Business, welfare, climate and energy groups argue policy certainty needed to drive down power costs
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| Groups including the Business Council of Australia and Acoss say ‘global transition towards lower emissions and ultimately net zero emissions is both necessary and inevitable’. Photograph: Dave Hunt/AAP |
Ahead of the first meeting of state energy ministers since Scott Morrison dumped the emissions reduction component of the national energy guarantee, a coalition of 15 groups from the Business Council of Australia to the Australian Council of Social Service have warned emissions reduction is not an optional extra.
In a joint statement targeted at federal and state energy ministers before talks this Friday, the groups say driving down power costs – the Morrison’s government’s stated priority – is urgent. But they argue part of the means of achieving that is being clear about future emissions reduction requirements, because that creates policy certainty.
They say “addressing emissions and reliability are not only critical in their own right, but are essential parts of achieving cost reduction”.
Energy ministers on Friday are due to discuss the reliability obligation of the otherwise abandoned Neg, but not the 26% by 2030 emissions reduction target for electricity now ditched by the federal government, with that policy a casualty of the Liberal party’s leadership civil war.
The groups say certainty about the outlook for emissions reduction is critical if Australia’s energy sector is to make an orderly transition, and they warn that policy intervention could be required to help low-income households, displaced workers and emissions intensive trade exposed industries adjust to a low-emissions future.
The groups also make a clear statement that Australia needs to remain in the Paris agreement. “We support Australia’s full participation in the Paris agreement and deployment of effective, efficient and equitable plans in energy and the rest of the economy to deliver on Australia’s Paris commitments,” the groups say.
“Continuing bipartisan commitment to Paris sends a clear long-term signal to investors and contributes to the global solution needed to minimise climate change.”
The signatories to the statement are the Ai Group, the Australian Aluminium Council, the Australian Conservation Foundation, the Australian Council of Social Service, the Australian Energy Council, the Brotherhood of St Laurence, the Business Council of Australia, the Clean Energy Council, the Energy Efficiency Council, Energy Networks Australia, the Energy Users’ Association of Australia, the Investor Group on Climate Change, the Property Council of Australia, the St Vincent de Paul Society and Uniting Communities.
The statement comes as the Morrison government is pressing ahead with a package of measures to reduce power prices, hoping to secure some hip-pocket relief for voters ahead of the next election.
The package has not been well received by business and the energy sector, with several stakeholders alarmed about the government’s threats about breaking up power companies, and about the flow on impact of proposed price regulation.
The federal energy minister, Angus Taylor, will attempt to seek agreement from his state and territory counterparts on Friday to roll out the price measures. In the event the states and territories refuse, Taylor has signalled the commonwealth will override them and make the changes unilaterally.
The government wants power companies to deliver customers out of cycle price reductions in January next year, rather than in July when determinations are normally made, with election timing in mind.
Additionally Taylor wants the states and territories to press ahead with implementing the reliability obligation of the Neg, with a final decision to be made in December.
He argues it is not a problem that his government dumped the emissions reduction obligation because the electricity sector will reduce pollution by 26% in “the early 2020s”.
“We are very confident we are going to get to 26% well ahead of time,” Taylor told Guardian Australia earlier this week. “The numbers are clear.
“There will be a 250% increase in renewables in the next three years. We are going from 17.5 terrawatt hours to 44.4 on the Energy Security Board numbers, and since that work was done there has been almost 1,000 megawatts of new renewable capacity added to the pipeline.
“We are very confident we will get to 26% in the early 2020s.”
The government has also this week flagged backing new private investments in coal-fired power, and possibly indemnifying new projects against the future risk of a carbon price. Labor has criticised that idea.
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