Press conference - Smithfield, Sydney

CHRIS BOWEN: Well, thanks for coming out, everyone. Obviously, I want to provide some comments on this morning's energy price increases under the Default Market Offer released by the Australian Energy Regulator.

Australians know very well that energy prices are going up and going up around the world. And the government's been saying from last year, of course, from around Budget time, that there would be enormous pressure on energy prices this year, and we're certainly seeing that play out in the figures released by the Australian Energy Regulator today. The Default Market Offer doesn't apply to most people, but it does indicate the pressure that energy prices will be under this year. Obviously, it applies in New South Wales, in South Australia and southeast Queensland, but it does indicate, as I said, the sorts of pressures that will be on energy prices right across the board.

Let me make a couple of points. Firstly, these are big increases that should be acknowledged and they will hurt for many families. Secondly, these increases would have been much, much higher without the intervention of the Albanese Government last year, working with other governments, particularly of New South Wales and Queensland. These interventions last year were absolutely vital, as the regulator herself has made clear this morning, in the absence of interventions, these sorts of increases would have had potentially a 5 in front of it, not a 2 in front of it. These increases of 50 percent that the government was looking at last year would have crippled many businesses and been a crushing blow to Australian families. Hence, we took the intervention we did last year.

A couple of other brief points. This was an intervention that was controversial. Mr Dutton and the Liberal party voted against it. If they had their way, if the Liberal Party had their way, these increases would have been 50 percent, not 20 percent. They walked into the Parliament and voted against these interventions. They walked into the Parliament and voted for even higher price rises. That's what the Liberal Party wanted.

Secondly, of course, there is more relief yet to flow. The Treasurer, Dr Chalmers, is negotiating with all his state and territory colleagues about the rebates that will be in the federal Budget. Those rebates will provide further relief over and above the package of interventions that we announced last year.

Final point I'd make is this is a Default Market Offer. It happens every year. The equivalent was hidden by Angus Taylor last year. Angus Taylor, in the most cynical move I've seen in a long time in politics, changed the law to hide the Default Market Offer increases from a short time before the last election to just after the last election. He actually issued a law change to keep the increases last year which were similar to these, hidden and secret until after the election. This is a man who wants to be the Treasurer of Australia. He can't be trusted with a jar of five cent pieces, let alone the Australian economy because he is fundamentally dishonest with the Australian people. His track record will hang around his neck for his entire political career when it comes to the dishonesty he showed in hiding these equivalent increases last year.

We have a very different approach. We won't hide increases. We'll deal with it. We've dealt with them in the intervention. We'll deal with them in the rebates. We'll be honest with the Australian people about the pressures in the system, pressures on energy prices in Australia and around the world, and we will also deal with them by the sorts of interventions that we have announced and we'll continue work on. Happy to take questions.

JOURNALIST: You did mention about interventions, including that would be the cap on coal, et cetera - what happens next when those caps are removed?

CHRIS BOWEN: Well, obviously we'll keep the situation under careful monitoring. Who knows, frankly, what the situation in the global energy market is with the invasion of Ukraine and the weaponisation of energy. We have indicated that we will have ongoing discussions about a gas mandatory code of conduct. Those discussions continue primarily between me and my department, the ACCC and the key players. We'll have more to say about that going forward. But obviously this was an intervention for a particular time and a particular set of circumstances. We'll need to monitor how those international circumstances change in coming years.

JOURNALIST: ACOSS is calling for emergency payments for debt relief for people who can't afford to pay these increased costs. Can you provide any direct relief to consumers who need it?

CHRIS BOWEN: Well, direct relief is exactly what will be in the Budget in relation to the energy price relief that the Treasurer is working through with his state and territory colleagues. We outlined, if you like, the guidelines, the contours for that last year. But obviously there's a lot of detailed negotiations to go into that and that is exactly what we're working on. And we will deliver in the Budget. We had a two-step process intervening to cap coal and gas prices, not universally popular with coal and gas companies but had to be done, not supported by the Opposition, had to be done. And then the bill relief, of course, that will be in the Budget.

JOURNALIST: The Coalition is suggesting, that as a result of capping coal and gas prices, that in the longer run this will in fact hitch up prices. What do you make of that?

CHRIS BOWEN: Well, I invite the Coalition to have a look in the mirror. I mean, here you have the Independent Energy Regulator this morning pointing out that without the intervention the increases would have been closer to 50 percent. An intervention that Mr Dutton opposed, like he opposes absolutely everything. I mean, you can't complain about high energy prices and then vote for higher energy prices. Now, we've carefully calibrated these interventions, we've worked through them very carefully. Mr Dutton and his bunch of irrelevancies put themselves out of the process, opposed the package, and did not enter any discussions with government.

JOURNALIST: But the longer-term supply?

CHRIS BOWEN: Well, I mean, obviously we factor all those issues in. I made comments about gas supply earlier this week, for example. I have more to say in coming days about gas supply. The intervention was absolutely necessary. You’ve got to do with both. I make the point that we've made particular reference to new supply in our arrangements.

So, this is also a political party which presided over four gigawatts of dispatchable power leaving the grid over the last decade, and one gigawatt coming in. And they have the temerity and the hide to lecture anyone else about supply. I mean, they need to just have a good long look in the mirror and firstly acknowledge their part - their part. Of course, there's a global crisis, but Australia went into that global crisis very ill-prepared because we had four gigawatts of dispatchable power leave the grid and one come on.

JOURNALIST: Given these ongoing price rises, are you going to be able to achieve that $275 price cut?

CHRIS BOWEN: Well, of course, that was what we indicated would be the impact by 2025. I'm not about to give up for working for lower power prices, no.
 
JOURNALIST: What about long term? Is it time to reopen the discussion about nuclear power in Australia?

CHRIS BOWEN: Well, it would be a particularly bizarre discussion. It would be a particularly bizarre conversation to say the answer to high power prices is to introduce the most expensive form of energy available, nuclear. I mean, that's the Liberal's plan. Mr O'Brien, my shadow Minister, takes himself off doing little videos in Japan: "Nuclear, What we can learn from Hiroshima. Nuclear, what we can learn from Fukushima". I mean, particularly bizarre little interventions, but bizarre in policy substance.

The cheapest form of energy is renewable energy. That's why we're working to get our energy grid to 82 percent renewables by 2030. We will. Right around the world, experts recognise that nuclear is very expensive, particularly expensive in Australia, because we don't have a nuclear industry to start with. We'd be starting from scratch without the infrastructure and the resources necessary to underpin a nuclear industry. Nuclear power plants are very expensive. They run over budget, they run overtime. Mr Dutton can go off on this fantasy frolic if he wants. We'll remain focused on the job of introducing more of the cheapest form of energy, the cheapest form of energy which is renewables.

JOURNALIST: You mentioned that a 50 percent increase in power prices would be crushing and crippling for families. How would you describe a 20 percent increase?

CHRIS BOWEN: Very tough. Very tough for many families, very tough for many businesses. That's why we intervened, to make sure it wasn't even tougher. These figures bear out the intervention, they bear out the forecast predictions we made. In fact, the relief may be higher than we anticipated. And thank goodness, thank goodness that we were able to conduct an intervention, because 20 percent increases are very tough, 50 percent increases would have been crippling.

JOURNALIST: The New South Wales - acknowledging this is an election campaign - the New South Wales Treasurer said this morning that he'd direct the Commonwealth to try and pay some rebates to businesses. Will that be considered or is that all part of what we're seeing?

CHRIS BOWEN: Well, again, Dr Chalmers is involved in discussions right across the board. I've noted the New South Wales Labor commitment in recent days, which of course, will also be part of those discussions if there is a change government in New South Wales and they have focus on businesses as well, the New South Wales opposition. But those discussions in terms of how the actual rebates get delivered to families and bill payers across the country will be a very important part of the Budget.

JOURNALIST: Just on the safeguard mechanism. What are you willing to offer the Greens to secure their vote on the safeguard?

CHRIS BOWEN: I'm in discussions with the Greens and I'm not in discussions with the Greens through the media. As I've indicated many times, I'm more than happy to have good faith discussions with people in good faith. We are having those discussions. Those discussions have been and will be in keeping with our mandate and our agenda and they'll continue in coming days.

JOURNALIST: I know it's hard to expand on the $275, but are you confident you can achieve that or how hard will it be to achieve that by 2025?

CHRIS BOWEN: Well, as I said, I'm not about to give up on working for lower power prices. I'm not about to give up on introducing more renewable energy because it's the cheapest form of energy. Of course, we indicated 2025 when our modelling indicated that would flow through. And of course, it's now 2023. We have a lot more work to do. Is it tough, a tough international environment for energy prices? Absolutely.

JOURNALIST: Can you keep that election promise?

CHRIS BOWEN: We are continuing to work to lower power prices as much as possible. We're not about to give up on that ambition.

JOURNALIST: When should people expect to start to see prices going down? I know that you're saying it's hard to get to $275, but when will they start to see some relief?

CHRIS BOWEN: Well, again, the Regulator indicated this morning that you're already seeing renewables see power prices be lower than they otherwise would be. You see lots of renewables in the system and the prices come down and indeed go negative at various points during the day. Our challenge, our opportunity, is to convert that through storage and transmission to being a broader proposition throughout the day and on many days. So that's already having an impact, that's already having an impact on energy prices. The fact that we have renewables much more in the system. The jurisdictions with the highest renewables are often the ones with the lowest prices if you look around the Australian National Energy Market.

But again, we'll always be very upfront with the Australian people. There are huge international pressures which show no sign of going away. I wish and I hope that Ukraine can be victorious very soon and that's, of course, our dear friends in Ukraine, that's very important for them. It's very important for people who care about political freedom anywhere and it would be very good for the world energy markets to return to normal. I can't tell you when that's going to happen. It's a very unstable and unpredictable environment in Europe and that's going to continue to play out for some time to come. But what we will do is what we have done so far. Be upfront with people about the challenges and work very hard, very carefully to intervene to reduce those pressures and those impacts on Australian families.

JOURNALIST: That's a long way of saying you don't know when prices will start going down.

CHRIS BOWEN: Nobody knows when the crisis in Ukraine is going to end. No one does, and we should just be honest about it. Okay. Thank you.