solution to the lack of investment certainty to be reasonable, although it is the federal government’s decision to have coal and gas-fired power plants, among other sources, to provide for the spare capacity that has attracted the disapproval of states and territories in Australia.
Speaking ahead of a meeting between the officials of federal, states and territories yesterday, the Energy Minister for Victoria, Lily D’Ambrosio, noted that her state “will not support” the plan, while her counterpart from the Australian Capital Territory (ACT) said they would “adamantly oppose” it.
According to D’Ambrosio, while a capacity mechanism is a possible solution for the lack of investment certainty, it is imperative for such a scheme to be designed properly. “Victoria will not be supporting CoalKeeper payments to ageing fossil fuel generators,” she noted. “Victoria is the pre-eminent place for investment in the new zero-emissions energy capacity and we don’t want to see investors lose confidence.”
This claim that the proposed plan would damage investor confidence was disputed by Federal Energy Minister Angus Taylor, who described the PRRO as a “technology-neutral” means of ensuring there is sufficient power to be dispatched from the NEM. “We need to ensure we have the on-demand power needed to keep the grid reliable and affordable for Australians, and support continued growth in renewables,” he said.
Meanwhile, ACT Energy Minister Shane Rattenbury says he will propose several amendments to the scheme, as he of the view that reforms to the electricity grid should happen “in a way that rapidly reduces emissions from Australia’s electricity sector”. The PRRO has not yet received any favour from New South Wales either, with Energy Minister Matt Kean saying he would be “carefully examining” it to ensure that it would not results in a surge in prices for households.
