All eyes on Canberra this Thursday

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DAILY NEWS…Thursday is going to be an interesting day in the nation’s capital as politicians return to parliament to debate legislation intended to bring electricity and gas price relief to households and small businesses. Sides are being taken, threats are being made. What’s it all about?

Friends of the Earth Australia are the latest environmental group to make public statements about the behaviour of the “fossil gas industry”, stating it “is attempting to blackmail Australians and force our government into backing down on price caps.”

Friends of the Earth issued the following in a media release on Tuesday, December 13: “It’s being reported that the industry is employing cartel behaviour to organise what amounts to a blockade, threatening domestic supply by cutting off east coast consumers from a resource that is rightfully theirs.

“Friends of the Earth calls on the Federal Government to maintain its resolve and push ahead with legislation this week that will put a price cap on energy, no matter what threats come from this dirty, war-profiteering cartel.

“The Energy Minster has the power to force the companies to hold back volumes of fossil methane gas through the Australian Gas Security Mechanism to avert fuel shortages. Friends of the Earth campaigners say she should not think twice about doing it.”

“In response to this blackmail threat the industry should immediately be slapped with a super-profits tax, so that the Australian public can recoup some of the money these multinational giants are making out of the suffering in Ukraine,” Friends of the Earth No More Gas Campaigner Freja Leonard said.

“The fossil gas cartel has been exploiting the environment and the hip pockets of Australian consumers for way too long,” she said.

“The funds from a new fossil fuel super profits tax could then be spent on weaning Australia off fossil gas altogether so that we can fully convert to renewable energy and finally kick these greedy companies out of the country.

“A recent study by the Macquarie University and the University of Wollongong illustrated that fossil fuel companies receive almost five times more cash in government subsidies than they pay in tax, so another thing the government should do is cut off their access to public funds completely,” Freja Leonard said. 

In April 2021, the Australia Institute reported that federal and state governments provided a total of $10.3 billion worth of spending and tax breaks to assist fossil fuel industries in the 2020-21 financial year. The $7.8 billion cost of the fuel tax rebate alone was more than the budget of the Australian Army.

“Over the longer term, $8.3 billion is committed to subsidising gas extraction, coal-fired power, coal railways, ports, carbon capture and storage, and other measures,” according to the AI research.

Albo expects action and has recalled Parliament to get things moving

The Albanese Government is partnering with States and Territories to shield Australian families and businesses from the worst impacts of predicted energy price spikes.

According to Prime Minister Anthony Albanese’s announcement following his meeting with chief ministers and premier’s last Friday, the Government’s Energy Price Relief Planwill: limit gas prices; limit coal prices; provide targeted energy bill relief for households and businesses; and invest in cleaner, cheaper, more reliable energy for the future.

The Prime Minister’s statement said: “We are experiencing sustained and unprecedented pressure on global energy markets. Russia’s illegal invasion of Ukraine is pushing energy prices to historic highs all over the world.

“In Australia, that’s made worse by nearly a decade of division, inaction and policy uncertainty on climate and energy under the Liberals and Nationals. The urgent action we are taking with the Energy Price Relief Plan will shield Australians from the worst impacts of price increases, delivering responsible and targeted relief to families, small businesses and manufacturers.

“The plan is responsible, targeted and temporary. It is designed to provide all Australians with a buffer in unprecedented times. This coordinated national approach continues the Albanese Government’s strong record of working constructively with States and Territories to address problems facing all Australians. It ensures that jurisdictions play their critical role in easing energy market pressures.

To summarise the initiatives agreed to by the National Cabinet, the Prime Minister and First Ministers last Friday, which will debated when the nation’s parliament is recalled on Thursday, December 15:

  1. Temporary cap on the price of gas – 12 month emergency gas price cap of $12 per gigajoule on new wholesale gas sales by east coast producers
  2. Mandatory code of conduct for wholesale gas market including a reasonable pricing provision
  3. Accelerating introduction of AGDSM
  4. Boost resources for the ACCC to monitor and enforce
  5. Ceiling on price of coal used for electricity generation at $125 a tonne in NSW and Queensland with the Commonwealth to contribute to costs.

According to the Prime Minister the average family would be $230 worse off in 2023 if these measures don’t go ahead.

“Combined, these gas and coal measures are estimated to: dampen predicted gas price increases by two percentage points in 2022-23 and 16 percentage points in 2023-24; reduce the impact of forecast electricity price increases of 36 per cent in 2023-24 by 13 percentage points, preventing a $230 increase that the average Australian household would have seen if these actions were not taken; and reduce expected inflation in 2023-24 by around an estimated half percentage point,” according to the Prime Minister’s statement.

The Commonwealth Government also announced it will partner with States and Territories to deliver targeted and temporary relief on power bills to eligible Australian households and small businesses that are customers of electricity retailers.

This will be done via an Energy Bill Relief Fund with up to $1.5 billion to deliver relief directly to electricity bills and Commonwealth support will be contingent on the relevant State or Territory matching funding on a dollar-for-dollar basis.

“This targeted and temporary support will provide hundreds of dollars of additional bill relief to eligible Australian families and small businesses and help shield them from the worst impacts of rising global energy prices,” the announcement said.

Final details and funding arrangements will be settled by National Cabinet by March 2023.

Beyond the immediate measures, the Prime Minister and First Ministers reinforced the commitment made by Energy Ministers at the meeting of 8 December, to implement the Capacity Investment Scheme.

This Scheme will unlock around $10 billion of private and public sector investment in clean, dispatchable storage and generation to ensure reliable and affordable electricity supply and reduce our exposure to high coal and gas prices over the medium and long term.

Australia’s National Energy Market saw a decline of 3GW of dispatchable power, or enough to power over two million homes during the past nine years according to the Albanese Government.

“Firmed renewables are the cheapest form of energy. The current coal and gas price crisis makes that reality even more stark. Rewiring the Nation and the Capacity Investment Scheme will drive investment in Australia’s future as a renewable energy superpower.

“Governments around the country are working together to provide relief to families, businesses, and manufacturers, along with longer term measures that increase capacity and reliability for renewable energy.”

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