Government’s Energy Strategy Failure


August 15, 2017

People in my electorate of Wills and all throughout Australia are hurting as power prices skyrocket under this coalition government’s mismanagement of energy policy. The pressure that these exorbitant power bills are causing is made even more difficult for a whole range of people who are vulnerable, especially working people, as they contend with flatlining wage growth and unaffordable housing. If the Prime Minister gets his way, single pensioners will be $365 worse off per year and couple pensioners will be $550 worse off per year when they lose their energy supplement payment, which was designed to help them address some of the skyrocketing prices of electricity and gas.

The price of energy is absolutely ridiculous. This is my latest gas bill. It is $736 just for two months. I wasn’t there half the time. My family was away for half the time. How is that possible?

We’re doing well enough; we get paid well in this place. But in my state of Victoria the evidence shows that wholesale power prices have doubled under the term of this government. Who bears the brunt of that? It’s families, pensioners, the vulnerable, students and small businesses. How households are keeping up with their bills under these dire circumstances escapes me. These costs are outrageous. They might not sound like much to this out-of-touch Prime Minister, but for the people in my electorate this is a very big deal.

I deliberately sought to join the House Standing Committee on the Environment and Energy because I am passionate about real action on climate change, and I want to get involved in the policy areas around the electricity market and energy. What I have discovered in the course of our inquiry is that there are some grave issues around the national electricity grid and its management, to the extent that power companies are gaming the national energy markets to inflate prices that are charged to consumers. They do this by manipulating the spot price and the current asking price for power, which is set over a 30-minute period, by withholding power and then releasing it once the price is inflated. It’s a bit confusing. It’s a bit like arbitrage and some of the stuff that went on in Wall Street. I don’t want to bore the chamber, but people should understand that the system is being gamed. It’s being gamed to the extent that power prices are skyrocketing and the consumers are facing the brunt of this.

The coalition have persisted in trying to cast this as an issue relating to supply rather than an active manipulation of the market. Time and time again, they’ve inaccurately cited a blackout in South Australia caused by extreme weather events that took down powerlines and tried to peddle the notion that renewable energy was somehow to blame. It wasn’t long after they started this campaign of misinformation that the Treasurer actually walked into the House carrying a lump of coal with him, and he talked about new coal-fired plants. Only yesterday, suddenly he has had his road to Damascus reversal, where he is now saying no new, cheap coal is possible. I think this speaks volumes about the priorities of this government. They’re all over the shop, first of all. But the reality is that there are times when there is an overall surplus of energy available, and prices are elevated through some of these gaming methods and they’re used to generate maximum profits. This dysfunctional nature of the national energy market is being looked at by the Standing Committee on the Environment and Energy. I hope that our committee will provide some strong recommendations to the government to fix the dysfunctional national energy market and reduce the pressure that is ultimately being placed on consumers.

Last week, we saw the Turnbull government and the Prime Minister hold a meeting with power companies. The outcome of this meeting was that companies agreed to make bills easier to read, to make switching power providers and power plans easier and to make sure people don’t lose discounts if they’re late paying their bills. Making changes to how power bills look is not going to solve the fundamental problem. They need to change what drives the prices that are on the bills. The real point is that this government has failed. It’s an absolute failure on energy policy. It’s failed miserably to set a clean energy target. It’s failed miserably to have any coherent national policy on climate change, a policy that should address the need for certainty for investors at a time when all of the old coal-fired power plants are coming to the end of their working life. The capital and the markets need to be allocated to developing new renewable energy infrastructure. They want that certainty.

We are facing a full-blown energy crisis. The government knows what to do to end it; it’s just not doing anything about it. The government’s own Finkel review, the one that it commissioned, made the same recommendations the government has been hearing for years from energy experts. The only policy the government hasn’t ruled out is a clean energy target, which was also recommended by the Finkel review, but it hasn’t supported it either. In fact, some members of the government have openly mocked the idea. The former Prime Minister, the member for Warringah, described the clean energy target as a ‘magic pudding’ and a ‘tax on coal’. This government is absolutely paralysed and can’t even back its own policy that was put to it by its own tailor-made review.

People in my community are sick and tired of the squabbling in Canberra. I think we hear that right across the aisles here in this place. We know from the members here that people are sick and tired of all this squabbling; they just want certainty. They want real action that will deliver affordable, reliable and clean power. This means a clean energy target. A future Labor government will set a target of 50 per cent renewable energy by 2030. This is something that’s about the future for our children and for our children’s children. We need to get on with it because it’s so important.