The Clean Energy Council has called on the COAG Energy Council to continue the detailed design and implementation of the National Energy Guarantee (NEG) policy architecture at its 10 August meeting, but continues to warn that the proposed emissions reduction target remains too low to encourage sufficient new investment in energy generation.
Clean Energy Council Chief Executive Kane Thornton said most credible analysis suggests that the current 26 per cent emission reduction target would be met by the electricity sector in just a few years’ time, due to the current wave of investment under the national Renewable Energy Target.
“Encouraging new investment into the next decade remains critical to reducing power prices as our old coal-fired power plants continue to close,” Mr Thornton said.
“The Clean Energy Council is also calling for carbon offsets to be excluded from the scheme. Out-sourcing our emissions overseas or to other sectors means lower investment in new Australian energy projects, which would lead to both higher power prices and a missed opportunity to invest in regional jobs.”
Mr Thornton said the continued development of the policy architecture with the support of both major federal political parties and every state and territory government would be a positive step forward, providing a policy framework that can be ratcheted up in the future.
“The ESB’s Decision Paper outlining the final design was provided to state and territory governments yesterday, and this paper has now leaked into the public domain. While the detailed design is important, our primary concerns remain with the emissions reduction target, the inclusion of offsets and the timing of future reviews – all elements that are expected to be addressed by the Federal Government in a separate paper ahead of the August 10 meeting.
“With the policy architecture settled, it would be easier to increase the emissions target in the future. We continue to urge the government to adopt a stronger and more realistic target that continues the momentum in clean energy investment and drives the transition of the energy sector.”
Mr Thornton said the Australian energy sector has the potential to play a much greater role than other sectors of the economy – such as agriculture and transport – where emission reductions are far more difficult and expensive to achieve.
The Clean Energy Council believes that the current emission reduction target will place responsibility for the energy transition on state and territory governments and energy customers, which are increasingly installing or procuring clean energy to reduce their energy prices.
Mr Thornton said that in light of the limited impact of a 26 per cent target on new investment, state and territory targets would continue to be important in providing the investment confidence for clean energy investment and job opportunities.
The Clean Energy Council’s support for the NEG is contingent on the COAG Energy Council addressing the following issues, the majority of which will be proposed by the Commonwealth Government (rather than the ESB):
“The Clean Energy Council looks forward to working with all COAG Energy Council members to ensure an effective NEG is developed that addresses these key issues,” Mr Thornton said.
Please contact Clean Energy Council Media Manager Mark Bretherton on 0413 556 981 for more information or to arrange an interview.