Queensland energy plan: good directions, but follow-through will determine affordability

“The State Government’s new plan for Queensland’s energy future sets a sensible course out of the increasingly unaffordable status quo, but success is far from guaranteed,” Rebecca Andrews, Queensland Head of national employer association Ai Group said today.

“Queensland businesses need reliable, clean and competitively priced energy to thrive. The Queensland Energy and Jobs Plan foreshadows dramatic change over little more than a decade. Most existing generation would retire or transition to providing backup and system services. Huge new renewable generation, energy storage, transmission and customer-side energy resources will be needed.

“We share the Government’s hope that this new energy system can be delivered smartly and cheaply enough to provide an enduring advantage to Queenslanders. There is no doubt that the costs of the existing energy system are mounting.

“Thanks to the war in Ukraine and its impact on global prices for coal and gas, Queensland wholesale electricity futures prices have nearly quadrupled over the past year. Businesses seeking new energy contracts are getting offers that are double or more what they pay now. The next few years look to be painful for energy users, and the Government’s flagged measures to help energy users with efficiency and energy management will be important.

“From affordability to emissions, there’s strong motivation to walk the path Queensland is laying out. There are plenty of risks that could make us stumble in the process, however.

“The governance of the plan, and the quality of analysis and consultation behind the choice and configuration of new projects, will be vital to ensure we tie together good projects into an efficient energy system. Queensland’s planning and the national Integrated System Plan will have to work together.

“Building all the new infrastructure will strain supply chains and available skills. There is opportunity for Queensland and the other states in this; we can have a competitive part in meeting huge needs for materials, componentry and skills across the country and our wider region. But the cost of clean energy is largely in building it, not running it; unless we are productive and efficient at the outset of these projects, we will not have an energy advantage at the end. Employment conditions and content requirements have to be reasonable.

“Constructing new transmission and large scale renewable energy zones will require environmental and economic regulatory decisions to be expedited while meeting community expectations of thorough scrutiny. Tensions over new projects elsewhere in Australia show how hard this can be.

“There is much detail left to be filled in through the next stages of the design and investigatory work the Government has flagged. That is sensible. More work and consultation will reveal new problems and opportunities and enable a better ultimate plan than one set in stone today.

“The Queensland Energy and Jobs Plan recognises the scale of change required to meet our energy needs. The real challenge will be delivery,” Ms Andrews said.

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