Zed Seselja (ACT, Liberal Party, Assistant Minister for Social Services and Multicultural Affairs) Share this | Hansard source

That was a couple of years before my birth. I've got no doubt that Senator Cameron wanted to do that trip down memory lane. I am more interested in a more recent trip down memory lane—this is going back to the last, incompetent, Labor government and its energy policy. We might talk a bit about that. I don't know who was top of the pops, I can't remember who was top of the pops, in 2010, but there was this crew in charge called 'Gillard and Brown', in a Labor-Greens government, who delivered us a carbon tax and a disastrous energy policy. That's why I'm shocked that Labor wants to talk about energy policy today in the Senate. Yesterday we were talking about its economic failures; today, its policy failures on energy—and what failures they have been. This is the party that introduced a carbon tax, the whole point of which was to raise electricity prices. This is the party that introduced a mining tax that hit the economy and made it tougher to use our abundant natural resources. This is the party that, with its partners the Greens, opposed coal mining and any effort to build power stations.

Senator Cameron talked about values. Remember when the Labor Party valued workers? I recall, distantly, a Labor Party that actually used to value workers. But this is the Labor Party which, in South Australia, cost local businesses $450 million because it simply couldn't keep the lights on. With a 50 per cent renewable energy target, the Labor Party in South Australia brought blackouts throughout last summer and left its people with the highest power bills in the country—and you want to talk about an energy policy!

Now Bill Shorten wants to take Jay Weatherill's energy policy national. That's what Bill Shorten wants to do. He wants to deliver the South Australian experiment and impose that on the Australian people. It is Labor nationally that is proposing a 45 per cent emissions reduction target by 2030, a 50 per cent renewable energy target, the forced closure of coal-fired power plants, and no energy security plant. That sounds like a Greens policy to me. It reminds me of a local Greens politician who said words to the effect of 'we don't want to go back to the caves just yet'. That is the type of policy, this Greens-inspired Labor policy, that will kill our economy.

Together these policies would absolutely wreak havoc on Australia's households and businesses, including the 900,000 Australians who work in manufacturing. These are workers who the Labor Party used to care about, but no longer do. Labor's own modelling, back when it was in government, showed that a target similar to 45 per cent, which Bill Shorten wants to impose on Australia, would increase wholesale electricity prices by 78 per cent. The Business Council of Australia called this 45 per cent target 'risky' and 'unnecessary' and said it could jeopardise Australia's future economic growth.

Only the coalition is capable of delivering solid, reliable and affordable energy for Australians. We as a government take this issue seriously, and we're not taking an ideological approach. Our priority is energy affordability and reliability, while meeting our international targets. That's what a responsible government does. We don't put forward unfunded energy targets. We don't try to close down power stations, leaving a state vulnerable to mass power outages during a storm. We look at the evidence and make considered decisions accordingly. That's why we commissioned an independent review of the National Electricity Market.

Australia's Chief Scientist presented his final report on the future security of the National Electricity Market to COAG leaders on 9 June. The independent review was commissioned following the statewide blackout in South Australia on 28 September 2016. It notes that business as usual is no longer an option. On 14 July 2017, the COAG Energy Council agreed to immediately act on 49 of the 50 recommendations of the independent review into the future security of the National Electricity Market. Following the eight-month review led by Australia's Chief Scientist, Dr Alan Finkel, these significant reforms have been agreed to in record time and will help to drive down power prices and ensure we have a more reliable system well into the future.

Key recommendations which the Energy Council agreed to include:

To help increase gas supply and reduce prices, the government calls on states and territories to accept the Chief Scientist's recommendation to adopt a science based, case-by-case approach to new gas supply and end their arbitrary bans and moratoria. This is effectively saying that we shouldn't be adopting a Greens approach when it comes to exploration. As for the clean energy target, we'll continue to work through it in a considered manner, with further analysis required. What we won't do is what the Labor Party has done and just declare a target without any planning or forethought and expect the Australian people to pay for it.

The coalition government also understands that base-load power anchors our electricity system. We know that we need to keep the lights on for all Australians, something that Jay Weatherill and Labor don't understand. We need to ensure we have enough power to meet future needs. The Australian Energy Market Operator's dispatchability report confirms that the accelerated withdrawal of base-load power, as pushed by the Labor Party, creates major risks in terms of both price and stability. AEMO's analysis shows there is a heightened risk of shortages during summer peaks without targeted actions to provide additional firming capability. They are currently seeking to contract 1,000 megawatts of additional generation for the coming summer to make sure we have enough electricity for these peak demand periods in South Australia and Victoria. The reckless policy of state Labor in Victoria and South Australia, contributing to the closure of Hazelwood in Victoria and Northern power station in South Australia, has seen the need for AEMO to take these steps.

Consistent with the advice of the Finkel review and of the market operator, the government will accelerate work around the strategic reserve, which will beef up how AEMO currently contracts for reserve generation to manage summer peaks. With a major coal-fired power station, Liddell in New South Wales, scheduled to close in 2022, AEMO has identified an additional shortfall of 1,000 megawatts from 2022 onwards. The Prime Minister has started discussions with AGL on keeping Liddell operating longer, remembering that our first obligation to families and businesses is to ensure the stability and affordability of the system. While the government understands coal is absolutely critical to the future of our energy system, Bill Shorten wants to close down coal-fired power stations.

We aren't only looking at coal, though. To help with the integration of more renewables, we are working with ARENA on pumped hydro projects in Queensland, South Australia, Tasmania and New South Wales. The jewel in this crown is the development of Snowy Hydro 2.0, which will increase the generation of the scheme by 50 per cent, adding 2,000 megawatts of renewable energy to the national electricity market—enough to power 500,000 homes. With a reckless 45 per cent emissions reduction target, Labor needs to be held to account for policies that will lead to higher power prices and a less stable energy system. To compare and contrast: everything that the coalition government has done in this space has been designed to deliver affordability and to ensure that we have reliability; everything that Bill Shorten and the Labor Party, at both state and federal levels, is proposing will do exactly the opposite. It will undermine the security and stability of our system and it will dramatically push up prices, as we saw when Labor was last in power.

We are not just looking at the supply side of electricity. We are also looking at what is happening in homes around Australia, with many families not being on the best deal they can be for their home electricity. That's why we're taking further action to help Australian families. We know that 50 per cent of households have not moved retailers or contracts in the past five years, even though savings can be as high as $1,500. At the first meeting of retailers, the Prime Minister has secured agreement on immediate measures and ongoing changes, to be backed by law, to put families and small businesses first.

The commitments from the retailers include: contacting all customers who are on expired discounts and telling them how much they can save on a better deal; requiring companies to report to the government and ACCC what they are doing to get families on a better deal and how many families remain on expired deals; developing simple plain English fact sheets with understandable comparison rates; supporting a change to the electricity rules requiring companies to inform customers when their discount benefits end, setting out the dollar impact of doing nothing; and ensuring families and individuals on hardship programs will not lose any benefit or discount for late payment.

At the second meeting, retailers agreed to go further, contacting another one million customers on standing offers—usually the most expensive rates. The government also secured a commitment from retailers to make available to customers their consumption and payment information, working with the Australian Energy Regulator on a QR code or equivalent on their bill which they can scan using a smartphone and instantly compare offers from other retailers. Since the first meeting, over 280,000 Australians have visited the government's Energy Made Easy website, which allows them to seek a better deal. The industry and government will continue to work together over the coming months to make more changes that will ensure families do not have to pay a cent more for electricity than they need to. The coalition government has directed the Australian Competition and Consumer Commission to review retail electricity prices. The review will scrutinise electricity retail behaviour as well as contracts offered to residential and business customers and ensure consumers benefit from competition in the National Electricity Market. Competition in retail electricity markets should mean lower prices for residential and business customers.

The Turnbull government is determined to ensure Australians get a better deal for their energy. An interim report will be delivered by September, with the final report by June 2018. In responding to the ACCC's review, the coalition government will consider what further action should be taken to ensure the market is competitive and energy consumers, both residential and business, can have confidence in the reliability, security, pricing and terms and conditions of supply. The coalition government will also legislate to remove the ability of networks to appeal the merits of decisions of the Australian Energy Regulator: This will remove the ability of regulated energy network companies to game the system at the expense of consumers. This reform is critical, as network costs make up around 40 to 50 per cent of the household bill. Energy networks will have access to judicial review if they want to challenge the AER's decisions. Telecommunications, water and postage sectors do not have access to merits review and nor should the energy sector. The LMR regime was established in 2008. Since then, electricity networks have used it to challenge 32 out of 51 AER decisions, resulting in $6.5 billion being passed on to consumers in their electricity bills. In not one instance has an appeal by the networks led to reduced costs for consumers. This process is seen as a free option for network businesses. A research note by a major broker said of LMR:

… investors are getting this as a 'free option', with the upside being it brings forward a dividend surprise.

In December 2016, the Commonwealth sought agreement at the COAG Energy Council to abolish LMR but was unsuccessful in achieving the support of all states due to vested interests. That is why we are showing leadership and taking this position to abolish this appeals mechanism. To back this, the Turnbull government is strengthening the AER by providing it with an additional $67.4 million in funding. This will ensure they are fully equipped to address behaviour in the market that is resulting in higher than necessary electricity prices. This is a response to the recommendation of the Finkel review to increase resources for the AER. Making sure the AER is well resourced is critical to consumer confidence in the electricity and gas markets.

In contrast to our comprehensive, wide-ranging plan to help Australians get secure, reliable and affordable power to their homes, we have seen the results of Labor's green-inspired policies. We have seen what has happened in South Australia—the highest bills in the country and the least reliable network. We have seen in Victoria, as a result of Labor pushing out Hazelwood, energy companies AGL and Energy Australia increasing bills by up to $135 in 2017. In its Climate Action Plan, Labor said it would kick-start the closure of coal-fired plants.