Business community unites to urge Coalition to abandon energy 'big stick'
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Australia’s biggest energy and business groups have banded together to urge the government to abandon its “big stick” approach to energy legislation, warning the divestiture powers the government craves will impede investment and create genuine sovereign risk.
Scott Morrison and Angus Taylor threatened to break up Australia’s energy companies if power prices didn’t come down – by utilising commonwealth divestment powers never used before in Australia – through legislation due to be introduced to parliament this week.
The proposal, labelled an “extreme measure” by the energy sector, had already created waves in the Coalition party room, with dissenters uncomfortable with the prospect of such a dramatic market intervention.
The move has prompted the Australian Energy Council, Australian Industry Group, the Business Council of Australia and others to join together to appeal to the government to abandon its plans, which it says will “specifically discourage badly needed investment in the energy sector”.
“The signatories to this statement are robustly opposed to the creation of unilateral divestment powers for the treasurer. Such discretionary and quasi-judicial powers represent deep and genuine sovereign risk,” the open letter to the government reads.
“They are inconsistent with best practice for a modern economy, such as Australia’s, and were specifically considered and rejected by the ACCC and the Harper competition policy review.
“If enacted, these powers would cast a pall over investment in all sectors of the Australian economy and threaten the economic attractiveness of a country highly reliant on foreign investment.”