Industry welcomes new energy policy
Western Australian business and industry is likely to benefit from sweeping reforms to the fuel excise after Prime Minister John Howard unveiled his long-awaited energy policy earlier this week.
But while the policy has been well received by industry, it has failed to win over environmental groups and the renewable energy sector.
Under the new policy, energy-intensive businesses that use diesel fuel for off-road industrial purposes will be eligible for increased tax concessions.
The policy will extend the diesel fuel rebate scheme to more than 50,000 petrol-powered trucks and will cost tax payers up to $1 billion over four years. Meanwhile, the excise costs on businesses and households will be reduced by $1.5 billion in the period 2012-2013.
The policy also includes a commitment of $75 million for ‘solar cities’ trials to gauge solar and energy efficiency, and the provision of $134 million to support the commercialisation of renewable technologies.
Business also will be encouraged to take up alternative energy such as solar and wind power.
However, companies involved in developing solar and wind technologies have lobbied the Government to increase its mandated renewable energy target from 1 per cent to 5 per cent, despite the increased burden it would place on industry.
Australian Petroleum Production and Exploration Association (APPEA) executive director Barry Jones said the national energy policy was “a major step forward in developing a long-term sustainability strategy for Australia’s energy sector, but a mixed package when evaluated against the other benchmarks set by CoAG [Council of Australian Governments] in 2001”.
The mining industry has also welcomed the energy policy, citing it as a cornerstone for the future development of successful industry.
The industry has warmed to the potential savings as part of an extension of the diesel fuel rebate scheme.
Despite this, concern remains about Mr Howard and his Government’s overall commitment to the mining industry
While the petroleum and energy industry – which pays royalties to the Federal Government, unlike most terrestrial miners – has been on the receiving end of government handouts over the past two years, the mining industry claims it has missed out.
Meanwhile, a $500,000 skills shortage package targeting the mining industry was announced last week at a Chamber of Mineral and Energy lunch in Perth. While this was welcomed by the resource sector, other issues are weighing more heavily on the industry.
Much of the mining industry has been calling for more sympathetic policies from the Federal Government, including investor tax incentives and increased funding for pre-competitive geo-scientific data.
Neither was included in the recent Federal Budget, provoking a strong reaction from the industry.
In fact, Association of Mining and Exploration Companies president David Harley said he was very disappointed by Mr Howard and his Government’s representation.
Mr Harley said the exploration industry would actually be better off under a Labor Government, given its willingness to introduce a flow-through share scheme.
