ACT warns Liberals: no energy deal with only 48 hours' notice

The ACT has warned it will be impossible to sign up to a deal when state energy ministers meet next Friday if jurisdictions only have 48 hours to consider the detail of the national energy guarantee.

The territory government in Canberra has been raising concerns about the design of the Turnbull government’s national energy guarantee for months, and has the power to scuttle the scheme because any changes to the national electricity market require a consensus.

The ACT’s minister for climate change, Shane Rattenbury told Guardian Australia on Wednesday he was looking to be constructive on the Turnbull government proposal, but not at any price, and not in a tearing rush.

Rattenbury warned his federal counterpart Josh Frydenberg ahead of a press club address he is scheduled to make on Wednesday that the states would need more than 48 hours to assess the detail of the scheme.

The design principles are currently being worked up by the Energy Security Board before being circulated to governments ahead of next Friday’s gathering.

“We do need to have adequate time to examine the material. If we get it in the middle of next week it is unreasonable to make a deal on the future of Australia’s energy market with 48 hours of reflection,” Rattenbury said ahead of the Frydenberg address.

He said the ACT wanted an outcome, not an impasse, but expressed concern that energy policy was once again becoming part of an internal proxy war within the Coalition, and a casualty of the Turnbull’s government’s internal power struggles.

“Frankly everyone is going to have a give a bit here, and to be honest the Coalition backbench has been the most intransigent,” the territory minister said.

“I think the positions the backbench has taken in the last week – they have actually hardened their agenda – they are not showing signs of looking to collaborate, and that is really concerning for the national interest.”

“We are definitely at the table and keen to talk, but we can’t be unduly dragged to the bottom of the pool by the hardened position of the Coalition backbench.”

Rattenbury said there was absolutely no question that Australia needed to settle a decade of climate and energy wars, and he predicted his state colleagues would look to do that in the event there was a deal to do.

“We do need to strive to find a common ground here, we need to get reform in the national energy market, there is no question about that, we just need to make sure that it isn’t a system that is so disastrous that it really will stymie progress into the future,” he said.

“If the outcome is so bad that there can’t be a peace found around it then it won’t provide the certainty that we are striving for here. If we sign off on a scheme that lacks adequate ambition, this issue won’t be settled.”

The ACT has commissioned expert analysis which identifies a number of deficiencies in the national energy guarantee, starting with a lack of ambition on emissions reduction, through to a number of technical problems associated with the as yet undefined reliability obligation to be imposed on retailers.

Rattenbury said the ACT has two layers of concern – firstly, a broad, in-principle policy concern that the Turnbull process locks in low ambition on emissions reduction for electricity, and that will ultimately force higher cost emissions reductions in other sectors of the economy if Australia is to conform with its Paris targets.

Then there are a number of specific concerns the ACT has about the impact of the proposed national energy guarantee on actions already underway in the territory.

Rattenbury raised one such issue, which was the idea that emissions reductions under the national energy guarantee would need to be reported regionally.

“In the ACT we have set up our wind farms in South Australia, Victoria and northern NSW,” the territory minister said.

“They would all be out of our NEG region, and if they didn’t count we couldn’t use those to acquit our emission reduction targets and we had to go and buy our energy somewhere else – we’d end up effectively paying twice.”

“That’s one example of a technical issue we need to overcome to protect the ACT’s specific interests.”

Frydenberg will use Wednesday’s national press club outing to warn his colleagues that “extreme ideologies” and polarisation in the climate and energy debate will only lead to more policy paralysis, and ultimately sanction short-termism and heavy-handed government intervention.

With colleagues actively disrupting the efforts of the leadership to bed down the national energy guarantee by calling for the nationalisation of the Liddell power station, and for the government to build new coal-fired power plants, Frydenberg will counsel colleagues to put down the cudgels.

The deadline for the meeting of state and territory energy ministers next Friday has collided with an outbreak of unrest within the government triggered by the loss this week of the 30th consecutive Newspoll – a metric Malcolm Turnbull used to take the leadership from Tony Abbott in 2015.