The Senate has passed Labor’s energy legislation with 28 in agreement and 22 in disagreement during a special sitting of Federal Parliament last Thursday.
The bill is to cap gas prices and fund consumer rebates to deliver power price relief.
However Federal Member for Nicholls, Sam Birrell, has said there is no guarantee the Greens-Labor deal to cap gas and coal prices will deliver short term relief, and that it’s clear it risks a price explosion in the medium term as investment and supply plummets.
“I fully understand the pressures major industries are under and know they need immediate relief to provide certainty for their operations into 2023, but market intervention on this scale is bound to have unintended consequences,” Mr Birrell said.
“Energy price relief was urgently needed, the method of achieving it is the problem.”
Mr Birrell explained gas is an important transition fuel which is increasingly being relied on for electricity generation to fill the energy gap created by the shift away from coal fired generation.
“Gas is critical to support the transition to renewables and the solution to upward price pressure is to increase supply,” he said.
“The Victorian Labor Government cannot escape blame, it has failed consumers by shutting down exploration and development of new gas reserves, and now Federal Labor has intervened by dictating the price, putting at risk investment, exploration and future supply. The less gas in the system, the more we will pay for it, it is the simple economics of supply and demand.”
Mr Birrell said the direct relief for households was never contested but at best, according to the Government, this will only reduce the projected increase in electricity bills next year from 36 per cent to 23 per cent.
