The National Energy Gurantee (NEG) will not work for South Australia, according to the state’s energy minister Tom Koutsantonis.
Mr Koutsantonis said the Energy Security Board’s advice on the National Energy Guarantee proves it would entrench the market power of existing fossil fuel generators and retailers, limiting competition and driving up power prices in South Australia.
The Energy Security Board report, released this week, includes a section titled ‘competition in South Australia’, which, according to the energy minister, demonstrates how a NEG would further entrench the monopoly behaviour of large market participants.
“The report shows the only thing the NEG guarantees is a longer lifeline for coal, more market power and more profits for the existing generators,” Mr Koutsantonis said.
“Essentially, the NEG is a guarantee for higher prices in SA.
“It proves it would make it more difficult for new competition from renewables to enter the market and takes Australia in the wrong direction.
“The reason high power prices are being experienced across the country is lack of investment, and lack of competition in the market.”
Mr Koutsantonis said the advice shows the NEG would favour the large monopolies meaning it would favour the East Coast and push up prices in South Australia.
“The NEG favours the market status quo, doing nothing to drive the transformation towards renewables and will not drive emission reduction to levels that are needed to meet the Paris targets,” Mr Koutsantonis said.
“The clean energy target (CET) was always considered the ‘second best option’, now COAG is being asked to accept the third best option.
“There is nothing here for South Australia – we have already set in motion a plan for our State to be more self-sufficient and to increase renewable energy generation and storage.
“We need more generation and more competition in South Australia, which is the key goal of our energy plan.”