Prime Minister Malcolm Turnbull has staged another dramatic retreat on energy policy in the face of a dire threat to his leadership, removing climate change targets from the National Energy Guarantee in his second policy reset in four days.
The revised scheme will go ahead without federal legislation to stipulate a 26 per cent cut to greenhouse gas emissions under changes aimed at averting a challenge from Home Affairs Minister Peter Dutton.
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| Prime Minister Malcolm Turnbull, Treasurer Scott Morrison and Minister for Environment and Energy Josh Frydenberg at Parliament House. Photo: Alex Ellinghausen |
Asked on Monday morning whether his leadership was under threat, the Prime Minister declared: "I enjoy the confidence of the cabinet and my party room."
Mr Turnbull also said he had the support of Mr Dutton following reports that the Home Affairs Minister was being asked to challenge for the leadership and was inclined to run, with his supporters claiming he had majority support in the Liberal party room.
"Peter Dutton was at our leadership team meeting this morning. He is a member of our team, he has given me his absolute support," Mr Turnbull said.
The changes do not abandon the government’s commitment at United Nations talks on climate change but postpone any attempt to legislate the 26 per cent target alongside the NEG, in the belief the cuts can be delivered by 2030 without the need for tougher rules.
Mr Turnbull told a press conference on Monday morning it was clear legislation, including an emissions target, would not pass the Parliament.
"In politics you have to focus on what you can deliver," Mr Turnbull said.
The decision postpones a divisive federal bill that has split the government over whether to legislate the Paris commitment, with former prime minister Tony Abbott and others threatening to cross the floor in a move that could trigger a leadership spill.
An exclusive Fairfax-Ipsos poll shows the Coalition has suffered a massive slump in its primary vote over the past month amid open disputes on energy and speculation over the leadership.
Mr Turnbull raised the idea last Friday of imposing the 26 per cent cut by regulation in a federal bill to support the NEG, departing from a plan put to the Coalition party room last Tuesday to set the target by legislation.
The approach outlined on Monday is to set the target in legislation and allow it to be changed by regulation, subject to findings by regulators on what the amended target would do to household electricity prices.
While this remains Mr Turnbull's policy, it will not be put to the Parliament unless and until it has majority support, a stance that will delay it indefinitely and avoid a trigger for disaffected Liberals to cross the floor.
"We are not going to propose legislation purely for the purpose of it being defeated," Mr Turnbull said.
Treasurer Scott Morrison said the government could not rely on Labor to pass the bill to set the emissions target, pointing to Labor's refusal over weeks and months to declare how it would vote on the issue, given it prefers deeper cuts of 45 per cent by 2030 compared with 2005 levels in the electricity sector.
Mr Turnbull insisted the government's energy policy remained the same but it would not present the bill on the emission target unless it was sure it would be carried by the Parliament.
Asked if he would bring on the bill if Opposition Leader Bill Shorten declared his support to guarantee the numbers in Parliament, Mr Turnbull said: "Let's wait and see what Labor does."
Mr Shorten said it was "unfair" for the government to argue it could not reach a bipartisan agreement because Labor had been open to negotiation on an emissions intensity scheme in 2016, a clean energy target in 2017 and the latest policy this year.
Asked if Labor would vote for the emissions reduction bill if the government put it to Parliament, Mr Shorten hedged by saying he could not be sure of the government's policy.
The reset means Mr Turnbull’s energy policy will be dominated by rules to cap default electricity prices for customers and increase financial penalties for the big three energy suppliers – AGL, EnergyAustralia and Origin.
The policy will also promise to underwrite new projects that add more reliable power to the electricity grid, as long as the projects come from competitors to the big three. This could include coal, gas, hydro or a combination of solar and wind and battery power.
"Power bills are one of the biggest cost of living pressures facing Australian families and, indeed, businesses," Mr Turnbull said. "Cheaper power has always been our number one priority when it comes to energy policy.
"Each and every one of these measures is designed with just one purpose in mind - making sure you get the best deal on electricity."
He cited estimates from the Australian Competition and Consumer Commission that the new measures would mean savings of hundreds of dollars for domestic and commercial energy users.
The new package includes a drastic new power for the ACCC to improve competition, allowing it to force energy providers to sell assets if they have too much market power.
Mr Turnbull said these were "new powers of last resort" but would allow the regulator to issue directions about an energy company's operations, require the "functional separation" of its assets and ultimately force the sale of its assets if required.
Critics of Mr Turnbull's earlier energy plan held out on giving their approval to the new position and warned against accepting a deal with Labor.
Tasmanian Liberal Senator Eric Abetz said he wanted to see the policy after it went through federal cabinet and was put to the Coalition party room.
"It would be most concerning if Labor were to say 'yes we support you in that regard' and we were to have that target," Senator Abetz told Sky News after the Prime Minister's press conference.
The warning highlights the danger for Mr Turnbull if Labor dares him to bring on the emissions bill and test the numbers on the floor of Parliament, given the warnings from conservatives against any outcome whereby the government and Labor vote together to legislate the cuts to emissions.
Links
- Malcolm Turnbull approves radical NEG redesign in bid to prevent backbench revolt
- Malcolm Turnbull should put his authority on the line over NEG
- Fairfax-Ipsos poll: Voter support collapses as Peter Dutton leans towards challenging Malcolm Turnbull
- 'He is being punished': The real reason Turnbull is under siege
- Turnbull Ditches Legislation For 26% Emissions Cut To Head Off Backbench Dissent
- Coalition Signs Off On NEG But Tony Abbott Continues Internal Dissent
- Consumers Aren't The Big Winners Out Of National Energy Guarantee
- As National Energy Guarantee Negotiations Continue, Labor Holds The Trump Card
- The NEG's Failure To Factor In Climate Change Will Cost Our Pacific Neighbours Dearly
- Politics Wins As Turnbull's Flagship Energy Policy Teeters
- Global Wind Energy Giants Blast Weak Emissions Target In National Plan
- Most Australians Want More Renewables To Help Lower Power Prices – Poll
- The Five Things We Can't Answer About The National Energy Guarantee
- States Combine To Pressure Turnbull On Climate Target
- Turnbull dumps emissions from NEG in final act of capitulation
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