Comments on Green Paper. Developing Northern Australia

Comments on Green Paper. Developing Northern Australia

Geoffrey Dutton 27 July 2014

Ratch Australia Corporation

The Development of Northern Australia (NA), is encouraged and supported by Ratch Australia, (RAC), as we have been actively involved in owning the only wind farm in Queensland (Windy Hill at 12MW) and in the development of Mt Emerald wind farm over the past four years, (190MW on the Atherton Tablelands). In addition RAC has been involved in bidding, developing and negotiations on several large scale energy projects across the northern parts of West Australia, Northern Territory and Queensland over the past seven years, and our Development personnel are familiar with a wide range of issues across the region.

The RAC comments are put forward as ten principles (in no order of importance), that will provide a solid foundation for the development of NA.

Principle 1

Developing NA requires business owners who will take risks, the 15% early adopters in society. It cannot be developed by old pioneering ways with no government controls, no taxes and the law of the strong.

So to attract people, the risk takers, the government will need to consider:

a.  Tax breaks that are meaningful for business and individuals.

b.  Use of Special Economic Zones, (SEZ) and outside of these a case by case special allowances (in taxation and other breaks) for projects.

SEZ’s have worked well in China (Shenzhen and other locations), to allow special conditions supporting development while industry and business gets started. Some companies will make big profits and will be viewed as not contributing their share to Australia; but in the long run the SEZ’s grow the overall economy and the SEZ’s will transition into mainstream; giving an overall stronger future to the nation as a whole.

Principle 2

Most agriculture and small scale commercial ventures cannot support the development of infrastructure in the same way as major mining companies.

Governments will need to support infrastructure with “first-in” business opportunities, on the basis that, longer term, others will come and the region will grow to the benefit of the whole nation.

The potential water available in North Australia is huge, but it will need careful design and expensive civil works to catch it, either in run of stream or side stream, then conserve and distribute it. Few major agricultural projects could afford the initial start-up costs of such schemes, and the repayments will be long term as viable agricultural projects build around the new secure supply. Even where there is a major initial project water user, governments will need to commit to major water projects with some form of long term financial support; taking a long term view to the benefit of all Australia, rather than looking for short term financial parity with the southern economy. ( that already has its own subsidised schemes such as the Snowy Mountain Hydro)

Principle 3

For Government to be involved it has to be there – physically.

In one recent meeting with government official in Cairns the official apologised to me for a letter coming from the southern based government department, saying, “I wish they had talked to me before they wrote the letter”.

Many people (not just governments) in the southern capitals have no idea what development is going on, or what the environment, culture and vegetation in the north are really like, with many assumptions based on vague memories or media coverage of Townsville in drought in the 70’s, the negative impacts of tropical cyclones or pictures of lush tropical forests around Cairns. They consequently have little or no concept of the issues that need to be considered when building and operating infrastructure in the North of Australia.

Devolving government to the regions means that the local Political Representatives and departmental heads, including Federal and State reps, need to have the skills, experience and authority to make decisions and keep development moving, within an agreed scope of government authority and in a timely fashion. If the local personnel are only messenger boys then it will only be a waste of public funds.

In addition to government departments the representation of regional NA needs to allow for the physical size and not just the number of people in an electorate. There needs to be more NA representation in parliaments that can lobby for changes, budgets and commitments to support the NA development as a whole.

Principle 4

Green tape has to be reduced.

RAC supports the government’s recent moves on Green tape reduction and has contributed to the process. Having had experience at one EIS that has taken 3 years so far and cost over $2m RAC is concerned about 2 aspects of the process:

a) The Outcome was undefined – with one Canberra official saying “just give it your best shot and we will make an assessment”.

1. To What standards?

2.  What connection with reality on the ground up to 2,500Km away?

3.  What balance of impact and benefit?

b) Referral criteria to the Federal system seem arbitrary, again with no fixed standards of what is needed and sometimes depending on the whim of a local council.

Ratch Australia supports the need for sound environmental planning and ongoing management for all projects and recommends the government moves away from the present subjective approvals approach towards a regulation based approach; where individual industries and projects have to comply in a self-regulated business environment under government guidelines and mandates;

in the same way as the mining and electrical/power industries now operate.

i. 

Principle 5

New technology is coming faster each year and will impact all new developments.

A - Robotics

The use of driverless trucks, shovels and farm machinery, together with remotely operated plants, remote security and the use of drones for operational and security purposes will make many projects able to operate with low numbers of staff, especially when added to a remote operating control room in a big city of choice, preferably in Australia.

This will continue the move towards the de-skilling of operational projects in many industries. On site staff for maintenance and essential services may live in isolated communities or work on a FIFO basis. This means that some large scale projects will not support a large remote community in the way that mining towns used to. Instead the projects will be designed around the most cost- effective process technology to compete in the world markets for minerals, agriculture and other products.

B - Power Supply

For power supply to remote small towns and projects there is already a strong movement towards independent power supplies based on renewables. A recent USA study on the coming technology changes in renewable generation concluded that even for major cities centres there was a move towards off grid supply, with the report concluding:

1. Solar-plus-battery grid parity is here (in USA) already or coming soon for a rapidly growing minority of utility customers, raising the prospect of widespread grid defection.

2. Even before total grid defection becomes widely economic, utilities will see further kWh revenue decay from solar-plus-battery systems.

(The economics of Grid Defection – when and where distributed Solar Generation plus Storage competes with traditional Utility Service. – COPYRIGHT: Rocky Mountain Institute. - FEBUARY 2014 - DOWNLOAD AT: WWW.RMI.ORG )

With this in mind the economics of renewable energy in remote situations is already sound and we can expect mini grids and remote power to be available where ever a viable project or settlement exists, with no provision needed or wanted for grid expansion from the main grid systems.

Principle 6

The Indigenous population of North Australia need to be recognised as mainstream Australians

As NA develops over the next 35 years to 2050 the Indigenous Population (IP) take their place as equal citizens in Australia. Living in NA, Indigenous Australians are well placed to lead in the development, construction, ownership and operations of new NA projects.

Working with IP’s relating to the RAC projects we often hear the question from elders, “will there be real jobs for our grandchildren?” While RAC is committed to this approach, it will require a NA wide approach to develop education and training across a wide range of real skills – business and technical, with the aims of:

1.  Business development and operational skills

2.  Growing IT skills in remote communities

3.  Opening doors to university for more IP young people

4.  Developing Operators and Maintainers skills

5.  Opening doors for Apprenticeships across a wide range of skills

6.  Opening doors for interns ( at high school graduation and university levels)

Principle 7

Land use permits and land tenure arrangements based on a 19th century system are no longer applicable for modern society, international trade and modern technology.

While the whole gambit of land tenure and permitting is not within RAC’s normal scope of work; we have been amazed at the difficulties farmers, indigenous land holders, power plant owners and city dwellers face, as they work through a confused system of land tenure derived in the 1800’s and then managed with bureaucratic red tape from pre computer days in the mid 1900’s. The positive comments in the Green Paper re this has to improve are noted.

Principle 8

Protect the Sovereignty of North Australia

The size of NA, and the projected growth of Asian demand for food and energy to 2050, means that either Australia will develop the North or others will come and do it for us.

This has implications for security, sovereignty and Australia’s responsibility to the global community to utilise the resources we are fortunate to have, in a sustainable manner.

With this imperative the mixture of government policy and funding, together with the encouragement of private investment and community growth, is an essential commitment to secure our nation for future generations. We must rapidly implement strategies to ensure that we don’t “sell off the farm” and reduce the opportunities for Australia to determine, and benefit from, the sustainable use of its land and protect its natural and cultural assets.

Principle 9:

The Opening of North Australia is directly related to the provision of infrastructure.

Infrastructure in the form of:

·  An integrated rail network to facilitate transport – north to south and east to west. To facilitate the transport of goods, especially agricultural products to both southern and overseas markets in a timely fashion. A rail network would provide long-term jobs for construction but reduces ongoing maintenance associated with roads. It would also reduce the amount of fuel used for transport, the number of large transport vehicles on those roads and the interactions (accidents) between large transport vehicles and other road users and/or animals.

·  This rail network needs to end in viable and well maintained Ports, with appropriate customs and movement facilitation. New ports will require support capital backed up by governments to get started.

Good infrastructure in place will also lead to ‘value add’ as natural products can be processed on Australian soils, leading to job diversification and longer term employment including business opportunities for remote populations, including indigenous business partnerships.

Principle 10

Above all else Developing Northern Australia requires vision.

None of us can see the end result but all parties need to dream big and plan for it to happen.

This will require bold determination, strategic and statesman-like thinking and bi-partisan support on the part of all concerned: governments, investors, tribal elders, and communities of all types. Australia has done this before, and can do it again. Developing an area larger than WA and more than three times the size of NSW has to be worth it.

Australians sometimes see The North as a harsh, remote and backward land, either flooded or bone dry depending on the season, but sustainably developed and opened up it is capable of sustaining large new communities and providing the food and raw materials for billions. When we expand the vision to include product processing and growing tourism then the region has wealth beyond our current imagination.

Ten Principles Summary

1.  Developing North Australia requires business owners who will take risks, the 15% early adopters in society.

2.  Most agriculture and small scale commercial ventures cannot support the development of infrastructure in the same way as major mining companies.

3.  For Government to be involved it has to be there – physically.

4.  Green tape has to be reduced.

5.  New technology is coming faster each year and will impact all new developments.

6.  The Indigenous population of North Australia need to be recognised as mainstream Australians

7.  Land use permits based on a 19th century system are no longer applicable for modern society, international trade and modern technology.

8.  Protect the Sovereignty of North Australia

9.  The Opening of North Australia is directly related to the provision of infrastructure.

10.  Above all else Developing Northern Australia requires statesman-like vision.

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