“If the NEG is implemented by the Turnbull government … in government Labor would legislate to scale the emissions reduction target under the NEG to be consistent with our whole of economy emissions reduction target,” Mr Butler said.
“Labor does not support the government trying to lock in weak emissions reduction targets, which will stifle renewable energy investment and make meeting our international obligations under the Paris Agreement practically impossible.”
The remarks suggest Labor has further warmed to the National Energy Guarantee after the latest iteration of the policy was circulated to energy ministers ahead of this Friday’s Council of Australian Governments talks.
Labor went to the last election pushing an emissions intensity scheme, which would have achieved its target of 50 per cent renewable energy by 2030.
Labor is understood to be confident that it could deliver that target, and investment certainty, if the National Energy Guarantee is designed well – and in particular if it would allow future governments to ratchet up emissions reductions.
Any agreement at COAG would need to be passed by Parliament. If Labor won the election, it would also need parliamentary approval for its plan to lift the targets.
A leaked copy of the Turnbull government’s plans for the policy, published by Fairfax Media on Monday, suggested the guarantee will lock in an emissions reduction target for 10 years from 2021, then review it only every five years.
The energy security board, which is designing the policy, said energy companies needed certainty to manage their investments, and feedback had indicated the proposed approach struck the right balance between certainty and flexibility.
It is understood Labor would override that timing through legislation, but would seek to carefully manage the change to ensure it was not rushed.
Environment and Energy Minister Josh Frydenberg said the guarantee would deliver lower electricity prices, greater reliability and help Australia meet its emission reduction targets under the Paris climate deal.
The energy industry itself has pushed for deeper emissions cuts under the NEG, saying it could do more to carry the burden of carbon reduction for other industries.
Australian Industry Group public policy adviser Tennant Reed said: “Nowadays it’s easier to see how deeper emissions reductions can happen in the electricity sector compared the manufacturing or agricultural industries.”
Origin, AGL and EnergyAustralia have also pushed towards low or zero emissions by 2050 or earlier. One energy insider said the higher targets, if implemented, were likely to be just part of the energy sector’s journey towards their 2050 commitment.
NSW and Victoria, the two most populous states, offered divergent responses to the NEG plans on Monday.
NSW energy minister Don Harwin predicted debate over state targets within the national one would “be a large part” of Friday’s discussion among ministers.
Still, he said changes in the design to ensure greater competition compared with the initial outline were “a good step forward”, and he remained “optimistic” the NEG would “massively change the game” in Australia’s electricity sector.
His Victorian counterpart, Lily D’Ambrosio, remained concerned the states and territories had been given too little detail and time to consider it.
“We can only make the National Energy Guarantee work if we are presented with a sound policy proposal backed by evidence and consultation,” Ms D’Ambrosio said.
“We want a genuine commitment from the Turnbull government for bipartisanship in lowering emissions, growing renewables and market reform.”
Nicole Hasham is environment and immigration correspondent for The Age, The Sydney Morning Herald, Brisbane Times and WAtoday.
Covering energy and policy at Fairfax Media.
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