Wednesday, 25 October 2017

FOLLOW-UP OPEN LETTER to Minister Frydenberg and MPs.

The Devil is in the details.
From Dr. Michael Crawford

Hon. Josh Frydenberg MP
Minister for the Environment & Energy PO Box 6022
House of Representatives
Parliament House
Canberra ACT 2600

25th October 2017

Open letter re your stated intention to abolish all taxes and subsidies from electricity

Like many people I have been looking for actual details of your Government’s new plan for electricity security and affordability, and how it will actually work.

I had found plenty of platitudes, media speculation, and wild hopes, but the detail was not apparent and, as I am sure you know, “the devil is in the detail”.

Then I came across the transcript of the press conference held by you and the Prime Minister on 17th October and finally some critical detail, though hidden away in a mass of otherwise vague statements.

You said, and your words are verbatim from the transcript on the Prime Minister’s website:
“This is a credible, workable, pro-market policy that delivers lower electricity prices.
It means no subsidies, no taxes, no trading systems.”
I have to admit that “no subsidies, no taxes” is quite specific and I applaud it.

And supporting your policy statement, the Prime Minister then said:
“This is one of the important things to recognise and it is widely acknowledged and, indeed, claimed by the wind and solar industry that they are now competitive with new builds of thermal power. 
So there is no need for a subsidy. In other words, they can compete on a level playing field.”
That leads to the critical question. When will you be introducing legislation into Parliament to abolish the Federal tax on electricity in the Renewable Energy (Electricity) Act 2000? That is the tax which is imposed under the Act if electricity retailers do not buy a certain amount of energy from renewable sources, with that tax falling on electricity consumers.

As you are undoubtedly aware, that tax drives the most oppressive of the subsidies which consumers are forced to pay in their electricity bills.

The statement you made at that press conference would be false, even a lie, unless you intend to repeal Part 4 of the Act – in which case you may as well abolish the whole Act. After all, according to the words of the Prime Minister at that press conference, it is now wholly unnecessary in order to make wind and solar power competitive with thermal power.

Removal of the tax imposed by Part 4 of the Act will also cause an instant drop in subsidies and that will immediately start to flow through to consumers and businesses in reduced electricity prices. Every day of delay is a day when electricity consumers are forced to pay excessive electricity prices, so I urge haste.

I appreciate that the ALP and Greens will bitterly resist this in the Senate. After all, they have a well demonstrated desire to shower subsidies, paid for by electricity consumers, on their mates in the wind and solar power industries.

But take it to the electorate. Give the people the opportunity to vote on your policy to immediately remove all taxes on electricity and all subsidies paid directly or indirectly by electricity consumers and you will have an overwhelming victory. The public will start to see their electricity prices fall now, not in a decade.

So I would appreciate your early advice as to when you will be introducing into Parliament the legislation to abolish Part 4 of the Act, or repeal the Act entirely, so as to forthwith remove all taxes on electricity and remove all subsidies.

Dr Michael Crawford
(email redacted)

cc: Members of Australian Parliament and other interested parties