The Federal Energy Minister insists the unprecedented market intervention to avoid blackouts across the east coast will continue for as long as necessary, throwing his full support behind the nation's energy regulators.
Yesterday the Australian Energy Market Operator (AEMO) took the extraordinary step of effectively seizing control of the energy market, suspending the spot price for wholesale electricity across the country.
It was the first time such a decision had been made, with the AEMO arguing it was impossible to ensure reliable power supplies without the intervention.
The AEMO had already been forced to put a cap on wholesale power prices, and had been ordering generators to continue producing power to ensure forecast shortages in supply in states such as New South Wales and Queensland were avoided.
Households and businesses have been urged to try to conserve power, switching off unnecessary appliances and lights in a bid to ease some of the pressure on the system.
Mr Bowen was asked whether it might be necessary to keep the market suspension in place for the duration of Australia's cold winter.
"I don't envisage that long, but it will be reviewed on a day-to-day basis," he said.
"I've been very clear with the chief executive of the operator. He has my full support for any action he deems necessary. The government will back the operator and the regulators 100 per cent.
Mr Bowen warned that NSW would be under "significant pressure" between 6pm and 8pm tonight, but that the market was working to avoid load shedding.
His NSW counterpart, Matt Kean, was confident there was enough reserve capacity despite a number of the state's generators being offline.
Mr Kean said that AGL's Bayside power station, which failed yesterday afternoon, would be online in time for the evening peak.
"We're cautiously optimistic that everything will be fine for the foreseeable future, but we're monitoring things closely because of the changed weather conditions and the unreliability of our existing kit," Mr Kean said.
Some generators have been accused of effectively gaming the system by refusing to produce electricity for the market, arguing the price cap means they are operating at a loss, and only switching back on when ordered to do so by authorities.
Those demand notices trigger the possibility of taxpayer-funded compensation for the energy companies.
Mr Bowen said there would be close scrutiny on energy producers.
"I'm not here to second-guess," he said. The energy regulator has our full support in monitoring all behaviour.
"I'm not here to make accusations. I'm here to say the regulator and operator has our full support in any action that they deem necessary — as they have done and as they'll continue to do."
Market rules could be rewritten after crisis
Prime Minister Anthony Albanese said the east coast electricity crisis could prompt a reworking of the National Energy Market (NEM) rules, including the incentives for generators to pump electricity into the system.
"There are weaknesses, clearly, that have been exposed, and all of the lessons of what is happening will be examined," he said.
"If there need to be any policy adjustments, then they'll be made."
The federal government has said the nation's energy woes are the result of a "perfect storm" — soaring international demand for Australian gas and coal prompted by countries weaning themselves off Russian energy supplies, the cold snap hitting a large swathe of the country, and unscheduled outages in Australia's ageing fleet of coal-fired power plants.
Mr Albanese and Mr Bowen argued it was more important than ever to press ahead with Labor's plans for great investment in renewable energy and storage, and to take a more assertive stance in tackling carbon emissions.
The Prime Minister today formally committed to the United Nations that Australia would cut its greenhouse gas emissions by 43 per cent by 2030 — a key election pledge.
Scott Morrison's government had committed to a reduction of 26 to 28 per cent, with the former prime minister repeatedly stating his belief the nation would exceed that benchmark.
Mr Albanese said he's already had feedback from international counterpart.
"When I've spoken with international leaders in the last few weeks, they have all welcomed Australia's changed position," Mr Albanese said.
