NSW parliament recalled for coal cap despite leave and renovations

NSW parliament will be recalled on Wednesday to put a $125 per tonne temporary cap on the price of coal used for domestic electricity consumption.

NSW Parliament House in Sydney.

NSW parliament will be recalled on Wednesday to put a $125 per tonne temporary cap on the price of coal used for domestic electricity consumption – but MPs won’t be able to sit in either chamber because both have been closed for renovation.

The energy legislation supports an approach agreed on by national cabinet to cap coal and gas prices to reduce pressure on electricity bills and aligns with measures passed in the federal parliament last week.

Those measures, passed with the support of the Greens and teal independents, included a gas price cap of $12 per gigajoule for 12 months and $1.5bn in targeted bill relief for low and middle-income households and small businesses.

A predicted 36 per cent rise in electricity prices would be cut by 13 percentage points and inflation reduced in 2023-24 by about a half percentage point, according to the federal government.

Premier Dominic Perrottet said the cap on coal and gas prices would help drive down the cost of energy for households and businesses, with an estimated average saving of $230 per household in future power bills.

The NSW government expects to lose about $150m in royalties as a result of the caps.

A string of the industry’s biggest players – including Woodside, Origin and BHP – have hit out at the legislation with claims the caps would trigger an investment drain and supply gaps.

Mr Perrottet is on leave this week but will return on Wednesday to support the energy legislation.

NSW Opposition leader Chris Minns supports the legislation but has blamed the government’s zeal for privatisation for driving up power bills.

“Their addiction to privatisation – especially of our energy assets and toll roads – has left us vulnerable to price shocks,” he said.

Parliament was not scheduled to resume until after the state election in March.

MPs will not be able to sit in either chamber, as all furniture has been removed from both the Legislative Assembly and Legislative Council for a $22m refurbishment.

A government spokesman said “alternative arrangements” elsewhere in parliament were in place for the sittings.

A Queensland government spokesman confirmed the state’s parliament did not need to be recalled to pass the federal government’s energy relief package. He said most of the state’s power generators were government-owned, meaning any price cap would be enforced by a ministerial direction.

Resources companies will this week launch a $40m campaign against Queensland’s coal royalty tax after the government increased the top coal tax rate from 15 per cent to 40 per cent in the June budget.