SUBJECTS: Liddell Power Station; Australia’s Energy Crisis; Energy Prices
SKY NEWS THE MORNING SHIFT
WEDNESDAY, 6 SEPTEMBER 2017
LAURA JAYES: We’ve seen a statement released to the ASX in just the last couple of minutes from AGL who has said that AGL is committed to the closure of Liddell Power Station in 2022, the company has made no commitment to extend its life beyond that period or even sell it off. This despite suggestions from Malcolm Turnbull, the Prime Minister, in Question Time yesterday and even as late as yesterday evening. To respond now the Member for Hunter and Shadow Minister Joel Fitzgibbon. Joel, what do you make of all this?
JOEL FITZGIBBON, SHADOW MINISTER FOR AGRICULTURE, FISHERIES, FORESTRY AND RURAL AND REGIONAL AUSTRALIA: Well Laura, it smacks of political opportunity and of course it’s just highlighting the chaotic nature of this Government. But I am angry for the workers I represent and all those consumers out there who are genuinely worried about energy prices and are looking to a government to act on their behalf but, instead, all we get and see is this spin from this PM. He has no plan. He had a phone call, a phone call we now know he misrepresented to both the Parliament and the Australian people. We need to get on with securing an energy policy for this country and we all know that there is an opportunity to do that, that is, the full embrace of the Finkel recommendations.
JAYES: The AGL boss, Andy Vesey is going to meet with the PM and Josh Frydenberg on Monday. Could this just be AGL in a bit of brinkmanship here trying to get the best deal for their company?
FITZGIBBON: Laura, I’ve been operating in the knowledge now for a decade that Liddell would close sometime in the not too distant future. We have known for some years now that it would be 2022 and I have been pushing working towards energy transition so that the Valley, the Hunter Valley, can remain the powerhouse of NSW and there is an opportunity to do so. And AGL can play a role.
JAYES: But if AGL pull out in 2022, that pulls a fair amount of baseload power out of the grid so how will that be replaced? What’s wrong with extending the life for five years if the Government can put tax-payer funds towards that, is that something the Labor Party would consider?
FITZGIBBON: Well first of all the Government’s not proposing to put tax-payer funds.
JAYES: Not yet.
FITZGIBBON: Josh Frydenberg walked away from that this morning at a rate of knots. But Liddell is a power station almost 50 years old. I’ve been talking to AGL about this. It’s very difficult to extend its life, it would take at least half a billion, probably a billion dollars, to get just a few more years out of it and even then it would be less reliable than it is now. But AGL want to stay in the Hunter, they want to stay in energy generation and I want my workers to transition to those new forms of energy. We have the transmission lines there, the land there, the skills there, the supplies of gas if we can get that side of the equation right. AGL wants to be part of that, they’re not looking to rip people off, they just can’t keep operating a generator which is now 45 years old.
JAYES: We have a situation here where for years a lack of bi-partisanship on this issue has really created the situation that we are in now.
JAYES: There’s fault on both sides, both from the Labor Party and the Coalition. What happens now, because we saw Mark Butler with David Speers last week signal that there could be some kind of bipartisanship but it can’t just be the government moving to the left as some would say, how much ground are you actually willing to give here? Does coal-fired power need to be part of the solution going forward?
FITZGIBBON: Well let me first challenge the idea that it’s not all their fault, I mean John Howard, Malcolm Turnbull, Brendan Nelson, Kevin Rudd, Julia Gillard and now Bill Shorten have all made commitments to a market based mechanism for dealing with the carbon issue. It was only when Tony Abbott came along and promised to unravel it all now five years ago that things went awry.
JAYES: Sure, we can get into the history wars here but this is now reaching crisis point.
FITZGIBBON: Well let’s get some bipartisanship on a clean energy target.
JAYES: But can coal be part of that mix?
FITZGIBBON: Well let’s talk about being agnostic on technology. No one would be happier than me as the local Member if we can extend the life of coal in the Hunter, but the problem is the people who make these investments are saying they’re not the least bit interested.
JAYES: But if there’s a tax-payer subsidy like there is for renewables it might be a different [inaudible].
FITZGIBBON: Well let me say, for a new coal power generators for example you needed to operate for at least 40 years to get a decent return on investment. You and I don’t know what the energy outlook is going to look like in 10 years’ time let alone 40 years’ time.
JAYES: But this is the whole problem, certainty, right? These companies do not have the certainty to do that.
FITZGIBBON: They need certainty in all technologies. For AGL to develop the sort of technologies they would like to see operate in the Hunter they need that certainty now and the certainty is not there and this intervention by the PM, this stunt is just going to further confuse the investors. Now the rules have changing on a daily basis and you know, you’ve got the PM of the country talking now about extending coal fired power generation.
JAYES: If Liddell could be extended by five years it would be good for your constituents.
FITZGIBBON: Nobody would be happier than me but it’s a 45 year old generator. I’ve been socialising with my constituents the idea that within five years, sadly this things will be gone and trying to drive new investment in new technologies and that investment won’t flow while Malcom Turnbull is confusing the market talking about possibly throwing money at an old generator that’s clapped out.
JAYES: Can I just ask about Labor’s policy though. It’s not clear, what is your policy to actually bring down energy prices.
FITZGIBBON: Well energy is like any commodity, its supply and demand. In a wholesale prices have been rising because there’s been no supply.
JAYES: You’re not talking about this renewable energy target that much anymore, is that (inaudible).
FITZGIBBON: Well our aspiration for a 50 per cent renewable energy target is not affecting energy prices today and it would be laughable to suggest it is. What’s affecting energy prices today is the inability of this Government to send the right signals to investors, to build generation whether it be, you know it doesn’t matter what form of generation it is, but to build some capacity and some output. Now the added supply catching up with demand is what will put pressure on power prices.
JAYES: Minister, Shadow Minister is should say, this has been such a vexed issue for so long, there’s so much frustration in the community about both sides of politics here. When is the bipartisan solution coming and isn’t it incumbent on Labor to really outline clearly how you would get energy prices down because we hear about a yes you’re supportive of a clean energy target out of the Finkel review but there is still this aspiration for a 50 per cent renewable energy target so which is it.
FITZGIBBON: Well Malcolm Turnbull appointed Finkel but now he won’t embrace his recommendations even though we stand ready to do so. Now let’s be honest about one thing, no government can fix the damage that has already been done. And that is the lack of investment we’ve had for the last five years. We are all going to be catching up now no matter what we do and the blame for that falls entirely on this Government and it started with Tony Abbott when he destroyed the joint.
JAYES: They probably would argue that it doesn’t fall entirely on this Government.
FITZGIBBON: And they would have no facts to back that argument.
JAYES: We will talk again, Shadow Minister Fitzgibbon thanks for your time.