Wednesday, 15 August 2018
Questions without Notice
My question is to the Treasurer. Will the Treasurer update the House on the steps the government is taking to strengthen competition, promote investment and reduce prices in energy markets? Is the Treasurer aware of any approaches that would seek to derail this success?
I thank the member for Boothby for her question. She, like all members from South Australia, lived through the failed Labor energy policy experiments by the previous South Australian Labor government. They lived through the blackouts. They lived through the huge surges in prices. They lived through the failed Labor experiment, but I suspect the members opposite and the Labor Party would probably think it was a success, because, according to them, success is when prices go up. You decide the policy is good when the prices go up. Thank goodness for Premier Marshall, because he's setting things right in South Australia. He's getting on with the job of cleaning up the mess that Labor left behind in South Australia. Premier Marshall is supporting the National Energy Guarantee.
He knows that, in fixing up the mess in South Australia on energy prices, the National Energy Guarantee is an important part of setting things right. The National Energy Guarantee is a critical part of the government's plan to produce cheaper electricity prices. This parliament has a critical opportunity to seize this sliding-doors moment for Australia to walk through to a path of cheaper electricity prices. There are two alternatives. One is that we pass the National Energy Guarantee and, through that measure alone, a $150 reduction in household power bills; the other is that we go down the Labor Party's path and see household power bills go up by $190 because of their reckless target policies, which will only force electricity prices up.
The National Energy Guarantee is part of a bigger plan. The ACCC was commissioned by me as Treasurer, and by the government, to put together further recommendations to lower electricity prices for cheaper electricity. The first thing they said was: 'Back the NEG. Back the National Energy Guarantee. That is a critical component.' Secondly, they said to give customers more power by shining a light on what has been a lack of transparency in how big energy companies charge people in the market and give consumers greater power to understand how they can get a better deal and ensure they get a better deal; to back in finance for new energy generation facilities across the country—that's their recommendation, to back that finance in, and that's what we're leaning into; and to put a leash on the big energy companies trying to gobble up smaller energy companies, to ensure there is competition in the market. That's a real plan.
We're moving forward with all of those plans to ensure that we can get cheaper electricity prices. But right now the challenge is to pass the National Energy Guarantee. We do not want to let jobs and investment go offshore. BlueScope, Alcoa, BHP, Rio Tinto are all saying, 'Pass the National Energy Guarantee, because it will deliver lower electricity prices in Australia and support Australian jobs.'
In fact, under the National Energy Guarantee, Tasmania will be one of the biggest beneficiaries. And do you know why? Because there is stable, dispatchable power in Tasmania, with so much of it being delivered by hydrofacilities. It's the Turnbull government that is interested in supporting a second interconnector between Tasmania and the mainland which can provide additional energy security to the people in Tasmania while also supplying more power into Victoria.
The National Energy Guarantee modelling shows that Australian households will be $550 a year better off—$150 a year through the guarantee and around $400 from other policies that are currently in practice. So, under the National Energy Guarantee, Tasmania, like every other state across the country in the national electricity market, will be the beneficiary.
My question is to the Minister for the Environment and Energy. Will the minister update the House on how the National Energy Guarantee will result in lower power prices for Australian households and businesses, including in my home state of Victoria? Is the minister aware of any other plans that will result in higher prices?
I thank the member for Chisholm for her question. I know that she supports the Turnbull government's moves to drive down power prices, knowing that, under the coalition, power prices will always be lower and, under the Labor Party, they'll always go up. That is the track record of the Labor government when they were last in office, when power prices doubled. They went up each and every year.
The member for Chisholm comes from the great state of Victoria. But, unfortunately, under the Andrews Labor government, Victoria now has the second highest prices in the country. Last September, the Australian Energy Market Operator put out a report which said that there was up to a 43 per cent chance of load shedding in Victoria. That's a euphemism for blackouts, and that is because the Andrews government cheered the closure of the Hazelwood Power Station, which could provide up to a quarter of Victoria's power supply. If you look at the last six months of 2017 in Victoria, Victoria was importing power instead of exporting it to the rest of the grid.
The member for Chisholm knows that, since we've come to government, we have put downward pressure on prices by getting more gas into the market by reining in the power of the network companies, which, if the Labor Party had thought about it when they were in office, would have saved consumers $6.5 million by getting a better deal from the retailers for millions of Australian customers; and, of course, through the National Energy Guarantee. This has been supported by groups in the member's electorate like Asaleo Care in Box Hill, which is a leading personal care and hygiene company with landmark brands such as Sorbent, Libra and Handee. It started in 1932. It was listed on the ASX in 2014. It has 11 manufacturing and distribution facilities and employs 1,000 people. They have got behind the National Energy Guarantee. The Victorian Chamber of Commerce and Industry, with 15,000 members, said of the National Energy Guarantee:
The NEG remains an important reform to improve energy policy predictability, reduce risk and encourage investment in new electricity generation.
We know that Manufacturing Australia has written in the Herald Sun about how important it is for the one million manufacturing workers across the country to have the National Energy Guarantee.
So, at the end of the day, if you believe in lower power prices, if you want to see Australian households $550 a year better off, if you want to see the wholesale price down by 20 per cent, if you want to be side by side with the big employers across the country, you get behind the National Energy Guarantee and you don't hide from your responsibilities, as the Leader of the Opposition is trying to do.
My question is to the Prime Minister. Modelling conducted by Hydro Tasmania in support of the Battery of the Nation project states:
… previous modelling showed that coal was not economic … This was carried forward as an assumption in the Battery of the Nation analysis.
Can the Prime Minister confirm that his plan to build new taxpayer-funded coal-fired plants will undermine the Battery of the Nation project in Tasmania?
I thank the honourable member for her question. As the first person—in enthusiastic approval of your doing more pumped hydro in Tasmania—to have coined the phrase 'Battery of the Nation', I'm very grateful for the question. I can confirm that the origin of the Battery of the Nation proposal came from a speech I gave at the National Press Club in February 2017, where I identified the need for more storage to support the amount of intermittent renewables. I underlined the importance of having a technology-agnostic approach to energy in order to have cheaper electricity. The objective is to have cheaper electricity.
The honourable member should not be so obsessed about one technology or another. As it is, recommendation 4 from the ACCC to provide support for new generation, competitive generation, is technology-agnostic. It could apply to energy from a pumped-hydro scheme in Tasmania or in any other part of the country, just as it could apply to a new thermal plant, be it coal or gas, or a mixture of all of the above. It is technology-agnostic and it has one objective and one objective alone, which is to deliver cheaper electricity.
As Rod Sims himself said, if we start picking one technology over another, that leads to higher electricity prices. We've got to have a system, a plan, that delivers energy at a cheaper price, and that needs to be technology-agnostic.
Ms Keay interjecting—
The honourable member is endeavouring to interject, and I thank her for her contribution, which I can barely hear because her mic isn't on—the Leader of the Opposition has a problem with that, too, of course!—but the fact is that all technologies have a role to play, and the approach we are taking is technology-agnostic because we want to deliver cheaper electricity. Pumped hydro and wind in Tasmania no doubt have a big role to play, but let the market decide. Let it compete, and then we will see that the real winner will not be one theory or another, not one technology or another, but Australian families. Cheaper electricity: that's what the honourable member should be supporting. We look forward to her and her party supporting the National Energy Guarantee. Cheaper electricity: that's what it's all about.