An integrated net-zero electricity system depends on governments restoring faith in the market delivering enough power to the right places at the right time.
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Why the Hunter Valley gas plant is bad policy
The Kurri Kurri gas fired power station will neither cut power prices nor add useful capacity. But it will push energy investment risk back onto the taxpayer.
Tom Parry
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It’s been more than 30 years since the National Electricity Market was put in place. The reforms included the separation of the ownership of generation from networks. And, importantly, the privatisation of most of the electricity businesses that had been in the hands of mainly state and in some cases local governments for generations.
It was generally accepted that governments weren’t the best owners of these businesses and taxpayers shouldn’t face the emerging risks in the evolving energy market. The reforms to energy markets arising from the seminal Hilmer review saw the Commonwealth and states implement good bipartisan economic policy.
30 April 2021
The Energy Security Board delivered a series of options for redesigning the national electricity market on Friday, but many energy industry players say the package has left some significant gaps in its proposed reforms, including addressing the sector’s greenhouse gas emissions.
“What should have been a pathway to steer the energy market towards net zero emissions is underwhelming in its vision. Instead, it proposes not only significant changes that delay the transition, but more importantly, recommendations that result in higher energy prices for consumers,” Stephanie Bashir from Nexa Advisory told RenewEconomy.
“The ESB’s Physical Retailer Reliability Obligation recommendations, if approved by the States, would require retailers to buy and surrender certificates from firm generators, effectively creating new revenue streams for coal and gas-fired generators.”