Budget: $41.5 million for energy security

Lightbulb with money symbol (Sumo Power)

The Federal Government has allocated a $41.5 million investment to keep the lights on and lower electricity bills in its 2018-19 Budget.

The Budget, released last night by Treasurer Scott Morrison in Canberra, includes an investment of $28.7 million over five years to implement the recommendations of the Finkel review, as well as the design and implementation of the national energy guarantee (NEG).

“We are committed to giving Australian households and businesses affordable, reliable energy, while also meeting our international commitments,” Federal Energy Minister Josh Frydenberg said.

The investment will also allow the government to push ahead with better forecasting and modelling to ensure the security and resilience of energy infrastructure; the creation of a consumer access data platform; and allowing the Commonwealth to continue leading the work of the COAG Energy Council.

“We will invest $12.8 million over six years from 2018-19 in revitalised energy security and resilience assessments as recommended by the Finkel Review, with an additional $4.9 million every three years from 2024-25,” Minister Frydenberg said.

“The energy security and resilience assessments include an accelerated examination of Australia’s domestic liquid fuel security to be completed by the end of this year.

“Australia’s liquid fuel supply increasingly depends on overseas sources and relies on market forces to maintain reliability and affordability.

“The assessment will identify whether the government should take further steps to ensure Australia’s domestic fuel supply is reliable.”

The government also committed to improving the functioning of Australia’s gas market by following up the Prime Minister’s agreement with LNG exporters and continuing to address market transparency, liquidity and competition issues.

APPEA chief executive Dr Malcolm Roberts said this highlighted the significant contribution Australia’s natural gas industry makes to the nation’s economic wellbeing and energy security.

“As the Budget points out, Australia remains on track to become the world’s largest exporter of liquefied natural gas over the next few years and with a large percentage of Australia’s LNG exports sold under long-term contracts which are linked to the price of oil, revenue from this key industry is set to rise,” he said.

“The recent increase in oil prices has coincided with a number of new projects coming online.

“Over time, the sector’s contribution to our economic performance can be expected to become even more important.”

The 2018-19 Federal Budget has come under fire for failing to deliver funding towards measures to tackle climate change or increase renewable energy investment.

“With an ever-raising price for energy supply to homes and business, we would have expected a much higher commitment to increasing the penetration of renewables for households and for commercial and industrial customers,” Indra Australia energy solutions manager Giovanni Polizzi said.

“Keeping an eye on promoting investments in technology for power networks would have also been desirable, as these organisations should avoid costly network infrastructure augmentation by digitising their operations and so harness the opportunities offered by demand response and distributed renewable generation.

“Encouraging a potentially costless energy such as renewable, is in our opinion the way to go for a stable energy price containment.”

Climate Council acting CEO Dr Martin Rice said it was disappointing the Budget had appeared to ignore climate change.

“The Federal Government’s continuous failure to seriously tackle climate change is an embarrassment,” he said.

“Australia is one of the most vulnerable countries to climate change in the developed world, with worsening extreme weather events including severe heatwaves, supercharged storms, heavy rainfall, flooding, droughts and bushfires.”

Dr Rice said the budget fell short on new funding to embrace the rollout of clean, affordable and reliable renewable energy and storage technology.

“The solution is here. Australia must rollout credible climate and energy policy that ramps up our transition to clean, affordable and reliable renewable energy and storage technology, while moving away from our polluting fossil fuel past,” he said.

“The only thing standing in our way is political will.”