Josh Frydenberg will take Greg Hunt’s federal environment portfolio following a frontbench reshuffle announced by Prime Minister Malcolm Turnbull.
Mr Frydenberg has given the resources portfolio to Nationals senator Matt Canavan, to become minister for environment and energy.
While it will be a challenging job, the energy industry has welcomed the appointment of a single minister for both the environment and energy, urging Mr Frydenberg to seek a renewed national compact on energy and carbon policy at the forthcoming COAG Energy Council meeting.
Energy Networks Association (ENA) CEO John Bradley said there is an enormous opportunity to achieve true integration in federal carbon and energy policy, but competing state and federal settings are increasing risks to customers.
“Our grid can enable a low carbon future without compromising reliability and security – but policy uncertainty creates an unfortunate layer of price and security hazards for customers,” Mr Bradley said.
“Other countries have looked at our National Energy Market (NEM) with envy, but the NEM could drown under the weight of competing state and federal carbon and renewables policies.
“We urge the Federal Minister to reconvene the COAG Energy Council so governments can recommit to a national compact on energy and carbon policy.”
Mr Bradley said many national reforms had remained in the ‘too hard’ basket, while individual states were failing to take account of flow-on impacts at a national level.
“Australia is yet to achieve national consistency in critical areas like consumer protection frameworks, energy pricing or coal seam gas development,” Mr Bradley said.
“Our energy system can respond to climate risks and technology risks, but it can’t deal well with constant policy or regulatory risk.”
Australian Energy Council chief executive Matthew Warren agrees, saying Minister Frydenberg has shown a strong understanding of the transformation required in the energy sector since he was first appointed to the energy portfolio last September.
“It is critical the technical, financial and policy challenges of decarbonising energy supply and the economy continue to be addressed. Combining energy and environment in a single portfolio allows for a holistic, integrated approach to national energy and climate change policy,” he said.
For the Clean Energy Council (CEC), the announcement signals hope that climate policy and energy policy are pulling in the same direction.
Acknowledging Australia has some of the oldest and highest-polluting electricity generation in the world, CEC chief executive Kane Thornton said clear and coordinated policy is crucial to attract private investment in clean energy and deliver a reliable and low-cost energy supply.
“This can deliver billions of dollars in investment and tens of thousands of jobs into the future with the right policy settings,” he said.
The news, however, hasn’t received as warm a welcome from the environment sector, which is disappointed there is no stand-alone environment department, and that the portfolio has been given to someone who last year argued the “moral case” for increasing coal exports.
Greenpeace has called the appointment a “huge blow” for the Great Barrier Reef, and Mr Frydenberg’s views on climate change an “embarrassing relic from a different era”.
“Australians have been clear in asking their government to choose the Great Barrier Reef over the coal industry,” senior climate and energy campaigner Nikola Casule said.
“For Malcolm Turnbull to appoint a minister who still believes that there is still a strong moral case for coal even during the worst coral bleaching in the Great Barrier Reef’s history is a clear show of contempt for the Australian public.”