SUBJECTS: More reliable and affordable power; Border protection.

PRIME MINISTER: Good morning everyone. This morning Angus and I met Colin and Avril Greef here in Canberra and we want their electricity bills, we want their electricity prices to be more affordable. We want their electricity prices to go down, that’s what we want to achieve, that’s what Angus Taylor is the Minister for, to get electricity prices down.

We have a plan to achieve that and that plan is to get the big energy companies under control. Our plan is based on the expert reports that have been provided by the ACCC. I initiated one of those when I was the Treasurer and the AEMC and following through on their recommendations and putting the necessary focus on keeping the big energy companies under control to get prices down.

Now, there are four components to this that Angus will take you through in more detail.

The first one is to empower customers with a price safety net and to end the loyalty tax that is put on customers all around the country. Just simply because they've stayed with their electricity company, they pay more. That has to end.

Secondly, to give ourselves as a Government and the Parliament, through the Parliament, the big stick we need to keep these big energy companies in line. To stop the gouging, to ensure they pass on the savings that are being achieved in wholesale prices. And I don't bluff. People can make many criticisms of me and they do regularly, that's fine. But they never accuse me of bluffing and I don't bluff when it comes to these issues.

Thirdly, forcing energy companies to buy ahead, to buy ahead and contract reliable energy supply into the market. Fair dinkum power, as you've heard me call it, from the generators so we can keep the lights on and we don't see a repeat of the fiasco we that saw in South Australia. That matter is before the states and Angus will be meeting with them again this Friday.

And to back in investment for more, new, reliable power generation. That fair dinkum power generation that works when the sun doesn't shine and the wind doesn't blow, because if you want to keep the big producers and the big companies in check, well there needs to be more. There needs to be more power, more reliable power generation going into the system to ensure that can get prices down. I mean, as we've always said and Malcolm would say, the laws of supply and demand have not changed, they're just as true as they've always been. There needs to be more reliable power supply, reliable power generation in the electricity market. That's what also gets prices down, forces more competition into the system.

Now, we will meet all of these goals while at the same time, meeting the targets that we've set out for ourselves when it comes to emissions reduction. That is our clear advice, that we can continue to meet the targets that we’ve set out for ourselves. We don't have to choose between the two, we will achieve both. We have met our Kyoto targets. We have met Kyoto 1. We will meet Kyoto 2 and we will meet our targets in 2030, as I've said, in a canter. We can achieve both, Australians expect us to achieve both, but what they really want to see right now from Angus as the Minister for getting electricity prices down, and myself, is the clear action to keep the big energy companies under control, so we can give the power back to the customers and get their prices down.

Angus, do you want to take us through those in a bit more detail? Then I'm happy to take questions.

THE HON. ANGUS TAYLOR MP, MINISTER FOR ENERGY: Thanks, PM. Today is an important day for getting power prices down in Australia. For too long, consumers, customers, have been getting a raw deal. The ACCC has told us this, other regulators tell us this and Australians tell us this. We know the energy market has not worked in the interests of consumers, households and small businesses as well as larger businesses. We need to get the energy companies under control, to stop the rip-offs.

That's why we have been focused on a comprehensive package which has, as the Prime Minister says, four parts. First, stopping the price-gouging by the big energy companies. We're banning sneaky late payments. We're requiring retailers to pass on wholesale price reductions and we're cracking down on dodgy anti-competitive practices. Our plan will be implemented through a comprehensive legislative package that will come through to the Parliament this year, as well as a package that will go to the COAG Energy Council.

We're empowering customers with a fair price safety net. This means removing the loyalty tax, as the Prime Minister said, for people who don't have time to negotiate a price over an extended series of phone conversations. The loyalty tax must go.

We also want to see the confusion go, when people are made offers and contracts in the market, the confusion must go. Yesterday, the Treasurer and I wrote to the Australian Energy Regulator to introduce a benchmark price, which will be worked up for full implementation by July 1. Thirdly, we're backing investment in reliable generation to improve competition, lower prices and shore up reliability.

Today, we begin the consultation process ahead of an expression of interest. We're aiming to have our first pipeline of projects early next year. We will be providing mechanisms to ensure that these projects are financed as per the ACCC recommendations. They recommended a floor price, we won't anticipate the banking, there will be other options as well, a broader range of mechanisms that are being discussed in the consultation paper. We also aim to support reliable power through the reliability mechanism we'll be putting to the COAG Energy Council this week for implementation, by the 1st of July.

Finally, I'm writing to all energy companies, all the energy companies supplying electricity in Australia to convene a round-table. I will be asking each company to individually take action to lower prices, specifically their standing offers by January 1. This is a down payment for all Australians on a fairer electricity market. Our package for affordable, reliable power will ensure a better deal for all Australians, a better deal for small businesses and ensuring that big energy companies do the right thing by their customers.

JOURNALIST: Do you have any numbers, specific numbers, for targets to contain prices or get them down?

PRIME MINISTER: Well, on the residential customers - this is just on the default price - the savings for residential consumers range from $273 in the ACT, through to $832 in savings in South Australia. For small business customers, it can be as high as $3,500 a year in South Australia and just under $1,000 in the ACT. So that is just on those measures alone.

The other measures, as Angus has just indicated, we want to see the electricity price come down in January and we're making it very clear to the electricity companies that's what we expect you to do.

JOURNALIST: Aren’t prices however, set in July in most places?

PRIME MINISTER: Well it's not compulsory, they can take their prices down and I expect them to do it.

JOURNALIST: Minister Taylor, on the investment mechanism which you mentioned there. The ACCC was very clear in its recommendation [inaudible] have prices attached, of $45 to $50 a megawatt hour. Is that what the Government is proposing? And you seemed to suggest that the Government was proposing that and some other things that I'm not really sure what you're talking about?

MINISTER FOR ENERGY: So the ACCC made it clear that one good mechanism worthy of consideration is a floor price. We are certainly including that as a mechanism that can be used. I don't want to anticipate the banking. What we do want to do is make sure we get that reliable power into the system, that Australians get a fair deal, that we have that reliable power that can provide electricity to all Australian households and businesses under all circumstances.

JOURNALIST: So you say you don't want to anticipate the banking, is that you saying - ?

MINISTER FOR ENERGY: Well the ACCC made a recommendation about a mechanism and that's a good recommendation. We're absolutely very interested in using that mechanism. It may not be the only one.

PRIME MINISTER: In the consultation paper, it sets out a number of measures and that is, that providing a floor price, a contract for difference, cap and floor collar contracts, government loans, all of these things are set out in the consultation paper. That's a discussion which we're very happy to have.

JOURNALIST: Whichever method you go with, will it be- take a technology-neutral approach? And will it be left to the market to decide which is the most viable technology?

PRIME MINISTER: Yes.

JOURNALIST: What do you say to Nationals MPs who want this mechanism to be used to invest in coal-fired power stations? Can it be used to do that?

PRIME MINISTER: Where it stacks up, it can be. Where it meets all the requirements.

JOURNALIST: Are you expecting there to be people coming forward with ideas to build coal-fired power stations?

PRIME MINISTER: Whether it's that or whether it’s any other sort of energy, reliable supply to the market to get electricity prices down, that's what we're for. We're for lower electricity prices and for people generating more reliable power in Australia. We don't take positions on the source of the fuel. What we do is we ensure we meet our broader emissions reduction target, which we do. Everything we're talking about here is consistent with that position. But it also means ensuring that we can unlock the investment that needs to come into the sector to ensure more power is generated.

JOURNALIST: Everyone is worried about power prices but some of your MPs are also worried about carbon emissions. Are you open to the prospect of putting more money into the Emissions Reductions Fund?

PRIME MINISTER: I've never ruled that out. I've always said that would be dealt with through the normal budgetary process. There's a Budget next year and there’s an ERC process underway at the moment. The current funding takes us through to the current period. So I've always been open to that.

There's a suite of things we're doing. I mean there’s ARENA, there’s the CEFC, there’s Snowy 2.0 there’s the small and large scale RET, there’s the Emissions Reduction Fund. But you know what there also is? Common sense and technology. Common sense and technology - and Angus might want to comment on this because you're closer to it than me on the details of the technology developments - but renewable energy is attracting investment because it has reached the tipping point where it just makes economic sense and no longer needs the regulatory and other economic intervention to bring it about and that's continuing to be the process in the future, which is where you always wanted it to be. So common sense and technology is enabling us to achieve all of these things, which I think is great news. No longer does government have to sit around and hold the hand of the renewable technologies, like it used to. It's going to happen more and more and more in the future and the investment is going to roll because it's common sense and it's economic sense. It doesn't need the government to be sticking its fingers into it. Angus?

MINISTER FOR ENERGY: Businesses and households have been driving extraordinary energy efficiencies in Australia using new technologies and new techniques for many years now. The forecasters continually have underestimated the amount of energy efficiency we've been getting, the gains we've been getting through use of new technology and techniques and that will continue. The track record in this country is an extremely good one and that common sense the Prime Minister describes is absolutely crucial and will play a major role in achieving these outcomes.

PRIME MINISTER: So the intervention we need now, is actually to keep the big energy companies in line. That's where Australians want governments to actually be acting now. They want us to act to ensure that those big energy companies don't rip them off, which is where our focus is.

JOURNALIST: Prime Minister can I take you to another topic?

PRIME MINISTER: Yeah unless there's other questions on energy? As you know, I like to deal with the topics -

JOURNALIST: Prime Minister the energy companies actually say the price caps will reduce competition between companies and hurt consumers, who are already shopping around, they’re going to pay higher prices in the future. What do you say to that?

PRIME MINISTER: I'd say: “they would, wouldn't they”?

JOURNALIST: Is the Government considering asking for a recount of the Wentworth by-election tally? 

PRIME MINISTER: Have we dealt with energy?

JOURNALIST: No. Thank you, with this underwriting mechanism, the ACCC was talking about new generation, generation that doesn't currently exist.

PRIME MINISTER: Correct.

JOURNALIST: Could this underwriting mechanism apply to retrofitting existing power stations? That’s the first one and second point, is the Government proposing as part of this not only to underwrite and finance but to guarantee new projects against future carbon risk?

MINISTER FOR ENERGY: So on your first point, there are a lot of ways of getting new generation. Brown fields, green fields, upgrades. There's lots of ways of getting new generation. We want the outcome. That's the focus here. We’ve got to get that dispatchable, that reliable power into the system to ensure that we can keep prices down, increase competition and ensure we've got the reliability and we should look at all of those outcomes. Your second question…

JOURNALIST: Well, there's underwriting finance and then there’s whether or not the Commonwealth guarantees these projects against future carbon risk.

MINISTER FOR ENERGY: What's crucial is that we ensure that new capacity can come into the market at a cost that will be affordable for Australians and Australian businesses. And that means making sure that Government carries as little risk as is necessary but as much as we need to make sure we get that reliable power into the system.

PRIME MINISTER: You make a good point, and that is our policies are based on our plans. Now, the Labor Party has different plans. They have a plan for a 45 per cent emissions reduction target, which would have a bigger impact on household electricity prices than the Carbon Tax that they introduced prior to the 2013 election and a bigger impact for businesses and a bigger impact for householders and a bigger impact for Colin and Avril, who we met this morning. So, no, we don't support those policies and we're not in the business of underwriting Labor's policies. That's the Labor Party's business and what we're saying here is our policies are about getting prices down. Labor's policies will drive prices up, and so under a Liberal and National Government, your electricity prices will be lower than under Labor.

JOURNALIST: Gas prices are going up, so are you saying that you can guarantee that people's retail prices will come down before the next election?

PRIME MINISTER: That is the pressure we will be placing and I'm saying that under the Liberal and National Government and our policies, electricity prices will be lower under us than they will be under Labor. Under Labor you will not only pay more on electricity prices, you will pay more in higher taxes, you will pay more in higher private health insurance premiums. Under Labor you will pay more and more and more.

JOURNALIST: You say "a big stick". Can you tell us what that is? What can you do to force these companies?

PRIME MINISTER: It's everything from enforceable undertaking through the courts through to divestment powers of their assets. That's a pretty big stick.

JOURNALIST: So you're going to tell them that at this roundtable, that if they don’t bring down their standing offer you’re willing to use those things?

PRIME MINISTER: Well that's what a big stick is for. Let's go here and then move around.

JOURNALIST: Over in other parties they're showing a slightly different attitude to your legislation with regards to asylum seekers and refugees.

PRIME MINISTER: Right.

JOURNALIST: What attitude are you bringing to this legislation, given that the support of the Labor Party, the Greens and others seems to be conditional on you amending it substantially?

PRIME MINISTER: Well, Labor have always been for weaker border protection policies. And you don't get children off Nauru by putting more children on Nauru through weaker border protection policies. I'm interested in getting children off Nauru. Over 200 children have already come off Nauru. More children have already come off in recent times under the quiet, effective management of these issues that the Government is pursuing. We're not here to grandstand on this. We're just here to get the job done. And Labor have always sought to weaken. This legislation has been around since 2016 and what they're showing is what they always do. They think this is something to trade over. You don't get to negotiate with people smugglers based on horse-trading in the Australian Senate. This is why Labor stuffed it up so much last time they were in. They thought that's how you manage this. That's just not how it works. You've got to have clear policies that protect our borders and you then have to manage the legacy of Labor's failure, as we have been doing. Closing the detention centres - thousands upon thousands upon thousands of children removed from detention under our Government and we're going to continue doing that job. So no-one understands this issue, I would say, more acutely and more sensitively than I do with my experience of this over a long period of time. I'm committed to ensuring that we can deal with this challenge in terms of the situation with the children and I'm open to every sensible proposal that would not also see more children go onto Nauru. Because don't forget it's not just our policy. It's the Labor Party's policy that if a boat turned up and there were children on that boat, a) that would be horrific enough, because they may have even died along the way, but secondly, those children would go to Nauru under the Labor Party policy. So you don't get children off Nauru by putting more on through horse-trading and this type of business we're seeing presented.

JOURNALIST: Is the Labor Party's offer sensible if it is a one-off for the kids and their children to take them off Nauru and send them to New Zealand?

PRIME MINISTER: Well, the Bill we put into the Parliament was the right answer. And, as I said, you don't horse trade on border protection. You don't do it. Because all you do is run the risk of creating this perverse incentive. Let's just think it through. The perverse incentive that if you put a child onto a boat, well, you're more likely at the other end to get the particular outcome you're looking for. I understand the grief. I understand the great level of community passion and anxiety on this. I do. But I also understand that I must take decisions that don't put more children at risk, which is the great folly of how the Labor Party have always engaged on this issue. They think it’s some sort of domestic negotiation. That's not how this works. So I will consider and take serious advice from people within Operation Sovereign Borders about the potential impacts of all of those things. When it comes to the New Zealand legislation, we've had that in place now for some time. It has never been my preferred outcome as to how we manage that issue. We've been dealing with that issue with our partners in the United States with great effect and one of the other problems with this issue being pursued in this way by the Opposition is it can work to actually say to people on Nauru at the moment, "Oh, I won't take the US offer because the Labor Party might be offering me a better offer." And so they're still on there. And so I would caution people to think carefully about the ramifications of this. I'll be listening carefully to those who are responsible for protecting our borders and stopping kids getting on boats. I'm not sure… to the best of my knowledge, the Labor Party did not seek advice from those agencies in the position they've put to us. I'm not here to horse trade on children. I'm here to help them.

JOURNALIST: So if this legislation passes, you'll take up the New Zealand offer and 150 refugees won’t necessarily go to New Zealand, even if the legislation passes?

PRIME MINISTER: Well let's look at the timeline, okay? The Senate doesn't meet now for several weeks and if the Labor Party wants to move their amendments and they have the support of Greens and crossbenchers, well that's a matter for them. They could have done that at any time for the last two years. They haven't chosen to do that. What we're seeing is the usual sort of panic you see from the Labor Party on these issues in response to domestic politics, rather than considering carefully the ramifications. Now, that matter wouldn't come back to the house until it meets later this year. So what I'm going to do is continue on the program that I have been working with some crossbenchers on very carefully, not in a big-noting way, just getting on with it, managing the issues case by case, talking to those who understand the mental health and physical health issues associated with those who are affected and just continue doing my job, as we’ve been doing for the last five years with great achievement.

JOURNALIST: [Inaudible] would it be your expectation that you can get all those people off Nauru by the end of the year doing what you’re doing now?

PRIME MINISTER: I’m going to continue just to work quietly and methodically with those who are looking to get an outcome here. Who aren’t interested in showboating and grandstanding, who just want to get an outcome. That’s what I’ve always been doing, that’s what our Government has always been doing, that’s why we’ve always been able to get the results and I want to thank those, both within my own Party and the National Party and those on the crossbench who have been taking that approach because we’ve been getting some good things done. We’ve been doing it without running the risk of seeing this whole horrible nightmare open up again. I’m not going to allow this nightmare to open up again. It was far too painful, far too painful, to actually fix this last time, and no one knows that, no one knows that, better than me.