1 00:00:00,240 --> 00:00:02,880 Speaker 1: Government line around the payment for the facility is ultimately 2 00:00:02,920 --> 00:00:04,440 Speaker 1: we're all going to say it's about two to four 3 00:00:04,480 --> 00:00:06,520 Speaker 1: dollars a megal. With our eventually we save two hundred 4 00:00:06,519 --> 00:00:08,799 Speaker 1: and sixty five million dollars a year. Simon Watts is 5 00:00:08,800 --> 00:00:11,360 Speaker 1: the minister. Good morning, very good morning, Mike, so Food 6 00:00:11,440 --> 00:00:14,680 Speaker 1: says bipartisan. Have you got bipartisan supporter? You don't know 7 00:00:14,720 --> 00:00:15,480 Speaker 1: at this stage. 8 00:00:16,000 --> 00:00:19,439 Speaker 2: Oh. Look, I've briefed Labor and the Greens, but as 9 00:00:19,480 --> 00:00:23,160 Speaker 2: we know, their policy and energies are pretty gray, so 10 00:00:23,480 --> 00:00:26,520 Speaker 2: they haven't said to me where they're at on this policy. 11 00:00:26,600 --> 00:00:29,200 Speaker 1: He would also like to see all gas users help 12 00:00:29,240 --> 00:00:30,440 Speaker 1: pay for this way, aren't they. 13 00:00:31,280 --> 00:00:33,760 Speaker 2: Well, the reality is this is an insurance policy for 14 00:00:33,800 --> 00:00:37,640 Speaker 2: the electricity sector. Gas users and industry users are the 15 00:00:37,680 --> 00:00:39,600 Speaker 2: ones to get impacted in the dry year because the 16 00:00:39,680 --> 00:00:42,720 Speaker 2: energy companies can buy at any price, So we need 17 00:00:42,760 --> 00:00:46,559 Speaker 2: to protect industry by having this capability. We think the 18 00:00:46,560 --> 00:00:48,960 Speaker 2: electricity sector should be the one that pays this insurance 19 00:00:48,960 --> 00:00:51,000 Speaker 2: policy because it's for energy security. 20 00:00:51,159 --> 00:00:53,880 Speaker 1: Can't they protect themselves? I mean, this is the gent 21 00:00:53,880 --> 00:00:56,400 Speaker 1: Taylor argument, isn't it. They've got no reason to protect themselves. 22 00:00:56,440 --> 00:00:58,880 Speaker 1: They're happy in a dry year simply to launch the 23 00:00:59,000 --> 00:01:00,480 Speaker 1: spot price to the moon and back. 24 00:01:01,080 --> 00:01:03,760 Speaker 2: We haven't got sufficient dry year cover. I think that 25 00:01:03,800 --> 00:01:06,119 Speaker 2: the points being raised will isn't Huntly enough. Well, Huntly 26 00:01:06,160 --> 00:01:09,119 Speaker 2: covers fifty percent of the problem. We need more. We've 27 00:01:09,160 --> 00:01:13,000 Speaker 2: got a truckload of gas generation capacity out there, which 28 00:01:13,040 --> 00:01:15,040 Speaker 2: we haven't got a fuel to run in a dry yet. 29 00:01:15,240 --> 00:01:18,839 Speaker 2: In twenty twenty four, Huntly gas peak was only running 30 00:01:18,840 --> 00:01:22,679 Speaker 2: at sixty five percent capacity. Mike, that's insane. It was 31 00:01:22,720 --> 00:01:24,600 Speaker 2: only running at sixty five because we didn't have the 32 00:01:24,680 --> 00:01:27,479 Speaker 2: fuel to run it. And you know how price is spiked. 33 00:01:27,560 --> 00:01:29,600 Speaker 2: That's why we need got certainty of volume in the 34 00:01:29,600 --> 00:01:30,280 Speaker 2: Sydney supply. 35 00:01:30,440 --> 00:01:32,880 Speaker 1: How much disparity of view is there? I read over 36 00:01:32,920 --> 00:01:35,000 Speaker 1: the summer period and I was reassured by it. And 37 00:01:35,040 --> 00:01:36,520 Speaker 1: I can't remember who it was. It could have been 38 00:01:36,520 --> 00:01:39,880 Speaker 1: the Meridian Head anyway, he said the Huntly deal solves 39 00:01:40,160 --> 00:01:44,720 Speaker 1: the problem. How can he say that and you say no, All. 40 00:01:44,600 --> 00:01:47,760 Speaker 2: The reality is is it covers fifty percent, and that's. 41 00:01:49,760 --> 00:01:52,160 Speaker 1: How can one hundred and you say fifty? Who do 42 00:01:52,200 --> 00:01:52,880 Speaker 1: I believe that? 43 00:01:52,880 --> 00:01:56,880 Speaker 2: That? Well? You believe me because that's the advice that we've. 44 00:01:56,720 --> 00:02:00,560 Speaker 1: Got a yearly truth Simon Mike. 45 00:02:00,680 --> 00:02:03,400 Speaker 2: We don't want to be reliant on one fuel either, Right, 46 00:02:03,600 --> 00:02:06,040 Speaker 2: more options gives us more diversity, and that gives us 47 00:02:06,120 --> 00:02:06,880 Speaker 2: more resilience. 48 00:02:07,000 --> 00:02:07,120 Speaker 1: Right. 49 00:02:07,160 --> 00:02:08,680 Speaker 2: We don't want to just have one all their eggs 50 00:02:08,680 --> 00:02:11,079 Speaker 2: in one basket either. But you know, if you look 51 00:02:11,080 --> 00:02:13,960 Speaker 2: at the gas price in the international market, we're going 52 00:02:14,000 --> 00:02:17,160 Speaker 2: into an oversupply position. The US have got a lot 53 00:02:17,200 --> 00:02:20,480 Speaker 2: of LERG coming into the mark the market, Australia have 54 00:02:20,560 --> 00:02:24,160 Speaker 2: got plenty of supply coming online. So you know, the 55 00:02:24,320 --> 00:02:29,240 Speaker 2: outlook for LNG supply on international markets is also heading 56 00:02:29,240 --> 00:02:33,200 Speaker 2: in the right direction. Bison in the winter and obviously 57 00:02:33,240 --> 00:02:34,480 Speaker 2: that's the European somehow. 58 00:02:34,520 --> 00:02:37,120 Speaker 1: Okay, Yeah, so that partially answers my next question because 59 00:02:37,120 --> 00:02:39,040 Speaker 1: these coast of Australia, East and seabord of Australia has 60 00:02:39,040 --> 00:02:41,000 Speaker 1: got major problems around prices of l and G because 61 00:02:41,000 --> 00:02:42,919 Speaker 1: the West will want to sell it to Europe and stuff. 62 00:02:42,960 --> 00:02:45,280 Speaker 1: You're confident you can dip in, which is what we 63 00:02:45,320 --> 00:02:48,160 Speaker 1: would be doing, dip into the LNG market and not 64 00:02:48,480 --> 00:02:51,000 Speaker 1: be bled dry at the price level. 65 00:02:51,800 --> 00:02:54,480 Speaker 2: Now, the feedback that I've had from the International Energy Agency, 66 00:02:55,080 --> 00:02:59,040 Speaker 2: and we're talking with them regularly, is actually the reality 67 00:02:59,120 --> 00:03:01,560 Speaker 2: is we're seeing an over supply coming into the market 68 00:03:01,760 --> 00:03:05,160 Speaker 2: because primarily the big players are saying, look, we need 69 00:03:05,240 --> 00:03:08,639 Speaker 2: gas domestically, and we need plenty of it, and that's 70 00:03:08,639 --> 00:03:10,480 Speaker 2: going to benefit a country like New Zealand as well. 71 00:03:10,520 --> 00:03:12,480 Speaker 1: I want to be positive, Simon, but when I watched 72 00:03:12,480 --> 00:03:14,600 Speaker 1: you yesterday stand up at the pulpit of truth there 73 00:03:14,639 --> 00:03:16,839 Speaker 1: in the Beehive Theater and tell me that this thing's 74 00:03:16,880 --> 00:03:18,920 Speaker 1: really by next year, I bet you a hundred bucks. 75 00:03:18,919 --> 00:03:20,960 Speaker 1: It isn't. I wish it was, but it isn't. Why 76 00:03:20,960 --> 00:03:21,880 Speaker 1: are you saying this. 77 00:03:22,600 --> 00:03:26,120 Speaker 2: Because the proposals that we've had from the entities that 78 00:03:26,160 --> 00:03:30,160 Speaker 2: are all international players have provided us timelines of when 79 00:03:30,200 --> 00:03:32,440 Speaker 2: they can make this happen. The key piece of asset 80 00:03:32,480 --> 00:03:36,800 Speaker 2: that's required is an effective bargeinership that will come from overseas, 81 00:03:37,440 --> 00:03:40,120 Speaker 2: and no surprise that those aren't available all the time, 82 00:03:40,680 --> 00:03:44,320 Speaker 2: but the companies are putting bids up there have said 83 00:03:44,320 --> 00:03:46,480 Speaker 2: that the availability of that. So that's the key piece 84 00:03:46,520 --> 00:03:49,840 Speaker 2: of kit that needs to be procured. And then we 85 00:03:49,880 --> 00:03:52,480 Speaker 2: look at the enabling stuff, which we can and believe 86 00:03:52,840 --> 00:03:55,960 Speaker 2: can be done within the timeline other things. 87 00:03:56,400 --> 00:03:58,480 Speaker 1: Yes, I understand that no one would disagree that's just 88 00:03:58,520 --> 00:04:00,400 Speaker 1: whether we can or not. The other thing I think 89 00:04:00,480 --> 00:04:02,480 Speaker 1: you might have got caught up on yesterday, as those 90 00:04:02,560 --> 00:04:05,360 Speaker 1: those pesky journalists tried to bait you and trap you, 91 00:04:06,120 --> 00:04:09,040 Speaker 1: was the cheaper thing. You sound like you're saying that 92 00:04:09,120 --> 00:04:12,160 Speaker 1: power will become cheaper. It won't, and you know it 93 00:04:12,200 --> 00:04:15,040 Speaker 1: will it. It will just potentially go up less. 94 00:04:15,840 --> 00:04:18,599 Speaker 2: Well, what we're doing, though, is that the levee that 95 00:04:18,680 --> 00:04:21,880 Speaker 2: we'll use to fund the infrastructure will not be passed 96 00:04:21,920 --> 00:04:25,800 Speaker 2: on to households, because households will see a net savings. 97 00:04:25,880 --> 00:04:28,440 Speaker 2: The advice that we have is that having this capability 98 00:04:28,440 --> 00:04:32,240 Speaker 2: in terminal and effect is an insurance policy will have 99 00:04:32,400 --> 00:04:35,599 Speaker 2: a downward impact on the overall price of energy in 100 00:04:35,640 --> 00:04:38,560 Speaker 2: the region of minimum ten dollars per mega what hour 101 00:04:38,800 --> 00:04:40,640 Speaker 2: and the cost of the levees to ten one is 102 00:04:40,680 --> 00:04:44,039 Speaker 2: two's eight positive mic and that's positive fail. 103 00:04:44,200 --> 00:04:48,000 Speaker 1: So what's preventing? And this is the energy companies once again, 104 00:04:48,080 --> 00:04:51,000 Speaker 1: they're throwing billions into this business of renewables. We've got 105 00:04:51,080 --> 00:04:53,120 Speaker 1: so many renewables in half a dozen years. We never 106 00:04:53,200 --> 00:04:54,880 Speaker 1: use the LNG. You built something for nothing. 107 00:04:55,960 --> 00:04:57,960 Speaker 2: Well, the reality is renewables are nice, but the sun 108 00:04:58,000 --> 00:05:01,720 Speaker 2: doesn't shine during the night when we need a famine 109 00:05:01,800 --> 00:05:04,120 Speaker 2: capacity and thermal capacity in the dry year, or we 110 00:05:04,160 --> 00:05:06,320 Speaker 2: don't have enough water in those lakes. We have to 111 00:05:06,320 --> 00:05:10,960 Speaker 2: make that from either gas, diesel or coal. Only covers 112 00:05:10,960 --> 00:05:13,080 Speaker 2: fifty percent of us. We've still got a massive gap. 113 00:05:13,120 --> 00:05:16,119 Speaker 2: That's why there's a price premium in people's bills. Having 114 00:05:16,160 --> 00:05:18,880 Speaker 2: the certainty of supply of gas to come into that 115 00:05:18,960 --> 00:05:24,599 Speaker 2: market when we need it means that at risk is mitigated, 116 00:05:24,600 --> 00:05:28,640 Speaker 2: and therefore that price premium that some people's bills comes off. 117 00:05:28,720 --> 00:05:31,280 Speaker 2: That's the rationale of what we're doing here. This is 118 00:05:31,320 --> 00:05:34,919 Speaker 2: a strategic investment also for national security, because guess what 119 00:05:35,360 --> 00:05:39,000 Speaker 2: if you can't have energy, then other aspects to economies 120 00:05:39,040 --> 00:05:41,320 Speaker 2: at risk. And we've got to protect those industries that 121 00:05:41,400 --> 00:05:44,720 Speaker 2: can't run on coal, surprisingly can't run on electricity. There's 122 00:05:44,720 --> 00:05:48,440 Speaker 2: a lot of industry, heavy industry that needs gas, and 123 00:05:48,480 --> 00:05:50,799 Speaker 2: if we haven't got it domestically in the short term, 124 00:05:50,920 --> 00:05:52,200 Speaker 2: we need to be able to import it. 125 00:05:52,480 --> 00:05:55,960 Speaker 1: Okay, appreciate it. Simon, what's credibility issues? Do you feel 126 00:05:56,000 --> 00:05:58,720 Speaker 1: the credibility issues around this one. It's not a bad idea, 127 00:05:58,760 --> 00:06:01,800 Speaker 1: it's not the end of the world. It doesn't vibright 128 00:06:01,839 --> 00:06:03,360 Speaker 1: to me. I'll explain what I mean in the moment, 129 00:06:03,360 --> 00:06:05,920 Speaker 1: but you're all your feedback so far as the If 130 00:06:05,960 --> 00:06:08,440 Speaker 1: you think we're building something between now and next year 131 00:06:08,440 --> 00:06:12,040 Speaker 1: and getting it ready, no one believes it. For more 132 00:06:12,080 --> 00:06:15,200 Speaker 1: from the Mic Asking Breakfast, listen live to news talks. 133 00:06:15,200 --> 00:06:18,400 Speaker 1: It'd be from six am weekdays, or follow the podcast 134 00:06:18,440 --> 00:06:19,320 Speaker 1: on iHeartRadio.