Department for Energy and Mining, $54,776,000

Membership:

Mr Gee substituted for Mr Bignell.

Hon. A. Koutsantonis substituted for Mr Odenwalder.

Minister:

Hon. D.C. van Holst Pellekaan, Minister for Energy and Mining.

Departmental Advisers:

Dr P. Heithersay, Chief Executive, Department for Energy and Mining.

Ms M. Hammond, Principal Accountant, Department for Energy and Mining.

Ms A. Blood, Executive Director, Mineral Resources, Department for Energy and Mining.

Mr V. Duffy, Executive Director, Energy and Technical Regulation, Department for Energy and Mining.

Mr N. Smith, Executive Director, Growth State and Low Carbon Transition, Department for Energy and Mining.

Mr N. Panagopoulos, Deputy Executive Director, Energy Resources, Department for Energy and Mining.

Mr S. Oster, Director, Growth State and Low Carbon Transition, Department for Energy and Mining.

The CHAIR: Welcome back to Estimates Committee A for the final session of the day and the week. The estimates committee is a relatively informal procedure and, as such, there is no need to stand to ask or answer questions. I understand that the minister and the lead speaker of the opposition have agreed to an approximate time for the consideration of proposed payments, which will facilitate a change of departmental advisers, but possibly not in this case. Can the minister and the lead speaker for the opposition confirm that today's timetable as previously distributed is accurate?

The Hon. D.C. VAN HOLST PELLEKAAN: Yes, sir.

The Hon. A. KOUTSANTONIS: Yes.

The CHAIR: Changes to the committee membership will be notified as they occur, and I have done so already. If the minister undertakes to supply information at a later date, it must be submitted to the Clerk Assistant via the Answers to Questions mailbox no later than Friday 24 September 2021.

I refer members to my opening statement at the beginning of today regarding the rules of debate, and that is that the rules of the house apply generally to when the house is in committee. One further comment I will make is that I encourage members to wear masks, other than when they are asking or answering a question or speaking.

I now proceed to open the following lines for examination. The portfolio is the Department for Energy and Mining. The minister appearing is the Minister for Energy and Mining. I declare the proposed payments open for examination and invite the minister to introduce his advisers and make a short statement, should he wish.

The Hon. D.C. VAN HOLST PELLEKAAN: On my left, I have Dr Paul Heithersay, Chief Executive of the Department for Energy and Mining. Behind him is Mayra Hammond, Principal Accountant. Next to Ms Hammond is Mr Nick Smith, Executive Director, Growth State and Low Carbon Transition. Behind him is Ms Alexandra Blood, Executive Director, Mineral Resources. Next to her is Mr Vince Duffy, Executive Director, Energy and Technical Regulation. In the Speaker's gallery, for obvious reasons, are Mr Nick Panagopoulos, Deputy Executive Director, Energy Resources, and Mr Scott Oster, Director, Growth State and Low Carbon Transition.

I have a very brief opening statement. Let me say at the outset that, given this is the fourth estimates committee I have participated in as a minister, I would like to thank my chief executive and all the DEM staff for the outstanding work they have done with our government over the last few years since the last election and also my ministerial staff.

I would also like to thank the broader energy and mining sector. COVID has had a massive impact on our economy and our lives and our homes, as we all know, but I think that the energy and mining sector, including the services components, has probably done a job at least as good as any other sector with regard to getting on, continuing their business and doing it responsibly throughout COVID. Great thanks to them as well because, while that has been beneficial to every one of those companies, and it has been beneficial to every one of those employees, it has also been extremely beneficial to our economy across the board, and that is extremely important.

The Hon. A. KOUTSANTONIS: First of all, I would like to thank the minister for his cooperation during the COVID lockdown and his commitment to the opposition to allow us to have estimates as quickly as possible after COVID. I think it was a sincere and genuine offer and I want to thank him for that. I would also like to thank the department for all the work they have had to do to prepare the minister to answer the opposition's questions. I also thank the department for the work they have done during COVID.

I refer to Budget Paper 4, Volume 2, page 102, objective. Minister, in the government's budget papers the stated objective is to deliver the government's commitment to reduce energy costs. If I go back to the last election, that commitment was to 'see an average South Australian household's power bill fall by $302 compared to the latest (2016-17) prices'. That is on page 9 of your Liberal Energy Solution document you published at the last election—I can see you nodding—and that is what was said.

ESCOSA helpfully publish annual figures. Every year they do a comparison of offers and they give us an average, and it is very useful information. In the period that the Liberal Party made its commitment, their base of 2016-17, the market offer was $1,976. The last full year average that ESCOSA did was $2,086, an increase from that period—that is to June 2020. Then the minister either instructed ESCOSA or ESCOSA of their own initiative did another piece of work, which was, surprisingly, to calculate the average power price from 30 June 2020 to 31 October 2020. That measure was $1,976.

On the best case example, power prices have decreased by a dollar on the government's measure of their $302; at worst, it has increased by $111. Can the minister explain to the committee how he intends to get that $302 power decrease from his stated base line in his policy document that he released in 2017 before the election saying that he would reduce power prices by $302 compared with the 2016-17 average price?

The Hon. D.C. VAN HOLST PELLEKAAN: I do not want to debate with the member the merits of different reports and different numbers that come from different places or the same place, but the advice I have is that, based on ESCOSA's numbers, the average annual residential electricity price has gone down $269.

The Hon. A. KOUTSANTONIS: From when?

The Hon. D.C. VAN HOLST PELLEKAAN: Since coming into government.

The Hon. A. KOUTSANTONIS: That was not your election commitment. Your election commitment was that you would reduce power prices by $302 compared with the latest 2016-17 prices. Power prices now are more expensive than they were in 2017 when you made that promise. The problem is that we have a commitment in writing from the government that they would lower these power prices. My question is: from your commitment, when will you lower power prices by $302 per annum?

The Hon. D.C. VAN HOLST PELLEKAAN: I do not accept the premise of that statement, that power prices are going up.

The Hon. A. KOUTSANTONIS: Well, it is here. It is your document; it is not mine.

The Hon. D.C. VAN HOLST PELLEKAAN: Our prices are actually going down.

The Hon. A. KOUTSANTONIS: I can table it, if you like.

The CHAIR: No, we do not table documents in committee.

The Hon. A. KOUTSANTONIS: It is your document, sir. It says here—

The CHAIR: Yes, I know. Member for West Torrens, you can circulate the document, if you wish, but we do not table documents in committee. You have asked your question, made your point and the minister is answering.

The Hon. D.C. VAN HOLST PELLEKAAN: I do not accept the premise of the question that power prices are going up. Power prices are actually going down. In fact, there is an enormous amount of information that supports that. Wholesale energy costs are currently the primary driver of retail price changes. South Australian wholesale electricity prices continue to fall with the decline of $62.04 in 2019-20 compared to an average of $109.80 in 2018-19. The Australian Energy Market Operator's data indicates that wholesale prices averaged $44.83 per megawatt hour for 2020-21.

A report from the Australian Energy Regulator has shown that South Australia recorded the lowest average spot electricity prices in the National Electricity Market for quarter 4 2020 at $35 per megawatt hour. This was the first time since quarter 1 in 2012, which I think is about the time the member became the energy minister himself, that South Australia had the lowest quarterly prices in the National Electricity Market. So they have been going up since then until we came into government.

As of 12 July 2021, South Australian futures were priced at $61.25 per megawatt hour in the third quarter of 2021. These declining wholesale costs should translate to lower retail costs in the future. The Essential Services Commission of South Australia reported that in June 2018 the average all retailers' market offers for residential electricity customers consuming 5,000 kilowatts per year was $2,244. This figure had decreased by $269 by October 2020.

So there is a lot more information that supports the benefits to households of our energy policies. We are getting electricity prices down and I stand by that $302 commitment.

The Hon. A. KOUTSANTONIS: Given the objective statements on page 102, can the minister confirm that his commitment was to reduce power prices by $302 compared to the latest 2016-17 prices when he published his policy?

The Hon. D.C. VAN HOLST PELLEKAAN: Let me go back and refresh myself on that, but let me be very clear—

The Hon. A. KOUTSANTONIS: That you do not know your election commitment?

The Hon. D.C. VAN HOLST PELLEKAAN: Let me be very clear: the commitment that we made, I stand by.

The Hon. A. KOUTSANTONIS: So you stand by—this is a copy of the 'Liberal Energy Solution: a real energy solution for South Australians'. On page 9, your document states:

This fall in wholesale prices would see an average South Australian household’s power bill fall by $302, compared to the latest (2016-17) prices.

That is accurate?

The CHAIR: Well, you have read the document, member for West Torrens.

The Hon. A. KOUTSANTONIS: I just do not understand why the minister will not repeat his own election commitment.

The Hon. D.C. VAN HOLST PELLEKAAN: Ask a question.

The Hon. A. KOUTSANTONIS: I am. Is that accurate?

The Hon. D.C. VAN HOLST PELLEKAAN: You are reading from a document there. Let me get to the heart of it. I stand by the commitment that we made—

The Hon. A. KOUTSANTONIS: Was your commitment—

The Hon. D.C. VAN HOLST PELLEKAAN: —and I will also—

The Hon. A. KOUTSANTONIS: Okay, was your commitment—

The Hon. D.C. VAN HOLST PELLEKAAN: I will also easily happily compare the record of the last 3½ years under our government—

The Hon. A. KOUTSANTONIS: Sure.

The Hon. D.C. VAN HOLST PELLEKAAN: —to any time under the previous government, particularly the time that the member opposite was the minister.

The Hon. A. KOUTSANTONIS: Let's actually then get to brass tacks. Did you make a commitment to the people of South Australia that you would lower power prices by $302 from a base of 2016-17 average pricing?

The Hon. D.C. VAN HOLST PELLEKAAN: I told you. I will go back to that document.

The Hon. A. KOUTSANTONIS: I have to say, this is not a matter of debate. It was an election commitment the minister made. You wrote this policy. Is your evidence to the committee you do not remember—

The Hon. D.C. VAN HOLST PELLEKAAN: No.

The Hon. A. KOUTSANTONIS: —or you do not know or you are just not going to say?

The Hon. D.C. VAN HOLST PELLEKAAN: My evidence to the committee is that I stick by the commitment.

The Hon. A. KOUTSANTONIS: Well, the commitment was 2016-17, and on your very best independent advice you had from ESCOSA you have reduced power prices by $1.

The Hon. D.C. VAN HOLST PELLEKAAN: And, Mr Chair, the member's description of the commitment is for the member to make. What I say very, very clearly is that I stick by the commitments that we have made.

The Hon. A. KOUTSANTONIS: I just again point out to the Chairman.

The CHAIR: Yes.

The Hon. A. KOUTSANTONIS: Sir, I cannot make inaccurate statements in the parliament because that would be a contempt of the parliament. I am saying that the Liberal Party document says that you would reduce power prices by $302 by 2016-17. I have asked the minister four times. He was the Liberal Party spokesperson on this matter and the minister. Page 108 of his Agency Statement says the objective is 'to deliver the government's commitment to reduce energy costs'. That commitment is in this document. This document says 2016-17. ESCOSA, which is an independent regulatory agency for the state, publishes these figures annually.

In 2016-17, the average price was $1,976. Even with the one-off June to October figure that the minister commissioned, the very best the government can say they have reduced power prices by all reporting is by a dollar off the base and metric they set. I go on to ask the minister: who instructed ESCOSA to publish this 30 June to 31 October report? Was that something ESCOSA did on their initiative, or did you instruct them to do so?

The Hon. D.C. VAN HOLST PELLEKAAN: Just to be very clear, rather than leave the people who are listening to this debate hanging on the words of the shadow minister, I stick by the commitments that we have made with regard to that. I stand by those commitments.

The CHAIR: You are repeating your answer to the original question. Thank you, minister.

The Hon. D.C. VAN HOLST PELLEKAAN: With regard to the commissioning of that report, I will take that on notice and get back to the house.

The Hon. A. KOUTSANTONIS: The only people who can commission reports from ESCOSA are the Treasurer or, I think, the water minister, or you. So either you signed a document to ESCOSA asking them to do this work, or you instructed your staff to ask them to do this work, or they did it of their own motion. Do you not remember asking them to do this work?

The Hon. D.C. VAN HOLST PELLEKAAN: I ask ESCOSA to do a lot of work. One of the things that we want to be able to do for the people of South Australia, and for this chamber and many others, is to provide as much accurate independent advice on these things as possible.

The Hon. A. KOUTSANTONIS: Why would ESCOSA for the first time in its history publish a report on the basis of 30 June 2020 to 31 October 2020? Was anyone attempting to try to get a number out there that showed that power prices actually decreased, or were they worried about something else? The next report is out in August, next month, and without this report—this subsequent report that ESCOSA were asked to do is to 31 October 2020—the public record will show a power price increase from your base of 2016-17 of $111. Is that why they were asked to do this report?

The Hon. D.C. VAN HOLST PELLEKAAN: I told you, I will come back with regard to the commissioning of the report. But let's just maybe save everybody in the chamber a lot of time: we have an election commitment, I stand by it, and let's see—

The Hon. A. KOUTSANTONIS: You just cannot remember it.

The Hon. D.C. VAN HOLST PELLEKAAN: —where we end up when we get to the next election.

The Hon. A. KOUTSANTONIS: What is the use of standing by an election commitment if you cannot remember it? I asked you a pretty simple question. It is on page 9 of your document.

The Hon. D.C. VAN HOLST PELLEKAAN: Again, I do not accept the premise of the questions or the statements.

The Hon. A. KOUTSANTONIS: Does that mean that the document on page 9 does not reference 2016-17 prices?

The Hon. D.C. VAN HOLST PELLEKAAN: Mr Chairman, I think I have been as clear as I can be.

The Hon. A. KOUTSANTONIS: I think you are absolutely being very, very evasive, and I think that raises more questions. It is not like you either I have to say, so I think we will move on.

The Hon. D.C. VAN HOLST PELLEKAAN: Mr Chair, I am not being evasive; I am sharing as much as I can. I have offered to bring information back and I could not be clearer—about five or six times—with regard to our commitments.

The CHAIR: Yes, and you will get back to us on ESCOSA.

The Hon. A. KOUTSANTONIS: There are many references to this project in the budget papers, so I will just choose one. It is Project EnergyConnect, just for the benefit of the minister, and it is in Budget Paper 4, Volume 2, page 111, highlights. I will ask a series of questions about that if I can. If you want more specific references, I can get them for you.

The Hon. D.C. VAN HOLST PELLEKAAN: Sure.

The Hon. A. KOUTSANTONIS: Have you received any advice that Project EnergyConnect's completion is delayed or if there have been any further cost escalations since the latest public announcements by ElectraNet or the Australian Energy Regulator?

The Hon. D.C. VAN HOLST PELLEKAAN: No.

The Hon. A. KOUTSANTONIS: What is the total cost of capital infrastructure for EnergyConnect in South Australia in dollar terms—maybe you can take this on notice if you do not have the answer—and what would that make up as a percentage of the total capital of the entire bill?

The Hon. D.C. VAN HOLST PELLEKAAN: I have these figures handy and I am happy to get them for you, but the reality is that none of them are a cost to the South Australian taxpayer through this budget. Those are costs that have been met by the private sector in building the interconnector, so they are not part of this budget. As we both know, there is a cost-recovery mechanism that works its way through and I can give you those numbers if you want.

The Hon. A. KOUTSANTONIS: Yes, please.

The Hon. D.C. VAN HOLST PELLEKAAN: They are a matter of public record.

The Hon. A. KOUTSANTONIS: Thank you.

The Hon. D.C. VAN HOLST PELLEKAAN: On 31 May 2021, the Australian Energy Regulator published details of its final decisions on costs for ElectraNet and TransGrid to build Project EnergyConnect. The regulator determined that the total cost for Project EnergyConnect is $2,275.3 million, comprising capital expenditure of $457.4 million for ElectraNet and $1,817.9 million for TransGrid. I do not have the percentages here, but they would be pretty straightforward.

The Hon. A. KOUTSANTONIS: In what financial year will a South Australian energy consumer receive their first discount as a result of EnergyConnect becoming operational?

The Hon. D.C. VAN HOLST PELLEKAAN: I will get that from an adviser, but let me go to where the shadow is perhaps heading. I am advised construction will start this year and I am advised that commissioning will start in 2023. I am also advised there is no specific date, to answer that question, but in general terms the answer is that as soon as the electricity starts to flow it has a positive downward impact on wholesale prices, and that works its way through to retail prices.

The Hon. A. KOUTSANTONIS: Last year's average spot price for wholesale prices was $40 in South Australia, or thereabouts. Project EnergyConnect will lower that by how much?

The Hon. D.C. VAN HOLST PELLEKAAN: I do not have that with me, but the latest numbers with regard to residential costs are $100 per year to South Australian residential consumers.

The Hon. A. KOUTSANTONIS: That is based on the ACIL Allen report, is it not?

The Hon. D.C. VAN HOLST PELLEKAAN: That is based on the numbers that the Australian Energy Regulator has signed off on.

The Hon. A. KOUTSANTONIS: That is based on the ACIL Allen report. I understand that the Australian Energy Regulator did not do their own modelling; ElectraNet and TransGrid did the modelling and supplied them with consultants' reports. That is where your number is coming from, the ACIL Allen report, is it not?

The Hon. D.C. VAN HOLST PELLEKAAN: It is the number that the AER accepted.

The Hon. A. KOUTSANTONIS: Yes, I understand.

The Hon. D.C. VAN HOLST PELLEKAAN: The two proponents provided them, where they came from and the backgrounds.

The Hon. A. KOUTSANTONIS: That is based on a wholesale power price dropping from $120 down to $60, that power price reduction you have just quoted, that $100 per year. The average wholesale power price in South Australia last financial year was $40. This report has already factored in the decrease, so what will the interconnector do to those South Australian wholesale power prices? Do you have any modelling or advice on that?

The Hon. D.C. VAN HOLST PELLEKAAN: I am sure it exists, but I do not have it with me. The reality is that the best information available, which was approved by the AER fairly recently, says $100 per year on average per household in savings on electricity bills.

The Hon. A. KOUTSANTONIS: What is the average cost to the 860,000 or so households connected to the NEM in South Australia in terms of their recovery of capital costs for Project EnergyConnect?

The Hon. D.C. VAN HOLST PELLEKAAN: The Australian Energy Regulator indicated that passing through the cost of the project will increase annual bills in the short term by $6 for households in the financial year 2022-23 and $17 per year per household each year during 2023 to 2028. That is the pass-through cost. Then the benefit from lower prices is approximately $100 above that.

The Hon. A. KOUTSANTONIS: Immediately?

The Hon. D.C. VAN HOLST PELLEKAAN: It is not in that first year. There is modelling available and I will bring the answer back to the house.

The Hon. A. KOUTSANTONIS: I am glad you say there is modelling available. Who conducted that modelling you are referencing?

The Hon. D.C. VAN HOLST PELLEKAAN: I will find out for you. What I am saying quite consistently is that we are working from the numbers the AER accepted. Some of them they worked on themselves, some of them they brought in consultants to help them with, some of them they received from TransGrid and ElectraNet when they produced them themselves and some of them TransGrid and ElectraNet brought in consultants for. There are a lot of sources of this information. The most important thing is that the Australian Energy Regulator, whose job it is overwhelmingly to approve proposals if they think they are in the best interest of consumers, have said that this project is good for consumers.

The Hon. A. KOUTSANTONIS: Was Project EnergyConnect referred to the South Australian Productivity Commission for analysis?

The Hon. D.C. VAN HOLST PELLEKAAN: No, it was not referred through the normal process, and there is a good reason for that: there is no state government money in the project save for underwriting, which is not going to be a cost to the taxpayer at all, but it is a private project. While it was not referred, they took interest in it and a favourable comment or two or more made about it, saying this would be very good. The reality is that it was not something that would be referred to them.

The Hon. A. KOUTSANTONIS: I suppose where I am going with this, minister, is that I have not seen any government modelling—New South Wales government, South Australian government or commonwealth government modelling—on the benefits of this, as you call it, 'private' piece of infrastructure.

This private piece of infrastructure has been given a legislative basis to recoup that money, and you gave evidence to the committee just now—that they can charge every household in South Australia $6 a year for the first financial year 2022-23, going up to $18 out to 2028 and then ongoing. This is a $2.2 billion piece of infrastructure that proponents have compelled South Australians and New South Wales residents to purchase whether they like it or not. It is a monopoly asset, a regulated asset. They can pass through their costs.

The question I have for you is: what have you done as a government, as a sovereign government, to do your own modelling, your own research, to verify and check the ACIL Allen report, which was commissioned by ElectraNet, the beneficiaries of this project, and the modelling done by TransGrid and their consultants, which is designed obviously to prove up their project? What independent work have you done to verify these numbers?

The Hon. D.C. VAN HOLST PELLEKAAN: First of all, while the shadow minister focuses on the cost to consumers, let me just say again that it has been independently verified that the benefits to consumers swamp the costs. It is a net saving to consumers. That is the important thing about this project.

With regard to what I have done specifically, what I have done is work very closely, as has my office and as has our department, with the Australian Energy Regulator. It is not at all uncommon when a national independent regulator is overseeing a project for the relevant states not to feel compelled to do their own work in parallel.

If the shadow minister is saying that he is uncomfortable with the AER work or the AER staff or the AER results or the AER way of going about things, he can hold that view, if that is his view. That is not my view. My view is that they have been extraordinarily thorough with regard to this project. This project has been turned upside down and sideways and inside out for quite a few years now.

The AER has done work on behalf of the South Australian government, on behalf of South Australian consumers and on behalf of customers in general. The Australian Energy Regulator, as an arms-length independent regulator, does that work on behalf of Australians, and in this case South Australians and of course people in New South Wales.

The Hon. A. KOUTSANTONIS: The AER is not an independent statutory body. It is part of the Department of Treasury and Finance in Canberra.

The Hon. D.C. VAN HOLST PELLEKAAN: I did not say statutory. I said independent.

The Hon. A. KOUTSANTONIS: ESCOSA, however, are.

The Hon. D.C. VAN HOLST PELLEKAAN: If you are suggesting that the AER does not work independently then I will leave that suggestion with you.

The Hon. A. KOUTSANTONIS: No.

The Hon. D.C. VAN HOLST PELLEKAAN: However, as far as I am concerned, they do their work independently of governments.

The Hon. A. KOUTSANTONIS: I have the ACIL Allen report here in front of me. Have you read the Acil Allen report?

The Hon. D.C. VAN HOLST PELLEKAAN: I have read the ACIL Allen reports. I do not know which one you have in front of you.

The Hon. A. KOUTSANTONIS: This is the one on Project EnergyConnect.

The Hon. D.C. VAN HOLST PELLEKAAN: As I said earlier on, I am not going to be drawn into a situation where the shadow minister reads something to himself and to the chamber and then asks me if it is all true or if I have read it. If the shadow minister is asking me as minister whether I have read every single piece of information that was produced by anybody involved in the AER's determination that this is a good project, the answer is no. Have I read some of it? Yes. Have I read a lot of it? Yes. But I am not going to get into the silliness of saying, 'Have I read the one that the shadow minister has in front of him?'

The Hon. A. KOUTSANTONIS: I think that is a fair statement. This is the one piece of work ElectraNet did for ACIL Allen. It was reported to ElectraNet on 24 September 2020 and submitted to the AER as the definitive modelling by ElectraNet on the case for the interconnector. Have you read that ACIL Allen report?

The Hon. D.C. VAN HOLST PELLEKAAN: I am not going to get into that.

The Hon. A. KOUTSANTONIS: I will take that as a—

The Hon. D.C. VAN HOLST PELLEKAAN: I cannot remember which report I read and which report I did not read and, as you said, that is actually very fair.

The Hon. A. KOUTSANTONIS: This is the report that the AER relied on. In this report, they have given us a load-weighted wholesale spot price with Project EnergyConnect and one without. They say in 2019 the wholesale power price on average in South Australia was just over $120, and then it drops in 2020 to $60, and it would have had a trajectory a lot higher had it not been for Project EnergyConnect. It bounces around between $60 and $75 and then goes off up over a longer period of time.

Given that the Australian Energy Regulator and AEMO publish annual reports about the average spot price, South Australia's average spot price last year was in the 40s, and the New South Wales spot price was a lot higher. You have committed South Australians to building an interconnector to a jurisdiction that is facing shortages in power. The spot price this financial year is well above a hundred dollars in Queensland and New South Wales, while we are enjoying relatively low spot prices in the wholesale market, although it is increasing.

The base case shows benefits when the price drops to $60. Given the price was at $40 on average last financial year, how do we get savings from the interconnector? Where do they come from?

The Hon. D.C. VAN HOLST PELLEKAAN: Well, that is a big question with a big answer.

The Hon. A. KOUTSANTONIS: I would love to hear it.

The Hon. D.C. VAN HOLST PELLEKAAN: That is completely contained in the AER's determination so, if the shadow minister really wants to, he can just focus on the AER's determination. The assertion I have committed South Australians to this is inaccurate. I support the building of this interconnector. The two proponents applied to the AER and others for permission to build it. The Australian Energy Regulator on behalf of consumers gave them that permission. Do I support that? Yes, absolutely, but the words used by the shadow minister are incorrect. This is a very good project. All the information the shadow minister is seeking is available in the AER's determination, and I refer him to that.

The Hon. A. KOUTSANTONIS: I point out again that the Liberal Energy Solution plan was all about an interconnector, including a $200 million fund that was never established to bring about its creation. I read from that:

Our solution will also increase South Australia’s connection with the rest of the national market and make renewables much more reliable by:

creating a $200 million Interconnection Fund to provide South Australians with access to cheap baseload power…

That cheap base load power you are talking about currently is more expensive in New South Wales than it is here, so my very obvious question is: if you are connecting us to a jurisdiction that has base load power of over a hundred dollars on average a megawatt hour, where are the price reductions coming from?

The Hon. D.C. VAN HOLST PELLEKAAN: Well, Mr Chair, he wanted the answer, so here is the answer, and please let me finish it. What the shadow minister has just said betrays his misunderstanding of the entire energy system. It might well be the reason that before we came into government we had more and more blackouts, higher and higher prices, and that since coming into government we have reversed that: prices are going down and we have reduced the number of blackouts.

To say that our energy policy was all about the interconnector is entirely wrong: it was a key component. Our energy policy included our Home Battery Scheme, it included the Grid Scale Storage Fund, it included demand management and demand response trials, it included a wide range of things and, yes, it included the interconnector.

It is true to say that the interconnector will benefit South Australians because we will have access to cheaper base load power, but for the shadow minister then to try to twist that into assuming that every drop of electricity that is going to be consumed in South Australia is going to come from interstate where power prices are on average higher—and I do appreciate his acknowledgment that power prices in South Australia are cheaper than in New South Wales—and to try to assume that we would be paying the average available in New South Wales instead of the average available in South Australia is either ill-informed or deliberate misrepresentation.

There will be times when the power prices in South Australia at a point in time might go higher for an hour, they might go for a day, they might go for a week. There will be times when power prices in South Australia are higher than they are in New South Wales. At those points in time, we will be able to access cheaper base load power from New South Wales. That is a fact. But power will be cheaper on average across the year in South Australia than it will be in New South Wales, but that does not mean we do not need the interconnector.

What that means is that we have the opportunity to use the interconnector in many ways. We have the opportunity to use the interconnector, as is already happening, as a way of attracting far more investment and thousands of jobs and billions of dollars into new renewable energy generation, which we actually cannot absorb in South Australia at the moment. However, that renewable energy, because it is going to be cheaper in South Australia and more expensive in New South Wales, can be exported into New South Wales.

The interconnector is not just about importing electricity into South Australia: it is a two-way tool. We will export far more renewable energy from South Australia into New South Wales than we will ever import of their base load power. Why is that important? Because we want to use this tool to its greatest effectiveness. There are plenty of examples with regard to points in time when, yes, we will import cheaper power, but across the average of the year we will be exporting our cheaper power.

Interconnectors are also very important with regard to being tools to manage frequency and voltage. It is naive to think of an interconnector only with regard to flows of electricity on a volume basis: whose got more, whose got less, where is it more expensive, or cheaper and who needs it.

Interconnectors are incredibly important as tools to be able to ramp up or ramp down, to push electricity one way or suck it the other to help with voltage control and frequency control in a way which if you do not have enough interconnection capacity you cannot do. If you get your frequency or your voltage out of whack, you actually have deliberate self-tripping blackouts, so an interconnector can be very useful for those things as well.

An interconnector can be incredibly useful with regard to islanding. Those in this chamber might remember a couple of Januarys ago—about 2½ years ago, I think it was—when a storm in Western Victoria knocked out some of their transmission lines, and so our interconnector to Western Victoria was not useful. We were effectively islanded. This interconnector would mean that instead of having one large and one small one—but essentially interconnection with Victoria, as we have at the moment—we would have large interconnection into two states instead of one. If one of those interconnectors became unviable for some reason, like storm damage or an islanding, we would have another one to fall back on. This would be incredibly important for security of supply in South Australia.

Another thing that is important about interconnection is that, in a world where we have more and more renewable energy penetration, weather not only goes to the demand of electricity, as it has for decades—even back in caveman days; when it was cold they burnt more wood—but now it goes to the supply of electricity as well. Weather goes to demand and to supply.

New South Wales has much more different weather from South Australia than Victoria does, so to make full use of an interconnector you need to be able to swap and share and move your electricity back and forth for a wide range of reasons with a jurisdiction that is not in the same situation as you at the same time and with a jurisdiction that actually does not have the same demand highs and lows at the same time or the same supply highs and lows at the same time.

We are very lucky to have interconnection with Victoria and it is very beneficial to us, but interconnection with New South Wales will be more beneficial because we will have more offsetting opportunities to share that electricity back and forth, the opportunity to use it as a tool for voltage and frequency, the opportunity to access additional electricity when we need it, the opportunity to export surplus renewable electricity when we have it and, by the way, to support the decarbonisation of New South Wales as their coal-fired generators are retired, as is going to happen. They can then use our surplus renewable energy.

We will have the opportunity to engage with a jurisdiction that has different supply and demand peaks and troughs, and certainly more different than we currently have with Victoria, which is important. There are many, many more things that are good about this interconnector. Let me finish with the fact that it is going to make electricity prices cheaper for South Australian households and businesses.

The Hon. A. KOUTSANTONIS: If I can move you to Budget Paper 4, Volume 2, page 111, performance indicators, another one of your election commitments was the successful uptake and installation of 40,000 batteries as part of the Home Battery Scheme. When will you complete having 40,000 batteries installed on South Australian homes? What year?

The Hon. D.C. VAN HOLST PELLEKAAN: We are working to do that and I will get some specific information in just a minute from my advisers. This is a fantastic program. We went to the last election with a commitment for a home battery scheme and the Labor Party went to the last election with a commitment for a virtual power plant, in partnership with Tesla, to be rolled out on Housing SA properties.

Most people thought that whoever was successful at the election would run their own home battery scheme and ditch the other one. On coming into government, we actually looked at the Labor scheme and said, 'Do you know what? We can run both. We will do ours and we can run theirs.' Why is the installation of home batteries so important and why is it such a key feature of our energy solution? They help the house that has them, of course.

The Hon. A. KOUTSANTONIS: Point of order: standing 98. I am not asking about the benefits of the Home Battery Scheme; I am asking about when the 40,000 will be—

The CHAIR: You asked when they would be established or finalised.

The Hon. A. KOUTSANTONIS: Yes. He is debating the answer, so if I could just have an answer to that.

The CHAIR: You are well aware, and we have been through this before: you have asked a question, a very specific question, and ministers can answer in the way they see fit. As I see it at the moment, the minister is giving background to the answer, which he will get to.

The Hon. D.C. VAN HOLST PELLEKAAN: The reason I am going through this is that the benefits of the batteries are actually quite important, and the fact that we have merged two programs together is quite important. For the shadow minister to focus on one program or the other only would be a fairly narrow-minded approach with regard to the benefits of these two programs. I will come to the timing—

The Hon. A. KOUTSANTONIS: I did not ask about the benefits of the programs, I just asked when they will be installed.

The Hon. D.C. VAN HOLST PELLEKAAN: —of the rollout, but let me say as briefly as I can that there are benefits to the scheme for households and there are benefits to the scheme for the grid. The benefits to the scheme for the household is about the household having a battery, and we want to get out tens of thousands of those, including the targets for each distinct group.

The Hon. A. KOUTSANTONIS: But you have not.

The Hon. D.C. VAN HOLST PELLEKAAN: The benefits for the grid are actually about the aggregated total capacity of the battery. Keep in mind that, when we provide a subsidy, we are using taxpayers' money to provide a subsidy to individual homes. I would not do that if there were not benefits for all the other taxpayers across the grid. So the aggregated total of the batteries' capacity is one of the most important things.

We have already achieved what we intended to achieve in the Home Battery Scheme with regard to the aggregated capacity of the batteries, so we are already achieving the benefits to the 95-plus per cent of South Australians who do not have a home battery. We are way ahead of schedule.

With regard to the benefits to the 40,000 people who will get their home batteries—I do not know, but somebody could tell me it is 1 or 2 per cent of the population or probably less or whatever it is—that will occur in September 2025. We already have about 25,000 home batteries either installed or committed to be installed across South Australia. That is 25,000 of the 40,000 that we committed at the election out of both of the programs that we have chosen to essentially merge together. It is 25,000 out of 40,000, and the 40,000 for that one program alone will be September 2025.

The Hon. A. KOUTSANTONIS: Performance indicators show that the government set a target in 2021 of 7,000 installations. It achieved 5,500. You subsequently lowered the subsidy again to $2,000, as I understand from the email you sent out either just before lockdown or during lockdown informing MPs of the step down to 2,000. Your target remains at 7,000 for this coming financial year. Can you explain to me your logic where you think that by lowering the subsidy you will still meet the same target as when there was a higher subsidy and you still did not meet that target?

The Hon. D.C. VAN HOLST PELLEKAAN: Well, yes, I can. The initial modelling that we used was on a seven-kilowatt hour capacity battery. What we have found is that the take-up of batteries on average has been a 12-kilowatt hour capacity battery. So we are achieving our total aggregated grouped up storage, which is actually the thing that benefits every household that does not have a battery. The overwhelming majority of people in South Australia are getting that benefit.

With regard to the very small share of people I also want to help, and who seem to be the key focus for the shadow minister, those 40,000 people have the opportunity to access a battery with a subsidy. They also have the opportunity to access not only a new battery but also new solar panels on their house if they do not have them through support from the Clean Energy Finance Corporation with $100 million of money for low interest loans.

To the point about the subsidy, we said very early on that we would offer a more generous subsidy at the start of the program and a less generous subsidy at the end of the program because one of the things that our program would do was bring down the cost of the batteries. The average cost of these batteries since we started this program has come down $4,700 on average.

The initial maximum subsidy was $6,000. It is currently $3,000. It will go down to $2,000. So in the time that we have reduced the subsidy by $4,000, from $6,000 to $2,000, our policy, as we said it would, has actually brought down the cost of the batteries by nearly $5,000. So a household that chooses to buy a battery today or tomorrow, or down the track when the subsidy is reduced again after another 1,200 or 1,300 batteries have gone out, will actually still be nearly $1,000 better off than they would have been if they had bought the battery at the beginning of the program and got the bigger subsidy.

That is how we are going to keep rolling out the batteries with lower subsidies because there are many benefits from this program, one of which is bringing down the cost of the batteries. We said that would happen and it is happening. So while we are reducing the subsidy, the net cost of the batteries is actually going down even faster.

The Hon. A. KOUTSANTONIS: I refer to Budget Paper 4, Volume 2, page 102, ministerial office resources and the workforce summary on page 103. Do you have any ministerial advisers who were seconded from another department?

The Hon. D.C. VAN HOLST PELLEKAAN: Yes, one.

The Hon. A. KOUTSANTONIS: Who is that?

The Hon. D.C. VAN HOLST PELLEKAAN: Scott Cawrse.

The Hon. A. KOUTSANTONIS: Do you have two senior advisers?

The Hon. D.C. VAN HOLST PELLEKAAN: Correct.

The Hon. A. KOUTSANTONIS: How many advisers in total do you have in your office?

The Hon. D.C. VAN HOLST PELLEKAAN: I have a budget for one Chief of Staff and three advisers and I actually have one Chief of Staff and two advisers.

The Hon. A. KOUTSANTONIS: Are both those advisers senior advisers?

The Hon. D.C. VAN HOLST PELLEKAAN: Yes.

The Hon. A. KOUTSANTONIS: Of the 13 FTEs in your ministerial office, how many have been seconded from outside the Department for Energy and Mining?

The Hon. D.C. VAN HOLST PELLEKAAN: Just to be clear, there are chiefs of staff and advisers and then there are essentially departmental ministerial staff. To the best of my knowledge and to the best of my CE's knowledge, none of those people in what would normally be the departmental category have come from outside the department. But we will take that on notice and let you know if it is different.

The Hon. A. KOUTSANTONIS: If I could refer you now to Budget Paper 4, Volume 2, page 111, growth and low carbon, highlights, dot point 4 relating to the hydrogen export study and the South Australian hydrogen export plan, what is the total budget allocation for 2021-22 for the hydrogen export plan?

The CHAIR: Member for West Torrens, I think you said page 111; it is actually page 110.

The Hon. A. KOUTSANTONIS: Thank you very much, sir. You have the wisdom of Solomon.

The CHAIR: I am just letting you know that I am onto it.

The Hon. D.C. VAN HOLST PELLEKAAN: To date, the South Australian government has committed more than $40 million in grants and loans to the development of renewable hydrogen, including Australian Gas Networks (AGN), Hydrogen Park South Australia, part of the Australian Gas Infrastructure Group, and recently launched its $14.5 million demonstration project.

The Hon. A. KOUTSANTONIS: I am not interested in the Renewable Technology Fund. I am asking what the budget is for the hydrogen export plan. The government did a hydrogen export study and has an SA hydrogen export plan. It is referred to on numerous occasions in the budget. You can come back to it. You can take it on notice; it is no problem.

The Hon. D.C. VAN HOLST PELLEKAAN: Just to clarify, are you sure you are not thinking about the Hydrogen Action Plan?

The Hon. A. KOUTSANTONIS: No, the hydrogen export plan.

The Hon. D.C. VAN HOLST PELLEKAAN: We will take that on notice.

The Hon. A. KOUTSANTONIS: What was the total cost of the hydrogen export study?

The Hon. D.C. VAN HOLST PELLEKAAN: Approximately $1.25 million.

The Hon. A. KOUTSANTONIS: Who was the external consultant who conducted that?

The Hon. D.C. VAN HOLST PELLEKAAN: I am advised KPMG and WSP.

The Hon. A. KOUTSANTONIS: What does the WSP stand for?

The Hon. D.C. VAN HOLST PELLEKAAN: We will come back to you on that.

The Hon. A. KOUTSANTONIS: On how many occasions have you met with representatives of H2U? Numerous?

The Hon. D.C. VAN HOLST PELLEKAAN: I would need to check my diary, but I suspect it might be four times perhaps.

The Hon. A. KOUTSANTONIS: Did you ever inform anyone from H2U that land at Port Bonython would be available for sale or lease before it was publicly announced by the government?

The Hon. D.C. VAN HOLST PELLEKAAN: No.

The Hon. A. KOUTSANTONIS: I have a letter here dated 4 May from the Treasurer addressed to Mr Attilio Pigneri, and I quote:

As you know, the parcels of land in which you have expressed an interest are proposed to be included in an upcoming open-market Expression of Interest (EOI) process.

So H2U, on 4 May 2021, before this letter was sent, had advance knowledge that land at Port Bonython was to go out to tender. Your evidence to the committee is that you or your office never told H2U that that process was underway?

The Hon. D.C. VAN HOLST PELLEKAAN: I have already answered that question. But let me be very clear. If I remember what you read correctly, the letter from the Treasurer says to H2U, 'The land that you,' being H2U, 'have expressed interest in'. It does not suggest that anybody has commented on that in any way to H2U.

It is not at all uncommon for a company to approach the government and say, 'We are expressing our interest,' and then if it is deemed appropriate for the Treasurer, if he or she sees fit, to write back and say, 'The land that you have expressed interest in, actually, we are going to do something with it.' It seems pretty straightforward.

The Hon. A. KOUTSANTONIS: Yes, that explanation is straightforward, but the letter, unfortunately for someone, says, 'As you know, the parcels of land—

The Hon. D.C. VAN HOLST PELLEKAAN: —that you have expressed interest in.'

The Hon. A. KOUTSANTONIS: —which you have expressed an interest in—

The Hon. D.C. VAN HOLST PELLEKAAN: There you go.

The Hon. A. KOUTSANTONIS: —are proposed to be included in an upcoming open market expression of interest.' How could H2U know about an expression of interest before everyone else?

The Hon. D.C. VAN HOLST PELLEKAAN: You will have to talk to the Treasurer about this if you want some more details, but—

The Hon. A. KOUTSANTONIS: So this is the Treasurer's doing?

The Hon. D.C. VAN HOLST PELLEKAAN: —let me just say again: the letter says very clearly 'from the Treasurer to H2U'. It makes it clear that H2U has expressed interest in the land. It does not say that anybody from anywhere in government offered land or talked to them about it or gave them any inside information or anything like that. It is not at all uncommon for companies to approach the government for land. In fact, I would be surprised if other companies had not approached the government and said, 'We have interest in the land at Port Bonython.'

The Hon. A. KOUTSANTONIS: That is a perfectly reasonable thing to say. There is only one problem and that is they knew about an EOI.

The Hon. D.C. VAN HOLST PELLEKAAN: That letter does not say that.

The Hon. A. KOUTSANTONIS: It does. It says, 'As you know, the proposed parcels of land in which you have expressed an interest are proposed to be included in an upcoming open market expression of interest.' This letter predates the government's public announcement.

The Hon. D.C. VAN HOLST PELLEKAAN: But it does not say that anybody talked to—

The Hon. A. KOUTSANTONIS: I did not say. I am asking you if you had.

The Hon. D.C. VAN HOLST PELLEKAAN: I did not. If you want more information, you can talk to the Treasurer.

The Hon. A. KOUTSANTONIS: Had H2U asked you to lobby the Treasurer on their behalf to give them access to this land through a direct approach?

The Hon. D.C. VAN HOLST PELLEKAAN: No, they did not.

The Hon. A. KOUTSANTONIS: Did they make an unsolicited bid to you for this land?

The Hon. D.C. VAN HOLST PELLEKAAN: No, and let me just try to help you here.

The Hon. A. KOUTSANTONIS: Thank you.

The Hon. D.C. VAN HOLST PELLEKAAN: We have been through this in question time. I did not meet with H2U any time around this point in time—

The Hon. A. KOUTSANTONIS: I believe you. Minister, I am not accusing you of lying. I am just asking.

The Hon. D.C. VAN HOLST PELLEKAAN: —that you are talking about. The letter that you are reading from, I think, is the same one that we have discussed in question time. There was a suggestion from the opposition in question time that something inappropriate had happened. It was very clear from all the information that came out in question time that that was clearly not the case, that the Treasurer wrote a letter to H2U.

The Treasurer actually also informed every other organisation that had expressed any interest in acquiring this land or expressed interest through the expression of interest process of the existence of a commitment to H2U. Also, from memory, it makes it very clear that H2U still has to fully participate in the expression of interest/tender process that H2U still would have to pay a market price. All of this information was actually proactively shared by the Treasurer through seeking the expression of interest process.

The Hon. A. KOUTSANTONIS: On that, minister, these documents were an addendum to the initial EOI. They were not included. When the initial EOI was released, the information was not included that H2U—it became apparent after you went on radio and said that—

The Hon. D.C. VAN HOLST PELLEKAAN: It was provided to all the people or organisations who expressed an interest, who said that they wanted to participate—

The Hon. A. KOUTSANTONIS: Subsequently, yes. But not the original expression of interest.

The Hon. D.C. VAN HOLST PELLEKAAN: If the shadow minister wants to split hairs—

The Hon. A. KOUTSANTONIS: It is not splitting hairs.

The Hon. D.C. VAN HOLST PELLEKAAN: Let me just be really clear: it was provided to the people who said they wanted to participate, not to the people who did not want to participate.

The Hon. A. KOUTSANTONIS: Just so the committee is clear, if a company has prior knowledge of an expression of interest, has made an unsolicited approach to the government for land and is granted that land and that is not made apparent to everyone in the initial expression of interest and is done subsequently, that is not the same as everyone being informed. This was a process that has been amended because it has been found out that H2U knew in advance that there was going to be an EOI.

What I am trying to get at—and I am not accusing you, minister; I am just asking you—is that someone has told them. Someone has told H2U that this land is going out to the market, and it just happens to coincide with their unsolicited bid for the land. They had been granted I think over a hundred hectares of this land adjacent to the land that is going out for an expression of interest, so there are probity questions here that need to be answered.

No-one is suggesting you have done anything wrong; I am just asking. How could H2U possibly know about this? You say you do not know; we will take our inquiry somewhere else. But it is not right to say that this was an open and transparent process in the beginning because when the expression of interest was released it was not part, unless you have other information—

The Hon. D.C. VAN HOLST PELLEKAAN: Let me just address that. If the member has concerns about the probity of the process—

The Hon. A. KOUTSANTONIS: I do.

The Hon. D.C. VAN HOLST PELLEKAAN: —the Treasurer and his department have gone through, he has avenues to pursue that if he wants to.

The Hon. A. KOUTSANTONIS: I will.

The Hon. D.C. VAN HOLST PELLEKAAN: I am confident that the Treasurer and his department will have dealt with this appropriately. Like many of the things that the shadow minister raises, he tries to create a spectre about when we get down the track something is going to be terrible: 'When we get down the track this will be bad, this will be bad, this will be bad.' This is the normal way that this member chooses to try to make things look bad when actually they are not.

The CHAIR: On that note, we might go to the member for Frome who has a question.

The Hon. G.G. BROCK: Thank you, Mr Chairman. Minister, on Budget Paper 4, Volume 2, page 110, I want to go back and look at the targets for 2020-21. Can you give me an update on who are the new members of the TLAP Committee? They have not been announced at this stage. I assume they have been picked, but I have no indication or information whatsoever about where it is.

The Hon. D.C. VAN HOLST PELLEKAAN: I will just come directly to that after helping the shadow minister—WSP is Williams Sale Partnership Limited. My outstanding advisers have been able to get that straightaway. Member for Frome, the membership of that committee has not been formally established.

The Hon. G.G. BROCK: I have another question, Mr Chairman. At the last estimates, we were informed that the review was done by Mr Lew Owens. Are you indicating to me at this committee that the final report from Mr Lew Owens has not been finalised; is that what you are saying?

The Hon. D.C. VAN HOLST PELLEKAAN: No, your question was about the membership of the new TLAP Committee, and what I said was that it has not been formally established.

The Hon. G.G. BROCK: Why not? First up, why has it not been—

The Hon. D.C. van Holst Pellekaan interjecting:

The Hon. G.G. BROCK: No, this was already on my list here, minister. I will rephrase it: does anyone who was not a member of the previous committee have access to any information or had any discussions with the old, the current or the new members of the proposed TLAP Committee?

The Hon. D.C. VAN HOLST PELLEKAAN: Just bear with me. Just to be sure I understand the question, it is: does anyone who was not on the previous committee have anything to do—any engagement, any involvement—with anybody who was on the previous committee or might be on the next one?

The Hon. G.G. BROCK: Or are having discussions with any new meetings of the new membership of the new TLAP?

The Hon. D.C. VAN HOLST PELLEKAAN: So does anybody who was not on the previous committee have any meetings with any members of the new committee, which has not been established?

The Hon. G.G. BROCK: Well, I understand there are members of our community who may have discussions with members of the new direction going forward who were not part of the old committee.

The Hon. D.C. VAN HOLST PELLEKAAN: There is one person I can think of, and that is Mr Peter Dolan. Mr Peter Dolan is a member of your community. Mr Peter Dolan has been appointed as the Executive Director of TLAP. I think he would fit into that category of people you are describing who were not on the previous committee but who do have engagement with people who might be on the future—

The Hon. G.G. BROCK: That has been announced publicly and I endorse that, and congratulate Mr Dolan on taking on that role. There is no-one better to understand the history of the lead issue in Port Pirie and the constraints we had with the previous TLAP Committee than Peter Dolan. I certainly welcome that. So you are indicating that, other than Mr Peter Dolan, no-one should be having meetings who were not members of the previous TLAP Committee?

The Hon. D.C. VAN HOLST PELLEKAAN: I think Mr Peter Dolan would fit into that category of people who were not on the committee before who do have access to information now. He is an outstanding appointment. I am glad that the member for Frome supports the changes we are making to the TLAP Committee that he and his cabinet colleagues at the time, back in 2014, established. I am pleased he recognises that what our government is doing is improving what happened there.

Mr Peter Dolan has been appointed as executive director of what has been called the TLAP Committee, which will be restructured. It has not been formed yet in any technical capacity. He would be speaking with a whole range of people who have an interest in this area at the moment.

The Hon. G.G. BROCK: Can I just go back. At the last estimates, the review had already been started from February. At that stage, you indicated that, as the local member, I would be advised as soon as possible. Here we are, nearly 10 months down the track, and we still have not finalised the new TLAP Committee, their obligations and how they going to work with not only the local council but also the local member and the community. It has not been made public; is that what you are saying?

The Hon. D.C. VAN HOLST PELLEKAAN: I will help you as much as I can. If you are asking whether the report has been made public, the answer is no. If you are asking why the report has not been made public, the answer is because of the key, most important first step to significantly improve this area of work, significantly improve the results achieved through the process—that you as the local member and you as a cabinet minister helped create.

I do not say for a second that you did not do it with all the best will. I know you would have done it with all the best will but, to be blunt, it was not good enough. That is not only your responsibility. You did not do it on your own, but you were part of it. I am grateful that you acknowledge it needs to be improved, and that is what we are doing.

The first step was appointing the right person—a super high-calibre person, the former 2IC of the EPA, somebody who has been deeply involved in this work and lots of other work over the last few decades that will be incredibly beneficial to this, somebody who has actually moved from Adelaide and bought a house in Port Pirie to live in Port Pirie to do this work. Getting that right person, that person who is so right for so many reasons, was the first step.

He started work on 12 July this year. I decided that it was worth waiting on moving forward with the other things we were prepared to do for the people of Port Pirie and the surrounding districts until we got the right person in place. That person started on 12 July and today is 30 July. We are not sitting around on our hands on this work, but I made the decision that it was worth waiting until we got him—and I am glad you agree he is the right person.

The Hon. G.G. BROCK: I have a further question. What I am concerned about is that I have had no communication or involvement with the new direction. The new direction of the new TLAP has not been made clear and the community itself is not aware of anything, other than of Mr Dolan, who has been in the paper—that is fantastic and is really terrific news.

What is the new composition of the new TLAP Committee? How will the new TLAP Committee differentiate itself from the previous operation and be more open and transparent and get the results that we need for our children and the community of Port Pirie with greening, lead reduction in the atmosphere and so forth?

The Hon. D.C. VAN HOLST PELLEKAAN: With regard to the composition of the committee, I have already said it has not been formally constituted. I think that is the third time I have made that very clear. With regard to other things that have been announced, we have certainly announced the new executive director. We have certainly announced that there will be greater transparency. We have made it clear that people locally who want it can have Peter Dolan's mobile number and can talk to him.

We have engaged with the local media, who said that under the previous system, which the member for Frome helped create, there was no transparency. That is something that local Port Pirie media professionals said: that the member for Frome's TLAP Committee was completely non-transparent. We have committed to change that and, in fact, the work has already started to change that. They can call up Peter Dolan any day of the week, as the member for Frome can do. He can talk to him and ask questions.

With regard to other aspects of the question, we have made it very clear also that local council will be involved in a way that they have not been involved before. We made it very clear that is going to happen and I believe deeply in that. Local council, as we all know, is the level of government that is closest to the people who we all want to represent and do the very best for.

We have made it very clear that is going to happen. We have made it very clear that there is going to be a change in the structure. We have made it clear there is going to be a community reference group. We have made it very clear that a lot of things are going to happen, but the specifics that the member for Frome would like to have right now I am not able to give him right now, but as soon as I can, I will.

The Hon. G.G. BROCK: Minister, when will that time come, when the local member and Port Pirie Regional Council, the mayor in particular, can have an open discussion and know exactly in which direction the new TLAP Committee will be going?

The Hon. D.C. VAN HOLST PELLEKAAN: That will happen as soon as possible. Certainly nobody in this chamber, including the member for Frome, should assume that nothing happens until they have the information. Things are already happening and things are already working. The people of Port Pirie are already starting to get benefits. We will be able to share the formal structure of how that works as soon as possible. The member for Frome will get this information, as I have publicly committed to him several times before, but the fact that he does not have it does not mean that good work has not started already, because it has.

The Hon. A. KOUTSANTONIS: I beg to differ. Last year, in this very forum, the minister told me in an answer to a question he did not know who was on the TLAP Committee. Here we are, later, with the same answer again that it has not been constituted. Then I asked him how the money, the $3.5 million that Nyrstar has allocated, for the Targeted Lead Abatement Program is spent. His evidence to this committee was that that money was allocated by the TLAP Committee. So is your evidence now that that $3.5 million has not been spent over the last 10 months since the last estimates committee on lead abatement programs in Port Pirie? Has there been expenditure?

The Hon. D.C. VAN HOLST PELLEKAAN: No, that is not my evidence.

The Hon. A. KOUTSANTONIS: Could you take on notice exactly what lead abatement programs have been put in place as a result of the TLAP Committee approving that expenditure?

The Hon. D.C. VAN HOLST PELLEKAAN: Shadow minister, I will certainly come back with more information if I can. For now, let me say that community programs to reduce children's blood lead levels have operated in Port Pirie for nearly 40 years through SA Health's Environmental Health Centre. TLAP is a 10-year program between Nyrstar and the government under the Targeted Lead Abatement Program agreement made in May 2014 when, no doubt, you, the member for Frome and some of your then cabinet colleagues developed this program.

The Department for Energy and Mining does not provide funding for TLAP. Nyrstar contributes up to $3 million a year and the government's contribution is SA Health's Port Pirie Environmental Health Centre operating budget funding. About $4.7 million annually is spent in four areas to reduce lead exposure, cleaning up legacy lead in the environment, reducing children's lead exposure at the household level, reducing community dust exposure and improving community understanding of lead exposure risks.

An independently chaired committee was formed in 2014, comprising representatives of Nyrstar, SA Health, the Department for Energy and Mining, and the Department for Education to implement, manage and monitor the program with observers from the Environment Protection Authority and the Port Pirie Regional Council. That is the summary of the program. The answer is very clear, that money in the last 10 months has been spent.

With regard to the specifics of how the TLAP Committee has allocated that, let me come back to you with whatever information I can share with you. Let me also just say that I do not doubt for a second that the member for Frome and the previous government wanted to do good work on this. I do not doubt that for one second. But I have to say really bluntly that the results they have achieved have not been good enough. They have not been good enough for the people of Pirie.

We were very respectful with regard to this issue when we came into government. A program had been set up. Lead in blood is a short, medium and long-term issue. We came into government and we changed some things quickly. This was one that I said, 'We've got to give it a chance to work. We've got to give this program a chance to work.' We have given it a chance to work and it is not working well enough. It is not working well enough for the people of Port Pirie, and so we are making changes. We are not turning it upside down, we are not throwing the baby out with the bathwater, but we are making changes that will help reduce lead in blood of people, and particularly of the infants who we all care about in Port Pirie.

The Hon. A. KOUTSANTONIS: I need to move on because we are running out of time. There are a few topics I want to cover so I will give advance warning to your advisers: land tax for mineral tenements and the White Rock Quarry. I have some questions about that coming up in a moment. I refer to the Budget Statement, Budget Paper 3, page 159, table C.2, estimate of payments from the Consolidated Account to the department. As you heard the Chair say earlier, this line was $54.7 million. The previous allocations were substantially higher. Could you explain what is the reason for the major variation? Is it a dividend process through the sale of the generators?

The Hon. D.C. VAN HOLST PELLEKAAN: Can you just repeat the line again?

The Hon. A. KOUTSANTONIS: It is the Budget Statement, Budget Paper 3, page 159, table C.2, estimate of payments from the Consolidated Account, from the Appropriation Act to the department—your budget basically.

The CHAIR: While the minister is seeking advice, do you have omnibus questions?

The Hon. A. KOUTSANTONIS: Yes, I do.

The Hon. D.C. VAN HOLST PELLEKAAN: I have just been provided with some information. The Department for Energy and Mining net cost of services reduces from $97.6 million in 2020-21 to $63.1 million in 2021-22. This reduction in net cost of services largely relates to the winding down of funding for the government's election commitments, including grant payments made to Project EnergyConnect. I am advised that this reduction in net cost of services does not reflect cuts to the department's programs or the implementation of savings measures.

The Hon. A. KOUTSANTONIS: Were there any FTE reductions as a result of that?

The Hon. D.C. VAN HOLST PELLEKAAN: No.

The Hon. A. KOUTSANTONIS: In terms of land tax, I would not mind you taking this on notice if you could, please, minister. The government's land tax changes now apply to mineral tenements and petroleum geothermal leases. How much land tax are people who hold tenements in South Australia under both acts, the Mining Act and the Petroleum and Geothermal Energy Act, paying to Treasury per year, and do you administer that, or is that done by RevenueSA?

The Hon. D.C. VAN HOLST PELLEKAAN: I will take that on notice.

The Hon. A. KOUTSANTONIS: I take you to White Rock Quarry, and I think the best reference I have, Mr Chairman, is Budget Paper 4, Volume 2, page 113, objective:

Manage the state's mineral resources through responsible, sustainable, effective and efficient policy and regulation…

I have attended a series of public meetings about the Hanson White Rock Quarry. I understand that the government has rejected the MOP that Hanson’s has submitted. The residents who are on the boundaries of this quarry and who own private properties claim to me that they feel they are being treated as second-class citizens, and they are asking: is the government considering a change to the private mines regime to allow the same distance differential between the Mining Act and private mines? Are you considering that change?

The Hon. D.C. VAN HOLST PELLEKAAN: To say that we rejected the MOP, I think, is an unfair characterisation on the company.

The Hon. A. KOUTSANTONIS: Okay, sure.

The Hon. D.C. VAN HOLST PELLEKAAN: It is the normal process that information is provided—people ask for more and it goes back and forth, as you would know. To say that it was rejected I think is harsh and unfair on the company, but, yes, we are in that back and forth process, as the shadow minister knows, because actually we have been very generous sharing information with him about exactly where that process is at the moment.

With regard to this issue more broadly, everybody understands that there are almost always some differences of opinion about developments of this type. This particular private mine has been operating since the 1940s. It has been there for a very long time, and in that time people have bought land and built and bought houses. They have changed hands on and on, and over those decades people have moved closer and closer to the mine, and that has been their right to do that.

The mine did not ever say, 'Don't tell those people they can't come up to our boundary,' but the people now would like to know whether they can have the boundary extended the other way. Guess what? It is a fair request. It is a fair thing to ask. If you live in a home and you prefer the quarry to be further away, or you prefer an expansion of a quarry not to come as close to you as it legally could, it is a very fair thing to ask.

Our department's job is to work through those requests to see what we can do that is fair for everybody concerned: what is fair for the tenement holder who has existing legal rights; what is fair for the people who want to change those rights.

The Hon. A. KOUTSANTONIS: I accept that. I want to get through some of these questions, minister, if I could, please, because—

The Hon. D.C. VAN HOLST PELLEKAAN: Many quarries in Adelaide predate—

The Hon. A. KOUTSANTONIS: Yes, they do.

The Hon. D.C. VAN HOLST PELLEKAAN: Separation distances are determined on a case-by-case basis reflecting a focus on safe, fit for purpose management of potential impacts in each circumstance rather than applying a standard one size fits all.

The Hon. A. KOUTSANTONIS: Are you satisfied with the separation between households and the proposed expansion of the quarry?

The Hon. D.C. VAN HOLST PELLEKAAN: I am satisfied that they are legally appropriate, and we are working through what is practically appropriate in a very responsible way. We are engaging with local residents, we are engaging with the company. As you would understand as a former minister, we are doing everything that we can to try to get the best result for everybody, understanding that it will not be a perfect result for everybody.

The Hon. A. KOUTSANTONIS: Has the department or your office instructed or asked White Rock Quarry to establish resident liaison groups or a community consultation process? Has the department thought of doing one itself?

The Hon. D.C. VAN HOLST PELLEKAAN: It has certainly been recommended.

The Hon. A. KOUTSANTONIS: When did you recommend them to them?

The Hon. D.C. VAN HOLST PELLEKAAN: It has been part of ongoing discussions between the department and the company.

The Hon. A. KOUTSANTONIS: Did the EPA determine that White Rock Quarry is in breach of its current MOP? The allegation is unacceptable polluting of Third Creek, a key water source for the Torrens.

The Hon. D.C. VAN HOLST PELLEKAAN: I am advised that there are concerns regarding silt-laden stormwater run-off from the quarry into a nearby creek that is part of the Third Creek catchment. Surface water quality is an incredibly important matter in South Australia, and at this site it is being actively regulated by both the DEM and the EPA. Hanson has been required to invest in sediment management at the quarry site and has invested $2.5 million in the past 18 months with reconstruction of a further sediment detention basin to be completed in early 2022.

I am aware that some people are concerned that the water seen in some creeks may contain waste from concrete operations, and I want to assure them that this is not the case. What is being seen in the creeks after large rain events is water run-off muddied by open areas and roads from both the quarry and nearby non-quarry sites. It needs to be improved and the regulators are ensuring that happens more broadly.

The community has expressed a range of concerns about the existing quarry operations, and I can confirm that all potential impacts on the quarry from Hanson's operation of the quarry are being actively reviewed and regular inspections are being undertaken at the site.

The Hon. A. KOUTSANTONIS: Minister, do you support an expansion of that quarry?

The Hon. D.C. VAN HOLST PELLEKAAN: I have no doubt that I will support the final determination about what expansion of the quarry can go ahead. As I said, there is a lot of back and forth. I am positive that the department will come to what is the best solution all things considered and, when they do that, I will support that solution.

The Hon. A. KOUTSANTONIS: The residents are very keen to know what the value of the mine is to the government, and I think what they mean is what royalties are paid. Could you take on notice, if possible, what royalties are paid from that quarry in terms of royalties to the government, what land tax they pay and what regulatory fees and charges they provide to the government on an annual basis.

The Hon. D.C. VAN HOLST PELLEKAAN: I will take that on notice, but I will very quickly add to that. The value of the mine is not only in the fees it pays to the government. The value of the mine is extraordinarily high with regard to the value of the material into projects that South Australians benefit from.

The Hon. A. KOUTSANTONIS: With your forbearance, I will go through the omnibus questions.

1. For each department and agency reporting to the minister:

What is the actual FTE count at 30 June 2021 and the projected actual FTE count for each year of the forward estimates;

What is the total employment cost for each year of the forward estimates;

What is the notional FTE job reduction target that has been agreed with Treasury for each year of the forward estimates;

Does the agency or department expect to meet the target in each year of the forward estimates; and

How many TVSPs are estimated to be required to meet FTE reductions over the forward estimates?

2. For each department and agency reporting to the minister:

How much is budgeted to be spent on goods and services for 2021-22, and for each of the years of the forward estimates period;

The top 10 providers of goods and services by value to each agency reporting to the minister for 2020-21;

A description of the goods and/or services provided by each of these top 10 providers, and the cost to the agency for these goods and/or services; and

The value of the goods and services that was supplied to the agency by South Australian suppliers?

3. Between 1 July 2020 and 30 June 2021, will the minister list the job title and total employment cost of each position with a total estimated cost of $100,000 or more which has (1) been abolished and (2) which has been created?

4. Will the minister provide a detailed breakdown of expenditure on consultants and contractors above $10,000 between 1 July 2020 and 30 June 2021 for all departments and agencies reporting to the minister, listing:

the name of the consultant, contractor or service supplier;

cost;

work undertaken;

reason for engaging the contractor; and

method of appointment?

5. For each department and agency for which the minister has responsibility:

How many FTEs were employed to provide communication and promotion activities in 2020-21 and what was their employment expense;

How many FTEs are budgeted to provide communication and promotion activities in 2021-22, 2022-23, 2023-24, 2024-25 and what is their estimated employment expense;

The total cost of government-paid advertising, including campaigns, across all mediums in 2020-21 and budgeted cost for 2021-22?

6. For each department and agency reporting to the minister, please provide a full itemised breakdown of attraction and retention allowances as well as non-salary benefits paid to public servants and contractors between 1 July 2020 and 30 June 2021.

7. What is the title and total employment cost of each individual staff member in the minister's office as at 30 June 2021, including all departmental employees seconded to ministerial offices?

8. For each department and agency reporting to the minister, could you detail:

How much was spent on targeted voluntary separation packages in 2020-21;

What department funded these TVSPs (except for DTF estimates);

What number of TVSPs were funded;

What is the budget for targeted voluntary separation packages for financial years included in the forward estimates (by year), and how are these packages funded; and

What is the breakdown per agency/branch of targeted voluntary separation packages for financial years included in the forward estimates (by year) by FTEs?

9. For each department and agency reporting to the minister, how many executive terminations have occurred since 1 July 2020 and what is the value of executive termination payments made?

10. For each department and agency reporting to the minister, what new executive appointments have been made since 1 July 2020, what is the annual salary and total employment cost for each position?

11. For each department and agency reporting to the minister, how many employees have been declared excess, how long has each employee been declared excess and what is the salary of each excess employee since 1 July 2020?

12. In the 2020-21 financial year, for all departments and agencies reporting to the minister, what underspending on operating programs (1) was and (2) was not approved by cabinet for carryover expenditure in 2021-22?

13. In the 2020-21 financial year, for all departments and agencies reporting to the minister, what underspending on investing or capital projects or programs (1) was and (2) was not approved by cabinet for carryover expenditure in 2021-22? How was much sought and how much was approved?

14. For each grant program or fund the minister is responsible for please provide the following information for 2020-21, 2021-22, 2022-23, 2023-24 and 2024-25 financial years:

Name of the program or fund;

The purpose of the program or fund;

Balance of the grant program or fund;

Budgeted (or actual) expenditure from the program or fund;

Budgeted (or actual) payments into the program or fund;

Carryovers into or from the program or fund; and

Details, including the value and beneficiary, of any commitments already made to be funded from the program or fund.

15. For the period of 1 July 2020 to 30 June 2021, provide a breakdown of all grants paid by the department/agency that report to the minister, including when the payment was made to the recipient and when the grant agreement was signed by both parties.

16. For each year of the forward estimates, please provide the name and budgeted expenditure across the 2021-22, 2022-23, 2023-24 and 2024-25 financial years for each individual investing expenditure project administered by or on behalf of all departments and agencies reporting to the minister.

17. For each year of the forward estimates, please provide the name and budget for each individual program administered by or on behalf of all departments and agencies reporting to the minister.

18. For each department and agency reporting to the minister:

What savings targets have been set for each year of the forward estimates;

What measures are you implementing to meet your savings target; and

What is the estimated FTE impact of these measures?

19. For each department and agency reporting to the minister, what initiatives or programs have been approved and funded as of 1 July 2021 but not publicly announced or disclosed in the budget papers?

20. For each department and agency reporting to the minister, how many complaints have been made regarding bullying, harassment, sexual harassment or any other form of discrimination or assault to human resources, the Commissioner for Public Sector Employment or any other government agency or statutory office?

The Hon. D.C. VAN HOLST PELLEKAAN: Can I add one piece of information for clarification. When asked about ministerial advisers, there is actually an additional adviser who supports me as part of my role as Manager of Government Business in the house I did not think of when I was thinking about ministerial office advisers.

The Hon. A. KOUTSANTONIS: Are they funded from the department, or does parliament fund that?

The Hon. D.C. VAN HOLST PELLEKAAN: Adviser.

The CHAIR: Thank you, minister, thank you advisers, thank you committee members. Given that we have reached the allotted time, I declare the examination of the Department for Energy and Mining complete and refer the proposed payments to committee B for examination.

At 16:33 the committee adjourned to Monday 2 August 2021 at 13:00.