Cap on coal price complicating federal bid to quell Australians’ energy costs | Australian politics

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The federal government remains hopeful the Commonwealth and states and territories can come up with a solution to quell swelling energy prices when they meet this week.

Federal minister Bill Shorten said all options remained on the table, with the stakes being too high to reach a decision on action.

“This issue is too important not to leave the room without it,” the Labor frontbencher told Sky News on Sunday. “Let’s see what emerges from the discussions on Wednesday.”

National cabinet will meet this week ahead of finalizing its plan for providing energy price relief, but the inclusion of coal has complicated matters, with Queensland and NSW being asked to cooperate with a plan that will temporarily cap the wholesale price of coal.

That presents a budgetary issue for the states. The prime minister, Anthony Albanese, has said he is confident the states will back the plan.

The NSW treasurer, Matt Kean, told Sky News the Coalition-run state supported measures to lower prices.

“Our legal advice says they do have the power to cap coal prices if they do go down that path and we will support them,” Kean said. “This is a national problem that requires a national solution.”

Queensland’s Labor government was proving more skittish but had not ruled out support.

Recalling parliament remains on the table to deal with any legislative measures that may be needed to implement the plan, which would include the states potentially having to recall their own parliaments.

Kean said his government would support price caps implemented by the commonwealth.

He said while he had spoken to the Prime Minister about implementing a coal price cap, no dollar figure was mentioned.

The commonwealth and some state governments are in discussions over how a gas or coal price cap would be implemented.

The federal government has raised concerns about potential legal consequences if it were to cap prices instead of states, but Kean said the commonwealth had the power to do so.

He said he shared concerns that acting too late would mean the measures would not bring down energy prices over the next 12 months.

The NSW treasurer said a gas price cap would need to be considered alongside coal.

He said a ceiling price for one would not be enough to bring down prices, with black coal setting the wholesale electricity price in NSW and Queensland more than half the time.

While all options remain on the table, the federal government has been reluctant to spruik rebates, pointing to the inflationary pressure of handouts.

Kean said the flow-on effect of increased energy prices being the biggest driver of inflation also needed to be considered.

“If it’s temporary and targeted to people who can least afford it, then it won’t have the inflationary effect people are worried about,” he said of the rebates.

Meanwhile, the minister for Indigenous Australians, Linda Burney, took a veiled swipe at those who wished to undermine progressing the Indigenous voice to parliament before consultation got under way.

Burney used an interview on ABC Insiders to head off criticisms for a body that is yet to be finalised, saying she would not preempt what the body advising on a voice to parliament might recommend, ahead of consultation.

“We’re not going to get ahead of the working group,” she said.

Burney’s comments came after the federal National party announced it would not be supporting the voice in parliament. Since its leader, David Littleproud, made the party room announcement, some Nationals MPs have said they remain behind the voice, while the Liberal party is yet to make a decision.

Burney said by the time the matter came to a vote – which the government has said will be in the next 18 months, with the second half of next year shaping up as the preferred time – the details would be clear.

“When people go into that ballot box, to have their say on the referendum, they will be well informed and they will well understand the reason for the voice, as I said to improve the life outcomes for First Nations people, but also issues around how it will work and, importantly, what it will mean in uniting this country,” she said.

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