Coal is seen as the most reliable of the energy sources especially during periods of peak demand and the federal government opted for reliability of energy in the eastern states following the politically damaging blackouts in South Australia last year.
The move was welcomed by the power generation industry, which had been calling for policy certainty to ensure long term investment in energy.
Energy Networks Australia said the focus on reliability and security in the new National Energy Guarantee was welcomed but policy stability was essential if there was to be downward pressure on energy bills.
“While the government’s commitments to target reliability and system security are important, any policy can only succeed if it can garner a broad political commitment that lasts beyond a single election cycle,” Energy Networks Australian interim CEO Andrew Dillon said.
“The measures announced today will need careful review, but stable energy and carbon policy will help meet the grid modernisation challenge, keep the lights on and make power bills more affordable.
“There are a range of policy options that can effectively manage the energy transition to deliver lower costs to customers without picking technology winners.
“We have to get beyond schoolyard debates about what is the best policy. This country has learnt the hard way that no climate policy will work if it is only in place for a couple of years.”
Dillon said to be successful both sides of politics and all levels of government had to work together to provide certainty to investors – whether they were utilities, new innovators or households – so they could make decisions without unnecessary political risk.
He said Energy Networks Australia would study the National Energy Guarantee closely to understand its impacts on energy networks and consumers, as well as actively participate in the consultation process.
Environmentalists have criticised the government’s decision preferring instead the more rapid take-up of renewables.
GetUp national director Paul Oosting said both pollution and power prices will go under the new energy plan.
“The power sector will be more polluting under this policy than if the government did nothing at all,” he said.
“You can’t simultaneously force us all to use more fossil fuels and reduce carbon pollution.
“This policy denies the science and the chief scientist and as a result denies Australians a safe future. Climate change is already causing more extreme heatwaves, bushfires, and cyclones.
“This is not a plan to cut climate pollution or fix our broken national energy market.”
Oosting said crippling investment in renewable energy was also bad news for power bills.
“Renewables are the cheapest way to increase the amount of electricity in our system yet the Turnbull wants to force Australians to pay a handful of old energy dinosaurs to keep out of date technologies running,” he said.
Oosting said in September, wind and solar generated more energy than gas.
“With clean energy from the sun and wind, backed up with batteries, we can fix our gas crisis, cut power bills and clean up our climate,” he said.
“Australians know that clean energy is the solution to the Turnbull government’s energy debacle – 96% of us want renewables to be our main source of power.”