TV CAMERAS captured a tense moment between Energy Minister Josh Frydenberg and Labor frontbencher Joel Fitzgibbon, with the two locking horns over energy policy.
“Josh, I think you’re embarrassed,” Mr Fitzgibbon told the minister in the corridors of Parliament House on Tuesday morning.
“I think you’re embarrassed because every day you’ve got to roll out and support the prime minister’s desperate attempts to mislead the Australian community.”
Mr Frydenberg was having none of it, telling Mr Fitzgibbon — who he later labelled “no-coal Joel” — that Labor was prepared to turn its back on a million households.
“You’re defending the big energy companies who are making big profits,” the minister said.
Mr Fitzgibbon responded by saying: “Off the back of the high prices you created.”
Both Labor and Liberal parties are blaming each other for problems with Australia’s power grid as authorities warn of more blackouts if more baseload power is not introduced to compensate for the closure of coal-fired power stations.
This is what’s going on:
WHY IS EVERYONE FIGHTING OVER LIDDELL?
AGL has announced it is planning to close its ageing Liddell coal-fired power station, located in the NSW Hunter Valley, in 2022.
But the Prime Minister Malcolm Turnbull is trying to get the company to keep it running for a few more years, or at least sell it to someone who will.
He wants to keep the power station open because Australia needs to maintain baseload power so it can serve as a backup when solar and wind are not available.
The energy market operator has warned there needs to be an extra 1000MW of dispatchable power — which can be sent when it’s needed — in the system before Liddell closes.
Unfortunately, Snowy Hydro 2.0, which will provide an extra 2000MW of electricity into the system, will not be up and running before 2023.
SEEMS SIMPLE, WHAT’S THE PROBLEM?
Getting AGL to agree to the keep Liddell running for longer doesn’t seem to be working very well.
After a meeting with AGL’s chief executive Andy Vesey on Monday, Mr Turnbull said he had secured a promise that Mr Vesey would ask the board to consider extending the life of Liddell or selling it to someone who would.
But it didn’t take long for Mr Vesey to create doubt over whether this would happen.
After the meeting, Mr Vesey said his company could find the best solution for the energy market while still closing the power station.
“I think that we are committed to finding the best solution for the market; we believe we can deliver that without having to consider the extension or sell the plant and that’s what we’re going to work on,” he told the ABC.
Backbench government MP Craig Kelly hit out at Mr Vesey, saying that statement was completely contrary to what he told Mr Turnbull.
“It appears AGL speaks with forked tongue,” he told ABC radio.
Mr Turnbull has since noted that AGL would benefit from closing Liddell because less supply could drive up power prices. AGL will run other power stations like Bayswater in Muswellbrook for decades to come and Mr Turnbull it was “making a fortune out of coal-fired power”.
“The only people that benefit from electricity being in short supply are the energy companies because the price goes up,” Mr Turnbull said during a press conference today.
“AGL’s management want to look after their shareholders. For them, scarcity of energy is good, because it enables them to raise prices.
“It’s not good for the Australian people. My job is to look after the people with more affordable and reliable power.”
IS THERE AN ALTERNATIVE?
Mr Fitzgibbon, who is the local Labor MP in the Hunter, supports AGL’s decision to close the power station and transition Hunter Valley’s energy sector to gas and renewables.
AGL says it will present the government with its plan to transition from coal within 90 days.
The issue with gas is that it has become very expensive in Australia after it began to be exported overseas. Its also unclear whether options like battery storage, which improve the stability of cheap renewables, can yet provide enough power to maintain the system.
But critics of the government’s plan point out that Liddell is also not very reliable, as it is always breaking down and would be very expensive to keep going.
Mr Turnbull said he thought the most obvious option was to keep the power station running but said he would consider other options that AGL was reportedly considering.
“They have not articulated what it is, so we don’t know and, frankly, I don’t think they do either,” Mr Turnbull said.
“If they had a plan, they’d be able to put it on the table now.”
Energy Minister Josh Frydenberg said keeping Liddell open longer was the only option on the table.
“I don’t think the company is placing the priority that it should be on the need for dispatchable power for the system,” he said, slamming AGL for making huge profits from coal power.