Coalition urged to end paralysis on clean energy target

One of Australia's most senior energy advisers has pleaded with the Turnbull government to end its paralysis over a clean energy target, saying the lack of clarity is hurting consumers already hit by soaring power prices.

"At least the states have a plan," said Chloe Munro, chairwoman of the national energy market operator's expert advisory panel.

Speaking at a symposium on energy futures, she said that while other countries were grappling with the transition towards clean energy, Australia was leaving it to the market, with potentially negative consequences for the community.

Chloe Munro, chairwoman of the national energy market operator's expert advisory panel. Photo: Jamila Toderas

Chloe Munro, chairwoman of the national energy market operator's expert advisory panel. Photo: Jamila Toderas

She said states were setting renewable energy targets in a time of unstable supply, rapidly rising wholesale prices and a lack of direction from Canberra.

"This may sound cynical of me, but at least the states have a plan," Ms Munro said.

"Whether all those plans add up to a national plan is another story, but it is something that is missing still at a national level, and we hope that the work of the Energy Security Board will tie all that together and we'll have a more coherent national approach."

The board is meant to co-ordinate the adoption of the Finkel review's recommendations to secure the national energy market, but the federal government has rejected the key recommendation a clean energy target.

Opponents of a target within the government have argued that renewables are too unreliable and expensive to form the backbone of the nation's energy supply.

Ms Munro spoke in Melbourne on Tuesday at an expert symposium on Victoria's electricity future after the sudden closure of the Hazelwood coal-fired power plant in March.

Her intervention in the debate over clean energy is significant given she worked with Australia's Chief Scientist, Alan Finkel, on his review and is now chair of the Australian Energy Market Operator's expert advisory panel.

The Turnbull government this week leapt on a report by the market operator that found Australia's states face a gas shortage three times worse than the operator had previously estimated, arguing it should be a trigger for state governments in Victoria and NSW to abandon their policies against onshore gas exploration and fracking.

Treasurer Scott Morrison added to the call on Tuesday, arguing the two states should change tack.

"We are walking around on top of the gas in NSW and Victoria that our economy needs, that the jobs that depend on that gas need, and it is important that this be freed up," Mr Morrison said.

The Victorian government immediately ruled out such a move, arguing the shortfall was caused by the fact most Australian gas was exported.

"Victoria is proud to be the first state to legislate a ban on fracking. It supports our farmers and preserves our state's hard-won reputation for producing high-quality food," Lisa Neville, the acting Minister for Energy, said.

The national energy market operator warned in its report that the east coast domestic market faces gas shortages of about 50 to 100 petajoules in 2018 and 2019, enough gas supply to power up to 100 regional cities for a year.

The operator's executive general manager of operations, Damien Sandford, told the symposium the looming shortage might force Victoria to rely more heavily on its gas "peaking" power stations to avoid gas outages.

Gas peaking plants normally operate just a few weeks of the year when demand spikes.

The rising wholesale price of gas is already having a severe impact on industry.

Innes Willox, the chief executive of the Australian Industry Group, said Australia was paying $16 per gigajoule of gas, roughly double the guidelines of $6 to $8 set by the Australian Competition and Consumer Commission.

Mr Willox backed calls from Canberra for Victoria to relax its moratorium on onshore gas exploration as a way to ease pressure on prices.

With Cole Latimer

This story Coalition urged to end paralysis on clean energy target first appeared on The Sydney Morning Herald.