This is definitely a matter of public importance because, still, Australian households and Australian businesses find themselves in the throes of a deep energy crisis, and under this Prime Minister—this new Prime Minister—and this new energy minister, this crisis is simply getting worse.
Last week, the Leader of the Opposition, the shadow Treasurer and I released a comprehensive, fully costed plan to take charge of our energy system again and to put consumers back at the centre of this essential, largely privatised service. The centrepiece of the announcement that we made last week was an offer, as we said time and time again in question time today, to resume negotiations and to finish the work on the National Energy Guarantee that was so close three months ago.
About the National Energy Guarantee: those opposite are trying to forget this little inconvenient piece of history, but there were no stronger advocates than the new Leader and the new Deputy Leader of the Liberal Party back when they were the Treasurer and energy minister in the Turnbull government. The new Prime Minister, when he was Treasurer, for example, said that this idea, the National Energy Guarantee, had the broadest support of any initiative he had seen in his more than 10 years in parliament. He said:
If you're not for the National Energy Guarantee, then you're for continued uncertainty which leads to higher prices.
On another occasion, he said that the NEG was the 'only credible plan to reduce electricity prices in Australia'.
Now, this was a plan—somewhat like the Clean Energy Target in 2017, which almost got there, and somewhat like the emissions intensity scheme in 2016, which almost got there—that had the support of every single business group in Australia. It had the support, broadly, of every state government in the National Electricity Market—Labor and Liberal alike—in Australia. It was something that the Leader of the Opposition, the shadow Treasurer and I had said, time and time again, was a model we thought was workable and which could be subject to agreement between the two major parties in this parliament.
But, again, it was subject to a veto exercised by a loud minority in the coalition party room, led by the hard Right. Time and time again over the last few years, sensible policy fell victim to the hard Right of the coalition party room. This is the group that the member for Higgins, quite famously over the last 48 hours, has called out as the 'homophobic, anti-women, climate-change-denier faction of the Liberal Party.' Our offer last week was genuine, because we have heard time and time again, not just over the last few weeks but particularly since the National Energy Guarantee was dumped by this new Prime Minister, that the best solution to this deep energy crisis in Australia is a bipartisan solution.
Since we made this offer back on Thursday last week almost every serious business group in the country has again called on the Prime Minister and the new energy minister to accept our offer and to sit down and resume negotiations on the National Energy Guarantee. Again, as we raised in question time, the former deputy leader, the member for Curtin, this week said on a couple of occasions on a front page from the Financial Review, 'Do NEG deal with Labor.' The member for Curtin said:
The government needs to consider energy policy through the prism of securing bipartisan agreement with Labor, to establish a long-term, stable regulatory framework that will support private-sector investment in generating capacity.
Not a new message, it is a message that has been given to this parliament, both sides of this parliament, time and time again by business groups that are struggling with the energy crisis that has emerged under this government in various prime ministerial forms.
Labor is clear about the National Energy Guarantee. This framework is a means to an end. The important end here is delivering investor confidence that is able to renew our aging, increasingly unreliable electricity generation system, much of which was built 30, 40 years ago. As I have said, as the assistant shadow minister for climate change and energy, some 75 per cent of our generators in the NEM are already operating beyond their design life. Whether it's an inconvenient truth over on the other side of this parliament or not, they simply have to be replaced. To be replaced, particularly given the privatisations led by Liberal state governments over the last 25 years, we need the investor certainty that the member for Curtin has rightly pointed to.
The National Energy Guarantee must be capable of delivering on Labor's commitment to 50 per cent renewable energy by 2030. That is a core condition for the Labor Party and it is also the nub of the problem we encounter on the other side of this parliament. The hard Right of the coalition party room is so deeply opposed to renewable energy for its own sake that they are willing to cripple investment and prolong this energy crisis that is biting household budgets and business viability. The hard Right continues to force the Liberal-National Party into positions like dumping the National Energy Guarantee, a policy that the now Prime Minister has said time and time and again would lead to lower power prices and increased reliability in our system, and had broader support than any other initiative he'd seen in his 10 years in parliament.
The hard Right position, and their stranglehold over climate and energy policy, forces the Liberal Party at different levels in this Federation to continue to run campaigns against Labor's renewable energy policies and campaigns that instead propose using taxpayer funds to build coal-fired power stations. Over the last 12 months we've seen two of them: in Queensland 12 months ago and in Victoria a couple of weeks ago. How did they go for the Liberal Party? How in touch are they with the sentiments of the community of Australia about what they want to see the future of their energy systems look like? This is a party under the control of the hard Right that is too busy fighting the inevitable future. For the time being at least, energy policy in this government remains in the hands of the hard Right of the Liberal Party.
The new energy minister boasts that now his only focus is on getting down power prices. We heard the Prime Minister boast about decisions that AGL and EnergyAustralia have announced over the last 48 hours or so, decisions that were initiated by the Labor Party being the first party to accept the ACCC recommendation about default capped pricing—a decision the Labor Party took that was then followed by the former Prime Minister, Malcolm Turnbull. They don't point out, of course, that the AGL and EnergyAustralia announcements amount to less than three per cent of households in Australia, nothing for more than 97 per cent of Australian households. And we know what is going to happen for the other 97 per cent of Australian households, because the government's own modelling indicated that a failure to deliver the National Energy Guarantee wouldn't see power prices come down by $550, which the NEG would have, but instead would see power prices rise by almost $300. A failure to deliver that bipartisan policy would see power prices rise.
We are already seeing that. As we've seen reported in the Financial Review time and time again, futures prices—the prices that the market is expecting in 2019—in the NEM have already risen by 40 per cent in the wholesale market over the last few months, as this new fellow took over the energy ministry. That is what the coup against Malcolm Turnbull and the National Energy Guarantee is delivering for households.
Other than playing catch-up on the Labor Party's initiation of default capped pricing, what has this government done? It has pulled out the big stick in the form of an investment policy that is reminiscent of the height of Venezuelan socialism—just an extraordinary piece of recklessness. If it was in the interests of consumers, perhaps the consumer watchdog might have recommended it after its 18-month retail price inquiry. It deliberately didn't recommend it. Such a grab bag of vapid, fatuous headlines—that's all we have from this new energy minister. We have an idea of building coal-fired power stations; that has gone really well in Queensland and it went really well in Victoria.
This new energy minister has even said he would be prepared to indemnify the operator of a new coal-fired power station, something the Australian Industry Group has suggested could cost taxpayers as much as $17 billion. These are the headlines this energy minister has put up in place of a bipartisan framework that was supported by every single business group in the country. There is nothing on renewable energy, nothing on a just transition for workers in coal-fired communities, nothing on batteries, nothing on the transition to the 21st century energy system that Australian households and businesses are crying out for. Why is that? It is because, although this deep energy crisis is of the government's making, the paralysis in the coalition party room means that they have no plan whatsoever to address it.