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Labor’s hydrogen hopes fade · The Front

• 0:03
  Speaker 1: From The Australian. Here's what's on the front. I'm Kristin Amiot.
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  Speaker 1: It's Wednesday, March five, twenty twenty five. Prime Minister Anthony
• 0:13
  Speaker 1: Albernizi says he's open to sending Australian troops to Ukraine
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  Speaker 1: to keep the peace. In a surprise statement on Tuesday,
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  Speaker 1: the PM said he'll consider any request by Britain to
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  Speaker 1: join a coalition of the willing in providing security to
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  Speaker 1: the wartor nation. The coalition has pledged to overhaul indigenous
• 0:34
  Speaker 1: heritage laws if it wins government at the next election,
• 0:38
  Speaker 1: after an indigenous group who sunk and New South Wales
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  Speaker 1: coal mine were revealed as one of the most litigious
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  Speaker 1: groups operating within the current system. That exclusive story is
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  Speaker 1: live right now at the Australian dot com dot AU.
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  Speaker 1: Just a tiny fraction of the government's grand green hydrogen
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  Speaker 1: plans have seen the light of day. They're being held
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  Speaker 1: up by bottlenecks and waning market demand. So should the
• 1:05
  Speaker 1: government stay the course or spend its millions elsewhere? That's
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  Speaker 1: today's episode. A couple of years ago, Fortescue mining magnate
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  Speaker 1: Andrew twiggy Forest gave Elon Musk a very public dressing
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  Speaker 1: down at a conference in Morocco.
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  Speaker 2: I'm saying, anyone, including Elon, who says hygien hasn't got
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  Speaker 2: a massive future are muppets.
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  Speaker 1: Twiggy was a ways into his big pivot to something
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  Speaker 1: called green hydrogen at that point, and he was in
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  Speaker 1: town to spook Fortescue's new hydrogen hub. Green hydrogen is
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  Speaker 1: made by splitting oxygen into its component atoms using renewable technologies,
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  Speaker 1: and it can be used to power everything from vehicles
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  Speaker 1: to generating electricity and manufacturing.
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  Speaker 2: This is hard edged ec economic choice, but it's also
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  Speaker 2: social and environmental rationalism, a fuel that you can make
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  Speaker 2: right here in Australia, clean as the day is long,
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  Speaker 2: and made by hard working locals, not by foreign companies
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  Speaker 2: controlling our standards of living at their whim buoid.
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  Speaker 1: By the optimism of one of Australia's richest men, the
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  Speaker 1: government dived in giving green hydrogen a central role in
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  Speaker 1: its future Made in Australia Net zero plan and announcing
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  Speaker 1: a handful of hydrogen hubs around the country.
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  Speaker 3: Because what potentially we have here with the hydrogen industry
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  Speaker 3: is some fifty billion dollars potential of benefit to our
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  Speaker 3: national economy, driving our GDP, driving our economy into the future.
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  Speaker 1: But by the middle of last year, Twiggy Forest's green
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  Speaker 1: hydrogen vision was crumbling.
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  Speaker 4: The most celebrated advocate for the Albanesi government's green hydrogen
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  Speaker 4: plan forced to slam on the brakes and back off
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  Speaker 4: a prized target, the iron Ore billionaire announcing seven hundred
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  Speaker 4: redundancies and a slow down in developing green hydrogen, and now.
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  Speaker 1: The government's own green hydrogen scheme has hit the skids.
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  Speaker 5: The size of the hydrogen and green hydrogen industry sort
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  Speaker 5: of anywhere from about one hundred billion to two hundred
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  Speaker 5: and fifty billion dollars in Australia, so there's a lot
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  Speaker 5: of hype and a lot of hope for it. What
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  Speaker 5: we've discovered is a lot of the projects have quietly
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  Speaker 5: been shelved.
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  Speaker 1: Harry Williams is The Australian's chief business correspondent.
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  Speaker 5: Probably about two thirds of the projects have either been
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  Speaker 5: paused or shelved completely, and the pipeline some sort of
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  Speaker 5: ninety nine percent have failed to move beyond the concept stage. Really,
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  Speaker 5: just a handful of projects have actually moved into formal development.
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  Speaker 1: Some of the sixty one big name projects unlikely to
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  Speaker 1: see the light of day, were pitched by the likes
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  Speaker 1: of AGL and the Macquarie Group. Perry, what does it
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  Speaker 1: actually mean that most of these projects haven't progressed past
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  Speaker 1: the concept stage? And why aren't they getting there?
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  Speaker 5: Do we know that? There's probably sort of three main
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  Speaker 5: things to look at. Really high production costs is one.
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  Speaker 5: It's difficult to actually get the scale to bring down
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  Speaker 5: the cost for green hydrogen. There's some infrastructure sort of
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  Speaker 5: bottlenecks or sort of hurdles which are often sort of
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  Speaker 5: the bane of big resources projects in Australia. And perhaps
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  Speaker 5: one that's been overlooked is the buyers of this hydrogen,
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  Speaker 5: So we're typically looking at Asian nations as the buyers.
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  Speaker 5: There just hasn't really been the demand that you'd expect.
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  Speaker 5: Those three things all combined have just made it a
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  Speaker 5: really tough cell.
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  Speaker 1: The government's prized green hydrogen projects have been dropping like flies.
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  Speaker 5: Taxpayers will pour two point four billion dollars.
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  Speaker 1: Into a plan to secure the future of the troubled
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  Speaker 1: wireless steelworks.
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  Speaker 6: Just a todd day after the country's biggest green hydrogen
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  Speaker 6: project bit the dust in Queensland, BP has announced that
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  Speaker 6: it's six hundred million dollar green hydrogen project at Quanana
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  Speaker 6: south of Perth has been part.
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  Speaker 3: Origin Energy is abandoning its plans to develop hydrogen at
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  Speaker 3: its Hunter Valley hydrogen hub, deeming the project too expensive
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  Speaker 3: and too risky.
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  Speaker 1: So where does that leave Labour's promised hydrogen economy and
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  Speaker 1: export sector.
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  Speaker 5: Yeah, Look, it's important to say that all is not
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  Speaker 5: lost without over complicating things. There's three forms of hydrogen
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  Speaker 5: which you might build a big industry. We're focusing in
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  Speaker 5: this story on moving sort of hydrogen to buyers in Asia,
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  Speaker 5: other ways of doing it as a feedstock in ammonia,
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  Speaker 5: which still has some potential, and perhaps the other really
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  Speaker 5: big hope which has become quite a big focus recently,
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  Speaker 5: is the likes of green steel. Again, sounds great, the
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  Speaker 5: actual market for that is quite small at the moment.
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  Speaker 5: And we speak to Alan Finkel in this story, obviously
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  Speaker 5: the former chief scientist, and he says the other issue
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  Speaker 5: is whether buyers are prepared to pay more for green
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  Speaker 5: steel because it's going to be tough for it to
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  Speaker 5: match the cheaper generation of coal and iron. It's definitely
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  Speaker 5: a big focus for a lot of the big miners
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  Speaker 5: at the moment, but again it's still got a little
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  Speaker 5: way to go.
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  Speaker 1: Do we know how much this has cost tax payers
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  Speaker 1: to date and does it line up with the government's calculatations.
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  Speaker 5: There has been enthusiasm across the political divide for this,
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  Speaker 5: but the Albanezy government's really invested a lot nearly nine
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  Speaker 5: billion dollars outlined in last year's budget, and the really
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  Speaker 5: critical thing is that green hydrogen is one of their
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  Speaker 5: main hopes for heading net zero targets. In terms of
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  Speaker 5: how much has been spent on this, there are reasonably
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  Speaker 5: modest numbers I think so far, but you're looking at
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  Speaker 5: a really substantial spend coming up in the next few years,
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  Speaker 5: and you're looking at a sort of potential election issue
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  Speaker 5: and that the coalition is going down a different path
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  Speaker 5: and will obviously prioritize nuclear over hydrogen. It's set to
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  Speaker 5: be a talking point as we get closer to the election.
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  Speaker 1: Just lastly, Perry, what's the government saying about these new
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  Speaker 1: figures and about the deviation of its green hydrogen plans.
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  Speaker 5: Look, we went to Energy Minister Chris Bowen on this.
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  Speaker 5: They sent us a statement the remaining committed to working
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  Speaker 5: alongside commercial interests to deliver on green hydrogen's potential. Probably
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  Speaker 5: the other thing from their side is that the incentives
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  Speaker 5: and subsidies that they outlined in the budget are set
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  Speaker 5: to start from twenty seven to twenty eight, so I
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  Speaker 5: guess they would say, look, there may be some teething
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  Speaker 5: issues at the moment, but long term there could still
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  Speaker 5: be a viable industry here.
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  Speaker 1: Coming up should labor break up with hydrogen. Last year,
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  Speaker 1: Opposition leader Peter Dutton unveiled a radical new plan to
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  Speaker 1: establish nuclear reactors at seven locations around Australia if the
• 9:01
  Speaker 1: Liberals win the next election.
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  Speaker 7: No other country in the world can keep the lights
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  Speaker 7: on twenty four to seven with the renewables only policy.
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  Speaker 7: We need to make sure that hospitals can stay on
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  Speaker 7: twenty four to seven. We need to make sure that
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  Speaker 7: cold rooms can stay on twenty four seven. We need
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  Speaker 7: to make sure that our economy can function twenty four
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  Speaker 7: to seven, and we can only do that with a
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  Speaker 7: strong base low power.
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  Speaker 1: When the price tag of the nuclear plan was finally
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  Speaker 1: revealed in December, Peter Dutton said it would cost taxpayers
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  Speaker 1: two hundred and sixty four billion dollars less to reach
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  Speaker 1: our twenty fifty net zero target. Then Labour's renewables only
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  Speaker 1: energy plan. The Prime Minister says that's hogwash.
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  Speaker 8: It is bizarre that you're looking at the most expensive
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  Speaker 8: form of new energy, So a six hundred billion dollar
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  Speaker 8: taxpayer funded program for an industry that doesn't exist. It's
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  Speaker 8: a fantasy.
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  Speaker 1: But as we've just heard, the government's own hydrogen plans
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  Speaker 1: aren't faring much better. Here's The Australian's Environment editor Graham Lloyd.
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  Speaker 9: Well, there's a couple of things to say here, and
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  Speaker 9: I think that the most important is that when politicians
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  Speaker 9: talk about the energy industry in general, they often don't
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  Speaker 9: understand the facts of what they're talking about. I think
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  Speaker 9: there's been an ideological hope that the hydrogen industry would succeed.
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  Speaker 9: There's been a lot of money put into it, but
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  Speaker 9: it's been obvious for some time now that a lot
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  Speaker 9: of that initial hope was misplaced, that the economics and
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  Speaker 9: the science of it as a substitute for natural gas
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  Speaker 9: really isn't going to be as feasible as people were hoping.
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  Speaker 9: I think you can say the same thing about the
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  Speaker 9: nuclear debate. The Albanese government is very critical of it
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  Speaker 9: and they're sort of putting it out there as less perspective,
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  Speaker 9: if you like, than hydrogen. But the difference is that
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  Speaker 9: the nuclear industry is a mature industry that's well established
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  Speaker 9: in many parts of the world. But again it's a
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  Speaker 9: matter of cost as much as anything else. But the
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  Speaker 9: real nuclear industry is around big base load operations that
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  Speaker 9: deliver emissions free power. The good thing really from the
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  Speaker 9: hydrogen experience is that the private sector has shown that
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  Speaker 9: it's not interested in throwing good money after bad. It's
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  Speaker 9: found it's more expensive and more difficult to do and
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  Speaker 9: the global market that is supposed to finance it just
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  Speaker 9: isn't there and willing at this stage, which leaves the
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  Speaker 9: government money. The government should really take a leaf out
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  Speaker 9: of industry's book and know when to cover its losses.
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  Speaker 1: With the cost of living top of mind for most
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  Speaker 1: Australian voters as we head into an election, the question
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  Speaker 1: is should we expect them to know or care about
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  Speaker 1: the difference.
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  Speaker 9: Well, I think it's a big ask to expect ordinary
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  Speaker 9: voters to really understand the complexities of the energy market
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  Speaker 9: and what the supplies of cheap energy actually mean for
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  Speaker 9: the cost of living. This is an issue that responsible
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  Speaker 9: governments have to manage and the best thing they can
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  Speaker 9: do is manage it in such a way that it's
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  Speaker 9: not in the headlines. And the starting point for that
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  Speaker 9: is to do a proper cost benefit analysis of what
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  Speaker 9: you get out of the public funds that are applied.
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  Speaker 9: Take a lead from the private sector in pursuing things
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  Speaker 9: that are worthwhile and don't distort the market with unreasonable
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  Speaker 9: rules and regulations.
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  Speaker 1: Graham Lloyd is The Australian's Environment editor and Perry Williams
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  Speaker 1: is our chief business correspondent. You can read that story
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  Speaker 1: right now at the Australian dot com dot a.
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  Speaker 8: You