"Full development of the Guarantee is urgent. Surging wholesale electricity prices are sapping profits across industry, and for some businesses the situation is life or death. Reliability is under threat. Emissions have been rising. New investment can turn prices, reliability and emissions around, but investment is being held back by deep ongoing policy uncertainty.
"With clear and credible climate and energy policy, more new generation could enter the market, including increasingly cheap renewables. Incumbent electricity generators could invest to upgrade their coal and gas plants to be more reliable, flexible or low-emitting. Manufacturers increasingly have plans to cut their energy costs by investing in their own energy supply, including on-site renewables and participating in larger generation and storage projects. But as long as the rules of the game remain unsettled, much of this potential will go nowhere.
"The Guarantee is still just a concept, but in its outlines we can glimpse a workable solution to support investment. We need consultation, collaboration and months of hard work to develop a detailed design that all of us can be confident is functional and efficient.
"Today's agreement for more work on the Guarantee is a great start. The Energy Security Board can now lead a process that gives a voice and a seat at the table to all of us who rely on the electricity system to live, work and stay in business. The best way for the States to resolve their understandable concerns about competition and climate ambition is to join that process wholeheartedly, not to get caught up in sterile arguments about modelling exercises.
"A decade of climate and energy policy warfare has left deep political scars and wasted huge economic opportunities. We are hopeful that the National Energy Guarantee can be a key element of a lasting and prosperous peace," Mr Willox said.
Tony Melville – 0419 190 347