ONE ON ONE

Matthew Kean is the Minister for Energy and Environment in the New South Wales State Government, and the Member for Hornsby in the NSW Legislative Assembly. He spoke to William Poole.

AMT: Firstly, tell us about the Electricity Infrastructure Investment Bill that was passed by the NSW Parliament in November? What are the key points of the legislation and what is it aiming to achieve? Matthew Kean: The NSW Electricity Infrastructure Roadmap is our plan to power NSW into the future and cement our State’s rightful place as an energy and economic superpower. As the NSW Energy Minister, my priority is ensuring we have the policy settings in place to keep the lights on and get electricity prices down for families and businesses across NSW. Our Roadmap and the Electricity Infrastructure Investment Act that underpins it will do exactly that. Our Roadmap will bring 12 gigawatts of renewable energy and two gigawatts of storage such as pumped hydro, online by 2030. It will inject $32bn of private investment into the State and deliver 9,000 jobs – mostly in the regions – by 2030. It is expected to deliver average electricity bill savings of $130 for households and $430 for small businesses through to 2042. And, importantly, it provides regional land owners an opportunity to drought-proof their incomes, with $1.5bn in lease payments expected to roll to farmers that host new infrastructure on their land by 2042. Put simply, it is our plan to make sure we have the next generation of electricity infrastructure in place as our existing kit comes to the end of its operational life. AMT: High energy costs have been a key issue for Australian manufacturers for some time now. What impact will this legislation have in that regard? MK: Our Roadmap will deliver NSW heavy industry and manufacturers some of the cheapest, most reliable energy in the world. But don’t take my word for it, Mark Vassella the Global CEO of BlueScope – one of our State’s biggest energy users – has said our Roadmap “will stimulate a manufacturing renaissance in NSW” and that it “is exactly the right policy direction at exactly the right time”. In fact, our modelling shows us that with this Roadmap in place, our electricity prices will rank third-cheapest in the OECD (Organisation for Economic Co-operation and Development) – which will unlock huge opportunities for industry and businesses in NSW. AMT: Do you see other governments across Australia adopting similar policies to those taken in NSW? MK: Most States and Territories in Australia have put energy policies in place to support the transition to a low-carbon global economy – but I believe we have the best policy in the nation. The Australian Energy Market Operator (AEMO) have echoed a similar sentiment, saying our policy “could be a template for adoption across the national electricity market”. Ultimately my job is to make sure we have the best policies in place in NSW, and I’m confident our policies will make us not only a nation leader but an energy and economic superpower. AMT: The plan entails significant investment in infrastructure. What supply chain opportunities do you see it creating for Australian manufacturers? MK: I see huge opportunities for Australian manufacturers – particularly in NSW. We have announced that we are going to establish a Renewable Energy Sector Board to look at everything from material sourcing and supply to contracting arrangements, and how we can give NSW manufacturers a competitive advantage in supplying our electricity infrastructure needs. The Board is going to look at terms we can put in our electricity infrastructure contracts and tender rules, which will drive the use of NSW products, where they are cost-competitive. Industry tells us we will need more than 650,000 tonnes of steel to deliver our three Renewable Energy Zones and my priority is finding ways to make sure that the steel and other products that power NSW, are made in NSW by NSW manufacturers. AMT: Energy policy has been a particularly divisive issue in Australian politics for over a decade, particularly at Federal level. Why has it been so contentious and how can these divisions be resolved? MK: For too long Australian politics has been ravaged by the “climate wars”, drawing lines of division between those who focused on the economy and those who focused on addressing our changing climate. But guess what – the two aren’t mutually exclusive. In fact they are undeniably, inextricably linked. A decade ago the risk of reducing emissions was that it would hurt our economy and make us uncompetitive. Today, the risk is that if we don’t move now to reduce emissions and build the cheap, reliable, low-carbon energy grid we need to power us into the future – we will miss the chance to underwrite our future prosperity. AMT: You’ve said in the past: ‘You don’t need to believe in climate change to believe in capitalism. We should absolutely take action to address climate change for our environment, but just as importantly for the future of our economy.’ Do you think Australia is failing to really grasp the extent of the opportunities that exist in these areas? MK: In NSW, we are not going to let that opportunity be an opportunity missed. More than half the world’s GDP is created in jurisdictions that have signed up to deliver net-zero emissions by mid-century – most recently Japan, South Korea and China. Now with (US President Joe) Biden in the Whitehouse, the US will soon have a net-zero-

emissions-by-2050 target. And when it does, more than 70% of Australia’s two-way trade will be with countries targeting net-zero emissions. The other factor in the economic reality is the plummeting cost of renewables, with wind and solar, backed up by storage like pumped hydro and batteries, representing the cheapest form of reliable energy in the market today. Any rational person can see the opportunities that presents for Australia, and particularly NSW. We have some of the best natural resources in the world, we have the skilled workforce, and we have an abundance of land to accommodate large-scale renewable projects. That trifecta gives us a huge competitive advantage in a low-carbon world. AMT: Tell us about your professional background leading up to your current role as Minister. MK: Prior to entering State politics I was a chartered accountant with PricewaterhouseCoopers. AMT: What is the most satisfying part of the job? MK: The outcomes! There is no point developing a policy and putting it in place if it is not going to deliver a benefit for the people we are elected to serve. Having someone in the local community or the business community raise an issue, and being able to work with some of the exceptional experts we have in NSW to develop a solution, and then see it implemented and make a tangible difference, is without a doubt the most satisfying part of the job. www.nsw.gov.au