Delayed projects wait for carbon price Email Print Normal font Large font Mathew Murphy May 17, 2007
Other related coverage Companies need carbon certainty Advertisement AdvertisementBILLIONS of dollars of investment are being put on hold across Australia, according to the Bracks Government, which accuses Prime Minister John Howard of "negligence" over his Government's response to climate change.
State Energy Minister Peter Batchelor has attacked the Federal Government for failing to establish a price for carbon that would give companies greater investment certainty. Mr Howard's Task Group on Emissions Trading is expected to recommend the establishment of a trading scheme for greenhouse gases when it reports to the Government on May 31.
Mr Batchelor, speaking during a parliamentary Public Accounts and Estimates Committee hearing, said projects such as Origin Energy's planned $1 billion gas-fired power station in Mortlake were at risk without a carbon price to determine its viability versus coal-fired rivals.
"Investment decisions are being delayed and withheld in Victoria, and right around the national electricity market, because of the negligence of John Howard," he said. "We need to provide investment certainty, particularly in Victoria where we have a privatised electricity-generation market."
Origin's general manager, public and government affairs, Tony Wood, said a price on carbon was a necessary ingredient for the company's Mortlake project to go ahead.
"Whilst a price on carbon is not the only factor, it is certainly a necessary one that has to be resolved," he said. "Otherwise, the carbon risk, which we cannot factor into our investment decisions, sits there as an impediment to going ahead."
AGL chief Paul Anthony earlier this year said projects were being delayed because of doubts about carbon pricing.
"It's a huge uncertainty for business," he said. "We need a very strong target set for us so we can make investment decisions."
Mr Batchelor said electricity prices for households would increase next year, once current retail tariffs set in 2003 came up for renegotiation. He said the Government was confident it would be only a "single-digit increase".
"I would be surprised and disappointed if price increases in Victoria got into the double-digit figures like they have in other states," he said.
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