Energy prices on the agenda as the national cabinet rolls out a deal

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    Prime Minister Anthony Albanese is set to reveal whether prime ministers have struck a deal to cut Australia’s energy bills at Friday’s national cabinet meeting.

    Amid reports on Friday afternoon that households will receive discounts and treasurer Jim Chalmers will be given the daunting task of getting an agreement in order, Mr Albanese is expected to deliver a press briefing at 3:45pm.

    In the Australian Financial Review on Friday, reports emerged that family discounts would vary from state to residence – as some have lower prices than others – and would be co-funded by the federal and state governments.

    Limits on coal and gas prices have also been signaled.

    The federal government has promised a decision by Christmas. However, the meetings to reach a deal are expected to last into January.

    Friday’s developments came after a virtual national cabinet meeting chaired by Mr Albanese, and Thursday’s meeting of Federal Energy Secretary Chris Bowen with his state and territorial counterparts.

    But the federal opposition warned that the national cabinet’s decisions should not have unintended long-term consequences.

    Opposition spokesman Simon Birmingham was concerned that the government’s potential intervention in the market could deter investors.

    “We need to see the details from the government… especially when it comes to gas companies being able to make a tougher deal without necessarily going down the path of direct regulatory intervention,” he said.

    “Additionally, if you create investment insecurity… the government may provide what they claim is short-term relief, but it may actually lead to more long-term pain.”

    Earlier, Mr Bowen was confident that a deal would be reached between the leaders. But he would not confirm whether discounts for households and businesses are on the table.

    “We looked at our respective powers and those of states – particularly those states with black coal production, namely NSW and Queensland – and talked to them about the most effective response,” he said.

    “We won’t do anything to fuel inflation…so everything we do will try to reduce bills before they reach consumers’ mailboxes.”

    Mr Bowen and the ministers of state and territory have agreed on a capacity mechanism that will rely on renewable energy. He said this was the biggest step forward in Australia’s transition to renewables.

    “Let’s be very blunt and frank: coal plants are going to close,” he said.

    “The task here is to ensure that new energy does not arrive until after the coal-fired power station has left, because that is too late, but before that.”

    He said the agreement would encourage investment and create jobs in the renewable energy sector.

    The federal budget projects a 56 percent increase in electricity prices and a 44 percent increase in gas prices for households over the next two years.

    -with AAP

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