Question Time

Electricity Prices

Mr VAN HOLST PELLEKAAN (Stuart) (14:18): Thank you, sir. My question is to the Minister for Mineral Resources and Energy. Will the minister stand by his claim on ABC radio on 9 May that South Australia does not have the highest electricity prices in the nation, and can the minister point to one official report that supports his statement? According to the latest AER State of the Nation market report of 4 February, South Australian households paid on average $261 per annum more for electricity standing offers and $203 per annum more for electricity market offers than any other state or territory in the national electricity market.

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (14:19): The shadow minister issued a press release earlier today—

Ms Chapman: How about an answer?

The Hon. A. KOUTSANTONIS: I am answering.

The SPEAKER: The deputy leader will withdraw for the next 15 minutes under the sessional order.

The honourable member for Bragg having withdrawn from the chamber:

The Hon. A. KOUTSANTONIS: The member for Stuart released a press release, 'Energy regulator exposes shock', talking about the latest data from the Australian Energy Regulator. This data is released I think nearly weekly by the Australian Energy Regulator, something that I don't think is pointed out in the press release. The opposition is attempting to say that the predictions of the AER always turn out to be completely accurate.

It is very difficult to predict what the actual outcomes will be with a very volatile and hostile market, and I will give the house some examples. The AER weekly reports that are released by the Australian Energy Regulator, which the shadow minister quoted in his press release today, predicted in the first week of November last year that for the first quarter of 2016 the average price for electricity prices in South—

Mr VAN HOLST PELLEKAAN: Point of order, Mr Speaker: under standing order 98, I ask you to bring the minister back to the substance of the question, which was about—

The SPEAKER: No, I know what the substance of the question is and I don't need to be reminded. The minister.

Mr VAN HOLST PELLEKAAN: It's not what he is talking about.

The Hon. A. KOUTSANTONIS: It is exactly what I am talking about, sir. It is the AER versus the actual outcomes. The AER weekly report for the first week of November 2015 published what they thought a prediction would be for electricity prices in the first quarter of 2016. They said that, for quarter one of 2016, the average price would be, I am advised, $80 a megawatt hour.

AEMO, who are the market energy operators, published the actual results for those months. In the first month of 2016, the price was $50.26, not $80 as predicted by the AER; in February, the hottest month of the year on average—

Mr van Holst Pellekaan: You obviously don't understand.

The Hon. A. KOUTSANTONIS: —it was $40.72, not $80 as predicted by the AER; and in March—

The SPEAKER: I call the member for Stuart to order.

The Hon. A. KOUTSANTONIS: —it was $53.33; on average, for that first quarter, about $48.10 a megawatt hour, not the $80 predicted by the Australian Energy Regulator. These predictions made by the Australian Energy Regulator through what Mr van Holst Pellekaan has attempted to do through his press release to frighten—I apologise, sir.

The SPEAKER: The Treasurer will apologise—

The Hon. A. KOUTSANTONIS: I apologise, sir.

The SPEAKER: —and not use a member's Christian name and surname; he knows the rules.

The Hon. A. KOUTSANTONIS: Yes, sir. The member for Stuart, in quoting these prices, knows that they are estimates; they are usually wrong. It is no fault of the Energy Regulator because it is a very difficult market to map. Indeed, the latest weekly snapshots released by the Australian Energy Market Operator show this in terms of what the most accurate outcomes for power prices are: in Queensland, the average price from the first week of May was $74.32; in New South Wales, it was $59; in Victoria, it was $43; in South Australia, $44.70 a megawatt hour; and Tasmania, $83.06.

What this shows is that there are fluctuations. Attempting to say one way or another with certainty that over the next three or four years the earth will stop spinning on its axis and the world will come to an end as we know it simply cannot be predicted by anyone. You can see that the Australian Energy Regulator, who are experts in energy regulation, find it very difficult to predict accurate outcomes, and when the market operator shows the actual outcomes they are very, very divergent. Anyone who attempts to make an accurate prediction cannot get it right.

Members interjecting:

The SPEAKER: The Treasurer's time has expired. I call to order the members for Goyder, Unley and Mitchell. I warn the member for Stuart, and I warn the leader for the second and final time. The member for Stuart.