Victorian Opposition leader Matthew Guy wants to include the state-owned rail networks in a 500-megawatt electricity supply contract, to incentivise the private sector to build a new power station.
Guy on Monday unveiled the Liberal National plan to reduce power bills.
The plan would bundle together the state’s rail networks, hospitals, and other major infrastructure, into a 10-year, 500MW supply contract for a new power station.
He said the plan would add extra supply into the market, and use the government’s buying power, to drive down retail electricity prices.
Addressing the media 12 days out from the state election, Guy said the plan would allow the market to best determine the mode of generation, while adding new capacity to the state’s strained energy network.
He criticised the Labor Government for allowing the closure of the Hazelwood power station, and for allegedly conspiring with the Greens to see Yallourn power station go the same way.
“[Premier] Daniel Andrews has lost control of electricity and gas prices and its hurting Victorians,” the Opposition leader said.
“Every Victorian knows that Daniel Andrews can’t win government without the support of the Greens which means more taxes and higher electricity and gas prices.
“Building a new power station in Victoria will mean lower prices for the long term which is going to save households and businesses hundreds of dollars every year.”
Shadow energy and resources minister David Southwick said Andrews was responsible for some Victorian households paying over $950 for electricity.
“You don’t need a crystal ball to know that a vote for Daniel Andrews and Labor means a deal with the Greens which will mean even higher electricity costs for homes and businesses,” Southwick said.
“Victorians can’t afford another four more years of Daniel Andrews and bigger electricity and gas bills. Only a Liberal Nationals Government will get back in control of energy costs.”
Plan questioned by Energy Council
The Australian Energy Council, which represents major electricity and gas businesses, warned by underwriting energy supply with government contracts, the Liberal National plan risked stifling investment in the long term.
“Government-supported investment, whether it is in renewables or other forms of generation, can have longer-term, and unintended consequences,” AEC chief executive Sarah McNamara was quoted by Fairfax.
“The potential impacts need to be carefully considered. If the policy settings are appropriate then private investment will respond to market signals.
“These are very difficult issues to capture in any economic model, and we have previously seen forecasts that fail to recognise the unintended consequences of subsidising plant beyond the normal market incentives.”