Chris Bowen won’t guarantee Labor’s pledge of $275 cut to electricity prices

Energy Minister Chris Bowen won’t guarantee Labor can still deliver its election promise of a $275 cut to power prices by 2025, after the electricity crisis drove wholesale prices through the roof.

Energy Minister Chris Bowen won’t guarantee Labor can still deliver its election promise of a $275 cut to power prices by 2025, after the electricity crisis drove wholesale prices through the roof.

The power bill cut was a major part of its Powering Australia policy taken to the election.

Just a month into government, Mr Bowen would not guarantee the full amount promised will be passed on to consumers in the wake of the crisis, saying “figures will move around”.

But he insisted that Labor’s policies for more renewable energy would still put “downward pressure” on prices.

Minister for Climate Change and Energy Chris Bowen. Picture: AAP Image/Steven Saphore

“Our policies are even more important in light of what we’re dealing with,” Mr Bowen said at the National Press Club on Wednesday.

“In light of the fact that we have been dealing with this crisis … in light of the fact the default market offer has gone up after the election … all that makes our task harder.

“Renewables are the cheapest form of energy, So it is more than ever to get them into the system. And they will achieve downward pressure on power prices.”

While short spikes in wholesale power prices are not passed on to consumers, sustained high prices are.

Power prices were already expected to rise 12.5 per cent prior to this month’s energy crisis, with Grattan Institute’s Tony Wood previously predicting the crisis will create “significant” price hikes this time next year.

Opposition energy spokesman Ted O’Brien said it was clear Mr Bowen did not have a plan to deliver its pledge for lower power prices.

“Labor promised a cut in power bills only last month. Every Australian household and business expects nothing less than full delivery of that promise,” Mr O’Brien said.

Opposition energy spokesman Ted O'Brien, Sunshine Coast. Picture: Patrick Woods.

Mr Bowen also said the Queensland government moving to hike royalties on coal was “entirely appropriate, but a matter for them.

“I completely understand the need for states to ensure fair revenue for their residents from resources that are under their ground,” he said.

He also revealed the prices of electric vehicles will drop by $2000 from July 1, promising this would be the one of the first acts of the new Parliament when it sits next month.

While Parliament doesn’t sit until the end of the month, Mr Bowen said laws cutting certain taxes on EVs would be backdated.

The Labor Government will also attempt to legislate its 43 per cent emissions reduction by 2030 target in that first sitting fortnight, which will see it have to negotiate with an emboldened Greens crossbench in the Senate to get it through.