Coal hard cash offer
Treasury underwrites new power plants
THE Turnbull Government will underwrite multibilliondollar investments to build new power stations in a bid to reduce energy costs.
This major financial contribution to build new power generation assets, which could be coal or gas, is also a sweetener from Prime Minister Malcolm Turnbull to win the support of hostile Liberal MPs, like predecessor Tony Abbott, who have threatened to cross the floor on his signature energy policy, the National Energy Guarantee.
Mr Turnbull’s popularity has taken a hit since the disas- trous Super Saturday by-election in Longman, with the latest Newspoll, published in The Australian today, showing his lead over Bill Shorten as preferred PM has been slashed from 19 points to 12.
The Coaltition’s primary vote slipped form 39 to 37 points and, on a two-party preferred vote, the government remains behind 49/51. It’s the 38th consecutive Newspoll the Coalition has trailed Labor.
Senior Turnbull Government sources yesterday confirmed they would adopt the Australian Competition and Consumer Commission recommendation to financially underwrite investment in construction of new power stations in order to help large energy users – including mineral processors, chemical factories, plastic and paper manufacturers – which have been battling high power and gas costs.
MP for Wide Bay Lewl O’Brien has not ruled out crossing the floor over concerns about subsidies for renewables.
While the power stations will be built specifically for the use of the largest energy users in the country, it will help lower power prices, a senior Government source said.
“The focus is on getting cheap power into the system. It decreases prices for everyone,” he said.
It will also eliminate the control which power retailers like AGL, Origin and Energy Australia have over the market.
The move is designed to ward off the potential for recalcitrant backbenchers, including Mr Abbott to cross the floor over the NEG, as they push for the government to focus on a price-target, not only an emissions and reliability target.
NSW MP Craig Kelly, who chairs the energy backbench committee, will hold a meeting at 8am tomorrow to nut out a position before a party room meeting later that morning.
Energy Minister Josh Frydenberg yesterday made a public plea to disaffected backbenchers to engage in “constructive discussion”.
Meanwhile, the government will this fortnight reintroduce its company tax plan to the Senate. It wants to reduce to 25 per cent the tax for companies with a turnover of $50 million or more.