Energy productivity a focus of the Energy White Paper

Minister for Industry and Science Ian Macfarlane released the Australian Government’s Energy White Paper last week, stating, “The measures in the Energy White Paper will deliver stable energy policy and efficient transparent markets that give consumers information to make choices about their energy use and industry the confidence to invest.”

Macfarlane said the white paper will provide a framework for coherent and consistent energy policy that will enable the integration of other related policies as they are developed, such as Australia’s emissions reduction target post-2020.

“The development of our emissions reduction policies will build on the framework in the white paper, to enable flexible policy development,” he said.

The paper says the government is increasing energy productivity to promote growth, with its National Energy Productivity Plan to provide a focal point for stimulating action that increases awareness about the benefits of improved energy productivity. Macfarlane said the plan will “deliver up to 40% improvement in energy productivity, reducing household and business energy costs, encouraging economic growth, as well as helping to reduce emissions”.

The Energy Efficiency Council has welcomed the government’s decision to make energy productivity one of its top three energy priorities, with CEO Rob Murray-Leach stating, “Getting more out of each unit of energy is the best way to cut households’ energy bills and boost Australian businesses’ competitiveness.” The council additionally noted that improving energy productivity is an ideal way to cut greenhouse gas emissions while growing the economy.

The government plans to work on energy market reforms with the states and territories through the Council of Australian Governments (COAG) Energy Council. Macfarlane said the government would work with the council to “develop the national energy productivity policy framework to deliver the collaborative actions in the plan ... [and] will also lead work through the COAG Energy Council to support the introduction of appropriate electricity use price signals for consumers and the removal of cross subsidies”.

Energy Networks Association (ENA) CEO John Bradley has praised the white paper’s plan to modernise Australia’s electricity tariff structures by rewarding customers who use off-peak energy. He said, “Australia has seen multiple studies conclude that cost-reflective tariffs, enabled by smart meters, would benefit most consumers, including lowering the bills by up to 80% of customers in a hardship program.”

But the Electrical Trades Union (ETU) said the paper has missed the opportunity to move towards nationally consistent electricity tariffs, with ETU National Secretary Allen Hicks asking, “If we have a National Electricity Market, why not have a national electricity price?”

The union highlighted the need to ensure price signals did not result in growing inequality. Hicks acknowledged that the encouragement of efficient, off-peak use is “great in theory” but may unfairly impact consumers such as working families “as they simply can’t alter their lifestyle to avoid peak periods”.

In one of its more controversial measures, the paper announces the government’s intention to support the responsible development of the coal seam gas (CSG) industry. Bradley said the ENA welcomes this support, which includes “the removal of unnecessary barriers to upstream supply without compromising robust environmental and planning regulation”.

But Greens Leader Christine Milne said the push for CSG “shows the Liberal and National Coalition’s complete disregard for farmers and regional communities, who are left to deal with the impacts CSG and shale gas have on their water, land and climate”. She noted the “widespread community opposition” to CSG on display during the NSW election, which resulted in a strong swing to the Greens in normally conservative regional electorates.

The Energy White Paper is available at www.ewp.industry.gov.au.