Interview with Craig Reucassel, ABC Radio Sydney

CRAIG REUCASSEL: Now look, getting three hours of free energy every day does sound pretty good. This is what the Federal Climate Minister and Energy Minister, Chris Bowen, is set to instruct retailers to do. It’s going to start later this year. It’s called the Solar Sharer Scheme. Chris Bowen joins us now. Morning, Minister.

CHRIS BOWEN: Good morning, Craig.

CRAIG REUCASSEL: Okay, so talk us through the Solar Sharer scheme. When’s it going to start, and who’s going to get it?

CHRIS BOWEN: So, we’re looking at 1 July next year, and we’re doing it through the default market offer. Don't mean to nerd out on your listeners, but you asked me a question. And that's the sort of regulated offer that only applies to a few hundred thousand people in the first instance, but also is a benchmark basically for every other offer. Now, the default market offer applies in New South Wales, South East Queensland and South Australia. That's just the way it's worked historically. But we'll work with other states to try and roll it out across the country a year later in 2027. And look, the principle here, Craig, is very simple. We have lots of electricity in the middle of the day, more electricity than we need. That's great for people with solar panels. And of course, more and more are saving that power for the night with their cheaper home battery. We just surpassed 110,000 batteries installed. But also we want to see the benefits of that free and sometimes, often negative-costed power shared with everyone else in the middle of the day.

CRAIG REUCASSEL: Yeah, okay. In terms of this, I did want to ask you about the default market offer part of this, because we've kind of been telling people constantly, hey, if you're on the default market offer, you're being ripped off. Make sure you're going to your energy company, getting on a better offer. Now you're going to put this on the one we've just told everyone to get off. And as you say, only a few people are in. So isn't this going to create a strange thing of people going, well, do I go back to the default market offer, or is it still going to be worth staying with the other thing? It's going to enter more confusion, isn't it?

CHRIS BOWEN: As I said, I think it provides a benchmark for everyone else. I think we can walk and chew gum at the same time. We can encourage people to shop around and make sure that they're getting the best deal. But with the best one in the world, you know, that is something that some people find difficulty doing. So that doesn't mean we shouldn't be making the default market offer as attractive as possible for those who are on it. I think we can do both.

CRAIG REUCASSEL: Do you expect that this will lead to a flow-on effect of other offers offering this? I mean, somebody on the text line actually said, we already get a free power between 10.00 and 3.00 and we love it through our power. So some energy providers are already doing this.

CHRIS BOWEN: Some are, and I would expect many more to follow with this because it becomes in effect- the D, it stands for default, right? So AGL does it at the moment. I'm not here to spruik any particular company, but just as a matter of fact, AGL does it. They do Three for Free, three free hours each day, 10am to 1pm. OVO, a smaller company, Red Energy does it, which is owned by Snowy Hydro. They do it on the weekends, four free weekend hours, and it's mainly targeted at EV charging. And GloBird, another company. So there's a few around who do it. But the thing is, too, by doing it in a regulated fashion, ensuring that the Australian Energy Regulator, who does an outstanding job, will approve each offer, I think consumers can just take a bit more comfort that they're not being ripped off somewhere else to make up for this. They're not paying for it through the nose and other time. The AER will be looking at that very, very closely and making sure that's not the case.

CRAIG REUCASSEL: Could you enforce this on all energy? Could you say all energy contracts had to have these free three hours, or do you only have control over the default market offer?

CHRIS BOWEN: We only have control of the default market offer. But as I say- 

CRAIG REUCASSEL: Yeah, okay.

CHRIS BOWEN: - many more people are on market offers for which the default does provide the benchmark. And so yeah, I know it's a bit complicated.

CRAIG REUCASSEL: No, I understand. Well, this is -

CHRIS BOWEN: We’re not working in a perfect world of energy regulation. 

CRAIG REUCASSEL: Chris, If you could make the energy system clear and simple, that would be great. Somebody else asks here is the government paying the electricity companies for the free three hours? How's it going to work?

CHRIS BOWEN: No, we're not. And because the energy companies, in effect, aren't paying for that energy in the middle of the day. I mean, if you look at your apps, which many people are on in the national energy market, often prices are negative in the middle of the day. So that's why those companies that are doing it already can do it. They're not doing it negative in the middle of the day. So that's why those companies that are doing it already can do it. They're not doing it out of the goodness of their heart or as an act of charity, to be fair to them. They're doing it because they can and it's an attractive offer. We want to see it spread more broadly because solar panels and batteries, there isn't a bigger fan in Australia of them than me, but not everyone can or is in a position to do it straight away. And this extends the benefit. If you think about- I think about a retired couple maybe living by themselves at home, the kids have left home, they can put the dishwasher on or the washing machine on in the middle of the day and know it's for free. I think about perhaps a working family with a bit more control over their energy use. You can schedule your car charger, if you've got a smart charger for the middle of the day. If you're at work, you've caught the train to work, you can schedule your appliances for the middle of the day. It really opens up a lot of opportunities. One of the things we’re doing, Craig, and I’m really quite excited about this, is really in many ways democratising the energy market. We used to just get a bill from the energy companies and have to pay it. Now we have power stations – you know, your roof is a power station, your garage and your driveway are power stations. We’re trying to put you more in charge of that. And with a lot of work underway, it’s called consumer and energy resources – basically, we’re now prosumers. We’re producing and consuming at the same time, and that really gives people options. But as I said, not everyone has solar panels and a battery, so I want to open up the benefits of that democratisation to more people. 

CRAIG REUCASSEL: To other people. Good on you, Minister. Thanks for speaking to us this morning, clarifying that. Appreciate it.

CHRIS BOWEN: Always a pleasure, Craig.