Tuesday, 21 June 2022

Energy policy

Mrs McARTHUR (Western Victoria) (19:25): (1998) My adjournment debate is for the Minister for Energy, Environment and Climate Change and concerns her long-known opposition to the inclusion of coal and gas power stations in the proposed electricity capacity market mechanism. Recent weeks have shown the cost of prematurely forcing generators out of the electricity market before sufficient replacement dispatchable power or storage—or in some cases even transmission infrastructure—has been put in place.

The tripling of brown coal royalties in 2016 did not just cost 750 jobs at Hazelwood, it has had a lasting effect on our energy market. Our state’s hostile attitude to gas production has not just forgone great opportunities, it has cost existing jobs too. I greatly regret the loss of 23 jobs at Stawell’s Advance Bricks & Pavers in my electorate, a family company with a history of more than 80 years. Last week they said their gas costs went from between $6 and $8 a gigajoule to $37 a gigajoule overnight. As the key enabler for the business, it was a mountain far too high to climb. Its doors will close within days. This is a real-life consequence of ideological decisions, and the impact on the families involved and Stawell is absolutely deplorable.

We have become used to this ideological intervention in the energy market, however, and added to failures on transmission infrastructure and hostility to coal and gas is the rejection of nuclear power. As the sad demise of Advance Bricks & Pavers shows, ideology affects energy prices in the everyday market, but it now seems the same stupidity will be extended to the proposed capacity market designed to provide power when the market proper is failing. If there was ever a time for ideology to take a back seat, surely it is when the choice is between maintaining power and the lights going off. And by definition a stand-by market, an insurance policy, is already an additional and usually unnecessary cost. Barring any use of fossil fuels in it will add further to the cost of running this capacity market. Even many experts generally supportive of increasing the share of renewables generation in the market recognise that this emergency reserve is not the place for ideology to trump common sense and value for money.

I am confident that the minister and her department will have conducted a full impact assessment on this policy choice, so the action I seek is the release of this assessment, specifically of the department’s view of the annual net cost of excluding non-renewable generators from the proposed capacity market.