Interview with Sally Bowrey and Matt Doran, Channel 7, Sunrise

Sally Bowrey and Matt Doran
National Electricity Market

MATT DORAN: Well, parts of Australia have narrowly avoided blackouts for now, as four major generators came back online at the 11th hour on Friday. That was after the Australian Energy Market Operator put a pause on the energy market and won't hand back control until this assurance from energy generators that they will supply the amount of electricity required.

SALLY BOWREY: Now, this was sparked by private generators withholding energy supply one even threatening to pull the plug on the system. For more on this, we're joined by the new Federal Energy Minister, Chris Bowen. Thank you for your time this morning, Minister. Can we just start off could you believe it when you were told a power generator was threatening to pull the plug?

CHRIS BOWEN: Well, good morning, Sally. And certainly, the Australian Energy Regulator and AEMO have been in regular contact with the generators. And the regulator, on behalf of the Government, has been making very clear the obligations of the generators. And many generators have responded very well to the Government and AEMO's requests. And certainly, AER, the Australian Energy Regulator, has been making very clear their legal obligations which the Government and the Australian Energy Regulator expects them to comply with. Because as far as I'm concerned, the government is concerned, consumers come first. And where the regulator is acting on behalf of consumers, they have our full 100% backing. But look, we do think we may be through the worst to this. We're very vigilant, we are very alive to the fact that something else can go wrong yet. But I do want to say that it's quite an achievement of everybody involved through the energy system that we've gotten through this crisis so far without any blackouts, without any load shedding. And that's a testament to everybody who's worked really hard over the last week and a half or so.

MATT DORAN: It's an achievement, Minister, but we shouldn't have had the crisis in the first place, should we? Should have been able to foresee this.

CHRIS BOWEN: Absolutely. Well, absolutely, Matt, absolutely. And this is the result of a decade of chop change energy policies, not enough investment in energy storage, not enough investment in renewable energy, not enough investment in transmission to get the energy around the grid. I mean, the system really isn't fit for purpose. So we've got a short term plan to keep the lights on and that's so far worked. And then we got a long term plan to get more investment into the system, more transmission lines up and running, more storage so we can store the renewable energy for when we need it. That's really important. This transition, I call it a transformation, it's more than a transition is going to be really hard to manage. There hasn't been enough investment. That's why we’re in the mess we're in. But we're getting on with the job and fixing it.

SALLY BOWREY: Yes, but there is a time frame now where we're going to be dealing with the threat of these blackouts for time to come. I mean, come Summer, are we going to be plunged into this again? When are we going to see the end of this crisis?

CHRIS BOWEN: Well, look, I've said before it's going to be a bumpy Winter and part of this transformation is that the energy needs and generation changes. So in the old days, Summer was the tough period for the energy system because everybody had their air conditioning on. Now you have more and more solar in the system and some are really pumping energy in the system. So pressure more comes on in winter. That's just part of the transformation. That doesn't mean that you don't do it, it means you manage it very carefully. So that's why we need storage. Batteries are just part of it. Batteries are very short term storage, they're good and necessary, but we need long term storage as well. And that's all that investment that we need. That's why I'm so pleased that State and Territory Ministers agreed with me a couple of weeks ago that we're going to now have one nationally integrated plan for the transformation about all the investment that's necessary. That's what's been lacking for a decade. As I said before, we just got to get on with it now. We don't have a minute to waste.

MATT DORAN: It's great to hear you're saying that, Minister, and you're right, we do need a national plan and we do need these things to come into effect urgently. But for people at home who are watching, they're just looking at the prices and the cost and they're worried about the power staying on. Do you think it's realistic to say that we can see prices come down in the near future

CHRIS BOWEN: Well, Matt, the situation in energy markets caused at the moment by a lot of different issues. We've had the war in Ukraine, we had a lot of coal fire power station outages, they're coming back on, we've had some coal shortages, States and Territories are working hard to manage that. But ultimately, as I said, more renewables in the system means cheaper energy because the sun doesn't send us a bill, the wind doesn't send us an account. And that's what we need more of in the system that will put downward pressure on energy prices. That's what our election policy was all about, reducing energy prices by doing that. But that won't happen until we get the transmission and the storage and it's all firing. And that's exactly what I'm working on every day to get that underway.

SALLY BOWREY: But when will we see this additional electricity coming to the system?

CHRIS BOWEN: Well, look, as I said, you don't fix ten years of delay in ten days, which is about what amount of time we've had. But I've already in my discussions with the sector and with renewable energy providers and transmission providers. I've already seen their enthusiasm. A new government in town that gets it, that gets the framework. I was speaking to a big conference of investors just on Friday. They're raring to go to get on with it. What we needed was a government that provides the policy framework and the certainty there's no shortage of investment cash.

MATT DORAN: When you pick up your phone to the Minister in those first ten days, and you've got the enthusiasm too, you're only asking one question, it's when, what are they telling you?

CHRIS BOWEN: Yeah, absolutely.

MATT DORAN: Is it months? Is it years?

SALLY BOWREY: What is the time frame?

CHRIS BOWEN: We've got to build 10,000 kilometres of transmission wise across this country to get this right. Now, that's not going to happen this year. We can start, and we have started and we are starting, but it is not going to happen immediately. But what we can do is over the next few years, get it built, get the downward pressure on energy prices through renewable energy. I think Australians understand that you don't fix this in a day, and we've never pretended we can, but what we can do is start on day one and that's exactly what we started to do. And you will see new investment coming on board. We've got our policy community batteries which will roll out around the country, that will help as well. We've got to do it all, we've got to do all the above, but we've got to get on with it. But we've got to get it right and we're doing all that at the same time.

MATT DORAN: It's a big job you've got there.

SALLY BOWREY: It is a big job. Minister, just quickly, obviously we don't have an energy system, we have an energy market. So given the crisis we've got, do the rules need to be rewritten for the market?

CHRIS BOWEN: Well, as you know, we suspended the market on Thursday, AEMO in consultation with me and all the State and Territory Ministers in the market. Suspend the market, that was 100% the right thing to do. That put consumers first and then helped us avoid blackouts. The market will come back on when AEMO is 100% satisfied that it should. In the meantime, I mean, I'm constantly talking to my State and Territory colleagues yesterday, today, all the time, and we will continue to look at what reforms are necessary. We've already changed some of the rules. We'll continue to look at what rules need to be changed. There's a real spirit of cooperation between the States and Territories; Labor, Liberal and the Green Energy Minister as well. We're all working together. I think that's what the country expects. And if a change needs to be made at any point, we've shown already we're prepared to make them.

MATT DORAN: Well, good luck with the job. Energy Minister Chris Bowen, thanks so much for joining us on Weekend Sunrise

CHRIS BOWEN: Thanks, Matt. Thanks, Sally.