The federal government is looking at all options when it comes to securing affordable energy, Energy Minister Josh Frydenberg insists.
And that includes subsidising new high-efficiency, low-emission coal power plants.
Asked whether the government would like to see the Clean Energy Finance Corportation give such projects taxpayer support to get them off the ground, Mr Frydenberg said it would look at all options.
“But I do point out it’s called the Clean Energy Finance Corporation not the Renewable Energy Finance Corporation,” he told ABC radio on Thursday from South Australia.
“That’s an important distinction.”
Coal continues to play an important role in securing baseload power, Mr Frydenberg said, citing Japan’s 90 high-efficiency, low-emissions power plants and plans to build another 45.
“They also have an emissions reduction target very similar to Australia’s – around 26 per cent,” he said.
“We should be encouraging as the world’s largest coal exporter, how do we maintain our baseload generation, improve the stability of the system, and coal certainly plays a role in that regard.”
Treasurer Scott Morrison echoed Mr Frydenberg, saying the government would have more to say as the year goes on but coal was an important part of the mix.
“Why would the Labor Party be opposed to lower power prices,” he said.
Deputy Prime Minister Barnaby Joyce believes Australia should build clean coal-fired power stations and consider sinking taxpayer cash into developing technology around lowering emissions.
Australia was a major coal exporter and it was “morally prudent” to be at the forefront of technology around burning the fossil fuel.
It was critical for the country to ensure “poor people can turn the lights on” as efficiently as possible, he said.
“The best way to do that is to build the plants and actually investigate how you can make that as efficient as possible,” he said.
Mr Joyce said he would have no problem spending government money on the developments.
His comments came after Prime Minister Malcolm Turnbull pledged to make electricity prices and energy security defining issues this year.
Mr Turnbull said energy policy was not an abstract issue because higher electricity bills hurt household budgets.
Mr Turnbull has pledged to keep the 23 per cent renewable energy target intact, noting it was reviewed and cut from 27 per cent under Tony Abbott.
On Wednesday, he revealed the CEFC and the Australian Renewable Energy Agency will now prioritise funding for large-scale storage and other flexible capacity projects, including pumped hydro.
Chief Scientist Alan Finkel will also provide advice on the role they can play in stabilising the electricity grid.
Mr Turnbull said it was an indictment on state governments that they had been pushing more renewable energy into their grids without thinking about how to back up variable sources such as wind.
The prime minister called on all governments to co-operate on achieving the trifecta of affordable, reliable and secure electricity.
Labor wants the RET lifted to 50 per cent by 2030, which Mr Turnbull dismissed as a mindless rush into renewables.