Energy ministers endorsed further work on the federal plan, which the Prime Minister insists will bring down power prices, keep the lights on and cut emissions, with the meeting endorsing a work program to progress the NEG, despite SA and the ACT voting against it.
The NEG would involve energy retailers delivering a set level of ready-to-use power in each state to shore up reliability, while also being compelled to meet an emissions target, helping Australia achieve its Paris target.
“We’re a no,” SA Energy Minister Tom Koutsantonis declared upon arrival today, calling the NEG a “cop-out to the coal industry”.
“All the NEG does is guarantee higher prices, more coal and less renewables.”
He lamented the abandonment of the Clean Energy Target recommended by the Finkel Review.
“No-one’s explained why… why are we choosing the third best option instead of the best option?” he said.
In an amendment, SA demanded further modelling by the Energy Security Board on the CET and an Emissions Intensity Scheme, as well as the NEG. But NSW, Victoria, Tasmania and federal minister Josh Frydenberg voted that down.
Koutsantonis said SA would push ahead with its own modelling of alternative energy policies.
Modelling by the ESB shows $120 a year could come off household power bills between 2020 and 2030 under the NEG, while bigger users would see more substantial savings.
But Labor energy spokesman Mark Butler said before the meeting there was deep concern in Victoria, South Australia, the ACT and Queensland that the NEG’s current design would not drive new investment in renewable energy.
There were also fears the policy would further concentrate retail energy markets which were dominated by a small number of big players.
“The real question is whether this policy is a properly functioning market, not one intended to prop up old coal-fired power and strangle renewables,” Butler told Sky News.
A deal announced by Engie on Thursday to sell the 1000 megawatt Victorian power station Loy Yang B to Alinta Energy appeared to confirm market confidence in the future of coal-fired power in the medium-term.
However, renewables have received a boost with Frydenberg today announcing plans for a $20 million feasibility and business case assessment for a second interconnector across the Bass Strait between Tasmania and the mainland grid.
It will allow Tasmania, which is investing heavily in renewable energy and storage, to play a greater role in the national electricity market and provide a backup to ensure supply to the Apple Isle.
“It will enable more renewable power here in Tasmania to be developed, and for Tasmania to become the battery for the nation,” Frydenberg said.
Tasmanian Premier Will Hodgman said while it would have a “significant cost”, there were enormous benefits for his state and the nation.
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