Shane Rattenbury, MLA
Following the release of two new papers on the National Energy Guarantee – one from the Energy Security Board (ESB) and one from the Commonwealth - the ACT continues to hold serious concerns about the National Energy Guarantee (NEG).
At this stage it still looks like a policy that will lock in poor outcomes for the climate, for renewable energy, for States and Territories who are pursuing strong climate actions, and ultimately for electricity consumers. The policy parameters of the NEG risk an outcome that would be worse than if States and Territories continued to lead the way without a NEG in place.
The ACT will use the upcoming Energy Council meeting to argue for improvements to the NEG to ensure it would actually be a workable and effective policy.
While the technical design of NEG mechanisms prepared by the ESB have an improved approach to accounting for emissions, there are serious deficiencies in the policy parameters proposed by the Commonwealth. It is also difficult to ask States and Territories to come to the Council meeting on Friday and sign up to a policy for which agenda papers and draft recommendations are still yet to be circulated by the Commonwealth.
The ACT's key concerns are:
- Locking in a weak target of 26% emission reduction in the electricity sector. A more ambitious emissions reduction target will improve outcomes for the climate, promote the construction of more renewable generation capacity and provide greater investor confidence and certainty.
- A failure to recognise additionality. The Commonwealth proposes to use its weak emission target to undermine the work done by progressive states – such as the ACT – to reduce emissions and stimulate investment in renewable energy.
- The likelihood of allowing carbon offsets. The proposal to allow retailers to use offsets to comply with emissions reduction obligations would further hold back the transition to renewable technologies, and risks the integrity of emissions reductions by shifting them to overseas.
- The NEG mechanism is still framed in a way that could operate to artificially prop up dirty, ageing coal plants, when we in fact we need to be transitioning away from coal.
- A failure of the NEG to recognise the investment in renewable energy already made by the ACT might risk ACT consumers paying twice for emissions reductions.
This current generation has an environmental, economic and moral obligation to do our best to tackle the threats posed by climate change, and this policy in its current form does not deliver on those obligations.