Finkel review to show clean energy target could force down bills

HOUSEHOLD electricity bills would be forced down under a new national energy plan which embraces wind and solar power and more gas without forcing out coal or risking widespread blackouts.

Chief Scientist Alan Finkel’s review will be released today. Picture: AAP

HOUSEHOLD electricity bills would be forced down under a new national energy plan which embraces wind and solar power and more gas without forcing out coal or risking widespread blackouts.

An independent review into Australia’s energy market security, to be released today, is expected to show modelling that a clean energy or low emission target would place downward pressure on electricity prices as well as drive investment in renewables.

But it will likely show Victoria’s current approach — which includes a 40 per cent renewable energy target, sky-high coal royalties and gas exploration moratoriums — is not sustainable.

The system — which has already won the support of major industry and business groups — would provide a more stable transition to clean energy because coal-fired power would not be driven out of the market as quickly.

Loy Yang power station in the Latrobe Valley. Picture: Aaron Francis

The review, conducted by Chief Scientist Alan Finkel, will show the policy could lead to greater investment in the energy sector, a surplus of production and a cut in prices.

The report risks reopening old wounds within the Coalition Government over energy policy, with former prime minister Tony Abbott already warning it would be a “big mistake” for the government to adopt a low emissions target which knocked out new high-efficiency coal-fired power stations.

But Opposition Leader Bill Shorten said he would “extend an olive branch” to Mr Turnbull in a bid to end the “climate change wars”

It is likely most coal-fired power stations, such as Yallourn and Loy Yang in the Latrobe Valley, would see out their “natural lives” under the government’s favoured system, rather than be forced out of business by alternate option — an Emissions Intensity Scheme.

The Finkel review is expected to advocate for major investments in electricity storage to improve the reliability of the energy market as it relies more heavily on renewable sources.

This could include wind and solar farms having to install batteries to store power or other back-up systems to take over if the primary energy sources fail.

A powerful coalition of business, union and environment groups warned yesterday that “the consequences of failure are too significant to allow this opportunity to pass”.

The Business Council of Australia, the Australian Council of Trade Unions, the Brotherhood of St Laurence and the National Farmers’ Federation were among those to release a joint statement calling for politicians “to deliver clear and enduring energy and climate policy”.

[e-mail]

@rharris334