impact assessment will be included in the licensing process, as has already been referred to by the Hon. Ms Franks in debate here, and that assessment, while it is being performed, is going to include Aboriginal heritage. Obviously, all that has to occur before a licence is granted, and that is going to happen here: something that allows for the minister or any other related bodies that might want to be consulted, and indeed the public, to have their say as part of that process, and then subsequently any environmental impact assessment will be published. So it is actually quite granular in how it is going to address those issues.

In particular, I want to pause to acknowledge that this bill will apply to both government land and also to private and freehold land, obviously, and in doing so it needs to and does acknowledge that any access to that land must be done through direct agreement with any required landholders. We have seen in other bills around energy just how important that concept is, particularly in this parliament or in the last government, and it is of particular importance when you are talking about multiuse agreements with significant cultural, pastoral, mining and energy sectors all operating in one area.

I mean by this that nothing will change when it comes to multiple land use—we acknowledge that now. Nothing will get worse and nothing will drive it backwards. This should allow hydrogen within that landscape, if you like, to co-exist through the standard mechanisms we usually put in place. We have dispute resolution, for instance, we have compensation, we have notes and entry provisions, we have consultation with landowners and access agreements. However, given that the scope of the increase in access that we are looking at to accommodate the scale of renewables that we are looking at, we also need to be quite innovative, and this bill seeks to head down that path as well.

That is why we are seeking to enhance the pastoralists' rights compared with the Pastoral Land Management and Conservation Act as it currently sits. We have enhanced dispute resolution mechanisms within that, so that any agreement must address all aspects of the life-of-cycle process in terms of access, and established the principle that any person seeking a licence must have the least detriment caused to the interests of the owner of the property, which in this instance would be the pastoralist, and that includes the least damage to the land.

In doing that, in taking that step and taking that innovation and attempting to extend certain rights, nothing limits what a pastoralist can put in an agreement between them and a licensee. So, if they want to further detail certain aspects, they can do that. Innovation is also why you need to look at different ways of achieving licensees, and it has already been mentioned in some debate here that this is why we are also introducing this concept of release areas.

Release areas are something of an innovation in regard to a step we are taking with this bill. These can be negotiated with a process of involving a government agency, native title landholders or other stakeholders if they are impacted. The process can also—does not have to—involve the minister if required for an assessment of the areas involved. Which minister it is, of course, will depend upon the area subject to the release, be it pastoral, environmental or the ocean waters.

The aim of these also is not just to provide a level of engagement or protection but also to be somewhat competitive in nature. In allowing the access, it also allows the state government to charge rent for the use of the land, so the functionality of it is dual function, and that thus ensures that you have a certain level of privilege known to the licensee in regard to what they intend to use the land for, which of course is generating renewable energy.

Nothing sharpens the mind quite like a dollar bill, so that is what it will do. Charging a certain amount of rent to a person who wants to establish renewable energy in a location enables the licensee to properly consider whether what they are doing is actually of benefit. The aim is to allow the government of the day to ensure that we only allow those who want a licence but will also deliver the best community or environmental benefits to obtain a licence or access for certain projects.

Having these steps in place has created something of a different structure, if you like, than business as usual about how we have got to where we are, and there are pushing and pulling reasons for that. At the end, they are both aimed at the same thing, which is recognising that what we are looking at is scope.

Forty to 50 times more renewables than we have now is a significant level of scope. It will require a significant level of obtaining social licence and it will change the face, literally, of how we look at ourselves in this state, and for very good possible benefits, because the nations of the world will be looking to places like South Australia to do exactly that, because they cannot achieve that level of social licence in onshore Germany, onshore Japan or even offshore Korea. They just cannot achieve that. They are not going to be able to do what it is that we have the unique capability to do here in our state.

The licensing arrangements that we are having to plug into the whole set-up are also seeking to be pretty innovative. Hydrogen infrastructure will probably change going forward. It is very likely that it will, as a moderately new technology, certainly in the scope which we are seeking to use it here. Licensing needs to be similarly structured to adapt as changes may occur. They will be in different types, which recognise the various areas which may affect the type of industry being recognised.

In terms of the different types, they are largely self-explanatory based on their names, which are driven, without going into it, by the various stages of the industrial process. However, there are a few issues, particularly given that it forms some level of debate by other members in this place. There are a few aspects of those that I want to highlight here now. While doing the basics like port storage or export infrastructure, the associated infrastructure licences allow for the creativity for new or multifaceted projects which may get a rise out of a new technology like hydrogen. It is not just doing it for what is in front of you; you can also do it for multifaceted issues, where new things may come up as part of that.

Existing resource claimants will have the ability to object, for instance, to the entry of an energy company where it will diminish the existing rights they hold. If you are a large mine which is currently in effect now and an energy company wants to utilise part of that, then you have an ability to object in some capacity.

In that regard, it is intended that the test will be to measure existing rights versus future activities. You cannot just say no for the sake of it. There is an expectation, in weighing up those two rights, that there would be a way forward for both to coexist. That needs to be the working point, the pivot point. That needs to be where you are both working towards that, not just saying, 'No, you can't have access because in some way I believe it will diminish my rights.' That is not the point of it.

Many of the licences will also not be able to be granted where there is a native title determination or within a registered native title claim, unless of course consent has been given as part of a land use agreement under the Native Title Act. That is a pretty powerful tool and I think a pretty necessary one. I think that gives a lot of rigour to the necessity to seek that social licence from our First Australians. They do have an incredible amount of leverage there and an incredible amount of capacity in those negotiations.

Further than this, the government, in setting up this bill, has also said, outside of this, separate to this bill, it will develop guidelines to support leading practice engagement for the purposes of support for our nation's First People. You are also seeing the intent there, if you like. It is not just a matter of what the government is doing in this bill, but in terms of its aims and achievements it is also saying, 'We are going to set guidelines for how those can best be achieved.'

In a similar vein of seeking innovation, where native title groups might seek it, a less formal agreement can be negotiated, if it is valid under the Native Title Act. So it still allows further flexibility and further innovation but only if it is sought by our nation's First People. Outside of all that, a fund will be created to be used in relation to the objects of the act to better protect and preserve native title and heritage of our First Nations people, which as we know can often come into effect when you are talking about issues like mining and energy.

I think it is pretty fair to say that our state sits as the home of some of the most prospective wind and solar resources in the world. I feel like we commenced capitalising on this, as I said back at the start, through decades of previous Labor governments with our wind and solar developments. We continued that as part of the Hydrogen Jobs Plan—a huge investment that was referred to by members here. It is a huge investment in this state for all the reasons I mentioned earlier, and it really is just the start.

In so many other aspects, I think it is very fair to say that our state has led the nation and indeed the world when it comes to energy. We are on the front foot. We are being mentioned by other nations around the world as something to look at and this bill may indeed be another occasion where the world looks to South Australia as the blueprint, and I certainly hope so.

Debate adjourned on motion of Hon. I.K. Hunter.