SKY AM AGENDA
MONDAY, 16 OCTOBER 2017
SUBJECTS: ACCC Report; Energy prices; Newspoll.
KIERAN GILBERT: With me now is the Shadow Assistant Treasurer, Andrew Leigh. Dr Leigh thanks very much for your time.
ANDREW LEIGH, SHADOW ASSISTANT TREASURER: Pleasure, Kieran.
GILBERT: This ACCC report comes out today, Newpoll showing about 60 per cent of people don't want to pay a dollar more for subsidising clean energy and you can see why given the pressure they're under?
LEIGH: I think if you talk to anyone who has got solar panels on their roof, they'll tell you how they brought down their power prices. Australia has got more solar per square metre than any other country in the world, it's got great opportunities for wind and wave and combined with battery and backup systems allows you to get that sustainability of supply that you need.
GILBERT: But to get the solar panels on the roof you need thousands of dollars in the first place? That's thousands many households wouldn't have.
LEIGH: The cost of these have come down significantly, which has been driving the uptake. Renewables produce about a fifth of our total electricity generation at the moment, Bloomberg forecasts that it will be three fifths in a couple of decades’ time. And we've got the situation now where three quarters of our coal plants are operating beyond their planned life, so we need to make that transition to renewables, not just to drive down power prices but of course to tackle climate change – given that we're the nation with the highest per person emissions in the world and doing so little to address climate change.
GILBERT: The consumer and competition watchdog says that households and businesses are under unacceptable pressure when it comes to the prices and the clean energy target is no guarantee that it will bring down prices. It's hardly endorsing that course of action?
LEIGH: Well they've in fact said that a clean energy target would put downward pressure on power prices -
GILBERT: Who said that?
LEIGH: The ACCC report.
GILBERT: The Chairman this morning said this morning when I spoke to him that there is no guarantee that it would? He said that it would reduce emissions but you can have all sorts of modelling that would suggest it would, he's not convinced it would.
LEIGH: The Government's own hand-picked Chief Scientist said it would put downward pressure on power prices. That’s why you have organisations like the Business Council of Australia, the Australian Industry Group – right across the spectrum, you had sensible organisations recommending a Clean Energy Target, as the Chief Scientist had done. We’ve got to put in place these market based mechanisms, Kieran, because if we don’t move on climate change now and make the steady transition, then we face a wrenching change which will damage the economy.
GILBERT: But isn’t it already happening? Mr Sims argues that businesses are already factoring in a carbon price within their operating procedures and he seemed to be suggesting, like Josh Frydenberg is, that the cost curve of renewables is such that they can stand on their own two feet.
LEIGH: The challenge for businesses is that they don’t have long term certainty as to what the Government’s policies are going to be. If you’re investing in a solar plant, you need to know that the Government policies are going to be, out decades. Right now, the Turnbull Government doesn’t know what it’s doing past 2020 because the left wing and the right wing of the party are in such a terrible brawl.
GILBERT: Do you need subsidies to have certainty?
LEIGH: You need to have a market based mechanism that makes clear that the Government is going to advantage those clean energy emissions. This is the basic economics of climate change, Kieran. Reducing our carbon emissions is in the national interest. We’ve signed up to these Paris targets, that we’ve been signed up to by successive governments and going right back to 2007. We used to have a consensus that a market based mechanism was the way to deal with it.
GILBERT: Is Labor still committed to that 45 per cent emissions reduction target that you’ve committed to? Because if you are, it’s a difficult political one for you to maintain, isn’t it, given how people don’t want to pay any extra in terms of their power bills. They’re already under the pump.
LEIGH: That’s what the experts tell us we need to do in order to meet our commitments we’ve made internationally. If we fail to meet these commitments, then potentially other countries will start to take serious action. It’s not like we’re leading the pack here, Kieran. We’re dragging our heels along the back. We should have been moving with a market based mechanism back from 2007, but we’ve had this decade long period in which we’ve had the conservatives in the Liberal Party effectively stymying effective action on climate change. Malcolm Turnbull promised that he would be a sensible centrist, but he’s been anything but on climate change and the abandonment of the Clean Energy Target is another indication as to why Malcolm Turnbull is now up to losing 21 Newspolls, heading rapidly towards beating the record of his predecessor of 30 Newspolls.
GILBERT: Andrew Leigh, we’re out pf time. I appreciate it.
LEIGH: Thanks, Kieran.