Our Plan

Issue 03

Lower Power Prices

The Morrison Government is committed to reducing power prices.

During six years of Labor Government, power prices doubled and went up each and every year.

We understand Australian families are struggling with the cost of living and rising power prices have a big impact on their household budgets.

Small businesses, the backbone of our economy, are also struggling with rising power prices. This prevents them from being able to employ more people and take advantage of new opportunities.

We are taking action to lower prices. Our plan for affordable, reliable power includes: a price safety net to protect customers; a big stick to stop energy company rip offs of customers; and a technology neutral program to underwrite new reliable energy generation.

This builds on previous measures to lower energy costs, including: requiring power companies to provide better deals; securing priority gas supply for Australia; and putting downward pressure on network costs (which are passed on to customers) by stopping the energy networks from gaming the system.

Our plan for affordable, reliable power is already getting results.

AGL, Energy Australia, Origin, Alinta and other retailers have cut prices for customers on standing offers by up to 15%. This means half a million families and small businesses will benefit from lower power prices from 1 January.

On average, savings for residential customers are:

  • $200 in NSW
  • $313 in Victoria
  • $272 in South Australia
  • $175 in South East Queensland

Bill Shorten wants to replicate South Australian Labor’s 50% renewable target on a national level, which will mean higher electricity prices and greater unreliability. This is like a tax on electricity.

Labor also wants Australia to go far beyond the rest of the world and cut carbon emissions by 45%. This reckless policy will damage our economy and cost local jobs.

Under Labor’s emissions intensity scheme, households will pay more on their power bills.

Labor’s true thinking was revealed by its Environment Action Network, which said: “high prices are not a market failure – they are proof of the market working well.”

State Labor policies have continued to increase pressure on prices through shortages in gas supply, unrealistic renewable energy targets, and open hostility to reliable baseload power.

Under Labor, Australians will be stuck with higher power bills.

OUR PLAN FOR AFFORDABLE, RELIABLE POWER

We are taking action to lower power prices. Our plan will help families with the cost of living, support small businesses and help Australia’s economy. We will:

  • Take a big stick to the energy companies to stop rip-offs. This includes banning sneaky late payment penalties, requiring savings in wholesale prices to be passed on to customers, and cracking down on dodgy, anti-competitive practices.
  • Create a price safety net to protect customers. This will stop customers being penalised for loyalty. It will provide relief from confusing and often expensive standing offers.
  • Back investment in new reliable power generation to improve competition, lower prices and guarantee supply.
  • Require energy companies to sign contracts guaranteeing enough energy to meet demand.

MORE GAS SUPPLIES

The Government is securing more gas for Australians, through the Australian Domestic Gas Security Mechanism. This gives Australians priority access to gas before it is exported.

We have secured agreement from gas producers to cover projected shortfalls (of up to 107 petajoules) over the next two years.

The ACCC has found our actions have reduced wholesale prices by as much as 50%.

New regulations will also improve gas transportation, which accounts for 15% of the cost.

However the best way to reduce gas prices is to encourage more exploration. State-based moratoriums on exploration and development are keeping prices high.

For example, Victorian domestic gas has not been development, which means Victorians pay a premium to get gas from Queensland. This can add around 20% to the cost of gas.

BETTER DEALS FOR CUSTOMERS

Companies will now be required to inform customers when their discount benefits cease.

Around 1.6 million families have received letters telling them they are not on the best plan.

Companies are now required to develop simple fact sheets with understandable comparisons.

Over 1 million families have now visited the Government’s Energy Made Easy switching website to get a better deal: www.energymadeeasy.gov.au

CUTTING NETWORK COSTS

We’re putting downward pressure on network costs, which are passed on to customers.

We’ve abolished the Limited Merits Review process, which allowed energy networks to appeal decisions of the Australian Energy Regulator.

If Labor had done this when they were in power, it could have saved consumers $6.5 billion.

BUILDING SNOWY 2.0

Snowy 2.0 will make renewable energy reliable by increasing storage capacity by 50%. This will add 2,000 megawatts of renewable energy capacity – enough to power 500,000 homes.

Snowy 2.0 will also create 5,000 jobs.

RECORD INVESTMENT IN RENEWABLES

2017 was a record year for investment in renewables for Australia, with investment increasing by 150%.

According to Bloomberg New Energy Finance, Australia is one of the top 10 most attractive countries in the world in which to invest in renewables.

REDUCING EMISSIONS

Australia will meet the emissions requirements of the Paris Agreement.

Australia beat its first Kyoto target by 128 million tonnes of greenhouse gases. We are on track to beat our 2020 target by 294 million tonnes.

The Government has committed to a responsible emissions reduction target of 26% to 28% below 2005 levels by 2030.

The Government is supporting practical emissions reduction projects through the Emissions Reduction Fund like energy efficiency, capturing landfill gas and boosting soil carbon.

We have secured more than 190 million tonnes of emissions reductions at a low average cost of less than $12 per tonne.

This compares to Labor’s Carbon Tax, which reduced emissions by less than 12 million tonnes at a cost of $15.4 billion – around $1,300 per tonne.

Information current as at December 2018