AEC: Best fix for energy prices is national policy reform

The energy industry today welcomed the opportunity to meet with Prime Minister Malcolm Turnbull to discuss how to end the current energy policy deadlock and bring down prices for customers.

Australian Energy Council chief executive Matthew Warren said the industry believed the best way to ease the pressure on energy pricing is to implement a coherent national energy policy as outlined by the government’s own Finkel Review.

“Recent power price increases are the result of old generators closing and the lack of a consistent plan as to how to replace them,” Mr Warren said.

“This is a national policy failure that has been a decade in the making.

“We agree that energy prices are unsustainable. We cannot fix this problem simply by talking about retail bills and customer deals.”

Mr Warren said the price of electricity had increased because it is becoming scarce.

“It is the market signalling the need for new firm generation capacity to be built,” he said.

“The situation is already critical in Victoria and South Australia.

“Investors cannot finance replacement generation capacity until they can see a workable, durable and bipartisan policy framework for the sector.”

Mr Warren said the clean energy target (CET) recommended by Chief Scientist Dr Alan Finkel was key to fixing the country’s energy woes.

“The report has been endorsed by most stakeholders, including major energy providers and consumers,” he said.

“Finkel has offered a blueprint that stakeholders agree is the essential element to overcome our current energy crisis.

“A bi-partisan, national clean energy target remains the key reform to drive new investment and bring down electricity prices.”

The federal government has agreed with 49 of chief scientist Alan Finkel’s 50 recommendations delivered in the Final Report of the Independent Review into the Future Security of the National Electricity Market.

It is yet to agree on the CET recommended in the report as the most effective mechanism to stabilise the country’s energy system.