Dec 09, 2016 - 4:38pmFederal climate and energy policy chaos has reached a crisis point and further instability will have lasting negative consequences for our country, The Climate Institute said today.
“The federal government needs to pull itself together and put energy and climate policy on a sensible, stable pathway to net zero emissions,” said The Climate Institute’s CEO, John Connor. “If it squanders the opportunities provided by its own 2017 climate policy review and the COAG process, all Australians will ultimately pay the price with an insecure, unreliable and unnecessarily expensive energy supply.”
Mr Connor said that today’s COAG meeting highlighted the urgency of resolving the challenges facing our electricity system.
“As the review by Chief Scientist Dr Alan Finkel shows, unless we face up to the need for change in our electricity system, we will continue to see rising electricity prices and threats to energy security,” he said.
Mr Connor said there are three key areas across which careful, strategic policy formulation needed to take place:
1) The new renewable and storage technologies that are coming into the market can be integrated effectively but this will require the market rules to change.
2) With the reality of coal stations shutting down at very short notice, the federal government must develop plans and strategies not only to replace them, but to assist the communities effected to adapt and transition. As it stands, the federal government has no plans in either regard.
3) Australia’s climate commitments in the Paris Agreement mean the power system needs to be completely decarbonized. With current policy setting seeing emissions continuing to go up, policy redress must take place to force them down.
“The draft Finkel report warns that the only way to reduce electricity costs and improve energy security is to provide a policy framework stable enough for investors to trust it, and with clear enough signals that investors know what they need to build, where to build it, and when,” Mr Connor said.
“These same messages are coming loud and clear from experts, power companies, and industry groups.”
He said the Australian Energy Market Commission report to government clearly showed that doing nothing, or maintaining current policy arrangements, will cost energy users more than would implementing an emissions intensity scheme. The modelling for the scheme showed Australia could achieve a 50 per cent reduction in electricity emissions, and energy users would still pay less than the do-nothing option.
“If government is serious about energy security, prices and emissions, its review needs to consider all options,” Mr Connor said. “The evidence is clear - we need a stable, long-term plan that involves all sectors of our community in the transition to clean zero emissions energy.”
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