Thursday, 22 February 2024
Bills
Climate Change and Energy Legislation Amendment (Renewable Energy and Storage Targets) Bill 2023
Climate Change and Energy Legislation Amendment (Renewable Energy and Storage Targets) Bill 2023
Introduction and first reading
The PRESIDENT (18:10): I have a message from the Legislative Assembly:
The Legislative Assembly presents for the agreement of the Legislative Council ‘A Bill for an Act to amend the Climate Change Act 2017 to change its title and to amend and bring forward emissions reduction targets, to amend the Renewable Energy (Jobs and Investment) Act 2017 to increase the renewable energy target for 2030, to introduce a new renewable energy target for 2035 and to introduce energy storage targets and offshore wind energy targets and to amend the Planning and Environment Act 1987 to expressly require consideration of climate change when making certain decisions under that Act and for other purposes’.
That the bill be now read a first time.
Motion agreed to.
Read first time.
Ingrid STITT: I move, by leave:
That the second reading be taken forthwith.
Motion agreed to.
Statement of compatibility
Ingrid STITT (Western Metropolitan – Minister for Mental Health, Minister for Ageing, Minister for Multicultural Affairs) (18:11): I lay on the table a statement of compatibility with the Charter of Human Rights and Responsibilities Act 2006:
In accordance with section 28 of the Charter of Human Rights and Responsibilities Act 2006 (the Charter), I make this statement of compatibility with respect to the Climate Change and Energy Legislation Amendment (Renewable Energy and Storage Targets) Bill 2023 (the Bill).
In my opinion, the Bill, as introduced to the Legislative Council, is compatible with the human rights as set out in the Charter. I base my opinion on the reasons outlined in this statement.
Overview of the Bill
The Bill is an amending Bill that makes amendments to –
• the Climate Change Act 2017 to change the title of the Act, bring forward Victoria’s long-term target for zero net emissions to 2045, provide for interim emissions reduction targets, and bring forward the preparation of certain documents required under the Act; and
• the Renewable Energy (Jobs and Investment) Act 2017 to increase the renewable energy target for 2030 to 65%, provide for a new renewable energy target of 95% for 2035, and introduce energy storage targets and offshore wind energy targets; and
• the Planning and Environment Act 1987 to expressly require consideration of climate change during the preparation of planning schemes and amendments to planning schemes under the Act.
Human rights protected by the Charter that are relevant to the Bill
The Bill does not raise any human rights issues.
Consideration of reasonable limitations – section 7(2)
As the Bill does not engage any human rights protected by the Charter, it does not limit any human rights and therefore it is not necessary to consider section 7(2) of the Charter.
Conclusion
Accordingly, it is my view that the Bill is compatible with the human rights as set out in the Charter.
Hon Ingrid Stitt MP
Minister for Mental Health
Minister for Ageing
Minister for Multicultural Affairs
Second reading
That the bill be now read a second time.
Ordered that second-reading speech be incorporated into Hansard:
The Victorian Government is committed to strong and decisive action on climate change and renewable energy to help secure Victoria’s economic prosperity and competitiveness in a net-zero emissions future.
Today I bring to Parliament the Climate Change and Energy Legislation Amendment (Renewable Energy and Storage Targets) Bill 2023 that continues to set world-leading climate action and renewable energy targets, introduce crucial energy storage targets and Australia’s first offshore wind electricity generation targets, and expressly embed climate consideration in land use planning decision-making.
Victoria’s ambitious climate action
The Victorian Government recognises that climate change is one of the most critical issues facing us today. Both the science – and our lived experience in recent years in Victoria – tell us clearly that sustained and ambitious action to reduce greenhouse gas emissions is essential to avoiding the worst impacts of climate change.
Victoria continues to demonstrate that ambitious emissions reduction action brings with it economic prosperity and growth. Between 2005 and 2021, our nation-leading climate change agenda has helped drive a 32.3 per cent reduction in state-wide emissions. Over this time Victoria’s economy has grown by 42.8 per cent.
Emissions reduction targets provide a clear signal to businesses, investors, households and governments on our plan to transform Victoria to a net zero economy.
By legislating our ambitious climate change targets, and setting them years in advance, the Government is providing clarity and certainty around the State’s direction and vision for our future.
These targets have been informed by independent expert advice, which considered the latest climate science, Victoria’s position in a rapidly decarbonising global economy and community expectations of climate action.
And we have already announced our intention to set our net zero emissions target to 2045 – five years earlier than our previous commitment.
Amendments to the Climate Change Act 2017
This Bill makes amendments to the Climate Change Act 2017 that will legislate our updated net zero target, setting in stone an emissions reduction goal that puts Victoria at the forefront of global climate action.
The Bill will also legislate interim emissions reduction targets: 28-33 per cent below 2005 levels by 2025; 45–50 per cent below 2005 levels by 2030; and 75-80 per cent below 2005 levels by 2035.
The Bill also updates the title of the Climate Change Act to the Climate Action Act. This change reflects the imperative the Victorian Government places on taking real action on climate change.
Delivery dates of key products under the Climate Change Act will also be streamlined as part of the Bill. The Emission Reduction Sector Pledges and Climate Change Strategy will be aligned to ensure a more efficient and effective approach to delivering significant emissions reductions across Victoria’s economy.
Whole-of-economy net zero transformation
Achieving our ambitious emissions reduction targets will require a whole-of-economy transition delivered in a strategic and coordinated manner. The amendments to this Bill focus on two high-impact areas for climate action: energy and land use planning.
The electricity sector currently generates around 50 per cent of Victoria’s total emissions, and addressing these emissions is key to achieving net zero.
In addition to the energy sector, the Victorian Government also recognises the critical role Victoria’s land use planning system will continue to play in achieving a net zero emissions and climate resilient Victoria.
This Bill reflects this approach – prioritising the increase of renewable energy generation and energy storage as the largest share of Victoria’s future energy mix, and reforming other key pieces of legislation to promote climate action across Victoria’s economy.
The energy transition
Victoria, along with many other parts of the world, is undergoing an accelerated transition of its energy sector from fossil fuel electricity generation sources towards renewable energy. This transition will require a generational investment in a diverse and decentralised mix of renewable electricity generation and renewable energy storage, supported by upgraded electricity transmission and distribution networks.
Over the last nine years, Victoria has established itself as a leader – nationally and around the world – in the development of renewable energy.
Over the last four budgets, we’ve committed more than $3 billion to drive forward our renewable energy transition.
As a result, Victoria achieved its first Victoria’s Renewable Energy Target (VRET) target of 25 per cent renewable generation by 2020, with renewable sources providing 26.6 per cent of Victoria’s electricity generation for the year. Since then, Victoria has built on this success, achieving a renewable energy generation share of 38 per cent in 2022/23.
Today, Victoria has 5,280 megawatts (MW) of commissioned large-scale wind and solar capacity, 4,030 MW of small-scale rooftop PV capacity and 537 MW of operational energy storage capacity.
And as I present this Bill today in Parliament an additional thirteen renewable energy projects totalling 1,407 MW are currently under construction and a further 6,129 MW of new projects have been approved under our Government but are yet to commence construction.
These achievements have made our State one of the leading destinations for renewable energy investment in Australia.
Amendments to the Renewable Energy (Jobs and Investment) Act 2017
This Bill continues this Government’s tradition of decisive action to lead Victoria’s transition to renewable energy. This Bill enshrines the Victorian Government’s commitment to deliver the clean low-emissions energy all Victorians deserve and seize the significant economic, social and environmental benefits this transition will deliver.
To manage Victoria’s renewable energy transition and ensure reliable and affordable electricity supply is maintained for all Victorians, this Bill amends the Renewable Energy (Jobs and Investment) Act 2017 to set forward the following targets:
• Increase the VRET for 2030 from 50 per cent renewable electricity generation to 65 per cent;
• Set a new VRET of 95 per cent renewable electricity generation by 2035;
• Set new energy storage targets of at least 2.6 gigawatts (GW) of energy storage capacity by 2030 and at least 6.3 GW by 2035; and
• Set new offshore wind energy targets of at least 2 GW by 2032, 4 GW by 2035 and 9 GW by 2040.
Legislating Victoria’s renewable energy, offshore wind and energy storage targets demonstrates our leadership and commitment to the energy transition. It will send a clear signal to the market and give confidence to the community that Victoria’s energy transition is being well managed.
Energy storage is vital to the decarbonisation of Victoria’s electricity sector. The firm capacity delivered by our energy storage targets will provide reliable, affordable and renewable energy as Victoria’s ageing and increasingly unreliable coal generation is replaced with new renewable capacity. Given the variety of energy storage technologies, the Bill contains a provision for the Minister to declare a facility not to be an energy storage facility for the purposes of the targets, ensuring that only dispatchable energy is counted. This will provide certainty clarity to industry and ensure the integrity of our energy storage system.
In addition, the scale of construction required to reach these targets will create substantial demand for labour. Achieving Victoria’s renewable energy and energy storage targets for 2030 and 2035 targets is expected to:
• support 27,800 jobs in Victoria over the period to 2030 and 59,200 jobs to 2035, with storage investment contributing 4,400 of these jobs to 2030 and 12,700 of these jobs to 2035
• support economic activity of at least $5.3 billion (in net present value terms) in Victoria over the period to 2030 and $9.4 billion (in net present value terms) over the period to 2035, with storage investment contributing $750 million of this amount to 2030 and $1.7 billion of this amount to 2035.
Legislating Victoria’s renewable energy, energy storage and offshore wind energy targets will also support their inclusion in national energy market frameworks and plans – notably the Australian Energy Market Operator’s Integrated System Plan.
To manage Victoria’s transition towards renewable energy, this Government has delivered and continues to deliver a number of initiatives and programs to improve system reliability, increase energy efficiency, create local jobs and support regional communities.
Victoria is implementing programs and policies to put the state at the forefront of the energy transition. This includes the $1.3 billion Solar Homes program, which has assisted over 250,000 households and businesses in installing solar PV systems, and the Victorian Energy Upgrades program, which has assisted over 515,000 households and 50,000 businesses in 2022 undertake energy savings and emissions reduction initiatives.
Victoria is also investing in battery and energy storage initiatives, such as the 300 megawatt Victorian Big Battery and investing in 100 neighbourhood batteries across Victoria to improve the energy reliability for local communities.
The VRET 2 Auction in 2022 brought forward 623 MWs of new renewable energy generation capacity, 365 MW and 600 megawatt hours (MWh) of new battery energy storage, and is expected to support at least 920 direct jobs and attract $1.48 billion of investment in new Victorian renewable energy projects.
The Victorian Government has committed to bringing back the State Electricity Commission, as an active energy market participant and to build new renewable energy projects. The SEC will invest an initial $1 billion towards delivering 4.5 gigawatts of power through renewable energy and storage projects.
Victoria is also leading nationally in developing offshore wind by establishing Offshore Wind Energy Victoria, which is currently undertaking engagement with industry and Traditional Owners on offshore wind projects. Victoria has also established VicGrid to coordinate the overarching planning and development of Victoria’s Renewable Energy Zones and Offshore Wind transmission projects. The $540 million Renewable Energy Zone (REZ) Fund has made investments to address some of the most severe areas of constraint on the grid to ensure that more renewable energy can flow through Victoria.
Accountability
To monitor Victoria’s progress with the energy transition, the Minister for Energy and Resources will continue to report to Parliament annually on progress made towards meeting Victoria’s renewable energy targets and will also report on Victoria’s progress towards meeting the energy storage and offshore wind targets. In October, the Minister tabled the 2022/23 VRET Progress Report in Parliament, which reported that renewable electricity sources provided around 38 per cent of Victoria’s electricity generation in 2022/23, putting the State on track to achieve its VRET 2025 target of 40 per cent.
Climate consideration in land use planning
In addition to the energy sector, the Victorian Government also recognises the critical role that Victoria’s land use planning system will continue to play in achieving a net zero emissions and climate resilient Victoria. Land use decisions cut across a range of activities and sectors, presenting significant opportunities for strong and meaningful climate action.
This Bill will add Victoria’s climate change goals to the objectives of the planning framework established under the Planning and Environment Act 1987 to expressly integrate climate considerations into our planning framework and the decisions made about the use and development of land across our State. This new objective will form part of the objectives to be considered when municipal councils come to review their planning schemes.
These amendments will also introduce a new head of consideration for planning authorities – including local councils – to consider climate change when preparing a planning scheme or planning scheme amendment.
Ministerial Directions will be issued by the Minister for Planning. Supporting technical material to inform the Minister’s Directions will be prepared by the Department of Energy, Environment and Climate Action. The Ministerial Directions will provide important clarity for how planning authorities are to comply with the new requirement, and fulfil their duty to consider these matters.
The Planning and Environment Act amendments do not directly concern planning permits, and the Ministerial Directions and technical and planning guidance will support planning authorities or proponents in considering emission reductions and climate change risks.
We have heard from local councils that they want to be empowered to take stronger action on climate change. We look forward to working with them on these changes.
Conclusion
The Victorian Government’s decisive leadership will continue to encourage the unprecedented investment Victoria’s renewable energy sector needs to deliver a renewable energy transition and help meet our target of net zero emissions by 2045. It remains committed to taking the serious and far-reaching action that has made our State a global model for others to follow. Our climate action leadership is helping prevent the worst impacts of climate change while bringing immediate benefits to the Victorian economy and community.
I commend the Bill to the house.
Evan MULHOLLAND (Northern Metropolitan) (18:12): On behalf of my colleague Mr Davis, I move:
That this bill be adjourned for one week.
Motion agreed to and debate adjourned for one week.