ELECTRICITY PRICES, COOBER PEDY

Mr VAN HOLST PELLEKAAN (Stuart) (15:00): My question is to the Minister for Energy. What advice does the minister have for the Coober Pedy business which took government advice to undertake an energy audit, then spent $700,000 on new energy efficiency measures, and now, as a result of the government's changes to electricity prices, the business's annual power costs have increased from $320,000 to $700,000; and why did the minister write offering another energy audit?

Members interjecting:

The SPEAKER: Order!

The Hon. M.F. O'BRIEN (Napier—Minister for Agriculture and Fisheries, Minister for Forests, Minister for Energy, Minister for the Northern Suburbs) (15:01): There are some businesses in Coober Pedy that have not undertaken the audit.

Members interjecting:

The SPEAKER: Order!

The Hon. M.F. O'BRIEN: We currently put around $5.2 million into remote communities to service the needs of 2,800 customers—that is, $5.2 million over 2,800 customers. I think that is a fair and reasonable contribution from the South Australian government. We have suggested that businesses that are going to be impacted by this particular change in charging structure undertake the audit, but I have also indicated that we are looking at a renewable solution for that community. Like all remote communities, it ultimately has to wean itself off diesel, because year in and year out the cost of generating electricity in those communities is going to progressively escalate.

As much as the member for Stuart may question what we have done, we have to send the price message. Without sending the price message, there will be no incentive whatsoever for those communities to look to alternatives. We believe that $5.2 million over 2,800 customers is a fair padding for that community, but at some stage that community and the state government will have to get together and look at the alternative, which I believe will be a solar solution. I have a team working on it. I hope we will have a solution sooner—

Members interjecting:

The SPEAKER: Order!

The Hon. M.F. O'BRIEN: —or later. It appears that the proposition being put by the opposition is: ignore the steady escalation in the price of oil and continue to pile in, year after year, an additional million dollars on top of the $5.2 million that we are already contributing. We are dealing with the issue.

Members interjecting:

The SPEAKER: Order!

The Hon. M.F. O'BRIEN: I am aware of the issues that are confronting that particular community.

Mr Williams: Have you given $2 million to the Coober Pedy council yet?

The SPEAKER: Order!

The Hon. M.F. O'BRIEN: In response to the question from the member for MacKillop, in large part, the proposition that we are putting in place was borne out of a recommendation from a review that had been conducted by the Auditor-General. He indicated that, probably for the space of several decades, we had in place a regime in remote communities that had no structure to it, and the Auditor-General was of the view that we could not continue to operate in those remote communities the way in which we had been doing.

So, we have responded to a recommendation from the Auditor-General. He has strongly recommended that we put in place a funding agreement and an agreement that basically corralled the manner in which electricity is generated and distributed. That is what we have done. Now we have to look through the issues that are arising out of that particular recommendation and that is what we are doing.