An In-Depth Review of Australia’s Energy Policies by the International Energy Agency (IEA) has found the National Electricity Market (NEM) is “world leading” while also identifying a number of key challenges facing Australia’s energy markets.
The Review’s recommendations align with reforms already under way as the Turnbull Government works to deliver an affordable and reliable energy system that will also meet Australia’s international commitments.
These include the responses to the Finkel Review into the National Electricity Market, gas market reforms and the National Energy Guarantee.
In particular, the National Energy Guarantee goes towards the Review’s overarching recommendation – for a stable, enduring policy response so that Australia can manage the energy transition already taking place. As the IEA Review highlights, the creation of the Guarantee is a welcome development in this regard, describing it as a “promising opportunity” to integrate energy and climate policies.
IEA Executive Director Fatih Birol has further said that “the government’s efforts to ensure energy security and move ahead with market reforms have been impressive”.
The Government’s National Energy Guarantee will ensure Australians will be $300 a year better off than they would be under Labor cutting electricity prices by:
- ending subsidies for energy, which are passed on to all customers;
- creating a level playing field that ensures all types of energy are part of Australia’s mix;
- providing certainty for investors – more certainty will mean more supply and, in turn, lower prices; and
- reducing volatility, by ensuring reliable energy sources which provide power when it’s needed.
The In-Depth Review also identified the threat to affordable and reliable energy due to the bans put in place by the Victorian and Northern Territory Labor governments on the development of gas.
The IEA found “there are significant concerns about the price and the availability of natural gas amid moratoriums on gas production in the eastern market”.
The Review of Australia’s Energy Policies was undertaken in March 2017 and is undertaken approximately every four years. The expert panel met with over 100 companies, industry associations and government representatives in Canberra, Sydney and Melbourne.
The In-Depth Review of Australia’s Energy Policies is available via: http://www.iea.org/publications/freepublications/publication/energy-policies-of-iea-countries—australia-2018-review.html