The Federal Opposition has responded to the Federal Government’s 2020-21 Budget, outlining a plan to invest $20 billion in rewiring the electricity grid to allow Australia to adapt to changing energy markets and become a renewable superpower.
Federal Labor stated that, if elected, it would rewire the nation to drive down power prices, giving the economy a boost of up to $40 billion and create thousands of new jobs – particularly in regional areas.
Australia should be a renewable energy superpower, according to the Labor Party, but the country’s electricity transmission system is “desperately outdated”. They argued that Australia’s transmission system doesn’t properly integrate the full capacity of the growing renewables sector, let alone unlock its potential.
Federal Labor Leader, Anthony Albanese, said, “Australia’s electricity network was designed for a different century, and transmission systems themselves are operated by monopoly providers who keep taking households and businesses for a ride.”
“Australians don’t just pay for their power, but for the cost of building and operating the grid and then a hefty price on top.
“Only Labor will tackle this head on with a modern grid, more jobs, cheaper power prices and the reliable energy our country needs to power industry into the future.”
Labor’s Rewiring the Nation plan would invest $20 billion to rebuild and modernise the grid, in line with a blueprint already completed by the Australian Energy Market Operator and signed off by all governments.
Modernising the grid is expected to provide thousands of new construction jobs for Australians, many of those in regional areas.
It may also revitalise traditional industries like steel and aluminium and allow growth in new sectors like hydrogen and battery production.
Fixing transmission is technology neutral and will allow the market to drive least cost, reliable new energy production, according to Labor.
By establishing the Rewiring the Nation Corporation (RNC) and keeping it in public hands as a government-owned entity, Labor said it will ensure the grid is rebuilt at the best price possible.
The RNC would partner with industry and provide low cost finance to build the Integrated System Plan. The end result is expected to be cheaper electricity prices for homes and businesses.
Labor said it would ensure Australia’s modern energy grid would be built by Australian workers using Australian suppliers by mandating local supply and local labour.
Shadow Minister for Climate Change and Energy, Mark Butler, said, “There is a race for renewable energy jobs and investment around the world and Australia should be leading that race.
“As more renewable energy gets built, we need the transmission network to support it.
“That’s why Rewiring the Nation is a no-brainer. It ensures Australia’s modern energy grid will be built by Australian workers using Australian steel at the lowest possible cost.”
The Clean Energy Council welcomed the commitment to establish a Rewiring the Nation initiative, stating that a 21st-century economy needs a modern electricity network that supports reliability, security and lower emissions technologies, and delivers low-cost energy to consumers.
The Clean Energy Council’s pre-Budget submission included a call to establish a future transmission fund and deliver the 2020 Integrated System Plan (ISP) developed by the Australian Energy Market Operator.
The ISP identifies the highest priority transmission projects with a clear business case to benefit electricity customers concerning the price, security and reliability of the energy system.
The Clean Energy Council said the challenge remains as to how to deliver these projects as quickly as possible.
While network service providers and private investors have demonstrated a strong willingness to own and operate new transmission infrastructure, the regulatory regime is not fit-for-purpose in providing certainty for them to make the necessary financial investments in these long-lived assets promptly.
For over a decade, the clean energy industry has called for reform, particularly to the Regulatory Investment Test for Transmission (RIT-T), to speed up transmission build for the benefit of consumers.
The Clean Energy Council said the recent rule change to integrate the ISP into the first stage of the RIT-T is a step forward, but more is still required.
The Clean Energy Council said that this has been demonstrated by the more direct and recent initiatives from governments to accelerate and underpin transmission investments, including through the Federal Government’s Grid Reliability Fund.
However, there is still a need for a more significant role for the Commonwealth Government to accelerate these strategic transmission projects to unlock the next wave of renewable energy investment, drive down power prices and deliver an economic and jobs boost.
The Clean Energy Council said it welcomes the Labor Party’s commitment to accelerating this investment and look forward to further consultation to ensure the program leverages the massive capacity and capabilities of the private sector and unlocks Australia’s enormous renewable energy potential.