Key departure casts doubt over Andrews’ big promise to revive SEC

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Daniel Andrews’ signature election promise to revive the State Electricity Commission has lost a key adviser as it waits to identify its first project to support, but the state government insists the wheels aren’t coming off the $1 billion agency nine months after it was announced.

While the government and Alan Finkel say his resignation is due to personal reasons, the setback comes three months after the former chief scientist of Australia urged the SEC to tread carefully so not to avoid crowding out private sector investment in the renewable energy market.

Former chief scientist Alan Finkel has resigned from Victoria’s renewed State Electricity Commission. Credit: Eamon Gallagher

Cabinet ministers were surprised by Finkel’s resignation, with three Labor MPs – speaking to this masthead on the condition of anonymity to discuss internal matters – pointing out they first learnt of his departure via the media.

Energy Minister Lily D’Ambrosio on Friday denied that Finkel’s resignation was a sign of problems with the SEC’s viability.

The government wants the SEC to speed up Victoria’s energy transition through investments in renewable energy generation and storage projects. However, the first beneficiary isn’t due to be announced until the year’s end.

“We did establish the expert panel for an initial six-month period,” D’Ambrosio said of Finkel’s resignation. “We are almost [at the end of] that six-month period.”

The minister insisted the agency would put downward pressure on wholesale power prices, but did not say specifically when that would occur.

Opposition energy spokesman David Hodgett said that wasn’t good enough.

Opposition energy spokesman David Hodgett.Credit: Daniel Pockett

“The Andrews government’s SEC is falling flat and failing to deliver the cheaper energy prices Victorians were promised,” he said.

“Victoria needs a co-ordinated approach to energy that increases supply, gets power from where it is generated to where it is needed efficiently, and delivers affordable and sustainable energy for households and businesses.”

Andrews promised last November to enshrine a revived SEC in Victoria’s constitution and said the agency would help create almost 60,000 jobs, including 6000 apprenticeship and trainee roles.

The premier also promised at Labor’s campaign launch that the agency would “drive down the cost of power for Victoria and families”.

The Electricity Services Commission last month announced a 25 per cent increase to Victoria’s electricity costs from July 1. The SEC invited expressions of interest last month.

Grattan Institute energy director Tony Wood said the government had made some “big statements” about the SEC’s ability to provide more renewable energy and push down power prices.

“It’s still unclear,” he said. “The acting chief executive was speaking at a conference in Melbourne [on Thursday] and didn’t provide a lot of detail other than it’s going to invest $1.5 billion in renewable energy and storage.

“I can’t see anything that says the SEC is going to do something that the private sector wouldn’t have done.”

However, Green Energy Markets analyst Tristan Edis said there were ways the SEC could complement the private sector, particularly through the rollout of electric vehicle charging infrastructure outside homes.

Aside from Finkel, the SEC’s other founding advisers include former Telstra chief executive Andrew Penn, ex-Australian Energy Market Operator boss Audrey Zibelman, Climateworks chief executive Anna Skarbek and consumer advocate Jo Benvenuti.

One adviser, speaking on the condition of anonymity to discuss internal matters, said they were not aware of any other resignations and that the government had indicated a willingness for them to extend their involvement.

“We’ve got more work to do,” the adviser said.

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