Energy costs won’t come down much in the near term as Australians brace for higher electricity prices on July 1, admits Energy Minister Chris Bowen.
Acknowledging the impending price hike, Mr Bowen said it would take time to implement the government’s plan to switch to renewables and strengthen the energy grid.
“It will take some time for our policies to work. I think people understand that you don’t fix 10 years of neglect in 10 days,” he told the Nine Network on Thursday.
“We have to build 10,000 kilometers of transmission cables for our system to be operational. You don’t do this in six months, you don’t do this in a year.
Mr Bowen also criticized the former government for delaying the announcement of an electricity price hike due on July 1 until after the election.
“The former government sat down on this before the elections. It was to be released under the new government, the news that energy bills were rising,” he said.
“The former government knew about it but did nothing to get the numbers out before the election, surprise, surprise.”
Bowen also flagged the introduction of the capacity mechanism, which will help boost energy supply, from 2025.
“I would like that to happen sooner than that. I will work with states and territories to try to make sure that happens, I have been clear about that,” he told the TAUT.
“It’s an important safety net.”
The Liberals slammed Labor for telling Australians their electricity prices would drop if they were elected.
“The sense of panic that comes from Chris Bowen at this time was not there when the Coalition was in government,” Opposition Leader Peter Dutton previously said.
“What’s happening with the economy right now – I mean, it’s still happening under the watch of the Labor Party.”
The suspension of trading in the national energy market eased from Thursday morning after the market operator indicated there would be enough capacity for homes and businesses.
Following a “significant improvement” in energy conditions, the Australian energy market operator said it would begin a step-by-step process that would bring the market back to normal.
The system was destabilized last week, prompting AEMO to take control to stabilize power supplies.
The energy market was able to start pricing again from 4 a.m. Thursday.
The market operator intends to completely lift the unprecedented trading halt after monitoring conditions for 24 hours.
AEMO chief executive Daniel Westerman said there would be a step-by-step approach to lifting the suspension. He said there had been a big improvement in the market, with about 4,000 megawatts of generation being sent back to the power grid after outages.
“That means the risk of any revenue shortfall has gone down significantly,” Westerman said.
“We know that many generators are working hard and closely with governments to improve confidence in their fuel supply, to ensure they are able to operate at the desired level of production.”
The market operator said it expected the system used to schedule power generation into the grid to work without failure.
This is due to a low volume of shipments to generators and a reduction in forecast power shortages as electricity providers respond to market signals.
Australian Industry Group chief executive Innes Willox said the recovery in the domestic energy market was a sign of easing pressures in the sector.
However, he said the situation was far from normal.
“[This] is the first step on the road to energy hell and purgatory, we could be here for a very long time,” he said.
“We are not back to normal and there is no reason to relax.”