10 June
Tasmanian energy minister reflects on national meeting
Tasmania’s Minister for Energy and Renewables, Guy Barnett, acknowledged the cost of living pressures on Tasmania’s minds.
Mr Barrett assured the Tasmanian people that the “Tasmanian Government and its Energy businesses are working together to keep downward pressure on energy prices”.
Tasmania is leading the nation by being 100 per cent self-sufficient in renewable electricity with a legislated target of 200 per cent by 2040.
“The current challenges in the National Electricity Market are putting pressure on consumers right across the country and we’ve been witnessing the greatest spike on wholesale prices since the announcement of the closure of the Hazelwood coal-fired power station in 2017.
“It was a collaborative meeting and we agreed to work together closely over the coming months to respond to this collective challenge in a way that builds skills and creates more jobs and opportunities.”
While the focus of the meeting was on the current challenges, Energy Ministers agreed for the states and Commonwealth to work together intensively to progress a national plan to transition the nation to clean, reliable and affordable energy that keeps downward pressure on power prices.
Ministers reinforced the critical importance of a sensible, considered reform agenda for the medium to longer term, to position the sector to be more resilient and able to navigate future global or domestic challenges to ensure a secure energy sector that will underpin a modern and low carbon economy, including hydrogen.
Projects such as Marinus Link, Battery of the Nation and Green Hydrogen are critical in this agenda and can form a key part of a supercharged Integrated System Plan as Australia moves to net zero carbon emissions.
Energy Ministers will meet again in July. In the meantime, the independent Tasmanian Energy Regulator will deliver the updated regulated electricity price in late June, and the Tasmanian Government said they remain ready to assess further concessions and support that may be needed in regard to energy price increases.
9 June
Outcomes of energy crisis meeting
The Australian Energy Council (AEC) has praised Federal and State Ministers’ decision to back renewables and storage as part of a new ‘National Transition Plan’ to protect Australians into the future.
At the energy crisis meeting on 8 June, Ministers from every State and Territory agreed to eleven actions to help pave the way for a clean energy future.
At a press conference after the meeting, Federal Climate Change and Energy Minister, Chris Bowen, said these steps are “no silver bullet, no magic answers, but material steps forward in a very positive fashion.”
Mr Bowen outlined three key steps from the meeting, which included:
- Developing a capacity mechanism, which prioritises storage and renewable energy
- A gas procurement and storage plan to be coordinated by the Australian Energy Market Operator (AEMO)
- A National Transition Plan, which has consensus from the Federal Government and all states and territories
The peak body for energy retailers and generators, the AEC, says the Energy Ministers’ Communique following their meeting sends the right message to the market.
The AEC’s Chief Executive, Sarah McNamara, said, “We know there is not a quick fix for the problems in the market at the moment and that’s why we are pleased to see the focus on measured solutions that will provide a long-term benefit to consumers.
“We are also very encouraged by the Federal, State and Territory Ministers’ commitment to work together to ensure Australia’s energy system is affordable, reliable and secure during the transition to more renewables-based generation.
“Critical to this is the ongoing work, led by the Energy Security Board, on a mechanism to ensure there is sufficient dispatchable supply available in the market as that transition is underway.
“We also welcome the decision to focus on market mechanisms to ensure supply and acknowledge there remains a lot of work to do in this area.
“At the moment, short term issues are causing genuine pain for consumers across Australia, focussing on getting reforms right will help protect Australia’s electricity networks in the future.”
As Australia’s energy ministers hold a crisis meeting, leading industry bodies have called upon the ministers to work together on an immediate response to the national energy crisis.
8 June
Federal Minister for Climate Change and Energy, Chris Bowen, has brought together state energy ministers for a crisis meeting on 8 June 2022.
A coalition of industry bodies have released a statement calling on the energy ministers to tackle rising energy costs and moderate the national energy supply.
The industry bodies represent businesses of all sizes, consumer advocates, the community sector, environmental advocates, farmers, investors, the property sector, professional bodies, researchers and Australia’s energy and energy management sectors.
The industry bodies include:
- Ai Group
- Australian Alliance for Energy Productivity (A2EP)
- ACT Council of Social Service, Australian Conservation Foundation
- Australian Council of Social Service
- Australian Energy Foundation
- Australian Sustainable Built Environment Council
- Clean Energy Council
- Community Housing Industry Association Victoria
- Energy Efficiency Council
- Engineers Australia
- Green Building Council of Australia
- Facility Management Association of Australia
- Group of Energy Efficiency Researchers (GEER) Australia
- Investor Group on Climate Change
- National Farmers’ Federation
- National Shelter
- New South Wales Council of Social Service
- Property Council of Australia
- Public Interest Advocacy Centre
- Queensland Council of Social Service
- Renew
- Rewiring Australia
- South Australian Council of Social Service
- St Vincent de Paul Society
- Tasmanian Council of Social Service
- The Australia Institute
- Victorian Council of Social Service
- Western Australian Council of Social Service
The meeting will discuss policy changes to alleviate pressures on the national energy market.
Measures being discussed include tackling rising energy costs, financial support to vulnerable energy users, cutting emissions by improving supply and lifting demand-side efficiency, improving energy management and encouraging fuel switching.
In a joint statement, the industry representatives said wholesale electricity and gas prices are soaring to unprecedented levels that threaten intense and lasting pain for households and businesses.
The industry bodies said this rapid rise is also causing chaos among smaller energy retailers, adding to immediate risks.
“Meanwhile those businesses unable to pass on their costs fear mounting cost pressures will threaten their viability, and some with immediate exposure have already been forced to temporarily shut down operations as prices spike,” the statement from the industry bodies said.
“There are some short term causes at play, including the unavailability of aging and unreliable coal generators and the onset of winter peak demand for heating.
“However, high international prices for coal and gas are the biggest factor and they are likely to be sustained for years to come.
“We are encouraged by national Climate Change and Energy Minister Chris Bowen’s early push to bring his State and Territory counterparts together this week. The response they forge jointly should be collaborative, balanced and staged.”
The industry bodies are calling for a collaborative response between the Federal, States and energy stakeholders because it says no one player holds all the powers, resources and information to resolve this crisis.
“Industry and community leaders can bring expertise, urgency and goodwill to the table and we ask energy ministers to work with us,” the industry bodies said.
“Working together and being transparent will give us all the best chance of success.”
The industry bodies are committed to finding a balanced solution for a reliable energy supply is essential, including behind-the-meter solar and storage accessible to all.
But the industry bodies believe final energy costs depend not just on the price of energy, but how much energy households and businesses have to use to meet their needs.
“A long-standing lack of investment in energy efficiency, energy management and fuel switching has left Australians more vulnerable both to high prices and to extreme weather,” the industry bodies said.
“Demand-side investments don’t just pay off through lower individual bills. They deliver improved health and higher energy productivity, reduce the need for new supply-side investment, and help us reach our emissions goals.”
The industry bodies also said a staged response is essential because this crisis includes both acute price pain and the likelihood of chronic high prices in the future.
There are calls for supporting the turn to renewable energy, as it will help with long term problems in terms of energy supply.
“Accelerating our clean energy transition in a fair and inclusive way will ultimately deliver durable help, but while that requires immediate action it will largely impact the medium term,” the industry bodies said.
“A faster buildout of large-scale renewables and transmission makes all the sense in the world, as does a speedier move from natural gas to alternatives from electrification (like efficient reverse cycle air conditioning in households) to biogas (like captured landfill gas running brick kilns) to hydrogen (like green hydrogen for essential chemical products) as appropriate in different contexts.
“Actually making this acceleration work will be complex, requiring reforms and coordination across multiple jurisdictions and both public and private investments.”
But most of all, there are calls for additional financial support to the most vulnerable energy users.
The industry bodies said that priority should be given to:
- Low-income households, including through increasing income support payments and more adequate and responsive energy concessions
- Those businesses who are coming out of contract or exposed to spot energy prices, are unable to pass increased costs on or are sufficiently energy intensive for these cost increases to threaten business continuity
The industry bodies also said broader reforms such as an increase in income support payments would reduce the need for emergency energy support payments.
“Without urgent action, this winter will be a difficult one for energy users and the next few years may not be much easier,” the industry bodies said.
“We are confident, however, that Australia’s governments can alleviate this pain and build a stronger, more affordable and clean future if they work together and draw on the expertise and goodwill around them.”
