Introducing the “Minister for Lowering Electricity Prices”
The new Energy Minister Angus Taylor has outlined the next steps that the Federal Government’s energy agenda with the priority on reducing power prices and system reliability.
This was the mandate laid out by the new Prime Minister Scott Morrison when announcing his Cabinet. In fact the PM went as far as dubbing the new minister as “the minister for lowering electricity prices”[i].
The new emphasis of the government was also reinforced by the separation of the energy and environment portfolios, which had previously been combined under the stewardship of Josh Frydenberg. The new environment minister is Melissa Price.
There has been a lot written about the new Energy Minister since his appointment at the beginning of the week. Much has been made of Angus Taylor’s comments on renewable energy and wind farms in particular. He has also been portrayed as a climate change sceptic[ii].
In response he has previously said “renewables are in my blood, and have been from the day I was born”[iii] a comment he repeated in his first speech as Energy Minster. He has also pointed to the fact that his grandfather, Sir William Hudson[iv], was appointed the first commissioner and Chief Engineer for the Snowy Hydro-electric scheme in 1949. He has said that he is not a climate sceptic and does not have a “vendetta” against renewables[v].
Elsewhere Infigen chief executive Ross Rolfe said: "I know Angus Taylor and he isn't so much anti-wind or renewables as against subsidies … He is of the view that it should be a level playing field for all types of energy."[vi]
So who is Angus Taylor?
Taylor is not new to energy or the energy debates that have swirled. He comes to the energy portfolio with an impressive CV. He is a Rhodes Scholar, has strong commercial financial and advisory experience, and he has strong front bench experience.
A closer look at his position reflects both his commercial perspective with concerns around the Renewable Energy Target (RET) not being the most efficient way to reduce emissions, and concerns about the level of subsidisation of wind farms.
He was appointed as Assistant Minister to the Prime Minister with special responsibility for Cities and Digital Transformation in February 2016 and was reappointed to the front bench after the 2016 Federal Election and became minister for Law Enforcement and Cyber Security in December 2017.
Prior to entering Federal Parliament he worked as a business and strategy adviser focused on resources, agriculture, energy and infrastructure sectors. He advised a number of global and Australian companies and public sector organisations, working at a CEO and board level[vii].
He joined Port Jackson Partners as a director in 2002 and is listed, along with the Australian Competition and Consumer Commission’s chairman Rod Sims, as a member of their alumni.
Before he joined Port Jackson Partners, Taylor was a partner at McKinsey & Co where “at the time of becoming partner in 1999, he was youngest partner in the global firm”[viii].
During his time with Pitcher Partners he was a member of the the previous Coalition Government’s Victorian Government’s eight member gas taskforce that was established in December 2012. The taskforce was chaired by former federal minister Peter Reith and among other recommendations called for the removal of bans on coal seam gas exploration.
Where to Next
As noted when Frydenberg took on the combined ministry he was given “a remarkably complicated brief. Energy and environment are both great examples of “wicked problems” – issues so complex that we struggle to define the problems, let alone agree on how to deal with them”[ix].
Energy remains complicated given its many aspects, and combined with a roadmap provided by the ACCC, even then it is not the full picture with the dropping of the Emissions Guarantee the Reliability Guarantee is now being reconfigured (read more here).
The immediate challenge for the incoming Minister is how best reduce prices – Taylor has said that while he does not believe in heavy handed intervention, he believes renewable energy has already benefited from intervention via the RET and that we are past the point of leaving the industry alone.
“Poorly conceived interventions in the past leave us no choice but to make interventions to get things back on track”.[x]
In his first official comment as Minister, Taylor said: “It is a simple truth that Australians should not pay high prices for their power, when we have cheap energy sources in Australia, compared to elsewhere in the world” and that he would “continue to advocate for the cheapest forms of power generation”.
The shift to prices was reflected in the government’s announcement that it would adopt recommendations made by the ACCC just over a week ago with a move to introduce a default price, along with government support for a new generator of dispatchable electricity via a mechanism to be the buyer of last resort right up to requiring forced divestments as a last resort (see last week’s EI).
The default price will be targeted at retail customers who remain on standing offers in four states – Victoria (7 per cent), NSW (18 per cent), South Australia (11 per cent) and more recently deregulated south-east Queensland (19 per cent).
Angus Taylor Biography[xi]
Elected to the House of Representatives for Hume, New South Wales, 2013. Re-elected 2016.
Assistant Minister for Cities and Digital Transformation from 19.7.16 to 20.12.17
Minister for Law Enforcement and Cybersecurity from 20.12.2017 to 26.8.2018
Minister for Energy from 26.8.2018
Cabinet Minister from 26.8.2018
Joint Statutory: Public Accounts and Audit from 04.12.2013 to 02.02.2016.
Joint Standing: Public Accounts and Audit from 04.12.2013 to 02.02.2016.
Joint Select: Public Accounts and Audit from 04.12.2013 to 02.02.2016.
House of Representatives Standing: Public Accounts and Audit from 04.12.2013 to 02.02.2016.
Member, Liberal Party Finance Committee (NSW) 2008-12
Secretary, Coalition Policy Committee on Employment from 2013
Born 30.09.1966, Cooma, Australia.
Qualifications and occupation before entering Federal Parliament
M.Phil - Economics (Oxford)
Partner, McKinsey and Co 1994-2001
Co-founder, shareholder and adviser, Farm Partnerships Australia and Growth Farms Australia from 1998
Programme director, Rabobank's Farm Leadership Programmes from 1998
Director, Port Jackson Partners from 2002
Co-founder and director, Eastern Australia Irrigation from 2007
Location: south-western New South Wales; it includes the Councils of Boorowa, Goulburn Mulwaree and Upper Lachlan and parts of Camden Council, Liverpool City Council, Wingecarribee Shire Council and Wollondilly Shire Council. Towns include Appin, Boorowa, Bundanoon, Camden Park, Colo Vale, Crookwell, Exeter, Goulburn, Gunning, Hill Top, Marulan, Menangle, Meryla, Oak Dale, Penrose, Taralga, Werai (part), Wingello (part) and Yerrinbool (part).
Industries: Mixed farming, grazing, fat lambs, fruit, vegetables, wine, timber and textiles.
[ii] Australian Financial Review, “Energy minister Angus Taylor a formidable wind farm foe”, 27 August 2018
[iii] Australian Financial Review, “Power firms as bad as banks”, 30 August 2018
[vi] Sydney Morning Herald, “Energy industry calls on Taylor to not give up the energy policy fight”, 28 August 2018
[x] AFR, “Power firms as bad as banks”, 30 August 2018