Coalition's public shaming of AGL another assault on imaginary energy enemies

Extract from The Guardian

all

Energy

Katharine Murphy on politics

Katharine Murphy

Malcolm Turnbull’s government doesn’t want to focus on its own indefensible failure. Instead it needs to run interference

Josh Frydenberg and Malcolm Turnbull, who declined to say whether Australia would have a settled energy policy within 90 days. Photograph: Dean Lewins/AAP

Contact author

Tuesday 12 September 2017 10.58 AEST Last modified on Tuesday 12 September 2017 17.05 AEST

If you’ve reached the stage where you can’t hear yourself think on the Marvel comic bout that is the Turnbull government versus AGL, the government has achieved its primary political objective.
So a quick word of advice. Pop on the noise-cancelling earphones and keep your clarity, because we need to be aware of what is actually going on here.
We need to start with prices. The Turnbull government has accepted political responsibility for reducing power prices to create a political point of difference with the ALP, so it desperately needs a hip-pocket strategy.

The government knows the cheapest power available at the moment is the power generated by ageing coal-fired power stations, such as Liddell in New South Wales. Hence the current push to keep it open for as long as possible.
AGL isn’t a political actor, it’s a private company. It’s working on a medium-term scenario to convert its old coal assets into lower emissions generation sources.

This is a completely rational strategy, given that’s where the energy market is going.
Self-evidently, AGL, being a private company, also wants to deliver healthy returns to shareholders and part of the way you do that is work the system as it stands and pick the market trends correctly, including the trend away from centralised power generation and consumers taking their energy needs into their own hands.
So you will gather by now there is a fundamental clash between the Turnbull government’s immediate political needs and AGL’s market behaviour and its medium-term planning for technological transition.

Styling the current fight as goodies versus baddies, and winners versus losers, just insults everyone’s intelligence.
The other thing we all need to be clear about is the government is seeking to have the fight in public.
If this was just about keeping Liddell open for a few more years, and you were a government operating in normal political conditions, you’d have a polite conversation with AGL in private.
The fact AGL is being ritually shamed and bashed up in public is telling. It tells you the government needs to run interference. It tells you they need a distraction.
So let’s ignore the WWE and be very clear.
The main problem bedevilling Australia’s energy sector at the moment is a lack of settled policy to define the investment framework. It means companies like AGL have to guess what regulations they will face in the future.
The government doesn’t want a focus on that substantive, persistent, indefensible failure. The government needs to run interference while it attempts to work out whether it is actually capable of agreeing on a new energy policy.

So while the government works out whether it can produce anything sensible to say about energy policy, enemies are being manufactured in Canberra’s boutique straw man factory.
They are running off the production line. The Labor party. Wicked AGL.
It’s cartoonish, complete with silly name-calling and shirt-fronting, and grown men rising to the bait and pointing fingers at one another in the press gallery corridor in Canberra.

James Elton-Pym (@JamesEltonPym)

Energy min Josh Frydenberg and Labor's Joel Fitzgibbon collide for corridor argument on Liddell power plant #auspol pic.twitter.com/XFjnvrYdT7

September 11, 2017

Meanwhile voters are so desperate for a fix they want the government to regulate energy prices.
There’s an irony here too.
At the meeting on Monday, the government gave AGL 90 days to produce an alternative power plan to keeping Liddell open.
But the deadlines and ultimatums only go one way. The government can’t yet guarantee that it can produce the overarching framework required to allow AGL to nail down a strategy – namely a clear energy policy for the period beyond 2020.
The prime minister was asked a direct question about this by a reporter on Tuesday morning: would Australia have a settled energy policy within 90 days, given AGL now had a concrete deadline?
Malcolm Turnbull declined to answer.