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Victoria\u2019s 10-year vision for the State Electricity Commission cannot guarantee that the election policy will deliver on the promise of bringing down power bills, energy experts say.<\/p>\n
Premier Jacinta Allan and Energy Minister Lily D\u2019Ambrosio unveiled the government\u2019s strategic plan for the SEC on Thursday, providing key details for the first time of how the revived commission will operate over the next decade.<\/p>\n
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Premier Jacinta Allan speaks at the Clean Energy Council conference in Melbourne.<\/span>Credit: <\/span>Eddie Jim<\/cite><\/p>\n It will invest an initial $1 billion towards setting up 4.5 gigawatts of renewable energy \u2013 enough to offset to closure of Loy Yang A in 2035 \u2013 while also operating as a state-owned company that will generate profits and invest that money into further projects.<\/p>\n To achieve this, it will become a retail business selling 1.2 gigawatts of power already purchased through agreements with smaller wind and solar farms onto government services and later to commercial and industrial customers. There are currently no plans to sell energy to households.<\/p>\n But Allan also revealed on Thursday that the SEC would become a \u201cone-stop shop\u201d to help Victorians electrify their homes, upgrade to more efficient appliances and install solar or battery systems.<\/p>\n Labor\u2019s pledge to revive the SEC came as the cost of living emerged as a key issue ahead of the 2022 election campaign, with the Andrews government promising it would bring down power bills amid soaring prices. This year, Victoria\u2019s default offer, setting the standard for basic deals, rose by 25 per cent \u2013 an average increase of $352 annually for a typical household.<\/p>\n Bruce Mountain, the director of Victoria University\u2019s energy policy centre, questioned whether the government could deliver on its promise to lower power bills through the SEC under the model it had put forward.<\/p>\n \u201cTo make good on their commitment, it\u2019s a foregone conclusion that they need to they need to sell to the customer directly,\u201d he said.<\/p>\n \u201cThey\u2019ll find that the commercial and industrial sector is the one bit of the electricity market that works well. Customers are informed, there\u2019s a thriving advisory sector that ensures that obvious mistakes are not made. So I don\u2019t think there are easy dollars to be had.\u201d<\/p>\n Mountain said it appeared the SEC was being set up to \u201clearn the ropes\u201d before making big steps in the sector, and that this was sensible.<\/p>\n Director of Victoria University\u2019s energy policy centre Bruce Mountain<\/span>Credit: <\/span>Eamon Gallagher<\/cite><\/p>\n \u201cThere\u2019s some gap between perhaps what voters might have imagined the SEC would be about and, and so far, where they\u2019ve got to. Not that I think that that\u2019s necessarily a bad thing,\u201d he said.<\/p>\n \u201cThe electricity industry is a devilishly difficult industry. Working out where the government has a competitive advantage is challenging.\u201d<\/p>\n Alison Reeve, deputy director of the energy and climate program at the Grattan Institute, said the vision for the SEC appeared to be tempered compared to what was announced at the election.<\/p>\n The government has previously argued it would drive down prices by increasing the supply of renewable energy in the market, but Reeve said investing $1 billion likely wouldn\u2019t be enough to achieve this.<\/p>\n Renewable energy\u2019s share of the electricity grid is growing.<\/span><\/p>\n \u201cThey will run into the same problems that everyone else who\u2019s trying to build new generation is running into at the moment,\u201d she said.<\/p>\n \u201cHaving $1 billion dollars and being government-owned doesn\u2019t fix the supply chain disruption that\u2019s going on globally, it doesn\u2019t fix the fact that inflation is blowing out everybody\u2019s costs, it doesn\u2019t fix the workforce issues [and] it doesn\u2019t fix the community opposition to transmission lines.\u201d<\/p>\n A pilot program will begin next year to guide people through the process of finding suitable products and accessing rebates to electrify their homes. It is not yet decided whether this could function as a website, hotline or door-to-door service.<\/p>\n An SEC Centre of Training Excellence will work with educators and employers to grow the workforce needed for the renewable energy sector.<\/p>\n Minister Lily D\u2019Ambrosio, Atlassian chief executive Mike Cannon-Brookes and Victorian Premier Jacinta Allan at the SEC announcement.<\/span>Credit: <\/span>Eddie Jim<\/cite><\/p>\n D\u2019Ambrosio said a key way the SEC would also drive down power bills was through the electrification of homes. The Victorian government estimates a typical detached home can save $1400 a year on energy bills if it goes electric and an extra $2700 with solar installed.<\/p>\n By the end of the year, the government will announce an update to its gas substitution road map, which is expected to detail further incentives to help people pay the cost of replacing their appliances.<\/p>\n \u201cThis is about really addressing cost of living and in a way that is significant and enduring,\u201d D\u2019Ambrosio said.<\/p>\n \u201cThe SEC will help with that and also make sure that they can trust the information [on rebates and products]. Navigating this complex system is something that our government wants to fix.\u201d<\/p>\n Get the day\u2019s breaking news, entertainment ideas and a long read to enjoy. <\/i><\/b>Sign up to receive our Evening Edition newsletter here.<\/i><\/b><\/p>\n<\/p>\n
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