PATRICIA KARVELAS: Several energy companies are bringing forward their retirement dates for their coal power stations with the largest in New South Wales announcing it will close in 2025. Origin Energy's plan to shut the Eraring Power Station in the Hunter region seven years ahead of schedule has sparked fears over electricity supply and price spikes. But the CEO Frank Calabria told RN Drive that in the future electricity supply will be a combination of batteries, hydro electricity and gas peaking plants. 

FRANK CALABRIA: Renewable supply is coming in. It's coming in quickly. I'm very clear about the long-term trend that supply for more renewables and capacity will come into the market, and that sufficient energy and capacity will be available to meet market demand. 

PATRICIA KARVELAS: Angus Taylor is the Minister for Industry, Energy and Emissions Reduction and my guest this morning. Minister, good morning. 

ANGUS TAYLOR: Good morning, Patricia. Thanks for having me. 

PATRICIA KARVELAS: You are the Federal Energy Minister. Why did Origin not consult you before making such a major announcement? ANGUS TAYLOR: Well, that's a question for Origin. 

PATRICIA KARVELAS: Why do you think? 

ANGUS TAYLOR: Well, I really don't know. I'm not going to speculate on that but what I will say is I know this is a very tough time for the workers at Eraring in that Port Macquarie, Lake Macquarie region. It's a short notice period. We're disappointed by that, and we will work closely with the private sector and with, of course, the New South Wales Government to make sure there's a solution to this but we were disappointed by the shortness of the notice. This is a very dramatic bring forward, and unfortunately it does mean there's a lot of work to be done in a short period of time. 

We've been doing an enormous amount of work to fill the gap from Liddell, and this is another gap that needs to be filled. Our biggest disappointment was that Origin didn't come forward with a complete plan to close the gap. 

PATRICIA KARVELAS: Well, Minister, the question is: is it concerning that big companies like Origin feel like they can't engage with the Federal Government before making these big decisions? 

ANGUS TAYLOR: Well, I engage with Frank Calabria on a regular basis. 

PATRICIA KARVELAS: Then why didn't he tell you about this? 

ANGUS TAYLOR: He certainly didn't. Look, that's a question for him, Patricia. I can't answer that question. 

PATRICIA KARVELAS: Okay, all right. Love to ask him, but I'm asking you: have you tried to find out? Because I reckon that would be the first thing many people would do. Did you call him and say, "Why didn't you tell me?" 

ANGUS TAYLOR: I have spoken to Frank and I've expressed my disappointment at the shortness of the notice. I've made the very simple point that we will fill gaps. Look, there's no doubt – 

PATRICIA KARVELAS: What did he say to you about why he didn't tell you? Sorry, I think it's a key question. You are the Federal Government. 

ANGUS TAYLOR: I didn't get an answer. And perhaps you can get an answer. But we can spend a lot of time this Patricia, but I tell you what I'm going to be spending time on in the coming weeks and months – is making sure this gap is filled, asking Origin to responsibly work with the New South Wales Government and us to fill that gap and making sure that the energy companies are not able to take supply out of the market and drive prices up. 

You know, we have seen this dynamic in the past. We saw it in Hazelwood down in Victoria. We saw it with Northern in South Australia where energy companies think they can take big pieces of capacity out of the market, not replace them. Yes, that will increase prices and increase their profits. But this is a utility service which every Australian buys, and it's crucial that we have affordable, reliable energy, and that will remain our focus. 

PATRICIA KARVELAS: Okay. You've been critical of the New South Wales Government's approach and its Minister Matt Kean’s approach. Aren't you being dishonest with the public criticising the New South Wales Government's proposed battery when you know it's about freeing up transmission capacity to allow users to access more existing generation? I mean, how can you criticise it when the independent system operator has endorsed the plan? 

ANGUS TAYLOR: I haven't criticised the battery. What I've said is it's not enough. We've got 2800 megawatts leaving the market. This is a two-hour 700 megawatt battery. That's a quarter – it's simple maths, Patricia. It's a quart of what's – 

PATRICIA KARVELAS: Sure, but AEMO would know, you'd hope. And they say that the New South Wales plan has reliability covered. Why don't you trust them? 

ANGUS TAYLOR: Let's be very clear – I've spoken to Daniel Westerman, the head of AEMO on this point. He has made very clear that they do not model price and affordability. They have done narrow modelling on one particular aspect of what is required by the grid. We need affordability. I'm sure your listeners out there don't want to pay more in their electricity bills. 

The good news is we've seen eight per cent reduction in household bills in recent years, 10 per cent in small business bills. So we want to see more of that. That's not what AEMO does. But it is what energy ministers, state and federal, need to be concerned about. And a gap like this, Patricia – let's be clear – a gap of this scale if not addressed will drive up electricity prices, which we're so focused on making sure doesn't happen. 

PATRICIA KARVELAS: And the New South Wales Government has provided the answer on that. If you don't think the national reliability is tight enough – 

ANGUS TAYLOR: Well, sorry, Patricia, can I interrupt you there? 

PATRICIA KARVELAS: Well, no, because I have a question. If you don't think the national reliability is tight enough, why haven't you changed it? 

ANGUS TAYLOR: No, my point is that the gap here is a risk to price. Now, we can debate whether it's a risk to reliability as against security. Technically they are different things. But there is no question it is a risk to price. And that is a very real concern. It's a very big gap. The New South Wales Government has a plan around a battery for a quarter of the size of what we're losing with Eraring. That's not enough. 

Matt Kean clarified yesterday – and I'm pleased to have seen this – that he recognises that there's a gap that needs to be closed here. We'll work with him, we'll work with the private sector. I hope Origin will show some real corporate, social responsibility and work with us to close this gap. Companies that leave this short a notice period and don't have a solution to the problem need to be held accountable for what they talk about a lot – which is corporate social responsibility. 

PATRICIA KARVELAS: But the accountability also lies with you, Minister. When did your modelling tell you that the power station would close? 

ANGUS TAYLOR: Well, we were working on the assumption that everyone else was – that it would close between 2030 and 2032– 

PATRICIA KARVELAS: So you got no other advice that that might change? 

ANGUS TAYLOR: Look, we have always been concerned about the possibility of timelines coming forward on closure of old generators. 

PATRICIA KARVELAS: So what contingencies were you making, then, given that you were working on that premise, because that's where the market's been going, Minister. 

ANGUS TAYLOR: Well, I was about to answer that question. So we're building 2,000 megawatts of capacity in Snowy 2.0. We're building 660 megawatts in the Hunter Power Project at Kurri Kurri. Despite resistance from many, it's very clear that was absolutely the right thing to do. We're working with Energy Australia on the Tallawarra B Gas Generator. We're helping the Port Kembla Gas Generator get final investment decision. We're committing over $500 million to support major priority transmission projects across the country – project in energy connect, VNI West, Marinus Link. So there's no – the Kidston Pumped Hydro Project, Tasmania's battery of the nation. The Victorian Big Battery. It's a long list, Patricia. And it's an enormous amount of work we've been doing because we know the risks are here. 

The problem with this announcement is it's brought forward a long way with a short notice without lead up. And that is something that Origin should be reflecting on. But we will be asking Origin to work very closely with us and take a responsible approach to this. 

PATRICIA KARVELAS: There are around 400 staff members at the plant. Origin has given them three and a half years' time to plan. They're focused on the reskilling and redeployment cross other parts of Origin. Will the government step in to mitigate job losses? 

ANGUS TAYLOR: Well, we only found out about this a little over 24 hours ago. But, look, there's no question that, you know, concern about the workers is real. We do need to make sure that the workers are given an appropriate pathway forward. Reskilling – or skilling more generally is a very big focus for our government. Minister – my colleague ministers who are focusing on this area I know are doing an enormous amount of work because we have got skills shortages. 

The good news for workers now is there is enormous demand for skilled workers, and there's certainly skilled workers at this plant. But we will do everything we can to make sure they're given the support they need. The first and primary responsibility, of course, sits with Origin, and we'll be looking to make sure they do the right thing. 

PATRICIA KARVELAS: Are you – have you reached out to Matt Kean? Will you be meeting with him? 

ANGUS TAYLOR: I've spoken to Matt Kean. Yes, I have. And, look, I've been very clear about our position on this, Matt and I have regular conversations, and it's good to see that he's recognised there is a gap in the market. He is, I know, committed to filling that gap. We'll work with him to do exactly that. And this is crucial for energy affordability and reliability in New South Wales and right across the national electricity market. 

PATRICIA KARVELAS: I've spoken to people who say that the reason you weren't consulted is that they don't trust you. Have you become irrelevant in the national energy debate? ANGUS TAYLOR: I've just gone through the list of all the projects we're doing. I don't think any of those are irrelevant, Patricia – 

PATRICIA KARVELAS: But they didn't call you and you keep saying – I mean, it just doesn't – it's kind of staggering to me that as the national Energy Minister you just didn't even get a call and you're just saying, "Oh, this is all new to me." I mean, that's shows to me there is something going wrong. 

ANGUS TAYLOR: Well, you know, the energy companies have a track record of wanting prices to be higher and profits to be higher. And we have – 

PATRICIA KARVELAS: So you think that's why? That they want – 

ANGUS TAYLOR: Hang on. No, I'm making a statement here. If I can finish. And the truth is that we have worked hard to make sure that prices are at a level which is fair for the energy companies and fair for consumers. It is reasonable to believe, because I've led that charge to make sure we've got affordable, reliable power in our grid, that I'm not always on the Christmas card list of some of the senior executives in the energy companies because my job is to make sure we get a fair outcome for consumers of electricity. So I understand that. 

But, look, at the end of the day, what we've got to do here is knuckle down and do the right thing. Origin, in particular, in a market like this, must show real responsibility. There's a lot of talk in the corporate world at the moment about taking social responsibility. Well, here is a good example, because prices, we cannot afford to lose manufacturers like Tomago in the Hunter Valley as a result of decisions like this. 

PATRICIA KARVELAS: Okay. Minister, just on another topic before I bid you farewell: do you believe, like the Defence Minister Peter Dutton and the Prime Minister who withdrew the comment, that Anthony Albanese is the Manchurian candidate? 

ANGUS TAYLOR: Look, I'm not going to get into this – into that. But what I will say, Patricia – 

PATRICIA KARVELAS: But are you comfortable – well, I want you to. Are you comfortable with those words being flung around like that? 

ANGUS TAYLOR: Those words were withdrawn in the Parliament. But I tell you – 

PATRICIA KARVELAS: Because – and, wait, they were withdrawn, sorry. Is that because they were wrong? 

ANGUS TAYLOR: Well, I'll tell you what is not wrong, Patricia – 

PATRICIA KARVELAS: I want to know if you think that is wrong, not the other way around. 

ANGUS TAYLOR: Well, I'm telling you what I think. And if I get a moment I'll say that. There is a difference in our position versus the Labor position in national security and defence. We saw it starkly when they were last in government when they slashed Defence spending, and we've seen growth of six per cent year on year. 

PATRICIA KARVELAS: Yeah, Minister, I understand that point. That is a different point to saying that the Deputy Leader of the Labor Party is a Manchurian candidate. Do you think that language is too overblown and inappropriate? 

ANGUS TAYLOR: Well, I'm using the language that I think is appropriate, which is there is a big difference between our policy on national security and defence and that of the Labor Party. And at a time when we're facing geopolitical risks which we haven't faced for a long, long time – arguably in my lifetime – that difference is important. It should be highlighted. It should be recognised. Australians will have a choice – 

PATRICIA KARVELAS: But why not highlight it just like that rather than using this inflammatory language? 

ANGUS TAYLOR: Well, I've highlighted it right now the way I see it. And – 

PATRICIA KARVELAS: And should I read into that because you think that language is too inflammatory? 

ANGUS TAYLOR: No, I think the point here that is important is there's a very big difference between our side of politics – the Liberal-National Coalition – and Labor when it comes to national security and defence. And that in this particular global context we're facing right now, that is very, very material and I think it's right for us to point that out and continue to point that out, Patricia. 

PATRICIA KARVELAS: We're out of time. Thanks for coming on the show. 

ANGUS TAYLOR: Good on you. Thanks for having me. 

PATRICIA KARVELAS: Angus Taylor is the Minister for Industry, Energy and Emissions Reduction. 

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