Josh Frydenberg (Kooyong, Liberal Party, Minister for the Environment and Energy) Share this | Hansard source

When the coalition came to government, it inherited a basket case of an energy system from the Labor Party. We all remember the chaos and dysfunction that characterised the Rudd-Gillard-Rudd years. We remember prices going up each and every year. We remember Australian households being hit by a doubling of energy prices when Labor was in office. We remember that great Athenian model of democracy, the citizen's assembly. We remember Cash for Clunkers, that great idea that was right up there with pink batts. And we remember the dreaded carbon tax, which imposed a multibillion-dollar impost on Australian families and businesses, so much so that Labor had to spend billions of dollars of Australian taxpayers' money shovelling it out the door in one hit to the coal-fired generators. You don't hear them talk about that much anymore. That was the Labor Party's record when they were in office. We know that the member for Port Adelaide was quite embarrassed by it, because he put out a book called Climate Wars, in which he said:

The truth is that we in Labor had sent too many mixed signals about climate policy …

… we've made mistakes in … the design of our policies—

and, wait for it—

… Australia's voters were determined to see the back of the Labor Government.

That's the reality of what happened when Labor was in office. They also ignored the advice of their own Energy Market Operator about the impact that the large gas export industry on the east coast of Australia would have on the supply-demand dynamic, driving prices up and reliability down. That was the impact of their ignoring of the Energy Market Operator's advice in their own energy document.

We came to government with that situation. What did we do? We abolished the carbon tax. The member for Port Adelaide seems to dispute how much of a saving went to Australian families. The ABS said that the abolition of the carbon tax resulted in the single biggest drop in electricity prices ever recorded. I'm reading from an ACCC press release on 28 July 2015:

The ACCC believes that, given all the available information, the Commonwealth Treasury's estimated $550 cost savings to households is reasonable.

That is the ACCC. Since that time the Abbott and then Turnbull governments have been taking action across the board to reduce power prices. We've done a number of things. We've intervened in the gas market to ensure more gas goes to Australians before it's exported overseas. The ACCC have reported that making that available to the market has seen gas prices drop by up to 50 percent. That is good news not only for electricity users, because, as some of the big coal-fired generators have come out of the system, gas has been setting the price of electricity about twice as much as previously, but also for large energy users for whom gas is an important feedstock. I'm talking about the fertiliser, chemical and paper industries and so forth.

Wholesale electricity prices are falling significantly. The wholesale electricity price is down by about 25 per cent this year. Last week the wholesale spot price was around $68 per megawatt hour compared to $101 per megawatt hour at the same time last year. That is happening as a result of the Turnbull government's interventions. Network costs have also been cut. Rates of return when Labor was in office were about eight to 10 per cent. It has now fallen to around five to six per cent. That can be worth a couple of hundred dollars a year to households. I took legislation through this parliament successfully abolishing the limited merits review, which has meant that no longer are the networks gaming the system. If Labor had done that when they were in office, they would have saved Australian consumers $6.5 billion, but they didn't do it; it has been up to us. Now we have a new binding rate of return, which could also save significant costs to consumers.

We're helping customers to get a better deal through the retail market. Since the Prime Minister's meeting with retailers last August 1.6 million households on expired or default plans have been contacted and offered better deals, half a million households have moved off the expired or default plans to better deals, and another 1.3 million households have got better deals. There's also the government's Energy Made Easy website. For those who are listening on their radios across the country, energymadeeasy.gov.au is the government's comparator website. When you go on it, you can compare your electricity bill to those offered by other retailers and save hundreds of dollars that way. It has had over a million hits since the Prime Minister met with the retailers. Electricity prices turned the corner on 1 July this year when prices came down in Queensland, New South Wales and South Australia, and we're hoping to see the same thing happen when Victoria does a reset in January.

We have also invested in important energy infrastructure. Most importantly, as the member for Eden-Monaro celebrated, welcomed, was delighted, was excited, was jumping from his chair with joy, that the Turnbull government is delivering Snowy 2.0, a major energy infrastructure project, a pumped hydro scheme which will be the largest of its kind in this part of the world, that will be 2,000 megawatts, that will create 5,000 jobs, that will power 500,000 homes. That's the reliability that we are bringing to the east coast of Australia, which Labor never did. We're investing in pumped hydro projects, through ARENA and elsewhere, in Cultana in the Upper Spencer Gulf, in the member for Grey's electorate in South Australia, and in Kingston in Queensland. We've identified 14 high priority or highly probable pumped hydro projects and hydro projects across Tasmania, to help Tasmania become the battery of the nation. We've talked about a second interconnector to provide Tasmanians with energy security and also to provide more power into the east coast of Australia.

All this work is having an impact, but it also leads us to the National Energy Guarantee, which I'm so pleased that my colleagues endorsed today to take to the next stage, when the states will hopefully sign on before the end of October. The states now have no excuse. They asked our party room to endorse it, and we did. The National Energy Guarantee was put together by the independent experts. Together with our other policies, it will drive electricity bills down by $550 for the average household, and wholesale prices by 20 per cent, which could be worth millions of dollars to the large energy users. It also has the enormous support of industry, business and energy consumer groups. Listen to what Energy Consumers Australia said:

… the Final Detailed Design of the National Energy Guarantee … includes updated modelling which confirms that the Guarantee can deliver much needed savings for households and businesses.

That was Energy Consumers Australia. What about the Queensland Chamber of Commerce and Industry, representing more than 400,000 Queensland small businesses? I'm speaking to the member for Dawson, because the member for Dawson has many businesses that would be involved with the Chamber of Commerce and Industry. The Queensland Chamber of Commerce and Industry says:

At the end of the day, the National Energy Guarantee (NEG) promises what we’ve all been waiting for – a downward pressure on electricity prices and policy certainty.

In New South Wales, the 190-year-old New South Wales Business Chamber, with 19,000 businesses, said:

Australia can't afford more flip-flopping on energy policy. We need to get a national energy policy that provides certainty, improves energy affordability and security and reduces emissions before the end of 2018.

There are similar endorsements in Victoria, in Tasmania and across South Australia. We've seen BHP, we've seen Rio Tinto, we've seen Aurora, we've seen Dow Chemical, we've seen the National Farmers' Federation, we've seen BlueScope. We've seen Energy Users Association and Manufacturing Australia. We've just seen the Australian Industry Group; Chemistry Australia, representing a $40 billion industry—the likes of 3M, Dow, Ixom, Qenos, Orica. These are the companies that employ millions of Australians—blue-collar workers. They are imploring us to support the National Energy Guarantee. They say, 'Listen to the experts.' They say, 'Put aside your politicking and your posturing. Get behind a policy that puts consumers first. Get behind a policy that maintains our international competitiveness. Get behind a policy which will reduce the bills of Australian families.' That's why the Turnbull government is getting on with the National Energy Guarantee. That's why the Turnbull government can deliver lower power prices. (Time expired)

See this speech in context