Energy Minister Chris Bowen has pledged to speak with his Japanese counterpart more frequently and make sure there are no misunderstandings about Australia’s direction after Japan raised concerns about the reliability of gas supply.
His reassurance of one of Australia’s largest energy customers comes as Prime Minister Anthony Albanese doubled down on rejecting a push from the Greens to increase the amount being collected in changes to the tax on gas projects.
Mr Bowen visited Japan last week in between ministerial G20 meetings to have discussions with Trade and Industry Minister Yasutoshi Nishimura.
Japanese officials aired concerns in July about Australia’s reliability as an energy supplier with the new safeguard mechanism requiring all gas projects to fully offset emissions from day one.
Earlier this year, the head of Japanese petroleum giant Inpex accused Australia of “quiet quitting” gas while the former ambassador to Canberra said some companies were worried the nation was leaning into “energy nationalism” after a series of policy changes.
Mr Bowen said he’d had a brief but productive visit to Japan.
“Bottom line, Japan is concerned about energy security and they’re concerned about climate change, and we can help with both,” he told The West Australian.
“I was keen to … assure them that Australia has long been an energy supplier to them and will continue to be, but increasingly it’s in their interest and ours to ensure that that energy is zero emissions.”
He and Mr Nishimura have agreed to create an “elevated partnership” on energy — effectively a way for them to have more frequent talks and make sure the relationship stays on track.
Mr Bowen believed the Japanese government understood the safeguard mechanism, in particular, was an election commitment from Labor.
“We’ve made changes and reforms, there’s no doubting that,” he said, on the cumulative impact of Labor’s changes in climate, tax and industrial relations laws.
“Governments, in my experience, understand that. Particularly (when) a new government comes in, there’s no point having a new government if you’re not going to change things.
“But they’re very interested to understand the objectives, how we go about it, and to consider how Japan can work with it.”
However, the Federal Government has rejected making further changes to its planned overhaul of the petroleum resources rent tax after pressure from an alliance of the Greens and independent senators David Pocock, Jacqui Lambie and Tammy Tyrrell.
The crossbenchers want the Government to trim the cap on how much income companies can offset through deductions from 90 to 80 per cent, which they say would add $2.6 billion to the $2.4 billion Labor expects to raise over the next four years.
Mr Albanese said on Wednesday the Government’s plan would collect more revenue sooner than under existing arrangements, and urged the Greens not to knock it over.
“Don’t do what you have done up to now with the Housing Australia Future Fund and say we want more, therefore we will have nothing,” he said.
“Don’t do the same thing and say we want more revenue, therefore, we won’t have any revenue from the gas sector.”
The oil and gas industry has reluctantly accepted the changes while warning ongoing interventions in the gas sector – such as price caps – would risk future investment.
It’s understood the Coalition will vote for the changes if the Government commits to streamlining project approval processes, although it is yet to reach a formal position.