Energy Networks Parliamentary Reception

Good evening everyone and welcome to ENA’s first parliamentary reception. We are thrilled to have such a great turn out. 

In particular, I’d like to acknowledge: 

• The Honourable Chris Bowen, Minister for Climate Change and Energy 
• MPs and Senators from across the nation and 
• ENA Chair Frank Tudor, the ENA board, members and stakeholders.   

While these days we’re all experts at video conferencing, most of us still enjoy interacting in person. That’s why we are delighted to be able to host this parliamentary reception tonight.  

Five years 

As Tam has mentioned, I’ll be finishing up at ENA in the next couple of months and this is likely to be the last public speech I’ll make as ENA CEO. If you’ll indulge me for a couple of minutes, I’d like to take you back five years to Sept 2017, when I started here, and consider what has happened in the energy sector since that time.
 In Sept 2017: 

The Finkel Review was only 9 months old and one of its key outputs, the Energy Security Board had just been set up. The National Energy Guarantee was still a month from being announced. 

Another of Finkel’s key recommendations was an Integrated Grid Plan. I’m happy to take some credit for its renaming as the Integrated System Plan, with the first one coming out in 2018. 

In Sept 2017:  

Renewables were under 16% of output, now they are nudging 27%. In particular, we had under 700 MW of large-scale solar, now we are approaching 8 GW 

Household solar was setting records at over 5 GW, it’s still setting records but now it has grown to over 14 GW   

Large-scale batteries were much-talked about and the one that kicked it off, the Tesla Big Battery at Hornsdale in SA, was being built and opened in Dec 2017. Now we approaching 1 GW of large-scale batteries and plans for gigawatts more.  

For networks, in 2017 solar enablement was rising to prominence, now it’s BAU. Network resilience to extreme events was a niche issue, now it’s taking centre stage. In early 2017, we launched Gas Vision 2050 and announced that we had to make Renewable Gases a thing. Five years later, renewable gas is being delivered in networks around the country 

A lot has changed. And yet we all know that the rate of change needs to increase if we’re to meet our climate goals. 

Need more investment in networks 

Worryingly, we’ve seen less network investment than we need, particularly in electricity transmission. In 2017 Lance Balcombe from TasNetworks was still a year or so from coining a phrase you may have heard a few people in this room use: “there’s no transition without transmission” 

It’s true Project Energy Connect is finally under construction and in the last few years we’ve seen upgrades to QNI and VNI as well as syn cons installed in SA, but we need so much more in the next decade 

That’s why we’re strong supporters of Rewiring the Nation. We will continue to work with the federal government and regulatory agencies to ensure it helps address financeability challenges, makes transmission cheaper for customers and gets transmission built 

And while big batteries are becoming commonplace, we now better understand the benefits household and community batteries can deliver. If you’ve got technical challenges such as high voltages at the local level, you need local solutions. 

It’s for this reason we are also strong supporters of the federal government’s community battery plan. We think distribution networks are well placed to deliver many of these and we look forward to working with the government and regulators to turn this plan into action 

Looking forward 

One thing I am proud of is how ENA has led the development of a better understanding across the sector of the critical role networks are and will play in the energy transformation. While the decline of coal, the rise of renewables and new tech like electric vehicles will probably continue to dominate the media headlines, everyone in the sector now knows it is networks that will enable all these other changes. This is no small shift. It’s a decade ago that a famous academic paper talked about a death spiral, which many took to mean we might see mass disconnections from the centralised grid and its ultimate death. It’s noteworthy that the lead author of that paper, one Paul Simshauser, is now the CEO of a network company   

There has been much work on that central role of networks and I’d echo what Tam said about how networks have been the most stable part os the supply chain of the last few years and we expect that to continue Earlier this year, we published our ENA Energy Vision for a net zero future. 

The vision highlights just how important the nation’s energy delivery systems – our electricity transmission and distribution and gas distribution networks – are to ensuring Australia achieves its decarbonisation objectives. This was widely supported in our stakeholder engagement on the vision – because it’s true. 

Lessons learned  

I could write a book on the lessons I’ve learnt over the last five years, but we don’t have all night so I’ll leave you with two 

Firstly, we’re all in this together. Many of the intra-sector battles we’ve seen much of over the past two decades, for examples between retailers and networks, aren’t helping anyone – certainly not our customers.  And while there are many who wish governments would get out of the way, that’s not going to happen. 

Energy has always been an essential service and, if anything, we will rely on it even more in the decades to come. Governments will not stand back and just let something that important roll. We can and should continue to debate the appropriate role for state and federal governments, but the more we can work with them the better off the industry will be – and our customers will be too. 

Secondly, change is hard. While it’s already true that wind and solar are the cheapest generation sources, that does not mean the transition to a safe, secure and reliable grid dominated by renewable generation will be a cheap and easy process. It won’t, it will be a rough road and upheavals like the suspension of the NEM we saw a few months ago will continue to occur. Don’t take this as a call to slow down. The energy transition has to happen, but we risk losing public support for the transition if we pretend this is an easy journey and then reality turns out to be much more difficult. And can I add one cheeky third lesson for everyone in this room – if you haven’t already done so, go and buy yourself an electric vehicle. It’s the future, get on board.  I don’t know what will come next for me but it’s highly likely it will be in the energy space. There are just so many fascinating problems for us to solve. 

Conclusion  

Just before I go I’d like to thank the fantastic ENA team that makes tonight and all the work we do happen. And also all our ENA members who participate in so many ways to help ensure ENA really is representing the views of the network sector. It’s been an honour to be CEO and thanks all. 

That’s certainly enough from me. I’d now like to welcome Chris Bowen the Minister for Climate Change and Energy to the stage. 

E&OE – Check against delivery