Morrison Government could force state-owned power generators to sell assets

QUEENSLAND state-owned electricity generators could be forced to sell assets if they manipulate prices under the Morrison government’s planned energy laws.

QUEENSLAND state-owned electricity generators could be forced to sell assets if they manipulate prices under the Morrison Government’s planned energy laws.

Treasurer Josh Frydenberg and Energy Minister Angus Taylor reassured MPs that state-owned generators could still be targeted by “big stick” divestiture powers despite watering down the planned measures.

“The Queensland state-owned generators are on notice,” Mr Taylor said. “We want to see lower prices and a stronger focus on customers. This legislation applies to all private and government-owned electricity companies.”

But the government faced criticism from former deputy leader Julie Bishop, who told a Coalition party room meeting the plans were inconsistent with Liberal values.

Fellow Liberals Craig Kelly, Jason Falinski and Russell Broadbent also criticised the plans, with NSW MP Mr Falinski questioning their ability to cut prices in regional Queensland.

Prime Minister Scott Morrison tried to placate critics, telling them the energy sector was not a “free market nirvana” but a “bastardised market”.

Another 14 Liberal and National MPs spoke in favour of amended laws in the party room yesterday but some of them raised philosophical concerns. Some Nationals want the laws to go further and apply to other industries such as supermarkets.

Queensland LNP MPs Keith Pitt and George Christensen gave spirited endorsements of the laws in the meeting but Mr Pitt left open the option of opposing them if they were not as tough as promised.

A 2018 Grattan Institute report found Queensland's government-owned generators were best at gaming the system, pushing up costs for households.

In a watered-down version of the planned laws, generators can only be forced to sell assets after this is recommended by the ACCC and ordered by the Federal Court.

The planned laws will not force privatisation but could demand assets be moved into a separate government-owned entity which is in direct competition.

The new laws will be introduced to the House of Representatives this week but debate may be delayed until next year.

Labor opposes the measures, which opposition treasury spokesman Chris Bowen mocked as a “Venezuelan-style intervention”.