Businesses are pleading with the federal government to deal with the energy sector as rising power prices hit their bottom lines.
The Turnbull government in turn has kept its sight on state policies that lock up the gas reserves it says are vital to ensuring affordable and stable electricity.
“If the Labor Party wants to go around chasing Green votes and preventing the access to gas resources, then that has one obvious consequence: it makes gas more expensive and less available,” Prime Minister Malcolm Turnbull told reporters in Darwin on Sunday.
“It undermines business because they don’t have the energy they need.”
Energy Minister Josh Frydenberg met representatives from steel manufacturer BlueScope last week, who delivered a blunt message.
“They said to me that the issue of energy security and affordability was a matter of survival for their company,” the minister told ABC TV.
Key senate crossbencher Nick Xenophon also called for more gas power to be brought into Australia’s energy mix.
But he said the government should look seriously at an emissions intensity scheme to make Australia’s electricity supply more stable.
The government ruled out such a scheme, which would make generators pay for excess emissions, a day after suggesting a review of its climate change policies may consider one.
“More and more experts are saying that that is the best way to reduce power prices and ensure security of energy supply,” Senator Xenophon told ABC TV.
“There’s a toxic culture of politics in Canberra that seems to prevent people sitting down together in a room from all sides of politics and thrashing this out and working it out.”
The government has been promoting high efficiency, low emissions coal-fired generation as a way forward but there is no appetite in the energy sector to build new coal plants.
Taxpayers could help pay for coal-fired power plants through the Clean Energy Finance Corporation but at the moment its rules say it can only fund new generators that have half the emissions of existing ones.
Even with the latest technology, coal power can’t meet that requirement without using carbon capture and storage.
Mr Frydenberg confirmed the government is considering changing the corporation’s rules to relax that 50 per cent emissions reduction requirement – a move that would require parliamentary support.
Senator Xenophon said coal was still quite dirty and it seemed to him clear the way to meet international emissions reduction obligations was to have more gas-fired generators in the short term.
“Once we get battery storage perfected, then you can let it rip in terms of intermittent forms of energy supply,” he said.
NSW Premier Gladys Berejiklian called for a balanced approach to energy security through a strong national framework and a mixture of power sources.