Sustainability of Energy Supply and Resources in NSW

Sustainability of Energy Supply and Resources in NSW

 (Committee Report, Legislative Assembly, NSW Parliament)

As Chair: I am pleased to speak on the Legislative Assembly Committee on Environment and Planning report entitled Sustainability of energy supply and resources in NSW, tabled on 13 August 2021. The committee began the inquiry in July 2019. It looked at the opportunities of renewable energy, including for workforces, industries and the wider economy impacted by COVID-19, and considered ways to support sustainable economic development in communities affected by changing energy and resource markets. The terms of reference also covered trends in energy supply and exports, and effects on regional communities, water security, the environment and public health.

Over 250 submissions were received from energy companies, industry bodies, local councils, community groups, unions and academics. The committee held four public hearings, with 59 witnesses giving evidence, and conducted a site visit to the University of Wollongong's Sustainable Buildings Research Centre and the Tallawarra Power Station. The report makes 21 recommendations and 15 findings that focus on support for communities, economic and employment opportunities of renewable energy, transmission infrastructure, energy management, and forecasts for domestic and export use of energy. The report finds that New South Wales' energy mix is changing due to market forces, consumer preferences, advances in and lower cost of renewable energy, and government policy changes.

Coalmining has played a significant role in the local economy, history and identity of the Hunter and Illawarra regions. Committee members acknowledge the mining industry's contribution to those communities. However, we heard that relying on coal has unintended effects. Having a high proportion of workers employed in the coal industry can mean a less diverse skills mix. Local communities and workforces are at risk of high unemployment and socio-economic decline as demand for coal and coal-fired power generation drops. That highlights the importance of giving ongoing support and significant resources to regional communities that rely heavily on fossil fuel energy generation.

The committee heard that considering the immediate needs of affected workers is key to successful transition planning. Stakeholders pointed to examples, like the Ruhr Valley, that show the importance of jobs guarantees. The report recommends that the Government consider a jobs guarantee proposal and its use in other jurisdictions. The Government's energy road map was released during the inquiry. The Electricity Infrastructure Investment Act 2020 and the Renewable Energy Roadmap are steps in the right direction. They address some concerns raised by stakeholders during the inquiry.

The State's renewable energy zones [REZs] will support the uptake of renewable energy. The REZs will have the capacity to provide most of the future power supply, but are limited by current infrastructure and a lack of investment. The Act aims to address those problems, and it is pleasing to see the work being done in that area. The renewable energy sector presents a significant economic opportunity for New South Wales, including recovery from COVID-19. Committee members heard that the sector could create a large number of jobs, mainly in regional and rural New South Wales. We need to make the most of the potential of renewable energy projects to create jobs and stimulate economic growth in coal-dependent regions. Diversifying industry and employment is key to the successful transition of coal communities.

The report considers that REZs should seek to stimulate local industry and manufacturing by procuring local content. It recommends that the Government prioritise local suppliers and workforces in REZs, and reports on the number of jobs created. The inquiry heard that New South Wales could create new renewable energy export markets. There is growing demand for green hydrogen. Developing that industry could diversify the future energy mix and provide economic and employment opportunities in regional areas reliant on fossil fuel industries.

The report considers that mine operators should rehabilitate and re-use infrastructure on mines and power generation sites. The inquiry heard about the potential for industries like mine site rehabilitation to stimulate regional economies, promote employment and address the environmental impacts of mining. The report also recommends that the Government seek to remove barriers that prevent the development of a container terminal by the Port of Newcastle. The port needs to diversify its trade base, but policy barriers prevent that. The inquiry heard that New South Wales is not efficient in its energy use. That puts more pressure on electricity generation and distribution infrastructure.

Better energy efficiency would help manage energy demand and affordability, and reduce carbon emissions. To achieve this, the report recommends that the Government implement its draft plan to save New South Wales energy and money, and support higher energy efficiency standards in the 2022 National Construction Code. Forest biomass and natural gas are often spoken of as alternatives to coal-fired power, but they are not renewable energy sources. Committee members encourage the Government to focus on sustainable options, like battery storage, to ensure energy reliability. We recommend that the Government take steps to ensure forest biomass is not eligible for renewable energy credits.

Several funding programs targeting diversification of mining communities were announced during the inquiry. Community consultation on how that funding is allocated will be vital to the success of those programs. In closing, I thank my fellow committee members for their valuable and cooperative contributions to the inquiry. I also thank the stakeholders who took part in the inquiry and committee staff for their professionalism and support through the challenges created by holding the inquiry during the COVID-19 pandemic. I commend the report to the House.

Let's work together to celebrate and protect our great city!