GRACosway Weekly Wrap Up

17 March 2017
Prime Minister Turnbull announced a $2 billion expansion of the Snowy Hydro Scheme this week in order to boost national renewable energy storage capacity. The four-year expansion is expected to increase the Scheme’s capacity by up to 50 per cent, with a feasibility study due by the end of this year. Mr Turnbull indicated the “unprecedented expansion” is capable of providing power to an additional 500,000 homes and will “enable greater energy efficiency and help stabilise electricity supply into the future”. In responding to the announcement, however, South Australian Premier Jay Weatherill described the expansion as “a $2 billion admission that the national energy market has broken and there needs to be public investments to actually fix it up”.

Mr Weatherill unveiled his own government’s response to boosting the State’s power supply and increase energy security via a new six-point plan. The “dramatic intervention” will involve the construction of “Australia’s largest battery” used to store wind and solar energy along with a $360 million gas-fired power plant to provide back-up power during peak demand periods. In responding to the announcement, Mr Frydenberg indicated he will seek legal advice on whether the plan breaches the National Electricity Rules (NER), as it proposes to incorporate increased state powers that will supersede the Australian Energy Market Operator (AEMO) to support South Australian energy security, if necessary. In contrast, Federal Opposition Leader Bill Shorten praised Mr Weatherill’s plan, stating that “It is time for Mr Turnbull to stop playing political games and work with Labor… for the interests of the nation.”

Pressure on the Federal and state governments to improve housing affordability has intensified, with new data revealing 11 per cent of NSW houses and units were purchased by foreign owners last year. Federal Assistant Treasurer Michael Sukkar refused to comment on whether changes to negative gearing and capital gains tax will feature in the upcoming May Budget, however, has indicated support for first home buyers to access superannuation if implemented as part of wider reform to increase supply in the market, despite a push-back from the superannuation industry. See the media coverage here.

In a landslide win last weekend, Labor declared victory at the Western Australian election with a 15.7 per cent primary vote swing against the Liberal Party. Requiring 10 additional seats to form government, Labor gained an extra 31 seats to hold a current total of 41, with the Liberal Party securing just 17. Incoming Premier Mark McGowan has announced a 17-member Cabinet, with Ben Wyatt expected to be named Australia’s first Indigenous Treasurer. Nationals Leader Barnaby Joyce described the WA Liberal ‘preference swap’ deal with One Nation ahead of the election as a mistake: “It’s in the Liberal Party’s interests to be close to the National Party, and it’s in the National Party’s interests to be close to the Liberal Party.” See the media coverage here and GRACosway’s briefing note here.

Sally McManus has been appointed Secretary of the Australian Council of Trade Unions (ACTU), becoming the first female leader of the national union organisation. A day after her official appointment, Ms McManus confirmed the ACTU’s support of the Construction, Forestry, Mining and Energy Union (CFMEU), which is currently facing charges of illegal striking. Her controversial comments around the issue have been regarded by Coalition figures as “a disgrace” and “extraordinary”. See the media coverage here.

The United Kingdom’s decision to leave the European Union has progressed this week, with key legislation passing both houses of parliament after six weeks’ debate. The legislation is expected to receive royal assent on Thursday before UK Prime Minister Theresa May triggers Article 50 of the Lisbon Treaty later in the month. Prime Minister May has described Brexit as “a defining moment for our whole country.” See the media coverage here.

The Federal, Victorian, ACT and NT parliaments sit next week.

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