ENGLISH, Mr Dominic, Chief Economist, Department of Industry, Science and Resources KAY, Ms Jennifer, Acting Head of Division, Environment Law Reform Taskforce, Department of Climate Change, Energy, the Environment and Water McKISSACK, Mr Adam, Chief Energy Economist, Office of Energy Economics, Department of Climate Change, Energy, the Environment and Water [by video link] MILLER, Mr Darren, Chief Executive Officer, Australian Renewable Energy Agency [by video link] O'CONNOR-COX, Mr Declan, Branch Head, Environment Protection and Biodiversity Conservation Regulatory Support Branch, Department of Climate Change, Energy, the Environment and Water PATRONI, Ms Kathleen, Acting Branch Head, Reform Strategy and Engagement Branch, Environment Law Reform Taskforce, Department of Climate Change, Energy, the Environment and Water SVARCAS, Ms Paula, Head of Division, Environment Regulation Division, Department of Climate Change, Energy, the Environment and Water [by video link] WENTWORTH, Mr Blaine, Acting Branch Head, Standards, Offsets and Approvals Reform Branch, Environment Law Reform Taskforce, Department of Climate Change, Energy, the Environment and Water WHITE, Mr James, Acting Head of Division, Electricity, Department of Climate Change, Energy, the Environment and Water WILTSHIRE, Ms Alison, Acting Head of Division, Clean Energy Investment and Facilitation, Department of Climate Change, Energy, the Environment and Water [by video link] CHAIR: Welcome. The Senate has resolved that an officer of a department of the Commonwealth or of a state shall not be asked to give opinions on matters of policy and shall be given reasonable opportunity to refer questions asked of the officer to superior officers or to a minister. This resolution does not preclude questions asking for explanations of policies or factual questions about when and how policies were adopted. If a witness objects to answering a question, they should state the ground upon which objection is made and the committee will determine whether it will insist on an answer having regard to the ground which is claimed. If the committee determines to insist on an answer, a witness may request that the answer be given in camera. Commonwealth officers appearing today are also reminded of the Senate order specifying the process by which a claim of public interest immunity should be made. A copy is available. The extract read as follows— Public interest immunity claims That the Senate— (a) notes that ministers and officers have continued to refuse to provide information to Senate committees without properly raising claims of public interest immunity as required by past resolutions of the Senate; (b) reaffirms the principles of past resolutions of the Senate by this order, to provide ministers and officers with guidance as to the proper process for raising public interest immunity claims and to consolidate those past resolutions of the Senate; (c) orders that the following operate as an order of continuing effect: (1) If: (a) a Senate committee, or a senator in the course of proceedings of a committee, requests information or a document from a Commonwealth department or agency; and (b) an officer of the department or agency to whom the request is directed believes that it may not be in the public interest to disclose the information or document to the committee, the officer shall state to the committee the ground on which the officer believes that it may not be in the public interest to disclose the information or document to the committee, and specify the harm to the public interest that could result from the disclosure of the information or document. (2) If, after receiving the officer's statement under paragraph (1), the committee or the senator requests the officer to refer the question of the disclosure of the information or document to a responsible minister, the officer shall refer that question to the minister. (3) If a minister, on a reference by an officer under paragraph (2), concludes that it would not be in the public interest to disclose the information or document to the committee, the minister shall provide to the committee a statement of the ground for that conclusion, specifying the harm to the public interest that could result from the disclosure of the information or document. (4) A minister, in a statement under paragraph (3), shall indicate whether the harm to the public interest that could result from the disclosure of the information or document to the committee could result only from the publication of the information or document by the committee, or could result, equally or in part, from the disclosure of the information or document to the committee as in camera evidence. (5) If, after considering a statement by a minister provided under paragraph (3), the committee concludes that the statement does not sufficiently justify the withholding of the information or document from the committee, the committee shall report the matter to the Senate. (6) A decision by a committee not to report a matter to the Senate under paragraph (5) does not prevent a senator from raising the matter in the Senate in accordance with other procedures of the Senate. (7) A statement that information or a document is not published, or is confidential, or consists of advice to, or internal deliberations of, government, in the absence of specification of the harm to the public interest that could result from the disclosure of the information or document, is not a statement that meets the requirements of paragraph (1) or (4). (8) If a minister concludes that a statement under paragraph (3) should more appropriately be made by the head of an agency, by reason of the independence of that agency from ministerial direction or control, the minister shall inform the committee of that conclusion and the reason for that conclusion, and shall refer the matter to the head of the agency, who shall then be required to provide a statement in accordance with paragraph (3). (d) requires the Procedure Committee to review the operation of this order and report to the Senate by 20 August 2009. (13 May 2009 J.1941) (Extract, Senate Standing Orders) CHAIR: I understand that information on privilege and the protection of witnesses giving evidence to Senate committee has been provided to you. I'm going to start with some questions for the department. When will all the new standards under the EPBC be released publicly for consultation? Ms Kay : We're working on releasing the standards very shortly. As you would be aware, we've done an initial public consultation on the national environmental standards for the matters of national environmental significance and the environmental offset standard. We're expecting that updated versions of those standards will be released in the coming weeks, along with our standards for data and information and community engagement. CHAIR: So when do you think they'll actually be made? Ms Kay : The minister's been publicly stating that he would like them to be made by 1 July this year so that it can give states and territories certainty for bilateral agreements as we're entering into negotiations. CHAIR: It's already six months after the legislation has passed. How much longer do you think it will take? Ms Kay : That's the timeframe we're working to—that is, to have them made before the end of this financial year. CHAIR: How are you going with your bilaterals? How many have you completed so far? Ms Kay : I'll start and then I'll hand to my colleague Ms Svarcas, who's online. We're having active discussions with states and territories on the bilateral agreements across the board. The minister met with his environment minister counterparts on 27 March, and they recommitted to negotiations and noted the importance of the bilateral agreements as part of achieving the benefits of the reforms. So we've been working really closely with states and territories on a multilateral and bilateral basis to start progressing discussions. CHAIR: How many have you done so far? Ms Kay : I might ask my colleague to talk about the current state of the bilateral agreements. Ms Svarcas : I think what you're referring to is how many have we renewed based on the regulatory changes that came into effect with the EPBC Act? CHAIR: Yes. Ms Svarcas : I just wanted to clarify that. We have commenced discussions with jurisdictions to start that process, but there are a few rate-limiting factors in us being able to progress them to a large extent—they are, as you've just described, the standards. What's important under the bilateral arrangements is that it's effectively an accreditation for the jurisdiction to undertake the actions on behalf of the Commonwealth. In order for us to be able to do that we need the standards to be able to confirm that the state's regulatory practice gives us the outcomes that the EPBC Act provides for. So there are a few steps along the way in order for us to progress the finalisation of renewed bilateral arrangements with jurisdictions. CHAIR: So none so far. What's the cost of complying with the new EPBC versus the old EPBC? Ms Kay : The impact analysis that we published ahead of the legislation gives a range of economy-wide savings of between $0.5 billion and $7 billion, and that's largely due to the improvements through the streamlined pathway. One of the things that proponents tell us often, and that I'm sure you've heard today as well, is that it's the back-and-forth in the system in how they comply that is slowing things down. One of the things that we are doing through the reforms is introducing a streamlined pathway, which means that, if proponents provide us all the information that we require upfront, they get a fast track through the system. As part of that, we are going through the process. The standards are a really important part of making sure it's really clear for proponents what they need to do right at the very beginning of the process. But there are a number of other things in the reforms that are helping to provide greater clarity. CHAIR: So it didn't save up to $7 billion? Ms Kay : That's the estimate that we've published. CHAIR: But you didn't know what the regulations were then, so how have you done that analysis? Ms Kay : That was the analysis that we did on the legislation that was introduced into parliament. This was from September last year. CHAIR: There's not much in the legislation. Most of it's in the regs. Ms Kay : Sorry, I didn't hear you. CHAIR: It couldn't have been a very thorough analysis because the regulations have a lot of principled detail in them. Ms Kay : The regulations follow the settings that are in the legislation, so what we're going through at the moment is updating all the regulations to match the updated settings and give more detail as to the overarching settings and frameworks that we set out in the legislation. CHAIR: But effectively, I mean, the legislation gives the minister, I would say, god-like powers to make all sorts of different judgements, effectively making the law. Therefore, you're compliance assessment and tabulation probably couldn't be seen to be a final analysis of the compliance costs because you didn't know what the law was yet. Ms Kay : We published our update, our analysis, as we were required to according to the Office of Impact Analysis. CHAIR: Are you going to do the same analysis on the regs? Ms Kay : The intention is that we'll do the same analysis on the standards, as is the process. CHAIR: Right, so you will look at the compliance costs of each of the regulations? Ms Kay : I'm just going to ask my colleague to talk a bit more to the process, if that's okay. Ms Patroni : Yes. So what we have— CHAIR: I'm not asking this question; I'm asking are you going to cost the compliance burden on industry as a result of the government making new regulations under the EPBC Act? Ms Patroni : In the impact analysis that was published with the legislation, we've said that we will look at the impacts of the standards when they're made to better understand, as you say, the specifics of the standards that will have an influence on the impact. So we'll be looking at updating that impact analysis. CHAIR: When you get the regs made or before they're made? Ms Patroni : We would usually finalise that analysis, alongside making the standards, when we have clarity about what will be in them. CHAIR: And you don't know yet. Ms Kay : Don't know what? CHAIR: You don't know what's going to be in the regs. The minister hasn't made the regs so you don't know what's going to be in them. Ms Kay : As I said, the regulations follow from the settings that are in the legislation. The legislation sets out a number of frameworks and they need to be enlivened through regulations. CHAIR: I'm not talking about the legislation. I'm talking about the draft regulations. Some of them are drafts; some of them don't exist yet. My question is: will you be conducting further compliance cost analysis when the regulations are made, before or after? Ms Patroni : I know you said you're not asking about process, but from a process perspective we would need to start that analysis alongside the finalisation of the regulations in order to have it ready when the regulations are made. CHAIR: Do you know what's going to be in the final regulations yet? Ms Kay : I might talk you through how we're preparing the regulations. As I said, there are a number of things in the changes to the legislative settings which need to be finalised in regulations. We're going through the process of making and drafting all of those regulations now and consulting on some of the policy settings that go into those. CHAIR: We know that. Ms Kay : Some of them will be made in advance of the national EPA being stood up on 1 July this year. All of the settings that the EPA needs to do its business will be made in regulations, as well as a number of the things, including the standards, that we need to enliven accreditation. All of the remaining regulations, which are some of the more complex policy settings, need to be given effect on or before 1 December this year, which is 12 months after royal assent of the EPBC Act. Some of the things that proponents need more time to adjust their behaviour to meet will be made ahead of that date. CHAIR: Are you going to monitor the ongoing costs, in an audit sense, of compliance, or is it just a one-off compliance cost? Ms Kay : When you say cost of compliance, do you mean cost of compliance to the EPBC Act? CHAIR: Yes. And the ongoing costs. Ms Kay : That might be one I need to take on notice. There are a number of parts to the EPBC Act and a number of points at which proponents will need to comply both pre and post approval. It's something we can give you a more detailed explanation of on notice. CHAIR: Let's try some simple questions now. How many houses are currently stuck before your EPBC quagmire? Ms Kay : I'm going to hand to my colleague online to start. Ms Svarcas : We currently have 92 projects, as at 21 April, that are in the system either awaiting an approval decision, awaiting a referral decision, under assessment with the department or under assessment with the proponent. That equals about 95,133 homes. CHAIR: That's 95,000 houses. How many of those have come in after November last year when the legislation passed? Ms Svarcas : I can give you the numbers since August 2025. We've had 25 new referrals for projects since August 2025. CHAIR: How many houses? Ms Svarcas : I actually don't have the number of houses. I've only got the project numbers for that 25. I can take that on notice. CHAIR: You've got almost 100,000 houses in your system. Is that right? Ms Svarcas : There are 95,133. That's correct. They are currently in the EPBC system, as of 21 April. CHAIR: And you've cleared out 17,000. Is that right? Ms Svarcas : As of 21 April, we've delivered 20,000 homes across 28 projects. CHAIR: You've approved. Ms Svarcas : Correct. CHAIR: Was it 115,000 before? Ms Svarcas : Before when? CHAIR: What's the time period in which you cleared 20,000? Ms Svarcas : The 20,000 homes have been since 24 August 2025. That's when we established the housing strike team to help fast-track and make an effort to make sure that we're getting the housing projects through the system. We set up the strike team on 24 August 2025 with an ambition to clear 26,000 homes by 30 June. As at 21 April, 20,000 homes across 28 projects have been given the green light as a result of the strike team's efforts. CHAIR: And you've got 95,000 left. Ms Svarcas : That's right. CHAIR: Can you provide on notice some more information about how long some of those applications have been in for? Maybe do a state-by-state breakdown—just a bit more information, because it's very hard to get information on these things. I appreciate you coming prepared with some good data today. It's much appreciated. Do you know, for example, whether any of these have been waiting for many years? Ms Svarcas : I can't give you the extremes. What I can say is that 34 of the 84 housing projects that have been completed since May 2022—so this is a longer timeframe than what we've just discussed—managed environmental impacts to a level that was below significant. They were allowed to proceed in as few as four to six weeks as non-controlled actions. This is a really good example where projects are designed not to have significant impacts and avoid EPBC requirements. They can get through the system really quickly. The housing team recently assessed and approved a housing project in 62 business days, so we are moving through them as quickly as we can and we are seeing some really good results. Also, some of the benefits of the EPBC reform for housing assessments will include the new streamlined assessment pathway when that becomes available. That will give us a statutory timeframe of 50 business days. So there are more reforms and opportunities for housing developments to go through the system quickly that are coming through the system now. CHAIR: What's the average timetable to get a house approval through the EPBC? Ms Svarcas : I'm sorry, but we will have to take that on notice. But I might just make a point— CHAIR: I have a lot of questions to get through, so, if you don't know it, take that on notice. Ms Svarcas : Okay. I just want to say that less than five per cent of housing needs to be assessed under the EPBC Act, so it's quite a small number of houses. CHAIR: There are 100,000 houses that Canberra has to approve in some form when, really, the national government wasn't supposed to have planning controls. You're sitting on 100,000 there, so it's still a lot of houses given we're in a housing crisis. So you take that on notice. What about resource exploration and the like? How many energy developments do you currently have under the EPBC? Ms Svarcas : Is this about energy writ large or— CHAIR: It is anything to do with energy. It could be renewables, fossil fuels—whatever. Ms Svarcas : For national renewable energy priorities—we could touch on that. CHAIR: I just want to know all of them—fossil fuels, renewables, whatever. Ms Svarcas : Sure. Let me find the right number for you. Declan, do you have the number? I've got approvals, but not necessarily what we've got in the system. Mr O'Connor-Cox : No, I don't have the number of renewable projects currently under EPBC assessment. We do have the number of approvals but not for the renewables projects, which includes generation, storage and transmission. We don't have the number under assessment for renewables. We do have some information on coal, gas and oil projects under EPBC assessment. CHAIR: How many of those have you got? Mr O'Connor-Cox : My figures are as of 1 April 2026. Sixty-two coal, gas or oil projects are under EPBC referral or assessment, and 41— CHAIR: And how many are oil? Mr O'Connor-Cox : I'll see if I've got that broken down. There are no oil extraction projects currently under referral or assessment. There are a total of two oil projects under EPBC referral and assessment as at 1 April. CHAIR: What's the average time taken to get a gas or oil approval? Ms Svarcas : We'll have to take the average on notice. CHAIR: How many times have you met with the housing minister to discuss the EPBC housing issues? Ms Kay : We can take that on notice. We do meet with our colleagues the housing officials pretty regularly. CHAIR: Have you met with the housing minister? Ms Kay : I'll take that on notice. CHAIR: You don't remember whether you have or you haven't? Ms Kay : I haven't personally, but that doesn't mean that members of the department haven't on EPBC housing. CHAIR: There are about 10 people there. Has anyone met with the Minister for Housing to talk about the housing EPBC issues? Mr O'Connor-Cox : I do recall meeting with the housing minister to talk about the work of the housing strike team and how that was going. I believe that there was at least one prior meeting, but, as my colleague said, we can provide exact figures on notice. CHAIR: Okay. If you can provide that on notice, I'd be grateful. Senator Ananda-Rajah. Senator ANANDA-RAJAH: Mr Miller, I'm interested in what your industrial decarbonisation program means for economic resilience, energy efficiency and any subsequent savings for business. If you could particularly focus on the big sectors—manufacturing, mining, agriculture and transport—that would be terrific. Mr Miller : We've got the industrial transformation stream that's supporting the heavy industry sector with decarbonising. I think a lot of the theme there is about electrification. We can think about this transition in two steps. One is getting industry to shift off coal and gas, principally for heating but obviously for mobility as well when we talk about mine sites. If you take the first step to get off coal and gas and onto electricity, you get an energy efficiency boost right away regardless of the source of electricity. And then, as we know, over time the grid will decarbonise, as is happening. We can see a clear pathway to very high shares of renewable energy in the grid. And so you get the emissions reduction uplift as a second stream of uplift once you've taken that early step to electrification. A lot of industry is interested in replacing gas and coal, which provides heat with electricity. Some of the challenges we have around that is obviously getting electricity into those facilities and actually expanding the grid capacity of the connection into those facilities. We're finding that a lot of facilities are interested in electrification but then will have to spend significant amounts of money. That comes with time, approvals and the like to get the grid connection expanded to allow that volume of new electricity to come in. We've seen people try to solve that with behind-the-meter solutions, like trying to put their own renewable energy on their own plots of land where they operate, but what you'll generally find is you'll run out of capacity, run out of space behind the meter. So we really do need to strengthen those grid connections and get those transmission systems built. I think we can be pretty confident that, especially in today's age, when diesel prices are high and gas prices remain volatile, getting onto an electrical solution is only going to help settle down the economics of these facilities for the long term. We've just got to cross that hurdle of getting these brownfield sites electrified and that grid capacity upgraded. Senator ANANDA-RAJAH: Earlier, you said that you are being approached by industries to electrify. Can you give us a sense of which industries are approaching you? There is a narrative circulating that we, as government, are imposing this on industries, but you're telling me that you're actually being approached by industries that are interested in electrification. Mr Miller : Yes. Many companies have their own decarbonisation objectives regardless of whether they're in the safeguard scheme or not. Those that are above the threshold, in the top 215 emitters, have a forcing mechanism there through the policy response that the government has provided. They are interested and have approached us. We're working with some of the very big industries in alumina refining and other refineries and the like, but then the food-processing, small manufacturing facilities are also very interested. They are particularly affected by volatility in fossil fuel markets and the sustained high gas prices that we've seen, although they have settled down over the last few years. There's certainly keen interest in new technologies, particularly in something like thermal energy storage, which is heating up very cheap materials such as refractory bricks and graphite and the like that can contain heat and provide that heat as a service, if you like, back into those industries. Even yesterday, at our board meeting, we were looking at two or three thermal energy solutions for food manufacturing in Australia, throughout New South Wales and Victoria. We're seeing a very big uptick in that kind of interest. Senator ANANDA-RAJAH: You mentioned refineries and food-processing companies. Are there any others? Mr Miller : There's beer production, wine production and, as I said, food, and probably less manufacturing at this stage. I haven't seen too much there. But food and beverage is a big theme that anecdotally I can observe through the portfolio, and then there are those larger refineries, particularly those alumina refineries, which have been a core focus of ARENA's for many years now, and that industry is really moving into this electrification space. Senator ANANDA-RAJAH: How are they doing that? Mr Miller : It's difficult because it's always hard to retrofit an existing facility. One thing we keep hearing is that, if we're building something new and electrified, the clean option is the thing that people will do naturally because the economics will be better. When you're looking at an existing facility, you really have to fit in with the existing production profiles and maintenance schedules for equipment. If you take the Yarwun facility up in Gladstone, for example, which we're helping Rio decarbonise with thermal solutions and hydrogen solutions for their calciners, each calciner is probably on a four-year maintenance rotation, so, unless you get your solution in in that four-year window, it's very difficult to disrupt the production of an existing facility. But forward-leaning companies like Rio are doing pretty well at investigating all of the options to decarbonise these alumina refineries. Senator ANANDA-RAJAH: Future Made in Australia is partly premised on Australia capturing new industries in this clean energy supply chain. What's your assessment of the productivity opportunity inherent to that? I'll also ask DISR about the role of R&D in further accelerating that opportunity. Mr Miller : There's a massive economic opportunity for Australia here. It's really ours for the taking. It's going to play out over a couple of decades at least. We're very interested, for example, in the green iron pathway. We have a particular project in our pipeline there with the likes of BHP, BlueScope and Rio that's looking at green iron manufacturing. Australia has the core ingredients to make that really successful: incredible sunshine, wind, land, skilled labour and connections to Asian markets. The challenge for us is going to be whether we can build these new deployments cheaply enough to compete on the global stage. We see the energy transition happening in two different domains. One is in the domestic domain. How do we decarbonise our homes and our businesses? You're not really competing with China when you think about decarbonising your electricity grid in Australia, but, as soon as you start to look at tradable commodities like steel, aluminium, hydrogen and the like, we really need to be much more cost competitive in the way we build large-scale deployments, like, for example, a green iron smelter, which is one of the core technologies there. The Future Made in Australia program, which we're helping administer, is really to prove up these technologies and, frankly, to prove we can build at scale cheaply enough to compete on the global stage. I think that's the next frontier of this superpower ambition that Australia has—to do big things cost-effectively enough to compete with other players who will be trying to do the same thing globally. Senator ANANDA-RAJAH: I'll draw in the Department of Industry, Science and Resources. On the topic of R&D, business investment has been declining in Australia since 2009, and this was thoroughly investigated through the SERD review. Now we have the Ambitious Australia report, which I really love. I think it's a terrific report. It's got some great ideas. What do you think the linkage is? Could you describe the linkage between R&D and some of the key themes in Ambitious Australia and productivity? Mr English : The key challenge for lifting productivity in a way that builds both the complexity of the economy and our long-term productive capacity over time is the generation of new ideas and the diffusion of those opportunities, technologies and ideas across Australian industry and production opportunities. The strategic examination of R&D highlights that, when you get that right, the spillover effects for the investment in R&D can be larger for the whole economy than it is for the firm. That's obviously the orthodox definition of a spillover, but there's some quantification that the SERD report puts around that—which we quoted in our submission—where every dollar invested in R&D returns $4.60 to the business and $7.14 to the wider economy over 10 years. The critical thing for Australia is to continue to make policy and build business opportunities and investment opportunities over time that shorten the timeframe for the diffusion and adoption of technology, lift the skill set that generates those new opportunities and build solid market opportunities to take advantage of those. The Ambitious Australia: strategic examination of research and development report talks about bringing the logic together across a number of those mechanisms. We've seen large business investment in R&D move over time in response to the changing economic structure, and we need to continue to connect our R&D efforts to the investors and the businesses that will become part of international supply chains and to build those innovative opportunities. That's where FMIA and its various investment streams play a part in helping to address some of the barriers to achieving those outcomes over time, by addressing key cost challenges and transition challenges in the economy to taking up new technologies. The report also talks quite a lot about how the innovation cycle is increasingly focused on the small business end of town. The statistics in the R&D tax incentive data, for example, show that the level of investment in R&D undertaken by small businesses, those with fewer than five employees, is now the largest growth element of the claims to the R&D tax incentive system. We think that bears out in some of the broader economic data that we analyse about business behaviour. That's quite good in terms of dynamism for the economy, allowing new ideas to be tried without having barriers around bureaucratic processes within various institutions getting in the way but also having capital and people move quickly from those opportunities to new places. The Ambitious Australia report did talk quite a lot about how we can evolve our venture capital system and our scale-up and start-up communities over time to maximise those benefits and how those, done right, have some of the highest yields for productivity according to the data analysis that we've done around the international experience showing that adopting ICT is important and highly impactful, but developing and adopting new technologies through R&D processes has greater impacts, again, if we can accelerate that through the economy. Senator ANANDA-RAJAH: I think the Economist recently identified Australia as a bit of a start-up hub. That definitely aligns with what you've just mentioned, but I'll leave it there because time is short. Thank you. CHAIR: Senator Grogan? Senator GROGAN: I might go to Ms Wiltshire first. In your submission, you make the case that climate change is a growing constraint on productivity. Have you assessed the productivity costs of specific climate events at all? What adaptation investments do you think would have the highest productivity return? Ms Wiltshire : I think that question is for our climate colleagues, and I'm not sure there's anyone on the call today that can assist. One of my colleagues in the room may be able to, but I think that's for our climate group colleagues. Senator GROGAN: I'm really looking for climate as in what's going on but also the transition piece, because my understanding is that you're in that clean energy investment and facilitation division. Maybe I've misunderstood the role, but, as one of those things that are out there to help with the mitigation piece—maybe you could just take me to the energy transition. I believe that's in your bag—clean energy. Ms Wiltshire : Sorry, can you go through the question again? Senator GROGAN: I'm essentially interested in whether you've done any assessment of—let me reframe this so I tie it directly to your title—the productivity of clean energy investment. How do you think it's going? Is this having a productivity impact? Is it not? What's going on? Ms Wiltshire : I can start, and then some of my colleagues may be able to assist. In general, when we think about the energy transition, we really think the transition supports productivity by delivering secure, reliable and affordable energy and reducing avoidable system costs through things like efficiency, electrification and providing policy certainty that crowds in private investment in renewable generation, storage and transmission. That's our general way of thinking about productivity in terms of the energy transition, but my colleagues Mr White and Mr McKissack may be able to add. Senator GROGAN: So you don't have any commentary on productivity in that energy space? Ms Wiltshire : I don't have any additional comments, no. Senator GROGAN: Do any of your colleagues? Mr White : I'll reiterate what Ms Wiltshire said. Energy's an essential input across the economy. Ms Wiltshire's division is focused on that clean energy investment and facilitation. They're running programs—Rewiring the Nation, the Capacity Investment Scheme, the renewable priority list. Our division is looking at the efficiency of the markets in terms of how we get the electricity delivered to the end users, households and consumers at the lowest cost. Our focus is very much on ensuring that the electricity supplies are clean, reliable and affordable, because you want electricity in the hands of consumers at the lowest cost. That maximises our capacity to produce goods and services with the lowest cost for that input. There's also the reliability aspect of it and the secure supply aspect as well. It's one thing to have electricity supplied to people at low cost, but it certainly works against it if the electricity suddenly isn't supplied for any reason. The reliability piece is very important. In terms of what we're seeing, the system is transitioning towards a reliable supply with downward pressure on costs relative to the counterfactual. In terms of actual productivity related measures and the types of things and modelling Treasury did for the Electricity and Energy Sector Plan, it's possible that Mr McKissack may be able to make some comment or otherwise comment more generally on the productivity piece. Senator GROGAN: That would be great. Mr McKissack : We did touch upon the productivity issue in the Electricity and Energy Sector Plan that the government released last year. I think colleagues have already talked a bit about the supply side and providing generation for the least cost. We also talked about the demand side of energy. I think there are a couple of ways in which you can promote productivity in the economy through the energy sector on the demand side. Part of it is through energy switching—for example, electrification. Electric vehicles are much more efficient in an energy sense than internal combustion vehicles. That switching through electrification does give you productivity benefits because you're using a form of energy that is more efficient to generate. That can be quite an important factor impacting on productivity across the economy. There are pure energy efficiency gains. A lot of programs we run through the department support energy efficiency in buildings and so on—better insulation and better use of better appliances that use electricity more efficiently. The last area I'd mentioned is when you use energy. Actually we have a system that does have to be built around peak loads. The more efficiently you can consume energy and reduce those peak loads, the more that also can add to productivity. Shifting your energy use within the day and within times of the year through some more flexible demand options is another important area. Senator GROGAN: We find ourselves in uncertain times. Do you see the energy transition as having potential for more independence that we gain from having a productivity impact? Mr McKissack : Yes, I think it does. I think we have seen that it can actually impact on reliability. As a nation, our ability to produce energy generated within Australia obviously has benefits to reliability. The sector plan last year did talk about, for example, a low-carbon, liquid-fuel agenda. That sort of fuel can be produced domestically. That obviously reduces your reliance on imported fuel. That's something that's very topical at present. But also, we've had a season in Australia where we did have a lot of hot conditions. We had bushfires. The electricity system actually held up pretty well, and that was assisted by renewables in the system and people being able to generate power off the rooftops, et cetera. I think there are actually a lot of spin-off benefits in terms of reliability from the energy transition, which then feed into productivity across the economy. Senator GROGAN: I suppose that takes me back to my initial question: do you think that climate change is placing a sort of growing constraint on productivity? Mr McKissack : Yes, it's a hard question to answer. Senator GROGAN: No worries. You know what? I'm going to give up, I'm going to write some stuff down, and I'm going to send it to you and see if we can't get a little bit more progress that way. Have I got time for one more? CHAIR: Yes. Senator GROGAN: I'll try be as quick as possible. Mr English, on the issue of artificial intelligence and its potential for productivity gain, you have said in your submission that technology is a strong performer and that there are opportunities there. What do you see as the AI component of the opportunities there? Mr Wentworth : I might take on notice a more fulsome answer from colleagues who are better placed to tell the story than I am. In the broad economic sense, the opportunity of AI is the more rapid spreading of a range of efficiencies that can be applied in businesses in day-to-day practices; AI will enable the adoption of those techniques, technologies and practices in a way that requires much lower investment and effort from businesses. I think you'll see AI substantially assist in the diffusion of new techniques, technologies and opportunities over time. It will obviously have the benefit of making a bunch of process tasks simpler and quicker and open up, particularly for a services economy, the opportunity for a higher level of support and services being provided through a bunch of areas. The financial sector is an obvious one. Senator GROGAN: I think the notion that AI will take over everything is versus that AI may be able to support in certain areas. There's a multitude of conversations about how it's going to play out, and nobody knows, but I'm sure everyone has got an opinion—how it might look to actually increase productivity in a positive way. I will just say: there were some issues raised earlier in the day about AI and the EPBC in terms of how AI might be able to help with some of the structuring tasks and that sort of thing. If you had any commentary on that, we'd be keen for it. Very finally—not meaning to wind up the chair—with the EPBC reform, do you feel like it's on track? It's a big task. It's 12 months. Ms Kay : I think we're progressing well. We are working towards all the milestones we need to work towards. We've had really constructive engagement from industry stakeholders, NGOs, states and territories. We've commenced some of the reforms already so that we have been able to turn on things as we are going on. We're not waiting for everything to be ready so that we can see the benefits. We're trying really hard. I know it's a big job, but we are trying really hard to help achieve the benefits of the reform as fast as possible. CHAIR: I have just a couple of final questions— Senator ANANDA-RAJAH: Can I just put one question on notice for ARENA? Could I get a list of all the investments we've made in transport, in electrification or low-carbon fuels; that would be wonderful. Mr Miller : That ARENA has made? Senator ANANDA-RAJAH: Yes. CHAIR: I have a quick question for the department and a quick question for ARENA. With the department, where did the idea of the fast-track process come from? Ms Kay : Do you mean the streamlined pathway? CHAIR: Yes. Ms Kay : This was something that came out through industry consultation and through the Samuel review; there were ways we could speed the process up for people. Particularly, as I said, a lot of the time is in the back and forth, so it's about making really clear the requirements up front so that people can then fast-track themselves. CHAIR: So it came from the Samuel review. That's fine. Ms Kay : I'm just looking at my colleague to confirm. I'll take it on notice to confirm. There was a lot in Samuel about how to speed the process up. CHAIR: It was in the bill that passed parliament in November. Ms Kay : That's right. CHAIR: Where did the idea that fossil fuel projects would be carved out come from? Ms Kay : That came through the Senate negotiations. CHAIR: That wasn't in Samuel, was it? Ms Kay : I'd have to take that on notice. That's not off the top of my head. CHAIR: Does anyone know where it came from? How many people were there in the room—about 10 people? Where did it come from? Ms Kay : As I said, that was in the negotiations. It wasn't in the original legislation. It was in the Senate negotiations to pass the bill. CHAIR: It came from the Greens, didn't it? Ms Kay : It was in negotiations. CHAIR: What advice did you provide about that removal of fossil fuel projects from the fast track? Ms Kay : I'll have to take that on notice. CHAIR: Well, no, you can't take it on notice if you know the answer. What advice did you provide? Ms Kay : There was a lot of discussion during the negotiation process and so I'd have to take on notice exactly what advice we provided at the time. CHAIR: This is a very material judgement. I'll just remind you of your obligations as a witness to the Senate. This is a very material thing that happened in the Senate negotiations. So did the department not provide any advice on the fossil fuel exclusion? Ms Kay : As I said, I'll take that on notice and get back to you. CHAIR: Sorry, I'm asking you— Senator GROGAN: Senator Bragg— CHAIR: did the department— Senator GROGAN: the witness is well within her rights to take it on notice. There may be people here, but it doesn't mean that they're aware of exactly what happened in those negotiations. CHAIR: We're going to suspend the hearing and hold a private meeting. Proceedings suspended from 14:05 to 14:14 CHAIR: The committee has just held a private meeting to consider the request of the official to take a question on notice. I'll just remind all the officials that they are required to provide information if they are aware of it. They are, of course, not required to make up things and they're allowed to take questions on notice if they don't know the answer. On this occasion, the committee's view is that the departmental officials would have known whether there was advice given or not. So the departmental officials have a choice between filing a public interest immunity claim and coming back tomorrow with a more senior official who can answer the question. Ms Kay : I would need to consult with the minister on any public interest immunity claim. I can maybe just add a little bit to the answer. The department provided advice to the minister during the Senate negotiations process. The exact advice I would need to take on notice. CHAIR: Okay. Well, thank you for answering the question. Thank you for your time and evidence today. We look forward to your various answers to questions on notice. Actually, I have one question for ARENA before you go. Maybe it's too general a question, but what are you doing or what control management process do you have in place there to ensure that we're not giving good money after bad in terms of different investments the taxpayer is making in industries which might have a short-term future but not a very sustainable future over the long term? Mr Miller : This is core business for ARENA. We've been doing this for 13 years now. We have a very robust investment process where my team of 40 or 50 investment professionals are working with the market to figure out what's doable in energy transition. We've got a strategy team that helps us refine our areas of the economy that we think are worth ARENA's time, effort and investment. We've got an independent advisory panel of experts, about two dozen engineering type people, that we run all of our applications through. They provide advice on merit across five key criteria. Then the next check and balance is the ARENA board process. For myself, I have certain delegation. Ultimately, there are various stage-gates and steps in that process. This week I've come out of a full-day strategy-setting process with my board and my senior management team. We continually look at the economy and look at what's working and what's not and refine our views. Frankly, we make certain approval decisions that need those companies to raise finance or get their approvals done elsewhere. Very occasionally we find that the costs escalate and we need to walk away from something we might have committed to. So we're continually looking at our portfolio and making those decisions about what areas to persist with and which areas we need to move on and away from. CHAIR: Okay. Thank you very much. And thank you very much for being here..