Australia is a major energy supplier to the world, and our economy has benefitted from a secure and affordable supply of energy. This has been a major component in Australia's competitive advantage.
ACCI's membership consists primarily of consumptive energy users. Therefore ACCI has been a major protagonist against unilateral carbon pricing where we would add costs to our economy that would reduce our competitiveness against products from other countries that had not applied the same cost increases.
That said, we strongly support efforts to improve the productivity of the energy that enters a business – that is on the demand side rather than the supply side.
Much recent debate has focussed on how energy is generated rather than how it is used. Business has a major cost incentive to ensure that these inputs are used efficiently and that the outputs from this consumption of energy is maximised. We support the concept of a National Energy Productivity Plan, called for in the Energy White Paper, but achieving the improvement goals will need industry partners.
We support programs to increase the energy efficiency of Australian businesses. ACCI is always pleased to see industry-led initiatives rather than a heavy-handed regulatory approach from government. That said, we need a partnership between industry and government.
Government has a strong role in implementing an appropriate policy framework, based on comprehensive cost-benefit analysis that incentivises desired behaviour. ACCI is technology-agnostic when it comes to the generation of energy. We believe that market forces are the best determinant of the energy supply mix asnd that this should not be artificially distorted. But on energy productivity, it is important that businesses have access to information about their options when they are looking to change their technology and practices.
A key consideration is that businesses have invested capital. That is, they already have light fittings, boilers, waste management systems, production equipment etc., Unless there is a significant subsidy or other incentive to change (and we don't generally support subsidies) a business will run its current assets until they are depreciated to a nil value and it is time to renew equipment. But once it is ready to change, a business becomes receptive to new, alternate and more efficient technology.
So a program like 2xEP assists to deliver Australia's national contribution to cutting greenhouse gas emissions, and also contributes to other nations' efforts. This means our influence on global emissions, air quality and quality of life could extend far beyond our local conditions.
Our region, the Indian and Pacific Ocean rims, has many developing and aspirational countries that are rapidly urbanising and have large populations moving into the middle class. These countries face the challenge of developing sustainably and deploying best-in-class technology as they go. They need not repeat the mistakes of the already-developed world. Rather they can leapfrog us through “smart cities” efficient public transport, low emissions generation and similar initiatives.
Australia has many professionals and site-level managers whose skills could be deployed to assist in this development. In doing so we can drive new and enhanced export earnings through our service offerings.
We are not talking about something that will take long to develop or require lots of research. Many measures are close at hand and known to industry. Whatever the measures, we lack a coordinated and coherent approach that informs energy consumers so they can act and react appropriately for their business.
We need the government to partner with out initiative, to encourage improved energy efficiency in order to improve business competitiveness, to deliver a substantial increase in GDP and to allow us to achieve emission reduction targets.