Federal Energy Minister Angus Taylor has hosed down talk of an energy royal commission, saying the electricity sector is listening to consumer concerns and that he is optimistic about the future of power prices.
At a conference in Sydney yesterday, Mr Taylor said electricity prices had been coming down and that the big power companies were starting to listen to both consumer concerns and the threat of government action.
“I’m actually pretty optimistic. I’ve been talking to the energy companies at length,” he said when asked what could trigger a royal commission.
“I think there is a recognition from everyone that we all have to lift our game to deliver a better outcome for customers.”
The sector has been buzzing in recent weeks with talk that the Attorney-General’s office had drafted terms for a royal commission into energy.
But there has also been a growing view that the government’s appetite for a royal commission has dimmed ahead of the coming election, in light of the turmoil that led to the ousting of Malcolm Turnbull and the calling of an inquiry into aged care.
Mr Taylor’s comments appear to confirm the reduced appetite for a commission and a pullback in rhetoric accusing power companies of driving up prices.
“If the industry focuses ·on consumers, customers and their interests, government can return to the light-touch regulation we would all prefer,” Mr Taylor said.
“Work with me to deliver and the big stick can go back into the bag.”
The talk will be welcomed by big and small energy companies.
Last week, Citi said Origin Energy was “50-50” on whether a royal commission would be called, citing a briefing with chief financial officer Lawrie Tremain.
Mr Taylor pledged to take a retailer reliability obligation that had been a feature of the dumped National Energy Guarantee to the COAG Energy Council this month.
“While the NEG is confined to the past, we support the resurrection of the reliability mechanism in some form,” he said.
But the architect of the NEG rejected the government’s assertion the scheme was dead, saying the Energy Security Board continued to work on the policy.
Prime Minister Scott Morrison declared that the “NEG is dead” last month after the contentious energy policy fell apart due to opposition from a pro-coal element of the Liberal party.
But ESB chair Kerry Schott said it was premature to write the policy off.
“The COAG Energy Council, which employs me and set up the board, has issued no instructions to us to stop work on the NEG,” Ms Schott told the conference.
“Declaring the NEG dead is premature, I think. The reliability part of it is still alive and is about to be legislated in South Australia.”
Ms Schott criticised politicians’ inability to agree on a settled policy. “While the NEG wasn’t the greatest way to do things, it meant everyone in the industry knew that when solar and wind were going up it needed to be firm. We really need to get back to something that has these things co-ordinated together.”
The ESB chair added she was still working through the stage of “grief” over the NEG. “I haven’t left anger yet,” she said.
Ms Schott said she did not think a royal commission into energy companies was needed.
At the conference, federal opposition energy spokesman Mark Butler said Labor was talking to stakeholders about whether the NEG was still a good way to underpin confidence.
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