NSW slams federal Coalition over “extraordinary” refusal to reinstate emissions in NEG

Relations between one of Australia’s last remaining Coalition state governments and the Morrison government continue to go south at a rapid rate, after NSW energy minister Don Harwin slammed his federal counterpart’s “out of touch” energy policy at the 21st COAG Energy Council meeting in Adelaide today.

In a brief, but stinging rebuke, Harwin said he was “very disappointed” by the federal government actions at the meeting, in particular its continued refusal to restore the emissions component of the National Energy Guarantee, after it was dumped from the policy in August.

“The refusal, on procedural grounds, to let the vital matter of restoring an emissions obligation into national energy policy be discussed is extraordinary,” Harwin wrote in an emailed statement.

“NSW will continue to pursue this critical matter with COAG Energy Council.”

The comments suggest little progress was made on energy at the Wednesday meeting, and that little has changed in federal Coalition ranks since the ousting of Malcolm Turnbull, even despite his role in dropping all mention of emissions from the NEG.

While Scott Morrison & Co doggedly stick to their mantra of low power prices forsaking all else, energy has become the source of major schisms in the LNP, as more elections loom – including a federal poll that could be just months away.

In particular in NSW, where a state election is scheduled for March 23, the Coalition Berejiklian government has made several considered efforts to distance itself from federal energy policy.

These included an op-ed in the Australian Financial Review on Wednesday, in which Harwin called the Morrison government out of touch, and said its refusal to factor emissions reduction into the NEG was driving power prices up, and not down.

“The federal government is out of touch on energy and climate policy, which is preventing new investment and prices from falling. It’s time for them to change course,” Harwin said in the piece.

“The market and industry is looking for certainty on emissions and that policy uncertainty will lead to higher wholesale prices and delayed investment decisions. That’s very bad news for households and businesses,” he wrote.

“We need to end the ‘climate wars’ and put science, economics and engineering ahead of ideology.

“That’s why NSW wants a sensible emissions policy to be embedded in the National Electricity Law, outside the high drama of the ‘Canberra bubble’.”

But NSW was not alone in stressing the importance of emissions in any national energy policy. Indeed, comments from Victorian energy minister Lily D’Ambrosio, have suggested the push-back from NSW is “too little, too late” on such an important – and popularly supported – issue.

“We’ve only seen floundering and backflipping and no direction whatsoever from the national Government. Today will be no different,” D’Ambrosio said before the meeting.

So what was achieved in Adelaide?

A communique from the meeting shows that the ministers agreed the final draft bill of the National Electricity Law (NEL) amendments, which will give effect to the Retailer Reliability Obligation, as proposed by the Energy Security Board.

The ESB will also continue work on a final package of rules to be brought to the Energy Council for approval in the first half of 2019, to get that reliability obligation into law by mid-year.

Another positive to come from the chaos was an agreement on developing a national hydrogen fuel strategy “for consideration” by the end of 2019.

According to the communique, ministers also agree to regulatory impact statements on air conditioners and swimming pool pumps and to draft a regulatory impact statement for certain electrical appliances to be demand response enabled.

Finally, the communique also noted that the meeting had discussed whether to task the ESB to draft an emissions obligation for introduction into the NEL for consideration by COAG Energy Council “as soon as practicable.”

According to the report, South Australia – another Coalition government – had proposed this request be considered out of session in February 2019.