Coalition party room backs National Energy Guarantee


Former Prime Minister Tony Abbott is among a small group that may still cross the floor and vote against the National Energy Guarantee despite it passing through the Coalition party room.

The Turnbull government's National Energy Guarantee (NEG) has been endorsed by the Coalition party room, despite former prime minister Tony Abbott blasting the explanation for how the policy would bring down electricity prices as "merchant bankers' gobbledygook". 

The party room's trick of approval clears the way for the government to introduce draft legislation that would force generators to meet both emissions reduction targets and a reliability guarantee. 

SBS News understands Mr Abbott and fellow Coalition backbenchers George Christensen and Andrew Hastie were reserving their right to cross the floor and vote against the plan.

The prime minister said he was "not going to go into what was said in the party room" but acknowledged some of his colleagues raised concerns. 

"The concerns expressed across the board were about prices, and we share those," Mr Turnbull told reporters on Tuesday afternoon. 

Mr Turnbull said the government was using all the levels available to reduce power bills with a combination of the NEG and the ACCC's various proposals

"It has the broadest support of any energy policy ... in my time in politics and possibly a lot longer than that," Mr Turnbull said. 

Tony Abbott released a statement on Twitter, saying he needed to address “rampant hostile briefing” against him.

He said much of the support from the party room was of the “yes… but” variety.  

“Unfortunately, most explanations of how the NEG (as it stands without price targets) might theoretically get prices down sound like merchant bankers’ gobbledygook,” Mr Abbott said.

“Yes, there were lots of pleas for unity but as one MP said, we’ve got to be loyal to our electorates and to party members too, and not show the ‘unity of lemmings’.”

Composite image of Tony Abbott and Malcolm Turnbull
Composite image of Tony Abbott and Malcolm Turnbull

Labor willing to support NEG, with conditions 

Labor is still offering bipartisan support, but only if it can be reassured the government will not spend taxpayers' money to underwrite new coal-fired power stations, as some on the Coalition backbench support. 

The prime minister has indicated he would adopt the ACCC's recommendation to help new generators get off the ground by underwriting their bank loans - but the proposal was never tied to coal, and is more likely to be used for new gas generators and renewables paired with battery storage. 

"Every industry body and every expert that advises the government on energy policy has said that new coal-fired power stations are, to use the words of the industry, simply uninvestable," Labor's shadow energy minister Mark Butler said. 

Labor also describes the government's 26 per cent emissions reduction target as "unambitious".

The Labor states, which are yet to support the plan, want the target set in regulations that can be more easily ratcheted up under a future Labor government rather than set in legislation. 

But Mr Turnbull said the target would be enshrined in law to provide more certainty. 

"We should legislate the 26 per cent target and if Labor wants to go to the next election and argue for a higher target, they should do so," he said.

"We'll gladly have that debate with them because if you were to have a higher target than 26 per cent, it would increase costs on consumers." 


Starting in 2020, the NEG is designed to bring down energy bills by about $550 a year and requires retailers to source electricity that meets reliability and emissions reduction targets.

Having cleared the party room, the National Energy Guarantee will once again be put to a teleconference of state energy ministers later on Tuesday. The states will be asked to agree to a four-week consultation process.

Labor leader Bill Shorten told a caucus meeting he believed the prime minister had surrendered to climate sceptics in the government.

"The only thing guaranteed to come out of today is higher power prices and less renewable energy. We have cobbled together today a Frankenstein's monster of a policy," Mr Shorten said.

"While Mr Turnbull goes around attacking Mr Abbott, Mr Turnbull is, in fact, giving in to a lot of Mr Abbott's values when it comes to climate change and energy."

Tony Abbott and Barnaby Joyce together in parliament in May.
Eyes will be on Tony Abbott and Barnaby Joyce to see how they vote on the coalition's energy policy. (AAP)

Crossbench Senator Cory Bernardi said the policy was a guarantee to push up prices.

"Unless they remove the barriers to nuclear power... and until they walk away from the Paris Agreement, they won't have my vote," the former Liberal senator told Sky News.

Stay up to date with SBS NEWS

  • App
  • Subscribe
  • Follow
  • Listen
  • Watch