Morning Shift: 10/08/17

August 10, 2017







TOM CONNELL: There could be relief in sight for those facing crippling energy bills. The Government says up to $1400 could be wiped off per year for some people as it pushed companies to simplify bills and tell customers as well when you’re coming off bills that have a lower charge rate. Will it work? Joining me live now is Shadow Energy Minister Mark Butler. Thanks for your time today.


CONNELL: Do you think it is going to save this much money?

BUTLER: We’ve been talking about this for some time. We took a very clear policy to the last election arguing that the energy market rules haven’t been working in the interest of consumers for too long. Instead they put the interest of the big power companies right at the centre, particularly power companies that have been privatised by former Liberal Governments acting with a very clear profit motive. Consumer groups have been talking about this for a long time, as well as groups like the Grattan Institute. I really do hope this does deliver a better deal for consumers but I’m not going to give the Prime Minister too many plaudits for finally grasping the blindingly obvious, which is what we’ve been arguing for some time; that these market rules are broken and they need an overhaul.  

CONNELL: On the broader issues, we’ll see what the energy companies get to on simplification its fairly straight forward you’d hope it happens, on the broader ones though for example this huge spot price we’re getting at times for electricity. Is it time to look at capping the price of the megawatt hour? Because it can get up to $14,000, why not cap that?

BUTLER: We want that to happen as rarely as possible, that top price, whether it is $14,000 or something else. The problem is it is reaching it more and more often because there is not enough supply in the system. This really reflects the lack of a stable energy policy at a federal level. When Tony Abbott came in he dismantled all of Labor’s previous climate change and energy policy, which is all well and good it is what he said he would do, but he didn’t put anything in its place. Energy companies that want to invest and put in place new generation infrastructure simply don’t know what the rules are. That has become an increasing problem as the ageing plants, particularly the ageing coal-fired plants start to exit the system.

Everyone agrees, Alan Finkel the Chief Scientist said this in his recent report; we need a policy that will pull through new infrastructure and that will stop the price peaking as often as it is.    

CONNELL: It might to a degree but again the $14,000, I mean this system is theoretically you have an incentive to get whatever power station you have running. What on earth incentive do you need for $14,000? Often the price is more like $65.   

BUTLER: That’s right. More often those peaks reflect a lack of competition and a lack of supply in the system. That is the problem because we don’t have new supply coming into the market because of a lack of policy. That’s why yesterday’s meeting while all well and good, I’m glad the Prime Minister finally grasped this challenge for consumers, but the real game is putting in place a national energy policy. That really is the recommendation that Finkel made for a clean energy target.    

CONNELL: That is a part of it.

BUTLER: No it’s not just part of it, it really is the centrepiece.

CONNELL: On this particular bit is there anyone really that would not turn on a plant at $10,000 but would at $14,000? Is there an operator where that is the margin? I assume not.       

BUTLER: I’d assume not as well. We shouldn’t see prices peaking at this rate other than in very unusual circumstances. But because there is a lack of competition and supply in the system, we are seeing it happen more often.

CONNELL: So you’re comfortable with the current peak rate then?

BUTLER: What I’m not comfortable with is the peak rate being used. It should be there as an utter exception and if you had proper supply coming through into the system we’d be back where we were a few years ago, when there was a surplus of supply in the system. Now we’re starting to see Hazelwood come out of the system, Northern come out, the Liddell power station is due to close in 2022, which really in energy policy terms is the blink of an eye. If we don’t start to get new supply into the system, we’ve already got a serious energy crisis; we’re going to have a more serious energy crisis on our hands.

CONNELL: On your willingness to back a clean energy target. You’ve of course had a 50 per cent renewable energy target by 2030, this (a clean energy target) would be lower. Does that mean a shift in policy, having higher emissions then previously planned?

BUTLER: No, no. Our position of 50 per cent renewable energy by 2030 remains Labor Party policy. What we’ve said is we want to sit down with the Government and put in place the clean energy target framework. We’ve also said that we think the recommendations from Alan Finkel are based on overly low ambition. We know that we would have to tweak that ambition upwards if we are going to have any chance of discharging the commitments we have under the Paris Agreement, and more importantly the commitments we have to future generations to start to get our carbon pollution levels down.  

CONNELL: So what you’re offering then, because there is a lot of talk about whether you’ll adopt the same as the Government’s policy, is a clean energy target but with more renewables in it?

BUTLER: Everyone that has looked at this clean energy target has said one of its design features has to be scalability. It has to be able to be adjusted in the future to take account of a range of things, including changes of technology. We know renewables are becoming the cheaper version of new electricity infrastructure. We also know the Paris Agreement is going to require all nations, particularly Australia which had one of the more modest or one of the lowest carbon pollution reduction targets, to start to ratchet up their ambitions in driving down carbon pollution.

SAMANTHA MAIDEN: I’m going to hop in for a minute to talk to you about the front page of The Advertiser, which is completely extraordinary; also because we are old Adelaide people.

BUTLER: Middle aged.

MAIDEN: This is the front page of The Advertiser, where Tom Koutsantonis, the South Australian Treasurer, has been accused of using a word that we’re not going to refer to; you can see it up on the screen, to a bank chief. Now people swear, sometimes at journalists in particular. However, is this an appropriate message for the South Australian treasurer to deliver to a business leader in South Australia?

BUTLER: I’ve only skim read the article online but the important thing as I understand; it is that the Treasurer has completely denied the allegation on the front page of The Advertiser. There are also some allegations about other conversations at the Mid-Winter Ball, the South Australian version of the Mid-Winter Ball, which are again denied by the former Treasurer Kevin Foley. So this has got a bit to play out I think but just one allegation on the front page of the newspaper does not make it so. It’s quite clear that Tom Koutsantonis has denied what is alleged.

CONNELL: I might just play you what we’ve heard on the same-sex marriage debate this morning. Zed Seselja whose comment is regards to making sure the debate is fair, that there is coverage on both sides. Let’s take a look first of all at what the Liberal frontbencher said.

Zed Seselja (recording): We absolutely shouldn’t be dragging kids into it and we shouldn’t be having anything other than a respectful debate. People have pointed out some of the people that are anti same-sex marriage and some of that language. On the other side unfortunately we’ve seen death threats for people hosting Christian events or people who are opposed to redefining marriage have had their events cancelled because of things like death threats. So we’ve seen some real extremism at the edges. We would absolutely reject that and urge people to have a civilised debate.

CONNELL: He makes the point the people for or against this proposal shouldn’t be threatened. And also that TV companies, for example, should accept advertising that advocates for a no vote. Do you accept that?

BUTLER: We’ve made the point really for two years, since this was first raised as Liberal Party policy, that we oppose the plebiscite on a range of grounds. We think we should just do our job in this building; we think it is a waste of money; it won’t be binding so it doesn’t do the job that it is proposed to do. But probably the most important reason we’ve opposed it is after talking to LGBTI groups, health experts, particularly mental health experts, we think this runs a very real risk of doing real harm to people. Now whatever side of the debate this is really isn’t the important thing. I’m particularly focused on the harm it does to the families that are really at the heart of this question. That is LGBTI families and their children, and that is a very big part of the reason we are opposed to this process.

CONNELL: We’ve taken that point we’ve spoken a lot about it on this program. But on the other side should television companies and networks for example not just say a blanket no to running the no campaign in terms of advertising?

BUTLER: That’s a matter they are going to have to decide. At the end of the day the particular focus Labor has had is on the harm that will be done to the group in the community that has their lives, their families, their relationships now subject potentially to a postal vote plebiscite, depending on whether or not the High Court lets this go ahead.

CONNELL: Alright Shadow Climate Change and Energy Minister Mark Butler, always a pleasure. Thank you for your time today in the studio.

BUTLER: Thanks Tom, Thanks Sam.