Scott Morrison last night delivered his 2017-18 federal budget which included a commitment from the government to deliver affordable and reliable energy through its energy security plan.
He reiterated a number of prior announcements including; Snowy Mountains Scheme 2.0, expansion of pumped hydro storage schemes in Tasmania, and a $110m equity investment in a solar thermal project in Port Augusta, South Australia.
The Federal Government announced it’s in negotiations with New South Wales and Victorian State Governments to buy Snowy Hydro outright. The government currently owns 13% and experts are quoting a price around $6 billion to purchase the remaining share.
Unfortunately, there was no certainty given to any future policies around carbon or renewable projects beyond 2020.
The Energy for the Future Package included the following expense measures under Environment and Energy:
- $19.6 million over four years from 2017-18 for the Gas Market Reform Group to accelerate reforms to improve transparency and efficiency in the gas markets;
- $28.7 million over four years from 2017-18 to encourage and accelerate the responsible development of onshore gas for the domestic market;
- $7.6 million in 2017-18 for pre-feasibility studies and cost-benefit analyses of constructing pipelines to link Northern and Western Australia gas reserves to the east coast, through Moomba in South Australia. Australian Energy Market Operator (AEMO) will receive funds from this allocation to study potential improvements to the National Gas Services Bulletin Board to improve publication of real-time gas availability. This will allow the market operator, businesses, and investors to make informed decisions about gas market operations;
- $30.4 million over four years from 2017-18 for new combined geological and bioregional resource assessments to assess the potential impacts on waterways and aquifers in three prospective onshore unconventional gas sites;
- $13.4 million over four years to support an Energy Use Data Model to improve forecasting and planning for energy markets – a critical measure to ensure the future energy market is more responsive to the needs of all consumers. The Model is an online data platform which links existing and new energy use datasets to deliver improved market forecasting and research outcomes.
Treasury expense measures for the Energy for the Future package included figures for previously released policy on gas and electricity monitoring by the Australian Competition and Consumer Commission (ACCC), which included:
- $6.6 million over three years from 2017-18 to the ACCC to establish a monitoring regime for the gas market. The ACCC will use its inquiry powers to compel the gas industry to provide greater transparency of transactions in the gas market, including factors affecting supply and pricing;
- $7.9 million in 2017-18 to the ACCC to review retail electricity prices. The ACCC’s inquiry will consider the competitiveness of offers available to larger business customers and consider wholesale electricity market conduct, price, and cost issues where relevant amongst other key components;
- $8.0 million in 2017-18 to extend funding support for the Australian Energy Regulator (AER), a constituent part of the Australian Competition and Consumer Commission, for a further year. This funding will ensure the AER is sufficiently resourced to undertake its legislated functions pending the outcome of an independent review of the AER’s resourcing requirements.
