Turnbull's new energy plan: What it means for power companies, consumers

Australia reportedly plans to ditch its clean energy target in favour of coal power generation. A proposal announced on Tuesday stated that energy companies in Australia should deliver a certain level of dispatchable power from ready-to-use sources like coal, gas, hydro and batteries.

The Turnbull government has decided not to pursue a proposed clean energy target, as was suggested in a report from Australia’s Chief Scientist Alan Finkel. A new so-called National Energy Guarantee will be implemented instead. It will replace the Clean Energy Target, which will be met in 2020. There will be no more subsidies for renewable power.

Power bills are expected to drop by $100 to $115 per year from about 2020 to 2030. Energy Minister Josh Frydenberg said the scheme would provide investment certainty and praised the system for its simplicity. The government also said the new plan has no tax, no certificates and no subsidies.

Australian Prime Minister Malcolm Turnbull has announced the plan, saying green sources of energy were now financially viable. He said previous energy plans have subsidised some industries, slugged consumers and punished others.

Turnbull assured there is no need for a subsidy. "In other words, they can compete on a level playing field,” he added, according to SBS.

The latest energy plan will require electricity retailers such as Origin, AGL and Energy Australia to ensure they limit their carbon dioxide emissions under enforcement mechanisms. This is yet to be tackled with state governments.

Electricity companies will now be forced to limit the carbon dioxide emitted in making the power they sell to a certain amount, which is yet to be legalised. The government maintained it is still committed to meeting the nation’s international carbon targets under the Paris agreement.

Canberra is expected to phase out subsidies for renewable energy from 2020. However, critics warn that such move could dent its ability to comply with emissions reduction targets set by the Paris climate agreement.

Earlier this year, Finkel laid out 50 recommendations on energy policy in a report. The government said it would adopt 49 of them before it announced it would not adopt the 50^th, which is a clean energy target.

Coalition backbencher Craig Kelly said the government's new plan was "superior" to the target proposed by Finkel. “This plan does more to tackle the issue of reliability and it also will help put further downward pressure on prices," he said.

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