Ministers for the Department of Infrastructure, Regional Development and Cities The Hon Michael McCormack MP Deputy Prime MinisterMinister for Infrastructure, Transport and Regional Development Senator the Hon Bridget McKenzie Minister for Regional ServicesMinister for SportMinister for Local Government and Decentralisation The Hon Alan Tudge MP Minister for Cities, Urban Infrastructure and Population The Hon Sussan Ley MP Assistant Minister for Regional Development and Territories The Hon Andrew Broad MP Former Assistant Minister to the Deputy Prime Minister The Hon Scott Buchholz MP Assistant Minister for Roads and Transport The Hon Barnaby Joyce MPFormer Deputy Prime MinisterFormer Minister for Infrastructure and Transport The Hon Dr John McVeigh MPFormer Minister for Regional Development, Territories and Local Government The Hon Keith Pitt MPFormer Assistant Minister to the Deputy Prime Minister The Hon Damian Drum MPFormer Assistant Minister to the Deputy Prime Minister Senator the Hon Fiona Nash Former Minister for Regional DevelopmentFormer Minister for Local Government and Territories The Hon Darren Chester MP Former Minister for Infrastructure and TransportFormer A/g Minister for Regional DevelopmentFormer A/g Minister for Local Government and Territories The Hon Warren Truss MP Former Deputy Prime Minister Former Minister for Infrastructure and Regional Development The Hon Paul Fletcher MP Former Minister for Urban Infrastructure and Cities The Hon Jamie Briggs MP Former Assistant Minister for Infrastructure and Regional Development

Doorstop with Senator The Hon Bridget McKenzie, Deputy Leader of The Nationals, and Senator The Hon Matt Canavan, Minister for Resources and Northern Australia

Interview

MMI035/2018

14 August 2018

Subjects: National Energy Guarantee

Michael McCormack: Well, it's fantastic to be here with the Deputy Leader of the Nationals Senator Bridget McKenzie from Victoria and the Queensland Senator Matt Canavan, who of course is the Minister for Resources and Northern Australia.

And this morning in the joint Party Room we have agreed to—with overwhelming support—the National Energy Guarantee. For our regional, for our rural, for our remote country communities, this is going to be a good thing. This is going to put downward pressure on power prices and that's what we all want.

There's a 100 per cent commitment from the Liberals and Nationals to put downward pressure on power prices. It's been something that we've discussed for a long time now.

I commend Josh Frydenberg for the efforts that he has gone to and for the power plan that he has put into the party room, making sure that we're all well aware of just how important this is, but making sure that we respond to the requests, the demands, the expectations of the people who we serve. Those people in regional Australia, those small businesses, those families, those households who have told us that for them, power prices and making sure that we certainly put downward pressure on them, and keep doing that through the National Energy Guarantee, is so important.

That's who we represent. Those regional, country communities, those families. They want a plan, they want security, they want reliability in the system but most of all, they want affordability. They want to be able to pay for their power prices without getting that quarterly bill every time and just seeing it go up and up and up.

Now, Labor stands for something different. Labor stands for higher power prices and higher power prices means less jobs. Higher power prices means that we are going to be de-industrialised. Higher power prices and higher emissions targets. And even the fact that Bill Shorten is wanting to put in place a power policy which is just going to de-industrialise our nation, create higher power prices, and create less jobs.

I'll ask Bridget McKenzie now to say a few words and I'll ask Matt Canavan to say a few words, then we'll take any questions.

Bridget McKenzie: Well thanks, Deputy Prime Minister. I'm incredibly proud to be part of the National Party today, because for a very, very long time, we have been belling the cat on the need for affordable power in this country.

And I think if you look over all the public commentary of National Party Senators, MPs, over the years that we've been having this debate in this country, it is the National Party that has put affordability at the front and centre of everything we've said publicly on this issue.

And that is because we represent the poorest people in this nation. Every single one of our electorates has an incredibly low median income level when compared to urban electorates.

We also represent those small businesses and industries which are incredibly energy intensive and I'll just briefly touch on the food processing sector. Yes, we represent the farmers and the miners—70 per cent of our exports, employing over 1.8 million Australians—but the value-add for our agriculture, the 800,000 Australians that work in food manufacturing are located predominantly in the regions and contribute over $380 billion to our economy. And it's a high, energy intensive production work. Those cheaper power prices mean those 800,000 Australians actually get to stay employed.

So, proud of the National Party yesterday endorsing the NEG. Proud of the joint party room today to proceed with a policy that delivers reliability to the national system and I encourage State Governments to get on board. Particularly the Andrews State Government in my home state of Victoria because of their decision to tax Hazelwood out of the system.

We've seen prices in my home state increase by 300 per cent and indeed our reliability issue's become more fallible. We have a 45 per cent chance, according to AEMO, of a blackout as a result of peak times because of the instability to the system that that failed decision that the Andrews Labor Government made to my home state, a manufacturing state.

So we can all about renewables and we can talk about decreasing investment in coal-fired power generation, and indeed dispatchable power generation, but the reality is that will cost jobs because we have direct evidence the impact it has on power prices and the viability of running a business.

I was really struck by the Labor Party's response to our decision out of the joint party room around supporting the NEG and reliability, and indeed focusing on affordability. And that is: they've got nothing.

They've got a 45 per cent renewable target. We know what that will do to prices in this country. And it's not because we're dinosaurs, it's not because we are just making this stuff up. The fact is that the ACCC says investment and over-investment and over-subsidisation of renewables in our system has actually led to power price increases—this is the independent regulator. So it's not any ideology, it's fact, it's based in evidence.

And I'm looking forward to a day when we see downward pressure on prices, not just for households, but importantly for the businesses that run our economy, given that two-thirds of the energy dispatched is used by industry.

Matt?

Matt Canavan: Thanks, Bridget. Thanks, Michael.

I just want to follow on from Bridget. She's absolutely right that in regional Australia, out in the bush, we feel the pain of higher power prices even more than anywhere else. That's because that's where the miners are, the manufacturers are, our farmers—all pay through the nose when power prices go up.

It doesn't matter if you're a cane grower up in North Queensland pumping water out of the river. An aluminium smelter worker at Tomago in the Hunter Valley paying high prices to manufacture steel and metals in our country. Or if you're operating a drag line in Middlemount in Central Queensland. All of these industries use power and when power prices go up their livelihoods are put at risk.

And what we have been focused on in the Nationals Party this past year is doing all we can to keep their jobs in this country.

I am focused on keeping a strong manufacturing sector in this country, particularly metals manufacturing. I am focused on making sure we keep a strong mining sector in this country, given the jobs it provides to thousands of Australians and to do that we need to put downward pressure on prices.

To get downward pressure on electricity prices, it's not rocket science: we need to attract more investment in supply. If we get more supply of power, we'll have lower prices. That's what the National Energy Guarantee tries to do, that's what our recommendation to attract investment in base-load power does. That's what we're all about—saying yes to power investment in this country, which will say yes to lower electricity prices as well, which will say yes to thousands of jobs across Australia and secure Australian families' futures.

The other side, I was just sitting in my office just then listening to Mark Butler, the Shadow Energy Minister in the Parliament, and the Labor Party—all could hear was two things: one, they want to say no to investments in coal-fired power, and two, they want to unilaterally make us poorer by putting up tougher emission reduction targets on this country.

There are people who want to invest in coal-fired power in this country. You can see that today in the paper with Trevor St Baker, the leader of one of the major energy producers in this country, he wants to invest in coal-fired power.

The Labor Party want to say no. They want to say no to investment that will help drive power prices down. The Labor Party want to put up prices by putting even more stringent emission reduction requirements on our country when no other nation in the world is asking us to do that. There's no pressure on us to do that. No one is asking us across the world to go from 26 per cent to 45.

The Labor Party want to do it because there is one group asking us to do that, there's one group asking for tougher emission reduction requirements and that's the Greens. And if you want to know what the Labor Party are going to do to energy prices in this country you just have to ask the Greens, because the Labor Party are led by the nose by the Greens now and they are adopting Green policies that will put jobs at risk, power prices up and make it harder for Australian families to pay their bills.

Journalist: Deputy PM, what would you say to the view that if you don't set your ambitious emissions reduction targets in the NEG, you'll have to make deeper cuts elsewhere like in agriculture, to meet the Paris targets, or do you just think we should pull out of the Paris Agreement?

Michael McCormack: Our farmers are already the most environmentally responsible farmers anywhere in the world. Our farmers are already doing their part to certainly make sure that they use every available drop of water in the least possible way that's going to cause emissions rising.

They take their jobs very, very seriously. They're producing their cattle, they're producing their sheep, their grain—whatever they're doing—they're making sure that they do it responsibly, sustainably and in an environmentally friendly way.

They've done what they need to do. It's time for us as a nation to take stock and to make sure that we do meet our Paris Agreement. We are. We're more than meeting them and we're certainly meeting those targets thanks to the Coalition's policies.

We're certainly making sure that this is part of the National Energy Guarantee—it is—but in a reliable and responsible way that doesn't put households at the risk of not being able to turn their heaters on when it's winter, not being able to turn their air conditioners on when it's summer. And making sure that they don't have to crawl under the doona at 4 o'clock in the afternoon simply to stay warm at this time of year.

That's where we're coming from. We're coming from a secure, reliable system with dispatchable power that, in a way, that pushes downward pressure on prices.

Journalist: Regarding recommendation four from the ACCC's report, are you advocating for public investment in coal-fired power from Government or let market forces decide?

Matt Canavan: The ACCC recommendation asks for the Government to support the contracting of power over a long period of time for new generation. I think we should listen to the experts here, to Rod, who's consulted with thousands, hundreds and I'm sure thousands of organisations through his organisation across the country about what is needed to attract investment in our power sector.

And he is saying that to attract a large-scale investment, which will take years to pay back because it's going to be probably in the billions of dollars, you need to have certainty not just for three years, not just for four years, not just for five years, but for a longer period of time, perhaps beyond ten years.

And his suggestion is that the Government helps support that investment over that period of time with a low price—with a guarantee of a low price—and I think that's something of great sense. The Prime Minister has said that we're looking to progress and fast-track that recommendation.

It's not about the Government dipping into its coffers, it's not about the Government subsidising certain types of power. It is about the Government standing behind investment in this country that's going to lower power prices and that's all I'm focused on. I'm just focused on the result.

The means of how we get there need to be worked through but the result of our lower power prices is what Rod Sims has recommended and the Labor Party appear to be objecting to and rejecting this recommendation, and if they're doing that they're against lower power prices.

Journalist: Tony Abbot said that 12 people expressed concerns about the NEG. How many Nationals were in that number and how can you say you're 100 per cent committed to the policy?

Michael McCormack: I'm not going to talk about what was said in the party room or the joint party room. But one thing I do know, that in both the party room—the Nationals' party room yesterday and in the joint party room with the Liberal and Nationals this morning—is that they're 100 per cent focused on bringing prices down. That's what the National Energy Guarantee does.

Thank you very much.