There is a growing concern within the energy market over the lack of transparency and lack of involvement of energy market experts, including key energy market regulators, in the meetings of federal and state energy ministers following a Morrison government led push for secrecy around such meetings.
In the wake of the Covid-19 outbreak, the Morrison government acted swiftly to abolish and replace a number of joint meetings of federal and state governments, creating the ‘national cabinet’. This included the abolition of the COAG Energy Council, and it has resulted in federal and state energy ministers forced to meet under, and be bound by, strict cabinet confidentiality rules.
The ‘national cabinet’ model sees the state and territory energy ministers effectively invited to attend a meeting of a federal cabinet subcommittee, dubbed the Energy National Cabinet Reform Committee.
This has provided federal energy minister Angus Taylor with a huge amount of control, the potential to dictate agendas, decision making and control over how information about what is discussed and decided upon by ministers is communicated to the public.
Other arrangements may have been agreed to amongst the ministers, but no such details have ever been released publicly. It is unknown how decisions are made in these forums and the degree to which Taylor exerts control over the other ministers.
In an apparent attempt to address concerns about meeting as a subcommittee of the federal cabinet, energy ministers recently resolved to form a second forum, an ‘Energy Ministers’ Meeting’, that will meet alongside the Energy National Cabinet Reform Committee.
Despite apparently setting out to simplify decision making between energy ministers, the Morrison government has ended with twice as many energy minister’s forums, while substantially reducing their transparency and the involvement of stakeholders, including excluding the participation of the key energy market regulators.
The new Energy Ministers Meeting will likely take on much of the same responsibilities as that previously held by the former COAG Energy Council, while the Energy National Cabinet Reform Committee will focus on specific priorities around ensuring reliable supply over the coming summer and a post-2025 redesign of the national electricity market.
But this has not prevented a number of key energy market stakeholders from speaking out about the lost transparency and the exclusion of key sector representatives, including the energy market bodies, from decisions about energy policy.
Chair of the Energy Security Board, Kerry Schott, recently issued a plea to governments to address concerns around engagement, telling the AFR energy summit last week that the government must improve the transparency of ministers meetings and the involvement of the energy regulators.
“COAG Energy Council has now been replaced by a National Reform Committee of cabinet dealing with energy – and by a ministers meeting – which is not covered by cabinet rules and conventions,” Schott said.
“It’s early days and the way these things work is still being worked out. But, I think there are two really important things that we can also learn from the success of the Covid management. And that is, we really need transparency about what the ministers are discussing.”
“It’s very important in energy, because of course, so much of the energy sector is in the private sector and if ministers are making decisions together, everybody wants to know, and wants to know in a very timely way.”
“The second thing I think was very evident in Covid was that the role of the experts was critical, and remains critical. That’s also true in energy. Expert advice largely sits in the market bodies and it’s very important that those three market bodies are in the room with ministers when decisions are being made.”
“So we’ll see how the new system works in practice. I think everybody’s willing to give it a go, but they are the two things that I think are very important to carry forward,” Schott added.
Chief executive of the Clean Energy Council, Kane Thornton, echoed these concerns, telling RenewEconomy that it was concerning to see energy ministers withdrawn from engaging with energy market stakeholders, at a time when rapid and transformational change was occurring in the market.
“While continued reform is appropriate given the pace of change, we do have a number of concerns with the current arrangements, as best we understand them,” he said.
“This includes a trend towards less transparency and communication from meetings of energy ministers. This is problematic given the rapid pace of change and significance of reforms being considered, and adds to investor concern about the uncertainty of regulation and reforms being considered.”
“The other concern is the apparent exclusion both of industry stakeholders and market bodies from many of these meetings. There is a long history of industry stakeholders attending a forum preceding COAG Energy Council to share perspectives with energy ministers on the topics of focus. These have not been held more recently.”
“There is also a long history – which I understand is no longer the case – of market bodies attending COAG Energy Council to help inform ministers on what are inherently very complex issues.”
“Each of these recent developments risk undermining collaboration, transparency and well informed decision making and take Australia further away from improving our management of the energy transition,” Thornton added.
RenewEconomy has made several attempts to request information about the proceedings of the federal cabinet energy subcommittee, only to be denied on the basis that all such material is cabinet-in-confidence.
With state and territory energy ministers bound by the cabinet confidentiality rules, even aggrieved ministers have been prevented from speaking openly about the meeting’s proceedings, as they had previously been able to, and done so quite vigorously, when meeting as the COAG Energy Council.
Several stakeholders told RenewEconomy that they were open to giving the new arrangements time, and energy ministers the opportunity to demonstrate that they will be able to generate good outcomes for the energy market and an ability to engage with stakeholders outside of the forums.
However, there has been a clear trend towards more unilateral actions by state and territory governments to introduce new state-based energy policies, with a lack of policy being developed at a federal level.
The new meeting arrangements have not prevented states like New South Wales, Queensland and Victoria announcing their own substantial plans for increased investment in renewable energy projects and they have not prevented growing antagonism between Angus Taylor and the state energy ministers.
