Industry groups are urging Prime Minister Malcolm Turnbull to hold the line on the National Energy Guarantee (NEG) as infighting forces critical NEG concessions.
Turnbull has introduced changes to the NEG in a bid to satisfy Coalition hardliners like former PM Tony Abbott. Abbott and his pro-coal Coalition colleagues are pushing for lower NEG emission targets.
The PM has therefore agreed to set the emissions target by regulation rather than legislation as originally intended. The current target of 26 per cent on 2005 levels by 2030 would then be regulated by the relevant minister.
NEG concessions and infighting destroying it: industry groups
Destruction of the NEG through Canberra infighting would be disastrous, says Tony Wood, Energy Program Director at the Grattan Institute.
Wood is calling on bipartisan support for the NEG. He says political leaders must “stay the course” to ensure certainty for Australia’s energy market.
According to Business Council of Australia Chief Executive Jennifer Westacott, investors are looking for security. A long-term mechanism is subsequently needed to meet international climate change commitments.
As reported by the Australian Financial Review, a suite of changes is due to be presented to the Coalition party room tomorrow.
Coalition leadership threatened by pro-coal lobby push
Party and media rumours are now starting to circulate. In addition to the NEG, rumours abound of a possible challenge to Turnbull’s leadership by Home Affairs Minister Peter Dutton.
A Coalition party room majority approved the NEG last Tuesday following tentative agreement by the states at a COAG meeting on August 10.
Ten federal MPs opposed or questioned the policy, however. A number also reserved their right to cross the floor on a Parliamentary vote. These include Abbott, Craig Kelly and former Nationals leader Barnaby Joyce.
Energy bodies throw weight behind NEG
Origin chief executive Frank Calabria says the NEG could provide the confidence needed for Origin to invest in gas generation and pumped hydroelectricity.
The NEG is also far from perfect, according to EnergyAustralia managing director Catherine Tanna. It is, however, the best option on the table.
Agreement by federal and state politicians on the NEG is also essential to avoid further uncertainty, claims Australian Industry Group Chief Executive Innes Willox.
However, the Smart Energy Council fears the NEG could destroy the renewables industry. It could put the brake on solar installations and energy storage batteries. Solar power industries have been experiencing exponential growth in recent years.