Business leader Innes Willox begs Coalition not to reopen climate wars
Innes Willox says the debate the parliament needs to have is how to achieve the net zero transition. (Michael Kappel/flickr.com/CC-BY-NC-2.0)
In short:
Innes Willox from industrial business lobby Ai Group says the Coalition should not reopen the climate wars by reconsidering its commitment to net zero emissions.
Mr Willox says this would "hobble" the Australian economy by undermining investment certainty, and argues the focus should instead be on enabling the build of renewables, gas and storage to expand.
What's next?
The Coalition's nuclear policy and its net zero emissions commitment are both under review after a heavy election defeat.
Another battle within the federal opposition over net zero would "hobble" the Australian economy, a prominent business leader has warned, urging the parliament to focus on the mechanics of the climate transition.
New Liberal leader Sussan Ley this week stated her belief that Australia should reduce emissions "appropriately", but could not say whether the Coalition would continue its commitment to achieving net zero emissions by 2050.
Prominent business lobbyist Innes Willox said that reconsidering net zero would be like "re-opening an old wound" and would undermine the confidence of investors.
Sussan Ley, whose deputy Ted O'Brien was the architect of the Coalition's nuclear policy, could not say whether the net zero commitment would remain. (ABC News: Matt Roberts)
"Oh God no, no, anything but, please … For many in business, there would be a lot of eye-rolling about this, simply because business had hoped that the broad fundamentals were settled," he told the ABC's Insiders: On Background podcast.
"Business has been locked into net zero now for a long time [and] has already made investment decisions predicated on emissions reduction heading towards net zero by 2050. To reopen that now would put a lot of potential investment decisions on hold."
Loading...Mr Willox, who is the chief executive of industrial business lobby Ai Group, said there was room for debate about how to achieve the target, including the future role of nuclear, but that net zero was a "north star" that let the market price and compare alternatives.
"We have an agreed position that both political sides have settled on for some time, and that's given business and industry some certainty around investment. To go back on that now would make things very difficult."
Nuclear worth talking about, but not for today
The Coalition's internal debate about climate policy has spilled out into the open since its heavy election defeat, with both the Liberals and Nationals calling for a rethink.
Matt Canavan, who challenged David Littleproud for the leadership of the Nationals, was explicit that net zero should be dropped and coal embraced, and while his leadership bid did not succeed, his view is shared by several party colleagues.
Liberal views are split between those who want the nuclear power policy ditched for more ambitious emissions reduction policies, those who want it retained but with less taxpayer money involved, and those who want to double down or ditch net zero entirely.
Even moderate Andrew Bragg has welcomed a rethink of that target, while Ms Ley has said energy policy should "start from the position of affordable, reliable, baseload power" and consider the energy needs of the manufacturing sector.
Mr Willox said certainty about targets was important for the manufacturing sector, not just for investments in energy generation itself.
"The one thing Peter Dutton said during the election campaign that was right on the money was that energy is the economy, and if we don't have energy right … Then we're really going to hobble ourselves as an economy," he said.
"Energy is so important to a range of businesses, not just energy-intensive industry or generators or utilities, there is a whole range of things that are at stake here."
Innes Willox says Peter Dutton was right to state that "energy is the economy", with the viability of energy-intensive manufacturing at stake in the transition. (ABC News: Matt Roberts)
He welcomed the nuclear debate and said there was merit in lifting the moratorium on nuclear energy, but that there were more pressing priorities.
"The fact is that it is a longer-term option … Nuclear may have made things easier towards the end [of the transition], but as of now, it's not there. So we have to plan without it," he said.
"What I kept hearing from the private sector was that in the Australian context, nuclear in the time frame that was being talked about wasn't going to stack up … Business needs to know that projects will be viable for a long time to make the investments they need to make, and at the moment it doesn't add up for nuclear for the private sector.
"That's not to say that it won't in the future, but we're dealing with the here and now. That's why I think the Coalition went down the path of government funding to try to speed that up … [But] that changes the ball game when it comes to level playing fields around investment."
Productivity needed to unlock transition
Mr Willox said the debate the parliament needed to have was how to achieve the net zero transition, citing regulatory blockages as a major obstacle.
"The government has, through this last term, had a whole range of objectives around renewable build, and we just haven't achieved that as a country. We haven't built the solar farms, we haven't built the wind that was expected…
"So we've got to look at a whole range of things around planning, around permitting, around construction time [and] construction cost."
Mr Willox welcomed comments by Treasurer Jim Chalmers that productivity would be a focus for the Albanese government's second term.
After the election, Mr Chalmers had said the economic priority of the second term would be "primarily productivity without forgetting inflation", inverting the priorities of the first term.
New Environment Minister Murray Watt told the ABC this week reforming environment approval laws was one of his "highest priorities … Current environmental laws aren't working for the environment and they're not working for business."
Murray Watt says environmental approvals are among his highest priorities. (ABC News: Ian Cutmore)
Mr Willox said productivity was "a very core message", including in the energy space.
"We're really interested in what the government is saying it will do with Murray Watt in the environment portfolio, to see how we can unshackle [the approvals process] to allow the build to occur…
"We have to get the social licence in place, the approvals, the permitting, and we've got to build it … Or else we're not going to achieve our targets. We're not going to achieve a 2030 target, let alone a 2035 target or a 2050 target."