Government unveils $1bn energy deal

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April 20 2021
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The Morrison government has announced a $1.1 billion energy and emissions agreement between the federal and South Australian state government.

Prime Minister Scott Morrison announced that the deal will aim to deliver more affordable and reliable energy, unlock gas supplies and kickstart work on a new interconnector between South Australia and NSW.

The Commonwealth will contribute $660 million and South Australia will provide $422 million as part of the agreement.

“Families and businesses need affordable, reliable power. That is what reduces prices and creates jobs. Australians also want to ensure we are doing everything we responsibly can to combat climate change,” the Prime Minister said.

“This means getting more gas into the market to support the increase in renewable solar and wind power coming into the electricity system. One works with the other to deliver lower cost, lower emissions and reliable power.”

Premier of South Australia Steven Marshall said the deal will help provide jobs and lower the cost of electricity, while helping the state’s growing renewables industry.

“This agreement also coordinates our efforts to deliver a hydrogen export industry in South Australia, deliver carbon capture and storage to reduce emissions, deliver the infrastructure needed for electric cars, and generate new revenue for farmers from carbon reductions,” he said.

The proposal aligns with Scott Morrison’s gas-led recovery, which has been heavily scrutinised by industry experts.

Under the proposal, the government has set a gas target of an additional 50 petajoules per annum by the end of 2023 and a stretch target of 80 petajoules per annum by 2030 to help increase the supply of reliable and affordable gas to the east coast of Australia.

The Australia Institute’s chief economist, Richard Denniss, said there has been no gas-led economic recovery, despite the government’s claims, since employment in the gas industry has been on the decline over the past year.

“There is no gas-led recovery; we’ve recovered without gas,” he told Sky News.

“In fact, to the extent the economy has recovered – and the government’s rightly proud of how quickly the economy has recovered – it’s important to know employment in the gas industry fell 10 per cent in the last 12 months.

“So, given that we’ve already been led out of COVID, it can’t be gas-led because gas has been going backwards.

“We’ve created hundreds of thousands of jobs in the last six months, and we’ve done it without the gas industry leading it.”

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

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