BARRIE CASSIDY: Angus Taylor, good morning, welcome.

ANGUS TAYLOR: Morning, Barrie, thanks for having me.

BARRIE CASSIDY: These two resignations so close to an election, is that a blow to the morale within the Coalition?

ANGUS TAYLOR: No, not at all, Barrie. Look, it's true that Christopher and Steve have been great contributors, 45 years in the Parliament between them and they've both made extraordinary contributions, but the faces change whilst the policies stay focused, the same things - a strong economy, safe and secure Australia, strong borders, fairer deal for Australians on energy prices. We're seeing on the ground the contrast is stark with the Labor Party now - 45 per cent emissions reduction target, slashing jobs by 336,000 according to independent modelling, $9,000 per year slashing of wages for the average worker. That contrast, the $200 billion in taxes from Labor, weak borders - the contrast is clear. I was at the Goulburn Show yesterday in my electorate and it was really stark. You can see now the differentiation, you can see how clearly our policies are working on the ground and morale is strong.

BARRIE CASSIDY: Let's talk about one of those key policies now and that's climate change, the initiatives that you announced this week, which will cost billions of dollars. All along you've been insisting now that you will reach the Paris commitments in a canter. So why this money?

ANGUS TAYLOR: Well, Barrie, take a step back a little bit - ten years ago to reach our Paris commitments we needed to reduce our carbon emissions between 2020 and 2030 by about 3.4 billion tonnes. We are now down to, as of December last year, down to the last 328 million tonnes. So the final piece of the puzzle we put in place last week which was that 328 million tonnes. What it means is with a whole series of initiatives we will reach Paris, but we know how we are going to reach that target 12 years ahead of time. Now that wasn't true with Kyoto-

BARRIE CASSIDY: We'll talk about whether you'll actually reach Paris in a moment, but can you see the point I'm making? That you've said all along you'd reach it in a canter and yet suddenly you get all these add-ons.

ANGUS TAYLOR: We will reach it in a canter. These policies, we've been working on them for an extended period of time, Barrie. They don't appear overnight. Snowy 2.0 we announced this week, we've been working on it for a number of years. Battery of the Nation, an extraordinary project down in Tasmania, 25 million tonnes from that and the Marinus Link. The energy efficiency initiative, 63 million tonnes. The Climate Solution Fund, 102 million tonnes. These are initiatives that we've been working on for a long time, they're proven initiatives, we know they will work and we know that they are the final piece of the puzzle to get to our Paris targets.

BARRIE CASSIDY: All right, we'll break those down in a moment. Just, though, on reaching the Paris targets, is there a bit of a pea and thimble trick going on here in the sense that you'll be relying on carry-over credits? By that I mean that Australia exceeded the Kyoto Protocol so you'll be using those excesses to count against Paris 2030.

ANGUS TAYLOR: Barrie, you're right, we did beat Kyoto 2010 and 2020 targets and we beat-

BARRIE CASSIDY: Well, when you say we, I mean, your government?

ANGUS TAYLOR: I mean Australia - I'm an Australian, so are you - 367 million tonnes and we should be very proud of that. We have done extremely well. By global standards we are right up there and that's an extraordinary achievement by Australia. In fact, when we got into office - this time I'm talking about the Coalition - we were 755 million tonnes behind the eight ball in getting to our Kyoto targets. We have turned that around by 1.1 billion tonnes. That's about two years of the total emissions of the economy. We turned that around. We're now going to be significantly ahead and it is very reasonable-

BARRIE CASSIDY: Can you please confirm for me though, that's because you will be significantly ahead because you will be calling on the credits?

ANGUS TAYLOR: No, no, I'm talking about significantly ahead on Kyoto 2020-

BARRIE CASSIDY: Use those targets-

ANGUS TAYLOR: By global standards there's less carbon in the atmosphere as a result of the hard work of so many Australian businesses and households over that period of time and the result is there's less carbon in the atmosphere. We take the view that that is something that is reasonable to include in how we're thinking about the 2030 targets.

BARRIE CASSIDY: Well, there are not less emissions in the atmosphere, and we'll get to that in a moment.

ANGUS TAYLOR: No, no, that's wrong Barrie - there is less carbon in the atmosphere because we beat our Kyoto targets. It's as simple as that. That is an extraordinary achievement by Australia. We should be proud of it. The key now is to make sure we have the initiatives in place to get to our targets for 2030. What we're not going to do is adopt the economy-wrecking targets of the Labor Party.

BARRIE CASSIDY: All right, we'll get to emission levels in just a moment - but just further on the use of the credits - and to be fair Labor hasn't ruled out using those credits either into the future.

ANGUS TAYLOR: That's right.

BARRIE CASSIDY: But there's a very strong view in Europe that this is against the spirit of the agreement.

ANGUS TAYLOR: Well, there's a lot of countries in Europe that didn't reach that Kyoto target so you might expect that. We did, and we have done better than almost every other country in the world and, as I say, we should be proud of it. So, we can achieve these targets without trading off the economy. What we're not going to do, Barrie, is adopt a 45 per cent emissions reduction target, which Labor has not fessed up to the implications of this or how they're going to do it. We laid out this week exactly how we're going to do this. We laid out every number. Labor hasn't done it and we know from independent modelling the 1.3 billion tonnes they've got to find will have a dire impact on the economy - $9,000 for the average worker, 336,000 jobs. As we see in the papers today a big hit to electricity prices - $600 for the average bill. So Labor's got to come clean. We've been very clear with what we're doing, Labor hasn't even told us if they're going to use the carry-over. They haven't told us that, as you point out.

BARRIE CASSIDY: Yes, and I just made that point, but let's go to emissions now. They're up, emissions are up over the last five years, not down.

ANGUS TAYLOR: Well actually, the latest greenhouse gas report that came out last week says that emissions are down by over 1 per cent. In the electricity sector, which has been my are-

BARRIE CASSIDY: No, no, no, they're up by 1 per cent?

ANGUS TAYLOR: No, no, you're wrong Barrie. A report came out last week saying they are coming down and-

BARRIE CASSIDY: This is the Energy Department report?

ANGUS TAYLOR: No, this is the Greenhouse Gas Inventory Report.

BARRIE CASSIDY: Yes.

ANGUS TAYLOR: They are coming down and the Department rightly believes they're going to continue to go down, and the result of this is we will reach not just our Kyoto targets - and we're still in the Kyoto period - we will reach our Paris targets.

BARRIE CASSIDY: Are you talking about total emissions across the economy?

ANGUS TAYLOR: Total emissions are coming down-

BARRIE CASSIDY: They're up by 0.9 per cent over the year.

ANGUS TAYLOR: In the last quarter they've come down 1.5 per cent.

BARRIE CASSIDY: Yes but not a quarter, over the year they're up by 0.9 per cent and they have increased every year for the last five years.

ANGUS TAYLOR: Well, they are coming down right now Barrie, and if we go right back when we got into government-

BARRIE CASSIDY: That's not what the figures say.

ANGUS TAYLOR: Well, I'm telling you what the figures were from the report that came out last week, and you should have a read of that report because 1.4 per cent down, 3.5 per cent down in the electricity sector.

BARRIE CASSIDY: You're relying on one quarter where for the last five years the figures have shown an increase.

ANGUS TAYLOR: Hang on Barrie - let's go back and look at the extended period of time. When we got into government there was a deficit to reach Kyoto of 755 million tonnes.

BARRIE CASSIDY: Well-

ANGUS TAYLOR: No, this is important because it is the total emissions that you emit over a time period that matters, that's what matters, not a single point in time. That's what matters. 755 million tonnes. Now, we've turned that around to a positive, a carry-over of 367 million tonnes. So that's a 1.1 billion tonne turnover. It was like the deficits we inherited from Labor when we got into government. They hadn't done the hard work, they hadn't got to the point where we were going to reach Kyoto. We will reach Kyoto.

BARRIE CASSIDY: You talk about surplus and deficits. Emissions actually fell during the Gillard period because of the price on carbon and then started to increase again once that price on carbon was eliminated.

ANGUS TAYLOR: Well there's no doubt that Labor did a lot of damage to the economy when they were in power and that did have an impact-

BARRIE CASSIDY: They reduced emissions.

ANGUS TAYLOR: In recent years we have seen stellar growth of our export sectors and the LNG sector, in particular, has seen extraordinary growth, and let me tell you, Barrie, the thing to remember about that sector is that reduces global emissions. It's replacing higher-emitting alternatives in countries like China. So it is true that those sectors have been doing well, but it is also true we've turned around at the same time the deficit we inherited of 755 million tonnes in order to reach Kyoto, to a surplus. We know that we've overachieved by 367. Every Australian should be proud of that, we should be talking it up at all times because it's a great achievement and we are also going to achieve our 2030 targets as we laid out this week.

BARRIE CASSIDY: Can I ask you on the Tasmanian initiative, and this is where the interconnector will hook up Tasmanian hydro with the mainland, there is a degree of scepticism about this plan. Basically it's about viability, because according to the feasibility study it says that this project will only be viable if there is an accelerated shutdown of coal-fired power stations. Is that what you're hoping to deliver? An accelerated shutdown of coal-fired power?

ANGUS TAYLOR: No, Barrie, what we want is more 24/7 reliable, on-demand power in the system. More supply in the system to drive down prices.

BARRIE CASSIDY: But it has to be viable.

ANGUS TAYLOR: Of course it has to be viable. Let's take a step back and look at why Snowy 2.0 and Battery of the Nation are good projects, they are worth investing in. We have a record amount of investment in solar and wind happening in our grid right now. A lot of it is household solar, there's also large scale solar and some wind farms, 6,000 megawatts a year, unprecedented - and that is expected, it's committed, to continue for the next three years, over $25 billion of investment. Now, the challenge with this is the sun doesn't always shine and the wind doesn't always blow, so you've got to back it up and store it. This is an enormous amount coming into the system. The trouble is the state governments, who are providing some of the encouragement for this, have not thought about backup and storage. Well, we are, that's why we're committing to Snowy 2.0.

BARRIE CASSIDY: That doesn't go to the question I'm asking. You are committed, aren't you, to underwriting some coal projects or at least looking at the prospect?

ANGUS TAYLOR: You're getting onto a different topic - but we have adopted the recommendations of the ACCC to get more supply and competition in the system, on-demand supply so that we can do what I've just talked about and we can make sure there's challenge to the very high market shares of the big players in the market. Now, the ACCC recommended that that should be technology-neutral and I can tell you we are following that edict.

BARRIE CASSIDY: So how many projects are you actually looking at to underwrite? I mean, the Resources Minister Matt Canavan says around 10. Is that right? You're looking at perhaps around 10 coal projects to underwrite?

ANGUS TAYLOR: Look, we were delighted with the response that we had to the registration of interest to this process. We got 66 submissions coming forward, Barrie, which was far more than I expected and that the Government expected - which was terrific - across a range of different technologies and that's good because we need balance in our system. We need a balanced, proportionate outcome-

BARRIE CASSIDY: So 10 is a reasonable figure?

ANGUS TAYLOR: We will invest, or underwrite because it's not going to be direct investment for the Government - we will underwrite to the level which will put downward pressure on prices, and competition in the market.

BARRIE CASSIDY: That could be as many as 10 projects?

ANGUS TAYLOR: Well, I'm not going to commit to a number here and now.

BARRIE CASSIDY: Senator Canavan has.

ANGUS TAYLOR: Well, I'm the Energy Minister. I'm not going to commit to the number right here and now. The right number will depend on the projects that can put downward pressure on prices and keep the lights on, because when the wind doesn't blow and the sun doesn't shine, Barrie, we've still got to be able to watch the ABC.

BARRIE CASSIDY: All right. Can I make a final point, though - if you are underwriting coal projects, whether it be 10 or whatever, if you prop up coal in that way you'll be competing against yourself in the Tasmanian project, because it won't be viable unless coal is accelerated, the taking coal out of the system?

ANGUS TAYLOR: Yeah, you just put your finger on it, Barrie. We want more competition, not less - and if what we're doing with Snowy 2.0, and what we're doing with Battery of the Nation, and what we're doing with underwriting results in more competition against ourselves, as you put it, that is a great thing, because the result of that is lower prices, keeping the lights on and avoiding the situation we had in Victoria in January - 200,000 houses lost their lights, Portland Aluminium Smelter had to go offline. You know, if Snowy 2.0 or Battery of the Nation had been up and running when that happened it wouldn't have happened. So we've got to address this, it is urgent. That's why we're doing it in a number of ways. It will result in more supply, it will result in more competition, as you rightly point out, and that will drive down prices.

BARRIE CASSIDY: Thank you for your time this morning.

ANGUS TAYLOR: Thanks Barrie.