PIAA defends Finkel Report

PIAA defends Finkel Report
Macaulay accuses politicians of breathtaking arrogance over energy report response

The PIAA says the Finkel report on the national electricity market needs political unity and fair consideration to help deliver affordable and reliable energy.

Dr Alan Finkel presented his final report of the independent review into the future security of the national electricity market to the Council of Australian Governments (COAG).

Andrew Macaulay, CEO, PIAA says, “Despite early statements suggesting political unity, political parties and interest groups seem to be staying in their various climate-corners. Given our energy situation, this political arrogance is breath-taking.

“Finkel is unlikely to have gotten everything right, but people must take to time to digest his report and consider what should result. After all, over a prolonged period, political leaders have squandered opportunities to head off our energy crisis, delivering instead a mish-mash of diverging and sometimes destructive political wish-lists. We can’t afford any more of that. Now is serious decision time.”

[Related: PIAA draws line under past, booking $1.27m loss]

Macaulay adds, “Above all, the printing industry needs cheap and reliable energy. Beyond this, we will consult with members to ascertain their views on what should be done in the wake of the Finkel Report.”

After the state-wide blackout in South Australia last year, COAG engaged chief scientist Dr Alan Finkel to inquire into energy stability and reliability. The Federal Government said it wanted secure and reliable supply, with sustainability an objective.

Macaulay says, “Finkel’s Report makes key assumptions to claim to be technology neutral with no prohibitions, just incentives for energy producers, plus that consumers will pay less. However, these assumptions depend upon the level at which Parliament sets clean energy targets to replace current renewable energy targets.  This politically-set level will determine which producers get subsidies, whether coal is effectively cut out of the market and whether consumers will pay less.”

The report acknowledges that the adoption of renewable energy has caused security and reliability problems and suggests that any new provider of renewable energy must guarantee back-up supply for example, by battery and therefore reliability.

Finkel also recommends a new over-arching bureaucracy - an energy security board to implement and coordinate national monitoring of security and reliability.

Macaulay says, “The emerging crux of the political debate seems to be whether there must be a future for plentiful, reliable and cheap coal.  Arguably, Finkel’s nominated clean energy target will cut out coal.  A group of Coalition back-benchers, led by Tony Abbott, says that coal cannot be cut out. Labor and the Greens essentially want an end to coal. 

“The Greens are not too keen on gas either.  None of this bodes well for a unified political outcome. Our early impression is that the Finkel Report could be positive.  But it will only be so if it results in unified political action.”

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