Billionaire technology leader and strong renewable energy supporter Mike Cannon-Brookes has expressed an interest in developing an option to replace Australia’s ageing Liddell coal-fired power plant if the conservative Liberal-National government can clearly identify the rules of engagement for any proposals.
The prime minister, Scott Morrison, said in a speech yesterday the government would back the construction of a new gas-fired power station in the Hunter Valley if the energy company AGL failed to replace Liddell.
Almost immediately Mr Cannon Brookes began engaging the Prime Minister on Twitter, demanding to know what the rules of the proposal were and indicating he would come up with a renewable solution.
Mr Cannon-Brookes later told Guardian Australia the prime minister needed to be clear about what the government was proposing and then let the market sort out the optimal replacement.
“Would I seriously have a look at this? Yeah, why not,” the tech billionaire and co-founder of Atlassian said.
“Let people come and bid, don’t force the solution and declare the outcome.
“What I’m saying is declare the rules and put it out to the market and that will get the best outcome for consumers.
“Be clear about how much money you are going to put up, don’t say if it’s a gas plant I’ll put up $500 million but renewables don’t need any subsidy, that’s literally what Mr Morrison said, renewables don’t need the subsidies, but gas does.
“I mean, what? Giant fossil fuel companies need subsidies to extract gas and export it? No, they don’t, that is bullshit. So, declare the rules of the game. That’s the way to get assets built.
“If those rules existed, would I, potentially, with friends, be interested in looking at them seriously and potentially putting in a bid? Absolutely. Give us the rules, let’s start by putting the rules together.”
Mr Cannon-Brookes said Mr Morrison had put a confusing proposition into the public domain when he outlined the next steps in the Liberal-National government’s gas-led recovery from COVID-19.
Mr Morrison had argued his government was “technology agnostic but we are going to go and build a gas plant, that doesn’t make sense”.
“The engineers, the scientists, the economists, nobody is asking for that thing, so just be clear,” Mr Cannon-Brookes said.
“If you are going to say I am building a gas plant, just say I’m building a gas plant, don’t smoke it with ‘lower prices’, this will result in higher prices.”
In his speech, Mr Morrison pointed to new commitments in the October budget, including funding of $52.9m to unlock more gas supply and boost transport infrastructure.
In a warm-up for substantial budget commitments, Mr Morrison held open the option of taxpayer underwriting for priority gas projects, streamlining approvals or creating special purpose vehicles for new investment.
However, he said “renewables like solar and wind don’t need subsidies”.
The government says it is giving the private sector until the end of April 2021 to reach final investment decisions on 1000 megawatts (MW) of new dispatchable capacity to replace Liddell, with a commitment for generation in time for summer 2023-24.
If the commitment is not forthcoming, the government said it would take steps to ensure the required dispatchable capacity was built.
The Australian Energy Council, which represents major electricity and gas retailers, said the government, with threats of heavy-handed intervention, was actually risking the investment it said it wanted.
The council’s chief executive, Sarah McNamara, said when it came to the energy market, “there are no material reliability concerns that would warrant this kind of interventionist approach, and there are already mechanisms in place to address any shortfall identified”.
She said the most recent assessment by the Australian Energy Market Operator (AEMO) identified a potential shortfall in New South Wales of only 154MW.
Ms McNamara said lack of policy certainty was the most substantial restraint on investment.
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