Topics: RACE for 2030 CRC announcement, coronavirus vaccine & industry impact
Speakers: Minister Andrews, Kate McGrath – Deputy Vice Chancellor of Research UTS, RACE for 2030 CEO Jon Jutsen, Sarah and Aaron Hall
Karen Andrews: It’s a pleasure to be here at Sarah and Aaron Hall’s home at Brookwater, just west of Brisbane. This is a very important announcement. We know that Australians want reliable, affordable, clean energy. And what we have is a collaboration between the Federal Government, researchers, and industry to look specifically at how we can provide reliable, affordable, clean energy, not just for individuals – for homeowners, for our pensioners – but also how we can provide exactly that for our businesses. Now, we have a perfect example here of a small business operating from home. So, we have a home-based business where energy inputs and energy prices are so important. Now, each and every day when I talk to businesses, the single biggest issue that they raise with me is the cost and reliability of their energy. So, what this CRC will do, the Cooperative Research Centre, which is a collaboration between Australian researchers and Australian industries, is look at how we can maximise opportunities to deliver reliable, affordable and clean energy. And young people are particularly interested in clean energy sources. And as a Government, we know that that’s important. But we also know that having reliable and affordable energy goes hand-in-hand with clean energy.
So this morning, we have representatives from the University of Technology in Sydney. And we also have representatives from RACE for 2030, which is the name of the Cooperative Research Centre which has been tasked with working with industry, researchers and the Commonwealth Government to deliver reliable, affordable and clean energy. I’ll now invite Kate McGrath, who is the DVC of Research at the University of Technology in Sydney, to talk about the work that they are doing.
Kate McGrath: Thank you very much, Minister.
I’m very happy to be here representing both the University of Technology, Sydney, as the lead University; but all of our partners. So, as the Minister has said, this is a very big consortia between research providers and the commercial people who are interested in this area. And under RACE for 2030, we’ve come together to really start to bring a different perspective to our energy challenges. We know that there are a number of different technologies already in existence and coming through the research pipeline that need to be mobilised as quickly as possible to create real solutions for individuals.
We also know that there are a large number of people like the Halls, and thank you so much for hosting us this morning, who want to be able to take those solutions and create benefit for themselves individually. We’re taking quite a different perspective, because we’re taking a people-centric perspective on this to really think about: who are the users of energy, and how can we deliver benefit and real reduction in their energy bills on a daily basis? So we want to be able to create something that’s of scale and scalable. So, a grid that can be mobilised very quickly. We want that grid system to be very stable, robust, reliable. We want to have a solution that is going to be economically viable and we want to be able to, in doing that, reduce our energy emissions. So have clean energy sources.
In order to be able to do that, it’s a really big problem, so we really need a large number of people to come together and collectively own this vision that we have. And that means that we’ve brought together energy producers all the way through the value chain to their energy users, to really explore this from this very different perspective than we have. This means that the research to get better technologies, a more robust grid system, will actually drive a different spending profile for our households and our businesses, and in doing so, be able to change the way in which people spend and invest their monies in the future. This is going to be quite a change for us and how we think about tackling reduction of energy emissions, and actually creating solutions for our energy challenges that we have.
To give you some more information, I’d like to pass over to Jon Jutsen, who’s our CEO of RACE for 2030 CRC.
Jon Jutsen: Thanks, Kate. Thanks, Minister.
RACE for 2030 is a critically important initiative to bring innovation to households and businesses to reduce energy costs, to reduce emissions and to improve the network reliability. We want to bring the latest in technology and applications to improve the way that we use energy across the economy.
So, for example, we’ve got an electric vehicle behind here which- imagine if you had an electric vehicle that not only was your transport approach, but also provided you power to the house during a shutdown or when electricity prices are high so that you could actually provide power out of the battery in your mobile car without having to invest in a separate, standalone battery. And we’re looking at applications to optimise the way that your solar could be used to get best utilisation of that solar. For example, to be able to use smart applications so that your air conditioning could be used in the afternoon when you’ve got sun on the roof, and be able to cut down your consumption at night time when the grid is under pressure and electricity prices are high.
We’re also looking at all sorts of technologies for implementing improvements in manufacturing and other businesses. So, using electricity technologies, for example, like high temperature heat pumps to replace boilers and gas-using appliances to improve the way that energy is used and to dramatically reduce emissions. We’re using smart manufacturing technologies and artificial intelligence to produce better products at much lower energy consumptions, with less waste. And we’re looking to work with the networks to improve network reliability by optimising their operations, by working with end use customers to improve the flexibility of their energy consumption so they can use energy at different times of the day. And by doing these things, we’re got to be able to simultaneously reduce costs, reduce emissions, and improve network reliability.
And finally, we want to work with our small companies and our Australian technology companies to build capacity so Australian companies can expand and export and be the powerhouse for providing this energy transformation.
Karen Andrews: Thank you.
The Morrison Government very clearly has vowed technology, not taxes. And this is a perfect example of how we can use technology to help people in their everyday lives and to help our businesses grow. Unfortunately, Australia has always downplayed its great role in technology. We need to stand up and take the place that we deserve. And a brilliant example of that is that we are dominating the market in solar cell technology. So Australian-designed solar cell technology is used in 60 per cent of the global market. So we are dominating that space. These are real opportunities for Australia to continue to develop the technologies that we are well known for, as well as new technologies, so that we can continue to demonstrate to Australia and to the rest of the world that we are, quite frankly, leading edge in technology.
Happy to take any questions.
Question: From a renewable perspective, you said we’re the leaders in solar technology. Should we be using more solar technology on a national scale, rather than coal-fired power stations?
Karen Andrews: We do have very high take-ups of solar, and quite frankly, if you look around where we are now, most houses do have solar panels on their roof. I have solar panels on my own roof. There is a very high take-up of solar technology here in Australia. Many businesses are starting to look at opportunities that solar delivers to them. As a Government, we are looking at how we make energy reliable, affordable and clean, and we are open to looking at a range of technologies to deliver that. That is exactly what this Cooperative Research Centre will be instrumental in delivering for Australians.
Question: And how will it work? Because obviously you can’t do everything. Will people come to the CEO with ideas of what to research?
Karen Andrews: Absolutely. Let me just start by that, and then I will ask Jon to continue. There are already more than 80 partners that are involved in this Cooperative Research Centre. They already brining some ideas to the table. They already bring some challenges that are needing to be resolved. What cooperative research centres do is bring together government, The Federal Government, as well as industry and researchers, and our research organisations, to solve these problems. And in this case, to make sure that we are developing the technologies for the future. So I will ask John to add to that, in terms of the technologies that are currently being considered, and how we will be able to meet the requirements of our Australian people, which is reliable, affordable and clean energy.
Jon Jutsen: Thanks, Karen.
Yeah, we have around 90 partners and the initiative is industry-led. So we’re taking what they see as being the key initiatives that they want to implement. But we also have some views of some of the key challenges that we have to address. So we’re melding this. We have a design already for the sort of program that we’d like to undertake, but this is a fast-evolving area, so we expect to be continually updating to make sure that we address the key issues.
We call this RACE for 2030 because we see some real urgency. It’s not just reliable, affordable, clean energy. So we’ll be doing a lot of things to address here-and-now-problems with networks and technology. At the same time, we’ll be doing some background research to look at some of the longer term issues.
Question: By 2030, or earlier, what sort of things specifically do you think we will have? I know you mentioned some of the examples before, but I mean, in real terms, what does it mean for people?
Jon Jutsen: I think what we’ll see is a much lower energy cost for people because they’ll be using technologies that are much more energy efficient. They’ll have much lower cost also and greater reliability in the network because they’ll be using smart controls to change the timing of when they use consumption. This is not something they’ll have to think about. This will be something that’s going on automatically using artificial intelligence. We’ll see industries using energy very differently. I suspect that there’ll be a lot of electricity technology used which is supplied by renewables, which will rapidly decarbonise manufacturing over that period. Electric vehicles which, you know, are in infancy in Australia. As I mentioned, electric vehicles have not only got the opportunity to reduce emissions but also the potential for, and in the case with the car that we’ve got here, to actually supply power back to the houses as well, using the car batteries.
So, it’ll be quite a revolution. I think there’ll be very substantial changes to the way that energy is used.
Question: What’s the number 1 thing that you’d like to see happen and when will it happen?
Jon Jutsen: That’s a good question. The number 1 thing. I think the first thing is to have a clear perspective on where we’re heading. And I think the rapid improvement of efficiency of decarbonisation is the key focus. And there are a raft of technologies. There’s no single silver bullet for this. Electric vehicles are going to be very important to the transition [indistinct].
Question: Could you give us an idea in terms of cost savings, by 2030, what would you expect [inaudible – wind interference]
Jon Jutsen: Not specifically, but you know, my expectation would be at least into 20 per cent through the sort of industries that will be implemented through this activity.
Question: How do you go about making this technology cheaper for people, and more accessible? Because I guess a lot of people want it but may not be able to afford it.
Jon Jutsen: Yeah, I think- well this is part of our research effort too. A lot of these technologies are affordable now, and in fact, if you have a look at what the Halls have done in this house, it’s quite remarkable because they’ve invested in very good insulation, LED lighting, a lot of energy efficiency measures, plus putting the solar on the roof. And that’s slashed their energy bills by 75 per cent. And that’s using existing technologies. And with the technologies that we’ll be developing, it’ll give even more opportunity for householders to take control of their energy costs.
Question: What are some of those technologies that you, sort of, talk about? We already know about the LED lights and about the efficient hot water systems and things that you can get now; solar panels on the roof. What else don’t we have in our homes that you would like to see, or that this research can help to develop?
Jon Jutsen: Well I mentioned some of those before, but the sort of technologies are smart controls, using artificial intelligence to optimise what’s going on in the house at any time, to take in energy when it’s cheap and to use storage to supply energy when it’s expensive, to be able to take control- sorry, to reduce energy consumption during peak periods to improve the networks. So, it’s that combination of efficiency, the utilisation of storage – and that might be thermal storage as well as using batteries – and integrating that optimally using smart controls. And I mentioned the smart controls for controlling the air conditioning, to cool a house when there’s plenty of solar. Because a lot of people have got surplus solar during the day and then, during the night time, the grid’s under pressure and they haven’t got the solar because, you know, it’s dark. So, using pre-cooling of the house in the late afternoon they could be able to turn off the air conditioning during the night time.
Question: [Inaudible question]
Kate McGrath: No, but those are two, like, really critical areas that we can do. But in terms of other things that are being explored, which is, I guess, an entry point into what we’re doing but not the focus of this. You know, there’s the hydrogen economy, which will allow us to actually use completely different types of fuels. There’s also the negative carbonisation, so where we’re actually using plant based technologies as well. So there’s a lot of entry from producers, so producing energy in a different way, that will be able to be picked up immediately because we’re going to get this grid distribution system working well. And that’s part of this, right, is: how do we actually really keep our finger on the pulse of what new technologies – which is also the creation of energy, not just things like solar panels and things and smart inverters and all of those sorts of things – but it’s brand new ways of actually creating the energy. And you want to not just create them but then be able to really mobilise them and translate them into use really fast.
Question: What is negative carbonisation?
Kate McGrath: So it’s where you’ve got plant based energy sources. So they’re sucking carbon out of the atmosphere and out of other storage sources so that you’re not depositing carbon in, but you’re taking carbon out.
Jon Jutsen: And just on the question about thermal storage. You can imagine the easiest example is like a cold store. They are operating to reduce the temperature and maintain the low temperature of the food. They’ve got a lot of thermal inertia, so they don’t have to be running all the time. So [indistinct] will be taking those chillers offline when you’ve got peak periods. That allows you to cut consumption in the networks.
Question: I know you’ve got 90 partners. These are a lot of ideas but obviously it’s not an endless pool of money. How many projects will you decide to continue? How do you- how many can you do?
Jon Jutsen: We’ll be doing a significant number of projects every year. And there’ll probably be about a three-year cycle as projects cycle through. But you know, I think we’ll be doing 20 or 30 projects a year. And this is going to be substantial undertaking. It’s not just the money that’s come from the Commonwealth. You probably understand the industry’s been very excited about this initiative, and there’s about a 4 to 1 leverage of the Commonwealth money from the business partners.
Question: What about the coal industry?
Jon Jutsen: The coal industry is not relevant to this particular CRC.
Question: In terms of- just very quickly, the research you’re doing in advanced storage and things like that [inaudible] some families, you know, the outlook cost of solar panel, and particularly for [indistinct] Would you expect that the cost will go down with this research? Is that what you’re hoping?
Karen Andrews: Can I just suggest, before we go to that, because there’s some really interesting stats that Aaron and Sarah have about why they changed to solar, and the reasons that have delivered them the savers that they have. So I’m very happy for Jon to add some more to that if needed. But let’s hear from Sarah and from Aaron about why they have done all that they possibly can to come up with a home that is as energy efficient as possible.
If you’d like to come through and just talk about why you’ve done what you’ve done.
Sarah Hall: Okay. So, when we first decided to build here we were very conscious of Brookwater being an eco-community. So we did keep in line with the covenants that they have and we were very careful with how we designed air flow, lighting …
[break in audio]
Aaron Hall: … energy is our single biggest expense. We don’t have a bigger expense in what we do. Even- all the kids are in private school and that doesn’t even come close to-
Sarah: Yeah. It is one of our biggest living expenses, is power consumption.
Aaron: It was a really hot summer this year and we had the air conditioner running all two months’ straight, and we still were 75 per cent reduction this year alone. So it’s, yeah, we wouldn’t be able to survive without the solar panels on the roof.
Sarah: We’re really excited to see what’s going to happen in the future.
Aaron: We need batteries.
Sarah: We do need batteries [laughs].
Question: Why haven’t you bought batteries? Is it because of-
Aaron: Because we’re kind of at capacity with the house at the moment, we- you can only get approval for systems under 13 kilowatts to feed back into the grid. And in the other parts of the year, we export considerable amounts to the grid, so we need to make as much on that as we can at the moment. And then in Summer, we just eat capacity. I would like another 10 kilowatts on the roof, and that would let me run batteries all day. But it’s not really the cost because even with the cost of investing in it, it’s still 50 per cent cheaper than what our electricity bill was beforehand, even remaking the payment. It’s just the capacity that we’ve got to feed back in.
Jon Jutsen: Look, our big focus is on using energy most effectively. Storage is an important part of the total picture in terms of operating the network as effectively as possible. So in the network stream of work that we’re going to be doing, we are going to be looking at how to use storage most effectively, whether that be at home or things like the car batteries or communities-based storage. So we’ll be looking at how to best integrate storage into the networks to get the best outcomes. But we’re not focusing on reducing the cost of storage. That’s not our focus. It’s more on using energy more effectively.
Question: I just have one quick open question to anyone: how much work needs to be done to change people’s mindsets, to get more families like this to invest and think about renewables in a different way?
Karen Andrews: Well, Australians are very good with rooftop solar. Many houses right across Australia are many businesses right across Australia already have solar panels. I think that Australians are very, very aware of the need to look at how they are using their energy sources, whether that be because they need to reduce the cost or whether they want to reduce their carbon footprint. There’s obviously a lot of work to be done, but at the end of the day, the role of the Government is to balance the needs of reliable and affordable energy. So reliable and affordable, versus clean energy. They aren’t mutually exclusive, but we can do this together. We just have to get the right balance.
Kate McGrath: So, I said in my part, one of the really critical differences for us is that we’re approaching the problem in a different way and we’re doing a people-centric approach so that we actually work to understand what would motivate individuals to change their behaviours, what will motivate businesses to change their behaviours. And so it is really that combination of: what are the technologies? How do we advance the technologies? How do we make the technologies being more straightforwardly moved into a reliable grid? But equally, we can do all that and still not actually change how people and businesses operate. So that difference for us, of taking that people-centric approach, is really, really critically important so that we are working from different perspectives to create something that’s going to hopefully, you know, totally be a game changer for how we explore this.
Question: About coronavirus. In your other portfolios, can you give us an update on how coronavirus is affecting industry [indistinct]?
Karen Andrews: So there’s two things in my portfolio in relation to Australia’s response to the coronavirus. Firstly, it’s with science. Australia was the first nation to be able to replicate the virus outside of China. We are now working as hard and as fast as we can to develop a vaccine. That’s currently undergoing testing at our specialised laboratories in Victoria. What’s important is that this goes through the proper process. We will fast-track it as much as we can, but we need to make sure that the virus that we have and the vaccine that we are in the process of developing is going to be fit for purpose. So that work is underway now. And I’m also aware of other nations, for example, the United States, that are also working closely on a vaccine.
In relation to industry, I speak to organisations, whether they be manufacturers or other parts of industry on a daily basis. We are working very closely with them in relation to their supply chains, particularly any difficulties that they may be experiencing in getting product out of China. Overall, the system is okay at the moment, but there are some things that we are very conscious of. Some of that goes to the level of panic buying. And can I say to Australians: you do not need to go out and buy toilet paper. There are adequate stocks and adequate manufacturing capacity of that in Australia. That is not going to be an issue. What we are doing is working very closely with our manufacturers to understand what their needs may be and to make sure that we are best positioned to deal with the impact of coronavirus.
Now, clearly for industry, there are a number of different things that are concerns. There’s logistics of getting product in from China. There’s also other global suppliers that are having some difficulties with logistics. We’re working with them. We’re working through the Department of Foreign Affairs and Trade to minimise any impacts as best that we can. But overall, I believe that industry is well-placed. Many of our food manufacturers, for example, have an inventory of four weeks plus, and are manufacturing and have increased the level of their manufacturing over the last week or so.
Question: There was some talk, I think it was last week, about all the plastics that manufacturers use to package their food all comes from China, and that there could be a shortage there. Is that one of your concerns?
Karen Andrews: Packaging, not just plastics, has been raised as an issue because we do rely on some overseas supply of that as well. So the manufacturers that we’re dealing with are looking at where alternate suppliers of that may be. They’re also looking at what alternate materials could be used to package their goods. So there is certainly a positive out of that with a potential reduction in plastics. But our priority is to maximise the flow of the supply of the materials that our manufacturers need.
Question: Is there anything we’re going to run out of, at this stage, that you’re watching, aware of, have a contingency plan for?
Karen Andrews: Look, quite frankly, there are a number of things that we have our eyes on at the moment. But I have been speaking to our food manufacturers. I spoke to a couple yesterday. I spoke to Kellogg’s and I spoke to Westerns. They are comfortable with what their stocks are. In the case of Kellogg’s, one of their premium products is Cornflakes. That’s selling fast at the moment, but I am assured that they have sufficient inventory, that they are not concerned. What might happen over time is that there is less choice. So for example, you might only be able to buy from a particular organisation just a loaf of bread that is either white, or it is wholemeal. There won’t be the wide variety of products. But we’re not likely to run out of bread, for example. There just may be some differences in the choices that people face over the coming weeks or so.
Question: Certainly not going to run out of toilet paper?
Karen Andrews: No, actually it’s quite disappointing for those people who need it who now can’t buy it, because people have stockpiled it. But look, all I can say is there is no need for anyone to be stockpiling toilet paper.
Question: What about staff in the industry? You know, in working with industry, to work out what they’re going to do. If predictions are right, in Queensland, it’s 1.2 to 1.5 million who might get coronavirus. What will workplaces do to keep …
Karen Andrews: Yeah. So there’s a number of issues that I know that organisations are looking at. It’s what might happen if there is a reduction in their workforce because some of those people isolate, are self-isolating – what that might do to their workforce. So, for our manufacturers in particular, they’re looking at how they can increase their capacity now, whilst they have a full contingent of workers. And they will also look at what they can do to keep their businesses operating.
Now, I’m holding a roundtable on Wednesday in Sydney, where I’m going to be speaking to many of our manufacturers, with our banks, with everyone who is involved in manufacturing and industry across Australia, to keep on getting an update of what is happening and to start looking at what we need to do from a government perspective to make sure that there’s a level of coordination. But I am very, very impressed by the work that is being done by individual businesses to make sure that they are in a good position.
Now, I am concerned about our small businesses, particularly those that have suffered from the effects of the droughts, from floods, from bushfires, and now may well be impacted through coronavirus. So I think we need to understand that there are some people that are out there that are hurting at the moment. Many of our restaurants are reporting that people are not going out for lunch or for dinner anymore. So I would encourage Australians to support their local restaurants, their local food chains. Get out there, buy things that they need from the stores, and make sure that we keep Australian businesses ticking over.
Question: I’ll just ask one last question, back to the vaccine, have you had an update from those scientists in Victoria who are testing it?
Karen Andrews: Our scientists are working around the clock to test this vaccine. It is currently undergoing the test process. We are looking at bringing the testing process for a vaccine in from more than a year, down to months, where that is possible. But we are not going to cut corners that will put in jeopardy any Australians. So there is a rigorous testing process. We will do it as fast as we can, but we will do a comprehensively.
Question: Any update, though? Are they having any success yet?
Karen Andrews: It’s positive – the work that is coming out of our testing facilities is showing promise. So, we believe that we are definitely on the right pathway, but it is very early stages. And it will take weeks, if not months, to get something out into the market because of the testing processes that this vaccine must undergo.