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No energy outcome is not an option

"The effect of today's National Energy Guarantee (NEG) announcement is that long-term investment certainty in the energy sector remains further away than ever. Despite the best efforts and goodwill of many, energy policy has again fallen victim to short-term political gamesmanship," Australian Industry Group Chief Executive, Innes Willox, said today.

"Resolving climate policy for the electricity sector is a must-do for any and every Australian government and the principles behind the NEG remain good policy.

"The present situation is evolving and open to interpretation. If it is still possible for talks between the Government and the Opposition to progress legislation through the Parliament, we urge the parties to do so. But if today's announcement amounts to deferring passage of the proposed legislation and shelving the pursuit of a lasting settlement on electricity sector emissions, that would be deeply disappointing.

"The potential for the forcible breakup of electricity businesses needs to be treated with considerable caution. The power of the threat of some intervention can be appropriate and effective as a last resort, as we saw with the Australian Domestic Gas Security Mechanism. On the other hand, forced divestiture would be a serious step that was specifically ruled out by the ACCC in their recent comprehensive report on improving electricity prices.

"No matter the politics of the day, the emissions question must be resolved. Australia has a national interest in successful global efforts against climate change, and our Paris commitment is neither easy nor sensible to reverse. Doing nothing is not an option and would almost certainly result in some form of global trade sanctions against Australia.

"Some states and territories have even more ambitious emissions goals; are busily producing policies to pursue them and we would much rather have a coherent and effective national approach to energy and climate policy than a state-based patchwork overlaying the fraying fabric of the National Electricity Market.

"As industry has been emphasising since the start of the climate wars, resolving climate and energy policy is critical to the future of the electricity system and every business and household that relies on it. Energy suppliers and users are planning for a low-emissions future and they need to know what the rules are.

"A lack of policy certainty will only serve to make energy investment more costly, more problematic and put jobs at risk," Mr Willox said. 

Media enquiries:
Tony Melville – 0419 190 347