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5 things you need to know today

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Published on: Friday, December 09, 2016

  • Despite being advised of the benefits, the Turnbull government has rejected the idea of an emissions intensity scheme on the electricity sector. The scheme is deemed to be the best option in terms of costs to the economy and impacts on power prices. In a paper to be discussed by the Prime Minister and the Premiers at the Council of Australian Government’s meeting, Chief Scientist Alan Finkel also warns that “political instability and uncertainty” has stalled investment in the electricity sector and that a uniform approach was necessary (AFR). Read more about Turnbull’s rejection of the scheme just days after putting the idea on the table in David Speers’ article today.

  • MD of oil and gas producer Santos, Kevin Gallagher, has criticised the way the company was formally run when he joined 10 months ago. He said technical and operating knowledge was lacking, that it was still structured for high oil prices and that there was a lower level of central governance for decision making (The Australian). Gallagher told investors yesterday that the company would be streamlining its business into five long-life natural assets, while all other assets would be spun off into a separate business to be headed up by former AWE chief executive, Bruce Clement. The separate business will include the coal seam gas project in NSW and interests in Indonesia and Vietnam. The move opens the door for divesting these assets in the future. 
  • The Federal Court has dismissed allegations by the competition watchdog that Woolworths was engaged in “unconscionable conduct” with its suppliers. Yesterday, the retail giant was cleared of acting unlawfully by asking for additional payments from its suppliers to plug a hole in its profits in a federal court decision. In a co-ordinated program called “Mind the Gap”, Woolworths raised around $18 million from suppliers in December 2014. The ACCC launched legal action against the supermarket giant over the scheme last December, accusing the company of breaching consumer law and acting unconscionably.   

  • The European Central Bank (ECB) said it would be extending its bond buying plans by a further six months. But instead of spending 80 billion euros per month (which is being spent currently), they will spend 60 billion euros per month from April next year. The scheme is now set to expire in December after previously being due to end in March.
  • At 0645 AEDT on Friday, the local share price index was up 16 points, or 0.29 per cent, at 5,557.

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