Energy ministers target reliable supply

Energy Minister Angus Taylor is discussing future energy needs with his state counterparts.
Energy Minister Angus Taylor is discussing future energy needs with his state counterparts.

Australia's energy ministers have committed to ensuring more reliable household power supply in a bid to prevent summer blackouts.

The agreement to strengthen the national reliability standard was the key outcome from Friday's meeting in Perth between federal energy minister Angus Taylor and his state and territory counterparts - the first of its kind this year.

The ministers will reconvene in March, when changes to the reliability standard are expected to be bedded down in time for next summer.

Australia's energy market operator has warned of a high risk of blackouts on the east coast this summer, while South Australia notably had widespread outages in 2016.

"The decision that was made today to focus on the reliability standards is all about maintaining balance in the system ... (delivering) power that when you flick the switch, you know it's going to be there," Mr Taylor told reporters.

"You've got to have that balance in the system. If you don't, prices go up and reliability falls away.

"We're determined to maintain that balance in the system and coal will have an important role to play for many years to come, as will gas."

The federal government has stepped away from a national approach and instead wants to ink individual deals with states and territories.

Victoria's energy minister Lily D'Ambrosio said the state had secured an agreement with the federal government to prioritise KerangLink, which would connect Melbourne with Snowy 2.0.

NSW have devised a plan which includes setting up a renewable energy zone in the state's central west and the goal of having such a reliable system that all households can still have power even if NSW's two biggest generators are down.

The government also unveiled the much-anticipated national hydrogen strategy spearheaded by Australia's chief scientist Alan Finkel.

ACT's energy minister Shane Rattenbury had sought to change the strategy so it only supported clean energy sources.

But federal resources minister Matt Canavan confirmed the strategy would also support production from fossil fuels.

"We have a really challenging task to bring down the costs of supplying hydrogen to the world," Mr Canavan said.

"Getting all of those costs down means trying different things at the moment and it's not the time to foreclose different ways of producing hydrogen which would limit our ability to reduce those costs in the supply chain."

A report by the Australia Institute showed the projected demand for hydrogen had been overstated, at times by a factor of 11.

The think tank urged the government not to rush into export opportunities using hydrogen made from fossil fuels, and instead wait until renewable sources were competitive.

Mr Taylor, who confirmed he will attend United Nations climate talks in Spain next month, insisted the government was committed to working with the states and the private sector to pursue low-cost emission reduction projects.

A UN climate science report released this year found net emissions of carbon dioxide must reach zero by around 2050 to keep temperature rises to 1.5C above pre-industrial levels and reduce the risks of climate change.

Labor's energy spokesman Mark Butler earlier warned against losing sight of renewable energy investment, accusing the government of turning its back on the National Energy Guarantee and making "secret sweetheart deals" with Liberal states.

Australian Associated Press