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Federal energy plan gets green light for next step


The Federal Government’s cornerstone energy policy has passed its latest hurdle, with a commitment from states and territories to continue detailed design work.

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It gives ministers who identified concerns with aspects of the National Energy Guarantee a four-month reprieve to push for changes before the Federal Government’s deadline for a decision in August.

Federal Energy Minister Josh Frydenberg went into the meeting of energy ministers in Melbourne with the recognition more work needs to be done.

He anticipated talks would secure support for a more detailed framework, rather than the overall support he had originally hoped for.

The Energy Security Board will now continue to progress a more detailed design, expected to be released in July.

“I think there is a recognition that there is more work to be done, there is a recognition that there is a lot of goodwill from all sides of this debate and there is a recognition that we will need to get an outcome in August,” Frydenberg said heading into the meeting.

No state has spoken out against support for a detailed design, but none has offered full support for the plan yet either.

South Australian energy minister Dan Van Holst Pelekaan gave the strongest indication of support.

“If the details we receive shortly will support South Australia, then we will support the National Energy Guarantee,” he said ahead of the talks.

If it doesn’t, the state won’t back the deal – but will support further detailed work, he said.

NSW and the Business Council are urging ministers to get on board with the plan.

ACT Climate Change Minister Shane Rattenbury and Victorian Energy Minister Lily D’Ambrosio both identified major sticking points and want more details.

The biggest is the 26 per cent emissions reduction target for the electricity sector, at the lower end of Australia’s Paris Agreement commitment of 26-28 per cent reduction of 2005 level emissions by 2030.

Ministers are questioning the low target for electricity where abatement is cheaper and easier to achieve than in agriculture, industry and transport.

“It’s a critical question and Minister Frydenberg needs to provide some specificity in how that will be achieved by the rest of the economy,” D’Ambrosio said on Friday morning.

Rattenbury also committed to pursuing recognition of states with more ambitious emissions reductions and renewable targets.

“I think it is appropriate that where those states are doing the work, they actually put in place heavier targets, that it doesn’t become a free ride of some of the other jurisdictions,” he said.

Federal Labor energy spokesman Mark Butler also expressed a desire for commitment for further detailed work and said he hoped there would be a model that could be agreed.

Labor has already committed to raising the emissions reduction target to 45 per cent if they’re in government after the next election.

Ministers at the meeting will set the date for the next Energy Council talks, which will become the federal government’s new deadline for an agreement, to allow time for legislation to clear parliament by the end of the year.


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