Energy deal leaked

Controversial plan reveals household savings, faces criticism

EAST coast households could save $550 a year under the Turnbull Government’s energy policy, but the controversial emissions reduction target could still prove a stumbling block.

State and territory energy ministers will meet with federal counterpart Josh Frydenberg next month to settle on the basic design of the National Energy Guarantee.

A leaked copy of an advice document drawn up by the Energy Security Board, which has designed the deal, points to annual savings of $550 for the average household in the decade from 2020, relative to 2017-18.

This is $150 a year more than previously forecast.

“The continued connection of additional renewable generation projects to the NEM (national energy market) in coming years is projected to see prices fall from today’s elevated levels,” the 39-page report says.

In previous talks between energy ministers, the emissions reduction targets attached to the NEG were a sticking point, predominantly for Labor states. The federal government is proposing a 26 per cent reduction for the electricity sector as part of Australia’s overall commitment to a 26-28 per cent reduction on 2005 level emissions by 2030.

There have been calls for a more ambitious target to reduce the pressure that a 26 per cent goal would place on other sectors, including agriculture and transport, where emissions reduction is more difficult.

The ESB document addresses this by saying “it is possible that higher emissions reduction targets may be set in future by the Australian government”. That leaves the door open for Labor to up the target, as they’ve indicated they will if the party wins government.

But Liberal backbencher Tony Pasin says this would be “foolhardy”. “It’s very likely they’ll use this infrastructure … to ratchet up the target for emissions reduction and thereby lead to higher energy costs,” he told Sky News.

Bill Shorten has called for a 50 per cent target.