Finkel review provides opportunity to ‘hit reset’

The clean energy target proposed to reform the National Electricity Market signals an important and welcome change in energy policy strategy, according to the Australian Energy Council.

Australia’s chief scientist Dr Alan Finkel presented the Final Report of the Independent Review into the Future Security of the National Electricity Market to COAG leaders in Hobart today.

The review concluded that a clean energy target is the most effective mechanism to reduce emissions while supporting security and reliability.

AEC chief executive Matthew Warren said the new model proposed was a potential game changer to the current energy policy and investment gridlock.

“For the past decade we’ve been trying to devise economic instruments to force the early closure of high emissions electricity generators,” Mr Warren said.

“This has resulted in a decade of discussion and experimentation with carbon pricing or taxing in some form.

“Dr Finkel’s report identifies that the real challenge in the national electricity market has shifted: old coal generators are exiting faster than we can replace them.

“What we face is an investment problem rather than a carbon pricing problem.

“The Finkel review provides a welcome reset in the debate on energy and climate policy in Australia.”

Deloitte national leader, energy and resources, Michael Rath said the review has come at a “crucial time” in providing both market and investment certainty.

“To date, the politics of power has damaged both our competitiveness and standing as an energy nation,” Mr Rath said.

“The Finkel review provides a great opportunity to step back and focus on what is and isn’t working in Australia’s energy market.

“As a nation, we need to take more of a big picture, long-term view of the market and create a better playing field for investment and an orderly transition.

“We need to acknowledge the energy market is in transition and that renewables, gas and baseload coal will be part of our ongoing fuel mix as we move to a low emissions environment – they are all part of the same ecosystem.

“The review provides that long-term vision allowing us to hit the reset button in securing Australia’s future energy market.”