DAVINA SMITH:
Treasurer, thank you so much for your time this afternoon. Let’s talk dollars. How much money will households save and where will they start to see this flow-on effect?
TREASURER:
The first estimate from the independent Energy Security Board was $115 a year for households and this is an important saving for families who are facing cost-of-living pressures. But more than that, it’s lower cost energy for more reliable energy that also meets our environmental commitments. So, this is what Australian consumers have been looking for and that’s what this plan delivers.
SMITH:
It’s a lot of pressure on households at the moment. The average household paying around $600 more on power than what they were a decade ago – $115 a year doesn’t remove that gap though, does it?
TREASURER:
Well, it goes a long way and any saving is an important saving and this isn’t the only thing we’re doing – that’s just for this measure. Already householders are benefitting from the pressure we’ve put on the energy retailers and on the gas providers, that has already seen gas prices come down and people are already getting better deals from their retail energy providers and so this is part of a much bigger plan that we’re already implementing.
SMITH:
It’s very much an issue of trying to weigh up sustainability and doing what’s right for the planet versus ensuring that people actually have power in their homes. How do you balance that as a Government which is what we’ve seen the issue being today? And you’ve set this energy target – this energy guarantee, I should say – just run us through what the meaning is, this energy guarantee?
TREASURER:
Well, the national energy guarantee has two key components. One is that it has a reliability factor which the retailer has to deliver and an emissions factor which they have to deliver on as well because that’s what consumers are telling us. They want to meet our environmental commitment but they want the prices to be lower and they want it to be more reliable. So you put that together and that’s what the scheme delivers. There are no more subsidies. I mean, the Labor Party under their plan will make people pay $66 billion – sixty-six thousand million dollars – in subsidies that aren’t needed anymore because the costs of renewables is coming down. They can stand on their own two feet, so it’s not demanding that the energy come from any particular source, they’ll find the best way to do that at the cheapest price and that’s put the biggest pressure down on power prices.
SMITH:
The change of stance on renewables and there’s focus now on energy guarantee is very much something that Tony Abbott pushed for – it was an option that he wanted to see. Does this prove that he’s still a very powerful voice in the Party room?
TREASURER:
Tony expressed his reservations about it today so I don’t know if that analysis holds but what we know is that what we’re doing is meeting our environmental commitments and putting downward pressure on power prices. Australians want both of those things. They don’t want to pay more subsidies that aren’t needed. That’s what Bill Shorten will give you an electricity bill on - $66 billion worth – what we have got is $115 cheaper power prices, that’s what the Energy Security Board has advised and further work will be done on that. So, it’s about more energy, cheaper and more reliable, and meeting our commitments on the environment.
SMITH:
If we move away from the politics of this, having a clean energy target was a recommendation by Australia’s Chief Scientist Alan Finkel, highly and widely respected, what makes Cabinet think that they know better on this stance than the Chief Scientist does?
TREASURER:
We’re taking the advice of the Energy Security Board. It was actually the Chief Scientist who recommended the setup of an Energy Security Board and that was done by COAG, that was done by all the states and the Commonwealth, and they’ve come back, having looked at that clean energy target and they’ve come back and said, “This is actually an even better way to go”. And so, the savings a figure, we can be absolute about our commitments on the environment and we can deliver far more reliability to families and households and businesses that they’re demanding and we can deliver under this scheme.
SMITH:
So, how quickly do you think these savings can be passed on to households? When will they start to see the benefit of it all?
TREASURER:
As I said before, they’re already seeing savings from the pressure we’ve put on energy retailers and on the gas companies. This scheme will be introduced as soon as possible, potentially in South Australia as soon as late 2018-early 2019, but if it can be done quicker than that, you can be assured that we will be moving heaven and earth to achieve that.
SMITH:
Treasurer Scott Morrison, thank you so much for your time this afternoon.
TREASURER:
Thanks, Davina. Thanks for your time.