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Petulant Premiers must plug into energy reform.



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1 September 2003

PETULANT PREMIERS MUST PLUG INTO ENERGY REFORM

State Premiers and Chief Ministers have a national responsibility to call a special meeting to progress the energy market reforms which were sacrificed when they walked out on Friday’s CoAG meeting.

Federal Industry Minister Ian Macfarlane is also calling on state energy ministers to seek an explanation from their jurisdictional leaders as to where energy reform has been left by Friday’s walk-out.

“This is a devastating loss of opportunity. The Premiers have turned their backs on the first real chance to address a growing hole of investment in energy infra-structure. We’re up to an investment tag of about $20 billion over the next 10 years and counting,” said Mr Macfarlane.

“By walking out I can only assume they are prepared to foot the bill themselves and take that $20 billion out of health, education and roads funding. All the State leaders had to do was agree to what their energy Ministers have already signed up to - the establishment of the Australian Energy Regulator,” he said.

Agreement on the establishment of the Australian Energy Regulator (AER) was extended at last month’s meeting of energy ministers to include the setting up of a national regulatory framework for electricity distribution and retail, to come under the AER by 2006.

“We - the energy ministers - have moved a long way in the last 10 months. There’s a real sense of urgency to reform the electricity and gas markets because the current regulatory structure is simply scaring would-be investors away. It is simply too confusing to invest in the current energy market,” said Mr Macfarlane.

“We needed Friday’s CoAG approval to reassure the industry that all the work done to date has not been in vain and, more importantly, so they could start planning for future investment under a new, simplified regulatory structure.”

Energy consumption in Australia has grown at an average of 3.7 percent over the last five years. Consumption is now double what it was in 1983 and ten times what it was in the 1960s.

“It’s unbelievable that with the black-out dilemmas of New York and London so fresh in everyone’s minds, the Premiers chose to turn their backs on reform in the most basic of services. They are already living in the dark if they think this issue can be ignored for any longer,” said Mr Macfarlane.