Tuesday, 21 June 2022

Energy policy

Mr QUILTY (Northern Victoria) (19:23): (1997) My adjournment matter is for the Minister for Energy, Environment and Climate Change. Last week the federal price-setting body that controls the Australian energy market intervened and shut down the electricity market. We then got to see the New South Wales minister for energy pleading with citizens to use less electricity. What kind of free market is a government price-setting body and a politician trying to manage demand via press conference? Australia’s energy system is collapsing, and it is the result of decades of bipartisan government policy at state and federal levels.

Renewable energy is expensive, and even with a flood of government subsidies it has still been too expensive to cover demand. You will read in newspapers that the cause of the low supply is our coal plants are struggling, breaking down and being decommissioned. Renewable energy advocates pretend that this pattern of coal plant failures is from random chance—that it is just a coincidence that coal has suddenly begun to fail after decades of reliability. According to them, it has nothing to do with renewable energy or government energy policy. What is actually happening is that electricity companies recognise that it is not worth investing money into maintenance, repair and refurbishment of coal plants when the government is going to shut them down anyway. Regulatory risk has pushed coal into an early grave by design.

We warned that decommissioning our coal production in favour of wind and solar energy would lead to expensive and unreliable energy, and here we are with expensive and unreliable energy. We are surrounded by politically motivated talking heads and journalists who want to convince you that these problems are caused by privatisation or by Russia or by anything except the obvious. The obvious is that the things we expected to happen are happening. We said the transition to renewables would be wildly expensive and consumers would pay the price. Now with the transition to renewables, it is wildly expensive, and consumers are paying the price. It is not caused by coal plants being shut down; coal plants are being shut down because of government policy favouring renewables. It is not caused by rising transmission infrastructure costs; transmission infrastructure costs are rising to facilitate renewables. It is not caused by privatisation; the market is following government decisions, not driving them.

The action I seek is for the energy minister to be honest with the Victorian public about the reasons for rising prices in the energy market. I do not want honesty because I want to stop us transitioning away from coal; it may well be exactly what we need to do. I want honesty to make sure we are considering all the options fairly, including nuclear. Government-led transition is leading us into an energy nightmare. It is confusing price signals, distorting incentives and warping our energy mix towards the extremely expensive and unreliable.