The Energy and Emissions Reduction Minister in Australia’s conservative Liberal-National government, Angus Taylor, has scheduled a discussion with state and territory energy ministers about the planned overhaul of the government’s Emissions Reduction Fund (ERF), a move following the government’s decision to quietly appoint an expert panel to come up with new ways to cut greenhouse gas emissions.
According to the draft agenda for today’s Council of Australian Government (COAG) energy council meeting, obtained by Guardian Australia, the federal government has scheduled a discussion about the $2.55 billion ERF, now rebadged the Climate Solutions Fund (CSF), at the long delayed meeting of federal and state energy ministers.
Ahead of today’s meeting, the first in nearly 12 months, Mr Taylor has signalled he wants to pursue a series of deals with the states to roll out new power generation and transmission, an approach that has followed the government’s decision to ditch the National Energy Guarantee (NEG).
The NEG was a casualty of the federal Liberal party’s leadership tussle last August, which say then Prime Minister Malcolm Turnbull replaced by Scott Morrison.
The government initially faced pressure from some of the Liberal state governments, including New South Wales, to revive the NEG, which was supported by most stakeholders in the energy sector.
Guardian Australia reports with the government refusing to reboot the policy mechanism that combined reliability standards and emissions reduction for electricity, the states have in more recent times pursued a specific wish list of projects they want assistance with.
Mr Taylor has not ruled out the side deals including direct assistance for emissions reduction in the states, and the government has been quietly pursuing an overhaul of the ERF, appointing a panel of four business leader and policy experts to suggest options to expand it.
The conversation at the COAG meeting today is expected to seek state and territory buy-in for the planned overhaul of the fund, which has been heavily criticised for failing to deliver substantial emissions reduction from the industrial sectors of the economy.
It is likely the states will want cash from the fund to drive abatement in their jurisdictions.
A discussion paper flagging the ERF overhaul, first reported by Footprint, said the fund had been successful in generating carbon offsets from native vegetation and landfill projects, largely because they cost relatively little and do not require businesses to make substantial operational changes.
However, it said the scheme had done little to cut emissions through energy efficiency projects and from industry, agriculture and transport, in part due to high upfront and transaction costs.
The ERF works as a reverse auction, rewarding landowners and businesses that make cheap, viable bids for taxpayers’ support to cut pollution.
The most recent auction bought emissions cuts equivalent to only 0.01 per cent of Australia’s annual greenhouse gas pollution after officials found just three projects worth backing.
Ahead of today’s meeting, Victoria’s state Labor government has asked the federal government to fast-track work on the Kerang link, a transmission line increasing power transfer capability between the Snowy Mountains region and Melbourne.
The request from Victoria follows a similar pitch from the New South Wales Liberal-National government, which has asked the federal government to underwrite new generation to replace the aged coal fired Liddell power station, and either underwrite or de-risk new investments in transmission that have been highlighted as urgent by the Australian Energy Market Operator.
EcoNews is an independent publication that relies on contributions from its readers.
WE’RE BUILDING A PLATFORM WITH A CLEAR FOCUS ON THE ENVIRONMENT, CULTURAL AND SOCIAL GOOD. CONTRIBUTE AND TOGETHER WE CAN MAKE AN IMPACT.
