Emergency Management (Electricity Supply Emergencies) Amendment Bill

Second Reading

Adjourned debate on second reading (resumed on motion).

Mr WINGARD (Mitchell) (15:40): I continue my remarks. A $24 million solution was offered by Alinta, and instead the Premier and Treasurer chose to spend $550 million of South Australian taxpayers' money. They are the cold hard facts: $24 million to keep prices down, supply on and no blackouts in South Australia, but the Premier and Treasurer chose the opposite. They chose statewide blackouts, higher electricity prices and a $550 million tax bill for South Australians. Enough is enough.

I am speaking to businesses all the time, and just recently I did a 50-business and 50-day tour, and with everyone I spoke to electricity prices were a key to keeping businesses going in South Australia. A number of businesses spoke to me; in fact, a bakery recently spoke to me about their electricity bill going up from around $5,500 to, I think, $7,000. That is a massive jump, and they are saying they are worried about how they are going to keep all their staff. I am not sure what the Premier and Treasurer say to the staff of that business, who will have their hours reduced and even potentially be laid off because of the exorbitant electricity prices that have been inflicted by this state Labor government. It really is a concern.

We know the track record of those on the other side of the chamber on electricity commitments and promises. Back in 2002, before my time in this place, the Labor government promised to build an interconnector to New South Wales. That was their push and they failed to deliver on that, the interconnector that would have supplied more reliable and efficient energy to South Australia. That was a commitment they made in 2002. How did we go? Did we get there? No, they failed to deliver, and it just gets glossed over and not spoken about now by this Labor government. That is a failure. Now they have this big $550 million commitment. Given their history and their track record, they have failed to deliver for South Australians.

What they also do not want to talk about on the other side of the chamber is the blackout day, the day that the blackout Treasurer and the blackout Premier really came into prominence, 28 September 2016. In fact, during this debate I heard it being called 'an unfortunate situation' by the other side of the chamber. There was a storm, no denying that, and powerlines did go down, but we blacked out the entire state. That is what the Premier and the Treasurer of this state did, that is what we had to suffer because the Premier and the Treasurer blacked out South Australia.

In the last day or so we have seen tornadoes in Queensland. That state did not black out. This was not 'an unfortunate situation' in South Australia: this was mismanagement of the highest order by this Labor government. When you go interstate now and speak to people and say you are from South Australia or from Adelaide, they scoff and laugh and ask, 'Are you keeping the lights on?' That is the situation we have got thanks to this government on the opposite side.

They want to blow some smoke and mirrors around the place and say they have a piece of paper that says they can resolve this problem. Well, their track record is appalling and they cannot. They must take responsibility. They will sit there and blame everyone else, as well. It is really quite amazing to see that they blame so many other people, but this government must take responsibility for the position that South Australia is in. They have been in charge for 15 years now and South Australia has been going backward at every turn. This is just a classic example.

Again, I hark back to the fact that the government's answer is a $550 million spend. There was an option: there was a $24 million option to keep the Northern Power Station open and keep reliable power coming into South Australia so that businesses could maintain their operations so that there would be reliability and that prices would not go through the roof, as we have seen. The government is out now with its propaganda and its smooth talking by the truckload. You will see the Premier out there talking nice and slowly and nice and calmly as if he knows what is going on, but look at his latest TV commercial where he is trying to convince the public of South Australia about what is going on, that things are okay. You look deep into it and you know that they are not.

The Premier talks in his TV commercial, and he spends hundreds of thousands of taxpayer dollars on his campaign. That is right: South Australian taxpayers' dollars are being spent for the Premier to be spruiking his claims. When you look at the TV commercial and you see him shaking his head, he shakes his head from side to side. He does not actually believe what he is saying. He is saying subliminally, 'No, this is not right. No, I have no idea. No, I have lost control.' That is what is really going on, and you can see it. Look closely at the television commercial and you will know that is what is going on.

The big problem here, and I have mentioned this but I will make the point again, is that the transition from coal to renewables has not been done responsibly, efficiently or effectively. For some reason the Premier is hell bent on fast-tracking us to a 50 per cent renewable energy target. Our plan and our policy is to say no to that. The federal target is 23 per cent. Why not go with the federal target? Stick to the federal target. Why do we need to be miles ahead of other states? We are up around 40 per cent now and that is what is costing us. We are paying more for our electricity, it is more unreliable and it is costing families and businesses, which in turn is costing jobs in South Australia.

This blind push towards renewables has left our state vulnerable. We look at the plan again, the pie in the sky plan. As I said, there was a plan in 2002 to build an interconnector to New South Wales. The Premier failed to deliver. Then a desalination plant and, of course, we know how that ended up. This plan now, when you see the Premier walking around with a brochure, stinks of what we saw with the desalination plant. The desalination plant doubled in size to what it needed to be because of ideologies that were just mismatched and did not deliver for South Australia.

South Australian taxpayers have paid the bill there. South Australian taxpayers are going to pay the bill here because this state Labor government has really let South Australians down. Let's break this bill down. Let's work out what it is going to cost every household. What you need do is go to every household in South Australia—everyone from uni students, pensioners, families and retirees—thanks to Jay's mismanagement. Thanks to the South Australian government's mismanagement of our electricity system, you will need to go to every household, as I said—uni students, pensioners, families and retirees.

Everyone will pay $775. Just go and get it out of the bank right now—$775—and hand it to the Premier and the Treasurer because that is what they are coming to get from you. That is what they are going to get from you to pay this back. They are going to take dollars out of your communities, dollars out of your schools, sporting clubs and hospitals. That is where the $550 million is coming from. It is coming out of your pockets, every South Australian's pocket, to pay for this mismanaged plan.

Right across the board, we know in South Australia that things are not going well. We have the highest unemployment rate in the nation, and I talked about businesses before that I have been speaking to. I am speaking to them and they say the cost of electricity here is hurting them. The bakery—

The Hon. T.R. Kenyon interjecting:

Mr WINGARD: And the member for Newland is scoffing over there, but I can tell him that the cost of their electricity at the bakery—

Members interjecting:

The DEPUTY SPEAKER: Order!

Mr WINGARD: —has gone up $1,500 and they are feeling the pinch.

The Hon. T.R. Kenyon interjecting:

The DEPUTY SPEAKER: The member for Newland is not in his place and he is on two warnings.

Mr WINGARD: They are saying quite outwardly that they will be laying people off because of the cost of electricity in South Australia. They will be cutting back the hours of people working in South Australia. Go to the ABS stats, and I can show them to the member for Newland and all those on the other side. For 27 months, on trend, we have had the highest unemployment rate in the nation.

When we want to talk about how well things are going, the other side want to keep comparing it with how we went last week or how we went last month. If you put it into a football analogy, and I like to do this to make it nice and simple by using a football table analogy. If you ended up at the bottom of the table and the next year you came 15^th and you were 16^th the year before, you would think, 'We have improved. We have gone up one. That's fantastic!'

The Hon. S.C. Mullighan interjecting:

Mr WINGARD: You would sound like the Minister for Transport who is making his comments here. He thinks that is great, to improve from 16^th to 15^th. He thinks that is fantastic. That is the mentality those on the other side have about how South Australia should go. They do not want to take South Australia from the bottom of the table and maybe move us into the finals or even push towards the top of the table. No, they do not want to do that. Let's just keep South Australia down, that is their intention. I must say that for 15 years it has been incredibly successful.

The transport minister swanned in here and joined his colleagues on the front bench, having worked in government for a long time and helped the demise of South Australia. Now he is on the front bench and he is doing his part to keep driving South Australia further down. He is going to come along with the rest of his colleagues and take that $775 from every household to make up for the appalling job that they have done over 15 years. I think enough is enough.

I think South Australians have had enough and they are starting to see the light. They are not listening to the slow talking, smooth operating ways of the Premier and his other offsiders. I think they have had enough. I stand here and I do not come from that background of having been around politics all my life. I come from a different field, and proudly so. I do not come with the polish of some on the other side, some who have been groomed for these jobs, and I do not apologise for that either.

We need more passion in this place. We need people who are here to get the job done, to improve South Australia, not to look after themselves, not to be career politicians and come here and work their way through union ranks, work for ministers, work through the whole operation and then get a safe seat, perhaps given to them by a union.

I do not think that is the way this place should operate, so I might not be as smooth as the Premier and I might not be as smooth as some of those on the other side, but I come with a great deal of passion to turn this state around. That is what we need in South Australia—no more smooth talking, we just need to get results and get South Australia off the bottom of the ladder.

I talked about unemployment and we know how South Australia is going there, and in terms of interstate migration we know that last financial year alone, 6,500 people moved out of South Australia. This is a great concern. We have brain drain, as it is called, and people are leaving South Australia right across the board. Younger people, middle-aged people and older people are leaving South Australia because they cannot find jobs. That is a fact. You can get out and speak to people on the streets and you hear it all the time.

When I get out in my community, it is often put to me that people are struggling to find work, that people are concerned for young adults moving into the workforce, that all the opportunities are on the eastern seaboard and there are no opportunities here. The cost of doing business and the high electricity prices that we talk about do have a real impact on what is going on out there in the community. That is something we need to be aware of. People are leaving our state and we need to do more to keep them here and to grow industry and grow business in South Australia.

I talked about the blackout on 28 September 2016, and that was a really significant moment for South Australia. You have seen the memes and so forth on social media where there is a map of Australia and South Australia is all in black. It hurts me to see that. People have taken the state logo and taken the doors off and made the South Australian part of that logo black, and that hinges around that 28 September incident.

It intrigues me that the Premier really refuses to speak about that day and refuses to acknowledge what happened within the system. Mind you, the Treasurer keeps talking about the National Electricity Market being broken and the NEM not working, yet he is a part of the National Electricity Market. He has a say at COAG and a say in the way these things are run, and he himself says that he is the lead legislator on that operation.

He has spruiked before how well it is working and then all of a sudden things go wrong. Does he accept responsibility for his part in this or does he say, 'No, we'll blame everyone else and it is actually everyone else's fault'? In fact, this is how confused the Treasurer is. He says it is broken, yet he is quoted as saying that the National Electricity Market has done a great job and has created a great system. It is amazing how he will flip-flop to suit himself. One minute he says it is great and the next minute it does not work and he says it is not going well enough.

I reiterate the point that I made at the start of my speech. It has been divulged in the paper today that the offer that was on the table was $24 million to keep Alinta, the Northern power station, up and running. The operators of that power station, the Alinta company, said, 'You're going to have problems if you lose this base load supply. You're going to be too reliant on renewable energies. We know it's intermittent. The wind doesn't always blow, and the sun doesn't always shine. We can keep operating for that $24-odd million figure. That's what we can do and it will give that base load power supply you need and allow that smoother transition because wind and solar energy isn't working on its own. It doesn't give you the base load you need when the wind doesn't blow or the sun does not shine.' The Treasurer just turned his nose up at them and so did the Premier. Instead they have gone for a $550-odd million solution. Anyone can stack up $24 million against $550 million and see how is it going to work.

Mr Hughes: Talk about apples and oranges!

Mr WINGARD: No, it is just dollars. The member for Giles wants to call it apples and oranges and, realistically, it is just dollars—$24 million compared with $550 million. I hope he does not become Treasurer of South Australia because if he cannot add up we will have a major problem.

We can talk quickly about the other part of the solution, which is the diesel generation. We need to make people aware of this because, although the plant the government is talking about was going to get built and is now not going to get built, they do have the backup of diesel generators. They are going to put these all around the city and all around the country as well, I presume, so you could well have a diesel generator coming to a street corner near you. That is what we are looking at, and we are interested to see how that is going to play out.

We asked more about costings as well. We had the battery at around $150 million. How is that going to work? What is going to happen? How is it going to be disposed of after five or so years of life? How much life will it have? The Treasurer, again, when asked questions on that today really did not have any answers.

I talk about the solution and, quite simply, one of the first steps has to be to abandon the renewable energy target (RET) that this state Labor government has at 50 per cent. They have set it at 50 per cent, which really is far above where the federal government has set the target, which is at 23 per cent. We cannot see why you need to be above the federal target, so we are saying let's go to the federal target. That is the first step, and that will give some surety to these base load suppliers that they can stay in the market here in South Australia.

That is a first step that should and could happen in a heartbeat. With the stroke of a pen, we could move that forward but, again, the Labor government is so hell-bent, to the destruction of businesses, companies and families in South Australia, on pushing the renewable direction harder and faster than they need to without any control. It is like going downhill on a bike and the handlebars start to get wobbly. The Premier is at the wheel and the Treasurer is sitting on the front handlebars. The handlebars are as wobbly as anything, and they are about to crash our state once more.

I think South Australians have had enough. South Australians are seeing what is going on. They are over the smooth talking. They want to see some reality come into this conversation. They want to see people who are out there genuinely fighting for South Australia, wanting to get the best results for South Australia, not a government that keeps spending millions and millions of taxpayers' dollars on spin, promotions, pamphlets and TV commercials. They are spending taxpayers' dollars on trying to spin the wheel. As we have said in this place before, if we could harness some of the spin that goes on on the other side of the chamber and draw energy from it, we could probably power the state for many more years to come.

The Hon. Z.L. BETTISON (Ramsay—Minister for Communities and Social Inclusion, Minister for Social Housing, Minister for the Status of Women, Minister for Ageing, Minister for Multicultural Affairs, Minister for Youth, Minister for Volunteers) (15:57): I rise today to support the Emergency Management (Electricity Supply Emergencies) Amendment Bill 2017. This bill is part of the key package of reforms we have in our energy policy. To remind people of where this fits, this is about local powers over our national market. This is supported by our energy plan, with battery storage and a renewable technology fund, new generation and more competition, a state-owned gas power plant, South Australian gas incentives and of course our energy security target.

As the minister responsible for communities and social inclusion, I have taken particular interest in the success of this bill. As members know, this government has taken a lead in fighting the rising cost of living, and that is why we introduced the new Cost of Living Concession, which will enable people to live their lives with less financial stress.

We know that the commonwealth government ripped up the national partnership on certain concessions without any discussion, but we were not prepared to let South Australians suffer, so we introduced the Cost of Living Concession. We not only introduced this concession, but we expanded it to cover tenants as well, so owner-occupiers can receive $200 as a Cost of Living Concession, and tenants $100.

Not only have we introduced this new concession for people, but we are also changing the way concessions are indexed, giving more people more money in their pocket. After 2014, we increased the energy concession to $215 per household. As a government, we have supported our sick and vulnerable through the medical heating and cooling rebate, reducing the financial stress on people who rely on running heating and air conditioning for their health and wellbeing. We have also been modernising some of our public housing stock by replacing old LPG gas and electric hot-water systems with solar hot water to reduce the pressure on energy prices put on some of our most vulnerable tenants.

This program alone has reduced the cost of running hot water by 30 per cent for 1,000 households. We have focused throughout South Australia on those households with larger families and those who are higher users of electricity. In addition, we have begun to install 400 solar panels in Housing Trust homes across 40 different suburbs. This is something the Minister for Housing and Urban Development spoke to us about in the house yesterday. Already, more than 300 households under Housing SA have put their own solar panels on their roof, and we have done that through a deed of agreement.

It is very important that we support people when they need help the most, and another area in which we help people is through the Emergency Electricity Payment Scheme, and they must speak with a financial counsellor to talk through the issues they have. It is available for $400 every three years and is part of our affordable living program. We also provide energy efficiency audits, which are available for free to people on low incomes through their energy retailer. The Retailer Energy Efficiency Scheme is an initiative of our government. It helps households and businesses save on energy use and costs and lower their emissions. In fact, retailers are required by law to help customers experiencing payment difficulties to better manage their energy bills.

This energy plan—Our Energy Plan—shows leadership. When I have been speaking to South Australians out in my electorate of Salisbury, this is what they have said to me matters most: 'We don't want this blame, he said, she said. What we want is leadership, and we've seen that from the Premier.' They say that to me when I am out doing my street-corner meetings, when I am doorknocking, or when I am having a conversation on the phone. It is about leadership. This leadership will lead to creating more competition in our local energy market to put downward pressure on electricity bills.

Tendering for 75 per cent of our electricity needs over the next 10 years will encourage new providers to enter the market. We anticipate that this will result in a new privately owned generator being built in South Australia. By encouraging energy providers to compete for customers, and providing South Australians with more choice, we will lower prices for everyone. Not only are we putting downward pressure on the cost of energy but we are also delivering jobs and energy reliability for everyone. We are building a new generator owned by the people of South Australia. That is what I am hearing more from everyone: it is about South Australian power for South Australians.

The one thing I hear when I am out there talking to the voters, talking to the constituents, talking to South Australians, is that we were insulted by the actions of the Prime Minister. It is just unbelievable for a man who has spent his life talking about reducing carbon, talking about the importance of renewables, to then accuse South Australia in the way he did. He just dumped on us for his political convenience and said that we were letting everyone down, that we were doing too much. I would say the opposite: we were doing the heavy lifting for him. He was the one who signed the international Paris Agreement. We were not there twisting his arm. Yet time and time again, South Australia is put up for ridicule because of this. I do not know how he lies in bed at night. This is a person who has spent 20 years of his life talking about this issue, and when it came to the crunch it was all about coal.

Another thing we are doing is establishing the renewable technology fund. We will be able to provide $75 million in grants and $75 million in loans to private innovative entrepreneurs who will develop the technology that will power tomorrow. These new measures will create 530 new full-time.jobs, and we will create an additional 100 jobs through increased gas exploration. Why have we had to do this? Why have we had to take this leadership and this action? It is because of the failure of the national energy policy that has resulted in the national energy market being unable to adapt to a changing mix of energy generation across the nation.

It is clear to me that a national energy market cannot take care of the needs of my constituents and that it cannot take care of the needs of South Australians. We must put South Australians first. This is what the Premier has done, and this is what the Minister for Energy has done—put South Australia first.

We need to ensure that South Australia will have the best possible guarantee of energy supply. We know, very proudly, that because of the actions of this government in South Australia we not only lead the nation in renewable energy development but we are also recognised as a global giant in pushing the adoption of renewable technology. While we will fund the development of new renewables technology, we will also lead Australia by building the nation's largest battery grid to store and supply clean renewable energy to South Australians.

This will begin the evolution of South Australia's energy grid from one that relies on a decaying, dirty energy mix to one that embraces the future of a growing diversity of clean renewable energy sources. The most important thing here, though, is that this plan is to ensure that we have local control of how the national energy market affects South Australians. Remember 8 February? Why did we suffer a blackout? Because people were not putting South Australia first, and that is why it is important to support this bill.

By granting the Minister for Energy new powers to direct the energy market in time of electrical shortfall, these new powers will ensure that we will no longer be held to ransom by unpredictable and unwarranted market behaviour. The minister will be able to direct generators to bring extra supply on and to make the National Energy Market Operator control flow on the interconnector. We will be remedying an issue.

With this bill, we are putting forth the ability for the Minister for Energy to have direct action on the market. These powers will ensure that every available measure is taken to ensure the supply of power to South Australians in emergencies. This energy plan means that South Australians will be able to rely on clean, renewable South Australian energy and not have to utilise energy sources from failing technologies and from interstate. While this plan is incredibly important, let's look at what we have also done so far.

We are helping large employers to manage their power costs. The state government is providing $31 million over two years to help large South Australian businesses to manage their electricity costs. Businesses that use more than 160 megawatt hours of electricity are eligible for this funding to undertake energy audits to find ways to reduce their power bills. These audits will be completed as of June this year. The grants are available to support projects to promote efficiencies such as the installation of solar systems with battery storage units. The funds support up to 500 South Australian businesses to undertake these energy audits and at least 110 businesses to implement the audit recommendations with at least six major energy-saving opportunities.

One of the other things that is particularly important to me as someone with 14 schools in her electorate is that we are making our schools more energy efficient. Schools with high energy use will become more energy efficient, shaving an estimated $2 million from their power bills each year. This is through a $15 million state government investment. Can I congratulate both the Minister for Energy and the Minister for Education on this bold, supportive and innovative move. The program will provide grants to support 40 schools to install solar panels and LED lighting and 200 schools to replace inefficient lighting and install sensors and timers. With this action, with this bold decision, 38 full-time jobs will be created and installation will start in 2017.

These things are happening because we have been active in this space. We have put our plan to South Australia, a plan that puts South Australians first and that puts South Australian power for South Australians at the very top of our agenda. This bill establishes an efficient process for the declaration of an electricity supply emergency. It gives responsibility to the minister responsible for energy and it allows the government to rapidly respond to scenarios as they emerge. This is what South Australians want. They want action and leadership.

Whilst the federal Coalition government is busy parading coal around federal parliament, the state Labor government has been busy developing an energy policy that not only delivers South Australians a reduced cost of living, a reliable supply and increased jobs, but it has also set the national agenda on energy policy. Once again, South Australia is leading the nation. I welcome and commend this bill to the house.

Mr PENGILLY (Finniss) (16:10): It is flabbergasting, the arrogance of this government coming into the house supplying the members and ministers with prepared speeches. The arrogance of this is unbelievable. They dropped this bill on the house yesterday morning with no notice. They dropped it on the house and they wanted to debate it straightaway. They did not give this side of the house any opportunity whatsoever to get briefings on it or prepare speeches prior to discussing it in the house. It is shameless arrogance from a decaying, out of touch government that is dying internally very rapidly. It is a disgrace.

Here we have this Labor government yet again doing far too little far too late, running around in a panic and introducing a bill and wanting to debate it on the very same day. They are trying to lay claim to fixing up something that they have had 15 years to do and they have done absolutely zilch. It is a bit rich for members opposite to get up and rattle out prepared speeches castigating us and everybody else, laying claim to being able to fix up the power market and energy supply in South Australia.

I will tell you what people want, Madam Deputy Speaker. They want to be able to switch on their lights, they want to be able to switch on their electric stove to cook and they want to be able to have a hot shower. That is what they want to do. They do not want to listen to hundreds of thousands of dollars worth of spin coming out of this pathetic, decaying mob opposite. I reckon that it is a bit rich because we have wind power, renewables, solar power—all good, not a problem in the world. It is fantastic and I love it. I have solar power myself. However, it is a bit rich to come in here and say that they are saving the state's power with their energy plan. They are a joke, an absolute joke.

What happened the other week between federal minister Frydenberg and the Premier was nothing more than an absolute stunt which, fortunately for us, backfired badly on the Premier. I heard the Minister for Tourism saying that he doorknocked people who told him what a fantastic job the Premier had done on Frydenberg. What a lot of tommyrot. The people the tourism minister spoke to spoke to me, and I will not say what they thought of the Minister for Tourism in here because I will get kicked out of the house if I do.

Today, we had the debacle of the Victorian Premier clandestinely going down to Hazelwood as they switched it off for the last time. When the lights go out fairly soon in South Australia yet again, for the umpteenth time, they are not going to blame us on this side of the house: they are going to blame this decaying government on the other side.

The other interesting thing about the scripted speeches that came out is the repetition—the repetition. The verbal diarrhoea that emanated from some members was unbelievable. They must have had a team of advisers spending days and days and days writing all these speeches so that members opposite could get up and read them out. I seriously wonder just what some of them thought when they were reading them out. The minister a few minutes ago was trying to put a bit of energy and passion into her prepared speech. Well, in my view, she fell way short.

While the government are clambering to run around to try to make out they are doing something, out in the real world people want power. They are paying ESL levies that are through the roof and going up. They are paying water bills that are through the roof and going up. They are paying power bills that are going through the roof all the time. They are fed up with it. They have had a gutful of you lot over there, an absolute gutful, I can tell you.

They just want to get back so they have some honesty and transparency in government, which they will not get. We have the Premier and the Treasurer standing up, puffing and blowing day after day, saying what a wonderful job they are doing. They despise one another, absolutely despise one another. It is disgraceful, it is obscene and it is incestuous government coming from a government that is seriously out of touch, has been there far too long and is arrogant beyond any realm of comprehension. It is time they went.

Mr HUGHES (Giles) (16:15): I thought that was going to go on for a lot longer. How many times can you call us arrogant? You could have repeated; the loop could have kept going. It might upset you to know that most of us wrote our own speeches so, if they are bad speeches, we are entirely accountable for their badness or their goodness.

I rise today to support the bill to amend the Emergency Management Act 2004. When the market fails to ensure the delivery of an essential service, we need a tool to enable the state to intervene in a timely fashion to secure electricity for households and businesses. We need look no further than what happened on Wednesday 5 February to see why the amendment is needed. On that day, the temperature in Adelaide hit 42°. I mention Adelaide because the load shedding essentially happened in Adelaide this time.

The temperature hit 42°, resulting in the highest peak demand in three years. There was capacity to meet that demand, but it was not made available. Instead of making that gas generating capacity available, load shedding was ordered. Due to the South Australian Power Networks error, 90,000 consumers were denied electricity instead of 30,000. Even the 30,000 was not necessary. What we saw was the clash between an essential service and the market, and the market prevailed at the expense of customers. It should not have happened.

Exerting local power over the operation of the national market will provide additional protection for South Australian electricity users, and it will ensure that an essential service is not treated as a corporate, profit-seeking plaything. I support markets, but I do not support market failure. The operation of the National Electricity Market and the regulations that govern that market are failing. The reasons for that are varied, and we could spend a whole day or two talking about the National Electricity Market, the regulatory framework—

An honourable member: We have.

Mr HUGHES: That is entirely true; we have. But the primary reason for the failure is the absence of leadership at a national level. I know that those opposite are sick of hearing this, but it is actually true. Peak business bodies have had enough. A whole range of organisations, a whole range of companies, have come out to call for an emissions intensity scheme, to call for a reform of this system that we currently have, but we have this absence of leadership at a national level.

The member for Stuart kept referring to the need for a sensible, well planned transition towards what I assume is a clean energy future and an electricity market that is essentially decarbonised by 2050, if not sooner. On that score, we are in agreement. Where we differ is that he sheets home all the responsibility for that sort of transition to the state government, but South Australia is not an energy island. For good or ill, we are part of the National Electricity Market which to date has seriously diluted our capacity to act alone. I have to add that privatisation has also seriously diluted our capacity to act on what is an essential service.

I think the member for Flinders might well wish that we were back in the days of a publicly-owned electricity system when it was an electricity system, because I can tell you that there would be far greater security for those people, especially the fringe communities on our network, on the Eyre Peninsula and in my electorate and communities like Hawker. However, that is ancient history. It has been privatised and we have to act with what we have at the moment, which is the national market and the privatised assets in our state.

We are part of a system that includes four other states, a territory and the national government. Just as the Liberals outsourced the control of our electricity system when last in government, they have now outsourced the decision-making on challenges that we face in South Australia to the federal government, a government that has shown itself to be totally incapable of providing the national leadership that is so necessary, the national leadership that many are calling out for.

What we have at the national level is a coal-fired merry-go-round. Round and round in circles it goes, when what we need is a clear path forward with a clear, clean energy goal and a thought-through transition to that goal, a transition that needs an emissions intensity scheme or some other form of fair pricing of carbon. There is virtually a consensus about this now, surprisingly. Those people who formerly were not fans or who were neutral have come on board because of the investment uncertainty that the lack of a price has created.

Too many people in the federal Liberal government—and the National Party, of course—are being captured by the merchants of doubt, and the coal lobby has funded the merchants of doubt. I feel sorry for our Prime Minister, held captive by the coal lobby and the far right, a pale shadow of his former self, but I feel even more sorry for our country and the rudderless approach to addressing what are profound issues when it comes to energy security and emissions reduction.

We all know the result of the abolition of the carbon price. We are told now by the Liberals in Canberra, by their senior advisers, that it was never a tax, that it was just incredibly grubby retail politics that we were engaging in. I feel sorry for our country, we need to reduce emissions and emissions are actually going up. As a state we now have a six-point plan designed to ensure greater grid stability and put downward pressure on electricity prices. It is interesting to reflect upon what the response to that plan has been.

There are a couple of big companies in my electorate. I have the largest user of electricity in South Australia in my electorate up at Olympic Dam and I also have Arrium, now in administration, that has some challenges with electricity and access to reasonably priced electricity. I wish the SACOME proposal on the group buy every success, and I hope they are able to shake out of the market some worthwhile contracts for that aggregated demand that involves 15 or 16 companies now. I wish them every success.

In relation to the six-point plan that we have announced, this is what the administrators of the steelworks at Whyalla and the mines at Whyalla have had to say:

Arrium administrators KordaMentha have praised energy initiatives announced by…state…governments.

I am cutting off a bit of the quote here because I am going to get back to the bit of the quote about the federal government in a minute or two.

Speaking at a meeting, KordaMentha partner Sebastian Hams—

a really good bloke—

said the administrators 'applaud' the initiatives. 'We welcome many measures that provide stability to the network—if you talk about that in relation to the sale process it is a positive because it shows the state government is dealing with the issue of stability in the network,' he said.

He also went on to praise the federal government, but he went to praise the federal government in a very particular way. He highlighted one of the agencies set up by the last federal Labor government. He mentioned the Clean Energy Finance Corporation's potential grants and potential loans. Meanwhile, Mr Hams also praised the federal Clean Energy Finance Corporation.

All the bidders have told us that it is likely they will look to use those grants to make the steelworks and mining self-sufficient. This is one of the great hopes of the sale process, that we will end up with a steelworks and a mining operation that are self-sufficient when it comes to electricity use. There are a number of approaches that can be taken to improve the energy assets at the steelworks, and it can be done in a way that uses the gases and the heat that are already produced at the steelworks.

The interesting thing about the Clean Energy Finance Corporation, and we can put ARENA into that as well, is that this federal government spent three years trying to abolish the corporation and trying to abolish ARENA. I know the value of both of those organisations. The administrators are supportive of the package because they think it goes some considerable way to addressing some of the issues that we face as a state.

The biggest energy user in my electorate is the BHP Billiton operation at Olympic Dam, and it is worthwhile repeating that. BHP Billiton has come out in fulsome support of an emissions intensity scheme, as have a number of other major companies. BHP Billiton, when the six-point plan was announced, said, 'We welcome today's announcement from the South Australian government. South Australian power for South Australians. BHP Billiton has been working closely with the South Australian government throughout the recent period of instability in the electricity market. It was pleasing to see the plan address the critical issues of energy security through a number of infrastructure and policy initiatives.'

The plan has actually been welcomed by some of the biggest industrial operators in our state. I have already had this complaint from some of the people in my electorate when they received the leaflet in the letterbox—and leaflets by their very nature are quick glance summaries, it is just the nature of that particular form of media. But the interesting thing about the plan is the detail that stands behind the plan, and there are a number of proposals in this plan that I warmly welcome. I think the $150 million renewable technology fund is a very useful addition to our energy road map in South Australia. I would have thought that the member for Stuart would be a warm supporter of that initiative.

I have heard a number of comments from those opposite about the costs associated with batteries, yet the rough rule of thumb when it comes to utility-scale batteries is that it is usually $1 million a megawatt. For those opposite who were asking the question—and I thought they would have known because I assumed they were informed people—the life of the battery is somewhere between 11 and 13 years. I am told by some of the big battery manufacturers that they look at a life of about 13 years but they put guarantees in for 12.

I think the 100 megawatt battery is going to be a useful addition, and that could be configured in a number of different ways. It does not necessarily have to all be at the one site. It is when we talk about batteries and innovation that we start to see why the regulatory framework around the National Electricity Market is so lacking and so behind what is happening in other jurisdictions overseas.

The Australian, as a newspaper, is not a great supporter of renewable energy. In fact, it is the opposite, but I still feel obliged to buy this paper every morning and read it before breakfast because it always has nuggets of really worthwhile information. I hate to have to make the admission that I actually purchase this paper. Alan Kohler wrote an article some few weeks ago about the mess we are in as a nation when it comes to the National Electricity Market and the role of the federal government and the role of the incredibly powerful incumbents in the electricity market. I do not like to quote at length but I will today because some people opposite did so yesterday. He says:

The most important thing with energy policy in Australia is which team thought of it.

If one team does this, the other team does that. If our team thinks this, the other team thinks that. He says that that is not getting us anywhere, and I tend to agree with that. What he points out is that the cost of solar and batteries is coming down, and they are taking off commercially. To complete the shift at the grid level, he said, two regulatory changes are needed. The first of those is that something like the US's Federal Energy Regulatory Commission Rule 755 should be introduced. He says:

This rule was introduced in 2011 to pay large-scale battery operators a premium because they can respond more quickly than coal generators to spikes in demand—

and also more quickly than some of the more traditional gas-fired power stations. If I have time, I might talk about some of the very contemporary gas-fired generators that Siemens, General Electric and others are working on. He goes on:

Rule 755 involves the electricity market operator paying for grid stability.

The Australian National Electricity Market is balanced in real time by matching supply to demand every five minutes. The system runs at a unlocked frequency of 50 hertz. If the generation demand balance starts to deviate too much, say down to 49 Hz, it can put the entire system stability at risk.

He rightly points out:

Thermal generators (coal and gas) provide mechanical inertia which can be called upon to move the frequency back into the safe zone…Market operator AEMO pays the generators to provide this service. The inertia acts as a brake to prevent the system from becoming unstable when an unplanned event occurs, like a big storm.

Large-scale grid batteries can mimic the mechanical inertia provided by traditional fossil fuel generators, except a lot faster. It means a well-placed grid battery can 'catch' any early deviation of frequency very quickly, which is worth paying extra money for.

The US regulators designed the FERC755 to provide a differentiated payment system for fast-acting batteries.

He explains that, as a result, batteries now make up 38 per cent of frequency regulation in one of the largest grids in the United States. It is in the north-east of the United States and includes Pennsylvania, New Jersey and Maryland. It is the largest competitive electricity market in America. He continues:

The [operator] buys more expensive premium response from batteries, but less overall frequency regulation services, leading to big savings for electricity customers. And, remember, this rule was introduced in the US six years ago—

and AEMO and the market regulators are still fluffing around here in Australia. There are actually a real brake on innovation and they are a real brake on innovation because of the power of the incumbents. Mr Kohler said:

The second rule change that would make a big difference would be to get rid of the half-hour settlement period.

I fully agree with him on that point. Generators bid into the system every five minutes, but settlement is averaged over half-hour periods, so it gives companies the opportunity to really game the system, especially when you have concentrated market ownership like we have in Australia and South Australia. He is saying that this system favours the thermal generators over solar and batteries because they (the thermal generators) cannot respond as quickly.

If the price spikes to the maximum allowable, which we all know is $14,000 a megawatt hour, and coal or gas generators fire up to take advantage of that, then they have to go for at least a couple of hours, but they still get paid the average over half an hour, which they know will be several thousand dollars, even if the price spike lasts only five minutes.

Time expired.

Mr GOLDSWORTHY (Kavel) (16:35): We do not need this legislation that is before the house because what we have seen today is that the truth has finally come out. The truth has finally been revealed about what offer was made by Alinta.

An honourable member interjecting:

Mr GOLDSWORTHY: The government know this. They are making comments and interjecting. They know that the truth has been revealed over the last 24 hours. As a consequence of that, we do not need this legislation. The member for Ramsay, in her concluding remarks, said that South Australia is leading the country. I will tell you what it is leading the country in. It is leading the country in unemployment, high taxes, high electricity bills, high water bills and right across many areas of government of responsibility—that is what it is leading the country in.

These last 24 hours have been a revelation with the information the opposition has received that there was a deal. There was an offer from Alinta in relation to continuing the operation of the Northern power station. The Premier's refusal to provide just $24 million to keep that power station operating is an economically damaging decision by the government. The decision to force the Northern power station to close will cost South Australian households well over $1 billion in increased electricity bills and higher taxes.

We have seen the Premier and government ministers move around in their statements in relation to Alinta. Initially, they said there was no offer. We questioned the government here in question time over many days and their position was 'no offer'—then they moved. They jumped around and said that the offer did not meet their needs. It is pretty clear that, if the offer had been taken up, we would not be faced with a bill of $550 million on a patch-up job.

I think that the government—the Premier and the relevant ministers—knew that the truth was going to come out eventually, so we saw a diversion strategy put in place, and that was the Premier going to a press conference that federal minister Frydenberg was holding and hijacking that press conference. I think they knew that the truth was going to come out eventually, so that was a diversionary tactic that they put in place to take attention away from the fact that the truth would eventually be revealed.

We know the Labor Party are good at this. It is a strategy that they implement often. I have been around the place long enough now to know how they operate, and this has all the hallmarks of that. If the Premier had just put the $24 million on the table, South Australian households' annual electricity bills would be hundreds of dollars cheaper and there would be no need for this $550 million patch-up job. We received a letter from Alinta to the Weatherill government that reveals an offer to keep the Northern power station operating for three years with the support of $24 million from the government. Their obsession with wind power drove cheap base load power out of the state, forcing up electricity, destabilising the grid and plunging South Australia into our blackout situation.

I listened to the Treasurer, who is the Minister for Energy, talking today about the Pelican Point power station. I have made comments about this previously in the house. I have been around long enough to remember the strident, vehement opposition that the then Labor opposition had against the construction of the Pelican Point power station. There were protests on the front steps of Parliament House. They were saying that the hot water discharged into the North Arm and the Port River was going to kill the dolphins. It was the biggest load of rubbish you could think of, but that was their position back in those days.

Now they are singing the praises of the Pelican Point power station. They did everything they could to stop the construction of that very important piece of infrastructure, but now, 15 years later or so, they are singing its praises. They cannot have it both ways. They have to be consistent in their approach on that matter, but their consistency in their approach in relation to promoting renewable energy has been one of the reasons why we are in the crisis we face today.

Their obsession with wind power and renewable energy has been confirmed by AEMO's report that the loss of power from wind farms was instrumental in the statewide blackout on 28 September. AEMO's report makes it clear that, had nine wind farms not tripped unnecessarily, there would not have been a statewide blackout. The Premier's claim that the wind farms were in no way responsible for the statewide blackout has been totally discredited. There is a lot of evidence before the South Australian community that shows that the government has been responsible for a failure in their energy policy. It has resulted in high electricity prices and unreliable supply.

As I said, what has been revealed in the last 24 hours is the hypocrisy of the government saying that there was no deal when we know there was a deal. We do not need this legislation. As other members have said, it has been brought on in a hasty fashion. We wanted to debate the very important legislation before the house in relation to child protection; however, the government has brought this into parliament without any notice at all. It is not normal practice and the government does not pay due respect to the parliamentary process.

The Hon. M.L.J. HAMILTON-SMITH (Waite—Minister for Investment and Trade, Minister for Small Business, Minister for Defence Industries, Minister for Veterans' Affairs) (16:43): This is a national problem that needs a national solution supported by solutions in each of the states. If you really go back to its beginning, it has to do with the nation's decision to form a national electricity market in the days of the Keating government when we realised that part of the economic reforms of the time required the electricity industry to become a proper market, rather than a government-run monopoly. That was something that we all went into as a nation together. Various states privatised, including Victoria and, of course, South Australia.

My personal view is that that was the right thing to do at the time, but it all hinged upon a set of regulatory arrangements and rules that enabled the electricity market to work effectively and efficiently in the best interests of all Australians. The idea was that whether states decided to retain their electricity assets or sell them, a set of market rules and a market design would be established that ensured that the investors or the states that retained ownership had a reasonable return on their investment, and that prices were kept down and the electricity market operated fairly. Now that system has failed; that system is broken.

That system was designed 20 years ago, and the rules that set out how that market would operate are now 20 years old. They are not working for a couple of reasons, and one of those reasons is that the world and the nation, and each of the states, have recognised the need to take action on climate change. There are people in the community and members in the house who would be denying climate change and would probably be happy to go back to a world of coal-burning power stations everywhere and to do away with renewables completely. I am afraid I am not one of them, and I think 90 to 95 per cent of Australians would share my view. Like me, they recognise that we cannot keep polluting the planet and that we as a nation have to play our part in reducing those emissions.

Of course, we have had a national debate about a coal price, about a carbon price, about an EIS scheme. We have had a vibrant national debate about that. It cost the current Prime Minister his job when he was opposition leader as the Liberal Coalition tore itself apart over the issue. There have no doubt been vigorous debates about it within national and state Labor politics, so this is not something that is unique to any particular political party.

But where we have landed as a nation is in a place where we all recognise that there is no going back to brown coal or black coal and that we need to move on to a new energy mix that involves renewables and gas as a much cleaner and preferred backup for base load generation and probably with battery storage and renewable energy and a range of other prospects included in the mix.

We have just had a royal commission that recommended that nuclear power for South Australia is probably unviable. Although I am not opposed in principle to nuclear energy, I think the royal commissioner's views are to be respected and I think, too, that the market is simply not big enough to sustain the sort of nuclear energy that you see on a scale in France where 80 to 85 per cent of their energy is nuclear. So it gets back to a combination of renewables and gas. That is the future and that is where we are going.

Sadly, as a nation, we have been unable to agree in a mature way about how we will manage this transition. We have not been able to agree on a price for carbon and we have not been able to agree, therefore, on an EIS scheme. We have developed what I might describe as a half-cocked arrangement, where the federal government and successive federal governments, of both political persuasions, have developed a renewable energy target (RET) and funded the establishment of renewable energy infrastructure, wind farms, solar, etc., with an incentive scheme while not putting a price on the polluters—the coal-fired power stations and the big energy polluters—because we have not been able to agree on that.

Sadly, that has delivered us principally to the point where we are at today. That point is one where we have an energy market that is broken, we have had rolling blackouts in a number of states (not just South Australia) and we have had increases in prices. All these things are symptomatic of our inability to agree on a carbon emissions scheme or a price on carbon on the one hand and, secondly, our inability to change the rules that set the paradigm for the national energy market in a way that ensures it is fair and robust.

Let me deal with the issue of the national energy market and how it is working or not working. I would have thought that with infrastructure assets like power stations, poles and wires, transmission lines and distribution networks, these would be regulated assets. They are the sorts of assets you would expect superannuation funds to buy and to return in the order of 5 to 7 per cent on a nice steady basis for their shareholders and, on that basis, to be a reliable and safe investment, but that is not what has happened.

It is not superannuation funds that have bought these assets; it is overseas interests that are interested in making super profits, and I am advised from industry sources that some of those investments are delivering yields of over 20 per cent. There is no doubt that there are some extraordinary profits being made, and we need to have more transparency of that so that people know where the money is moving and where the money is shifting.

We have had all sorts of accusations during this debate about price gouging, about generators closing down, generators for maintenance so that other generators they own can make a super profit at certain times and about people gaming the system. I do not know the extent to which those accusations are true, but I think our regulators need to provide us with the sort of transparency to ensure that, if those sorts of rorts are occurring, they are exposed for public scrutiny because we need openness and accountability on how this system works.

Because the rules that run the market are not working, they need to be changed, and they need to be changed to reflect the second part of this debate, that is, that we need to reduce our carbon emissions. When the rules were designed 20 or more years ago, we essentially had a base load renewable structure within our national energy market. Most of our energy was coming from coal and gas and turbines. That is all outlined in the government's excellent report, titled 'It's time to take charge of our energy future'.

Since then, our goal of reducing carbon emissions has led to a lot more renewable investment, and that has been encouraged by successive federal governments of both political persuasions who have incentivised solar and wind. So, we now have solar and wind as a major player in our energy transmission and distribution. In this state, it is around 46 per cent; at a national level (and we are the major contributor), it is still extraordinarily low and we look like falling short of our targets.

This is a national market not just a South Australian market so, although we might have a high ratio of renewables, you have to consider that we are pulling more than our weight and contributing to the national targets in this regard. But the rules need to recognise that wind energy is non-synchronous and subject to certain influences that coal and gas are not and that solar similarly generates during the day but not at night and has other synchronous issues linked to it.

The rules have changed to recognise that the distribution structure has changed, and that is causing situations where, as we saw, a gas turbine down at Pelican Point can be turned off on a day when there is turbulent weather and we have load shedding instead of synchronous and continuous supply. It is evident from some of the contributions that some members, in my view, do not quite understand how the market is working or not working, and I think we all have an obligation to inform ourselves a little bit better in that regard.

Because of all this uncertainty about the rules, about the way the market is working, but principally about the fact that the world and the nation are clearly heading towards a more renewable future, coal plants are closing all over the nation. Forget about Playford B, Northern, Morwell, Anglesea, Hazelwood, Wallerawang, Munmorah, Redbank, Swanbank, Collinsville in Queensland, New South Wales, Victoria. Coal-fired plants are closing all around the nation because there is a clear message that disincentivises investment in coal because the world and the nation are heading to a more renewable future.

The investment is going to be in gas and renewables, and clearly that is an irreversible trend. Even during debate, those opposite have acknowledged this by claiming to be strongly and earnestly in favour of renewable energy. I listened with great interest to the shadow minister's contribution in this regard, when he went over chapter and verse how committed those opposite are to renewable energy. The only trouble is that, if you are going to be committed to renewable energy, you have to be committed to a price on carbon because it is very hard to have a renewable energy plan without a price on carbon.

In listening to the arguments from members opposite about what we need to do, it is compellingly clear that those opposite, the alternative government, if you like, do not have the narrative or a plan to fix either our short-term problems or, may I say, our long-term problems. If I heard the shadow minister correctly, the opposition supports storage. Well, that is in the government's plan. If I heard correctly, they support renewable energy, and that is in the government's plan.

If I heard the shadow minister correctly, he agrees that we need to go into wind and into solar, but there is talk of it taking time, that we should not advance too quickly and that we should leave it for three, four or five years and make a slow transition from base load into renewables. All of that is fine. The only problem is that we have a problem now, we have a problem today. We have a problem that needs a fix in the coming months, not a problem that needs fixing in the coming years. We need to fix the short-term, the medium-term and the long-term problem.

Of course, the government is doing that with this plan, which involves battery storage and renewable technologies, new generation and more competition, a state-owned gas power plant, South Australian gas incentives, local power over the national market and an energy security target. I have not heard from members opposite an alternative plan or an alternative vision. You need to be able to answer the question: what would you do?

Of course, having been asked that question many times by Leon Byner and others—Leon is probably the best at it—I try not to go into a debate without having an answer to it. I am yet to hear from the opposition what they would do. It is fine to critique the government and it is fine to say, 'Oh, well, you should have left the Northern power station open,' even though, as acknowledged, it would have only been for two or three years as a pre-stopgap measure, it would have cost an extraordinary amount of money and would not have stopped there and it would not have been a solution for our needs, as has been explained by the Minister for Energy.

It is fine to criticise the government for what it is doing. It is fine to criticise the government and say what you think should have been done in years past, but at some point as an alternative government you have to be prepared to say what you think your solution is. Can I say that it would not have been that hard for the opposition to do just that. They could have come out with their own plan three or four weeks ago and had everybody talking about their solution instead of waiting for the government to take the initiative. They did not do that.

I just say to the opposition: it is a chess game. If you are constantly responding to the moves of your opponent, as you seem to be doing, you will constantly be on the back foot. You have to be courageous, you have to be bold and you have to be prepared to engage in the battle of ideas. I have seen none of that in this debate, just feigned outrage and criticism of the government without constructive solutions having been applied as an alternative narrative. I would simply say that, if we going to have an intelligent and informed debate about this, there needs to be a narrative from those opposite about what they would do.

Can I go on to explain the importance of this to be solved at the national level. If you are going to have an energy grid, where energy is shifted across borders seamlessly to meet localised demands, then there must be a national set of rules and it must be considered to be a national energy system. You cannot say that South Australia must take complete 100 per cent responsibility for everything that happens in the national grid when we do not have complete unrestricted control of that national grid. When you are part of a national system, you are part of a national system over which you do not have complete control.

What I think we need to do, and this is where members opposite can make themselves useful, is convey a message to Canberra, to all who will listen, that we need to revise the market rules, that we need to redesign this system to take account of renewables, that we need to set a price on carbon—whatever form we can agree upon to do so—and that we need to go forward into a future that sees a significant role for renewable energy transmission and a significant backup role for base load, principally gas, to provide the support that renewables will always need.

There is the associated issue of gas. It does surprise me that, in a nation so abundantly blessed with gas, we are sitting here discussing gas shortages. How we as a nation allowed that situation to develop is something we might wish to reflect upon. The government, in recognising that shortfall, has now taken steps to encourage further exploration, to get more gas out there on the market and to provide it to state governments and to gas-based energy generators for the purpose of providing more supply to our markets.

Can I use the final few minutes to clarify some quite shady suggestions that came from the federal defence industry minister, Mr Pyne, the member for Sturt, suggesting that the Future Submarine project might be threatened by what he called 'Third World power supplies'. Mr Pyne told the federal parliament that the Department of Defence had advised him that separate power generation and fuel storage would need to be built at Adelaide's Osborne yard.

I have checked out a lot of this with my agency and we have done some research into it. It turns out that there is good reason to question whether that claim is accurate and genuine. I sought advice from the managers of the Common User Facility at Techport, who in summary said that the reliability of the power supply is not and has not been an issue at Techport. The advice showed that the precinct has had on average two or three blackouts per year. The facility manager advised my office:

Practically all of these have been for no longer than 30 minutes with the exception of three: one outage approximately two years ago which was a network fault and had a three-hour duration; a second outage happened around 12 months ago and went for one hour…caused by ASC tripping the main substation for the precinct; finally, there was a major statewide blackout in September last year.

Let's look at that from the perspective of a major shipbuilding program. Based on an average of two blackouts per year of 30 minutes' duration, the lost time is one hour per year. I hardly think that is going to stop shipbuilding operations down at Osborne. The air warfare destroyer and Collins sustainment programs would be the main programs affected.

In the 12 years since ASC was selected as the shipbuilder for the AWD project, we would have lost just over two days' work in 12 years. It is hardly Third World conditions. These were mistruths about the reality of South Australia's situation and very disappointing when you see the reports of the Australian Energy Market Operator in recent days, including today, pointing out what is really wrong with our system.

I say to the house that we need a measured and considered debate. The government has come up with a plan of action that will deal with this issue in the short term, in the medium term and in the long term. We have a plan. It has been carefully thought through, and it would be assisted by an intelligent critique and some alternative ideas from members opposite because in government you have to get out there and do things. You have to solve problems, not just talk about them. With that, I commend the matter to the house.

The Hon. S.E. CLOSE (Port Adelaide—Minister for Education and Child Development, Minister for Higher Education and Skills) (17:03): I am proud to be part of a government that has a bold plan to ensure stability in our energy supply. We are a government that is getting on with delivering our plan with this bill that is before the parliament. I am also proud to see productive discussion about energy in South Australia and throughout the country. This is a discussion that was initiated by the actions of our state government and our Premier. Finally, energy is in the headlines for more than just stunts, such as senior federal government ministers bringing coal into parliament for show-and-tell. What a disgraceful act, when the Great Barrier Reef is under assault from climate change, to parade a piece of coal around as if it were harmless and, worse, as if it were a joke.

For years, South Australian school students have been having much more mature discussions about coal, energy, renewables and climate change than we have heard recently from our federal government. It is for the students that we are now taking action to shore up our electricity supply, to ensure affordable power for South Australians and to increase the use of renewable and low-carbon energy. We need to stand up now for our state, for our community and for businesses that must have a reliable, affordable electricity supply, and we must also stand up for future generations.

Any reasonably minded person can see that under this current arrangement, this electricity market with assets in private hands, we are not getting the reliability we need now, we are not getting investment and we are not making the technological progress needed to ensure it in the future. There is more at stake in the provision of electricity than the bottom line of companies that bought our electricity assets when Mr Rob Lucas, in another place, sold South Australia out. It should be obvious to everyone, but unfortunately it is not. The opposition turned our state's need for electricity into a money-making opportunity for private companies.

In 1946, the state's power system was nationalised and the Electricity Trust of South Australia created. The then premier, Sir Thomas Playford, took the steps he needed to ensure reliable power for the people of South Australia. After 54 years of the state government controlling electricity in this state, the opposition began selling off our assets and abdicating its responsibility in 1999. It sold the infrastructure this state needs to make and distribute power, the responsibility of supplying this power to customers. It turned it into a retail opportunity for the highest bidder. It placed the generation, supply and maintenance of this essential service in the hands of private interests and, of course, we ended up where we are today.

It is not surprising that organisations headquartered internationally are not focused on ensuring that we in South Australia have enough power to get through a hot summer's night, or that their corporate planning is not centred around ensuring that our people in South Australia, our businesses and services, will have enough reliable power in the future. This is where government needs to step in, and this is what we are doing.

It is similarly the case when it comes to climate change. It is real, and not only do the people of South Australia know this but our businesses do too. They realise that the current electricity market is not sustainable and they realise that there are serious costs to burning coal. They are trying to factor it in, trying to predict when the federal government will take action to price carbon, but they are struggling—and who can blame them? That is why we are seeing businesses advocating for an emissions intensity scheme, that is why we are seeing our coal generators closing, that is why we are seeing gas providers struggling to compete.

I know that climate change is in the minds of our children, too, our students. In class they discuss and learn how to live sustainably and how to reduce their impact on the environment. Of course, the schools they attend rely heavily on power. This state government has been working to keep these costs low, to use power responsibly and to source renewable energy. We are working to reduce the cost that our schools are paying for electricity so that we can use more of it to support education.

This will be further helped by the Sustainable Schools Program launched earlier this year. A total of 240 schools across South Australia, the schools with the highest energy use, have been selected for the program in which 40 schools will receive $250,000 for solar panels and LED lighting upgrades and 200 schools will receive $25,000 for LED lighting upgrading. This is also expected to produce 38 full-time equivalent jobs and, in accordance with this state's Industry Participation Policy, local businesses, contractors and suppliers will be targeted to ensure that local industry benefits from the program.

In addition to creating jobs and bringing the cost of power down for our school system, this infrastructure gives students an appreciation of the importance of electricity for their schools and helps with their learning. These installations are great examples for our students about conserving power and using renewables to generate it. It gives them an appreciation that it is a resource that is to be used sparingly and gives them an appreciation of how its reliability is important for their classrooms and everyone else in the state. It is this understanding that we have lost in Australia. We have a free market that is focused on the bottom line for generators and not on the importance of the resource for the people.

I am proud to be part of a government that is governing in the interests of our people. I am proud that we are showing our children how seriously we are taking their future, that we are not ignoring major issues until they become someone else's problem, until they become their problem. Every day we encourage our students to be innovative, to tackle problems with creative solutions, to think outside the square. We must be prepared to do that as well, to demonstrate that we are willing to use modern thinking and new technology to make progress in this state.

The people in my electorate of Port Adelaide have given me great feedback about this plan, too. They want the improved reliability, lower power prices and extra jobs that the government's energy plan will bring. They were hit hard when the power went out unnecessarily in February. When temperatures soared, the national operator was caught totally unprepared. Without the correct weather data from the Bureau of Meteorology, they did not predict the rise of demand in time. They did not act early enough to bring on more capacity in South Australia and as a result many more homes lost power than should have.

The free market system failed us and the national operator failed us. My constituents were left unnecessarily without power. This has a direct impact on their businesses that rely heavily on their reputations. This bill gives the South Australian government the powers that we need to avoid situations like this in future. My constituents tell me that this is not good enough. They implore us to act, to govern. They want us to take action to prevent this from happening in the future to ensure this state has reliable and affordable power. That is what they have elected me to do and that is what they have elected all of us to do.

I am proud that I can now tell them the steps that this state government is proposing to give energy security for the future. I can articulate precisely what our plan is and how it will improve the situation. I am proud that we are looking at all of the available technology to tackle this, that we are intervening in a market that is not designed with them in mind. I am proud that we are now working to set an example in this country, and in fact globally. We are tackling the issue of energy head on and showing that solutions are possible. This government is taking back control of South Australia's power, and this government is looking after South Australians.

The Hon. S.C. MULLIGHAN (Lee—Minister for Transport and Infrastructure, Minister for Housing and Urban Development) (17:11): I rise to speak on the Emergency Management (Electricity Supply Emergencies) Amendment Bill 2017. I speak at the end of a large number of contributors in this chamber.

The DEPUTY SPEAKER: Can we just clarify that you are closing the debate?

The Hon. S.C. MULLIGHAN: I believe so.

The DEPUTY SPEAKER: You are closing the debate, so everyone is aware of that?

Mr Duluk: No.

The DEPUTY SPEAKER: Everyone is aware of that?

An honourable member interjecting:

The Hon. S.C. MULLIGHAN: There are two more?

The DEPUTY SPEAKER: But if you are speaking—you are not in charge of the bill.

The Hon. S.C. MULLIGHAN: No.

The DEPUTY SPEAKER: The Treasurer is.

The Hon. S.C. MULLIGHAN: Yes, that's right.

The DEPUTY SPEAKER: I just needed to clarify that for everybody. Sorry to interrupt.

The Hon. S.C. MULLIGHAN: You threw us all, but that's okay. You gave me a heart attack! Thank you, Deputy Speaker. I speak almost at the end of a large number of contributions on this bill.

The DEPUTY SPEAKER: You scared us, you see.

The Hon. S.C. MULLIGHAN: And me as well. It is an important issue, as we all know. As members, we are continually approached by our constituents, let alone other members of the public, who are concerned about the state of South Australia's electricity network and also the market which is responsible for operating that market.

It is fair to say that particularly in the last six months South Australia has been badly let down by our electricity network and by the operations of the market which runs that network. We have had failures in supply in total. We have had load shedding blackouts, and we have had fluctuations in pricing substantially for those businesses which have stayed on those more flexible contracts. We have had households and other consumers who are being exposed to increasing prices, prices which have increased since the very early 2000s.

But it has not always been the case for South Australia. As the member for Port Adelaide was alluding to, there was a time when South Australia had a very proud history when it came to our electricity network, particularly since the interventions by the Liberal and Country League and their premier, Sir Thomas Playford, in 1946. Indeed, the chamber is graced with a picture of him overlooking all our deliberations.

He realised that, with the old Adelaide electricity supply company headquartered out of London and operated solely for the benefit of its shareholders, South Australia's electricity supply in those days was not only unreliable but unaffordable. It was a major barrier to postwar industrial development in South Australia, so he took the extraordinary move, for somebody who represents the conservative side of politics, of reaching out to a Labor federal prime minister and striking a deal to nationalise the electricity system in South Australia.

He took some other quite revolutionary steps as well. He created a major industrial opportunity for car manufacturing in South Australia. He approached General Motors in America. He also master planned and developed and delivered an entire new suburb to support those manufacturing operations, and he greatly expanded the Housing Trust which, I believe, was started by Sir Richard Butler, the grandfather of the current federal member for Port Adelaide.

In the years that followed that intervention and the nationalisation of the electricity market, South Australia became known, at least in the electricity context, as the place where you had cheap reliable power. Skip forward, as the member for Port Adelaide did, to the experience of the 1990s. Certainly, when there was a change of government in late 1993, there was a considerable amount of debate about how the state would meet its financial obligations at that time.

Not only were there some swingeing cuts made by the then Liberal Party but there arose concern about whether the Liberal Party had secret plans to privatise the Electricity Trust of South Australia. Of course, we all remember that, in the election campaign in the second half of 1997, the then premier, John Olsen, was forced to rule it out. He used the words 'never ever'. Never ever would ETSA be sold. That is what he said in the lead-up to the 1997 election.

Remember, of course, that the 1997 election came halfway through the life of that government. They had four years on the treasury bench to deal with what they saw as (and indeed what were for the community) substantial financial burdens, which needed to be reduced. Despite being halfway through their term, they said that they would never ever do that, but of course they did. They chose to privatise our electricity network.

They chose to take a short-term opportunistic view about the value of our electricity supplies and they offshored it, not quite back to London to where the Adelaide electric supply company was headquartered but indeed to a former UK interest in Hong Kong. We have now seen the demand for energy companies like AGL and others to invest in renewable energy because they understand that with renewable energy, yes, there is an up-front capital cost but then there is the promise of cheaper, affordable electricity after that investment has been made.

As we have seen the growth of renewable energy, as we have seen the billions of dollars invested in this state, as we have seen the hundreds of jobs that have been attracted to constructing let alone maintaining these sites, with this electricity network solely in the purview of private interests and run without concern, let alone recourse, for government at state level or at any other level, they have chosen to prioritise profit oversupply. That has certainly impacted the security of our electricity supplies.

I do not think we have seen a situation like we have experienced in the first part of this year, when electricity companies were making decisions to deliberately constrain supply to an electricity network in an effort to maintain higher pricing across the market and generate higher profits, since the very early 2000s in California when Enron, the company responsible for managing that state's electricity supply, was found subsequently to have been taking decisions deliberately to close off parts of its electricity generation network, spike demand significantly higher than what it was and reap much higher pricing. That is the sort of cold corporate greed that, thanks to those decisions taken 20 years ago to privatise ETSA, South Australians are now exposed to.

Unless we have a bill like this, unless we have this type of law which enables South Australia, through its parliament and through its ministers, to take back some control over how our electricity network is run on behalf of South Australians, that is the sort of treatment we can expect from these companies. They are not here for goodwill, they are not here for our benefit: they are here for their benefit. They are here to maximise their returns to their shareholders, so that is why this part of the government's energy plan is absolutely crucial, as are those other elements that we have announced in the preceding couple of weeks.

Making sure that there is an increased supply to meet those peak levels of demand is absolutely critical. Making sure that we have new gas-fired generation is crucial to ensuring that we have enough base load power not only to provide much-needed competition within the market but to ensure that we can supply during those periods when there is peak electricity consumption in South Australia. Supporting a new gas power plant is critical to that, as are the government's procurement decisions to use our government power purchasing agreement to bring on another gas-fired generator.

We have also said that we would introduce an energy security target requiring retailers selling electricity in South Australia to source a minimum amount of power from South Australian generation, again to keep base load electricity generation on an ongoing basis, to provide competition in the market, to bring down prices and to provide security for electricity consumers be they residential, commercial or industrial. To deal with the issue that the member for Waite raised in terms of having sufficient gas supply, those South Australian gas incentives are absolutely crucial not just for the exploration but also for sharing the benefits of gas production with landowners. Then, of course, on top of those two gas generators I mentioned, there is the battery storage as well.

You can see from the government's plan that not only do we have these powers to, for the first time, insert some control back over South Australians' electricity network, but we also have a broad-ranging solution to provide competition, to put downward pressure on prices and to ensure base load generation on an ongoing basis. That, of course, is what has angered and frustrated the opposition so much, particularly during the last week.

They are outraged that we would not be prioritising coal interests. A couple of weeks ago, they were promoting Eastern States' coal interests. Now they are promoting coal interests that apparently would only run for some further 12 months from where we are now. Short-term coal interests are what they want to have. It is not South Australian gas, which is sustainable into the future for many, many years: it is those short-term coal interests.

That coal lobby, of course, has a proud history of supporting the electoral prospects of the Liberal Party across this country, and that has been the rub for the state opposition as well as the federal Liberal Party. They are absolutely addicted to fighting against what should be a secure, green, low-cost energy future for this country let alone this state—nothing irks them more.

In the face of all the evidence that is provided, both at a state but particularly at a national level, about those actions that need to be taken to ensure that we have ongoing investment in our energy industry and to ensure that we have all those new investments, in gas-fired base load electricity generation and also in renewable energy and renewable storage technologies, they continue to make the decision to shove their head deeper and deeper into the sand and say that coal is the answer.

It is not the answer, and any conversation you have with any South Australian who is not a blind supporter of that side of politics—and of course, as we know, for the last 15 years that is a narrower and narrower band of South Australians—about the future of energy in South Australia will tell you that renewable energy is at the heart of our energy future. They realise the benefits, just as we did when we introduced a program to support the installation of rooftop solar in households.

So successful has that program been, and so ubiquitous are those rooftop solar systems, that well over 130,000 homes now have them installed, which I think is approximately one in seven households across South Australia, not just in the metro area but across the whole state and across all demographics. They are installed everywhere, including on farm sheds and sporting clubs. That is why in South Australia we know that a clean energy future, which is based on renewables and which has a gas base load at its heart, is the future for South Australia, and that is what this plan does. But it does not fit with their ideology and they have been left absolutely stranded when it has come to adequately responding to this energy issue in South Australia.

I spoke a couple of weeks ago, when we were last here, about the deliberate misrepresentation that the Leader of the Opposition and those opposite immediately rushed to to try to place blame for the troubles we have had in South Australia with our electricity network at the feet of the government and ensure that they would crowd out that base reason as to why we were having these issues—that is, a privately controlled, privately run electricity system, run for the interests of corporate profit with the interests of consumers and the interests of security of supply and reliability running distant last. Their effort to crowd out that argument is obvious.

There is one part of the parliamentary year that I enjoy—or at least enjoy more now—and that is budget day.

The Hon. T.R. Kenyon: It's better than it used to be.

The Hon. S.C. MULLIGHAN: It is better than it used to be, I admit. Yes, that is certainly the case. Budget day results, of course, in the publication of the state's budget papers. Budget Paper 3, referred to as the Budget Statement, goes to some pains in its appendices to tell the financial history of the South Australian government, and it casts its net back quite some way.

Looking at the most recent iteration of one of these appendices, which records in quite some detail the revenue and expenditure received by the general government sector, and those two key metrics that are revealed every budget time—the net operating balance and the net lending balance—they tell the story of why the South Australian Liberal Party is at pains never to have the sale of ETSA discussed publicly or within this chamber or indeed anywhere else. It is because they have been engaged in a near 20-year campaign to rewrite history as to their absolute financial destruction through that process.

They claim, of course, that they were selling these assets for in excess of $3 billion to retire debt. This appendix, this data, these numbers tell the precisely opposite story. We know that the member in another place, the Hon. Mr Lucas, likes to say, 'It was my duty to do that. It was in in an effort to improve the books to make sure that we ran down debt.' Even a cursory glance at the figures in this appendix tells a different story.

What were the four budget deficits that Rob Lucas ran while he was treasurer in this place trying to prosecute the sale of ETSA, trying to make the case that he was going to retire debt? What did he do over the scope of the four budgets that he oversaw? The first was a deficit in excess of $200 million, then the next year it was in excess of $300 million, the next year it was nearly $300 million and the next year, a marginal improvement, just less than $200 million.

While he was saying that he had to do this to retire debt, he racked up net operating deficits in excess of $1 billion, but the actual figure, which goes to the level of the state's debt, is not in an operating balance: it is in the net lending balance. Those four deficits over those four years were even worse, with one year nearly approaching half a billion dollars. He was out there trying to tell South Australians that he had to go through with this sale to retire debt, but at the same time he was racking up the debt. In this case, $1.3 billion of debt is what he racked up during his time as treasurer while he was making the case to South Australians that ETSA needed to be sold.

As we know—and as a cursory reading of the Hansard of the Legislative Council when they were debating that will show—we were not the only people deceived by the Hon. Mr Lucas. He also deceived a former member of the other place, the Hon. Nick Xenophon. Nick Xenophon only voted for that legislation because he had a promise from Mr Lucas that there would be a state referendum on whether ETSA would be sold. He promised that.

So, not only did he wilfully mislead South Australian voters about his financial mismanagement but he also lied to those crossbench MPs to elicit some support for the sale of ETSA. That is why they will not talk about a gas future. That is why they will not talk about the importance of renewables. That is why they bemoan this bill about South Australians taking back control of our electricity network. It is to hide their bloodied hands over their mistreatment of the state's finances and the sale of electricity in South Australia.

The Hon. J.M. RANKINE (Wright) (17:32): This legislation is an important part of the initiative this government is taking to ensure that we have certainty in our power supply and that we are not held hostage by power companies whose focus is and always has been on profit and not on what is best for South Australia or for South Australians. The Premier has outlined a clear and specific plan, a clearly articulated way forward that will deliver more generation, more competition, more gas, more renewables, that is, clean energy, more storage of power and, importantly, more jobs.

The culture of this state has always been one of independence. We were settled by free settlers who had to make their own way. We do not like being reliant on others. We certainly do not like being reliant on other states for our power or held hostage by profit-driven power companies. With this legislation, we reassert our independence, and if the people of South Australia were looking for indicators of what differentiates the political parties in this state this is it. This is a defining issue. This Labor government is prepared to do whatever it takes to secure our power supplies. The Liberal opposition has no plans.

Our Premier is prepared to stand up to the federal government and fight for South Australia. The Liberal leader in this state sits on his hands and awaits instruction from his friends in Canberra about what he is allowed to do. We have seen this time and time again—the River Murray, health funding, Gonski and the list goes on. It is pathetic really, and I know that it is causing great consternation within his party. None of them seems to know what to do. They are waiting to see their leader step up to the plate but, no, he is on his back having his tummy tickled like a happy little puppy.

The Labor government is prepared to take back control of our power. Those opposite did not even want to debate this legislation. They want to wait for instruction from Canberra. I am going to read a quote from Hansard from 20 years ago, and it is a quote from the debate that established the Electricity Trust here in South Australia. At that time, Sir Lyell McEwin said:

…who would suggest that the metropolitan water system should be the province of private enterprise, and that Government should participate only in the unproductive schemes? There is a distinct avenue for public utilities in the sphere of social services as distinct from the realm of trade and commerce. The metropolitan tramways were originally privately owned, but I can trace no suggestion that their operation by trust was termed 'socialistic' in the conservative past at the time of acquisition. I understand that even the harbours were not always publicly owned, and it would be just as fantastic to suggest their return to private enterprise as it would be to suggest that the construction of road and bridges should be vested in other than a public body. What standard of hospitalisation would the State enjoy today were it not for the Government hospitals, to which increased access is continually being sought at the instigation even of Parliament itself.

That is what Sir Lyell McEwin had to say in debate on 7 November 1945:

Who would suggest that the metropolitan water system should be the province of private enterprise…

The Liberals did. Further, he asks:

What standard of hospitalisation would the State enjoy today were it not for the public hospitals…

Well, we saw that when the Liberals privatised Modbury Hospital. This Labor government took it back into public hands and has invested millions in upgrading and refurbishing it—$30 million alone for the new rehabilitation centre, which we will see at the open day on 8 April.

The last Liberal government in this state went to the 1997 election promising that it would not sell off ETSA. It was the greatest political deception ever inflicted on the people of South Australia. The election was in October 1997, and by February 1998 we were being told that ETSA was now up for sale. As far back as 1996, the Liberal government was working assiduously on selling off our state's largest publicly owned asset. When challenged, the then deputy premier said on ABC News, 'There is no sale of ETSA, there's no plan for the sale of Optima Energy—full stop.' The then premier told Channel 9 News, 'We are not pursuing a privatisation course with ETSA.' Further, the then premier told The Advertiser, 'I have consistently said there will be no privatisation, and that position remains.'

They told South Australians that ETSA was not up for sale while at the same time they were working secretly to do just that. Mr Janes, the managing director of ETSA, told an economic and finance committee that ETSA began discussion of privatisation in February 1997. In November 1997, just weeks after the election, he said he told the then premier, and I quote:

…work was continuing on the Schroders privatisation report. Mr Janes said the Premier told him he should tell the new Minister for Infrastructure as a matter of courtesy, what was going on. Mr Janes emphasised that all this activity was highly secret and said only the Premier, the Deputy Premier, Mr Janes himself, Mr Armour, Schroders and a single ETSA officer working from home were aware of this activity…

It was even kept secret from ETSA personnel and certainly secret from the people of South Australia. They worked to keep it all quiet. How did they justify it? They came out and said, 'Oh, we've changed our minds'. First, there was the claim that national competition required it to be sold—a clear lie. They said that they needed to sell it to reduce debt. But then again what did the Premier say to the estimates committee on 17 June 1997? The Premier said:

No Government, current or future, would deny the revenue flow. I simply ask the question, ‘Why on earth would you simply sell something when the revenue flow from that sale—that is, the debt reduction and the interest saved—did not equate to the revenue flow out of the sector on an annual basis?’ That is just not logical. One has to look only at the budget sheet to see what the industry is generating for us now.

Then, as I said, during the election campaign he went on to say, 'We are not pursuing a privatisation course with ETSA.' So, it was simply a ruse. The sale was ideological, not financial. Quite frankly, the more things change the more they say the same. This Labor government wants control of our power. This Liberal opposition wants to leave power in the hands of private companies. South Australians simply cannot trust the Liberals to protect them. South Australians cannot rely on the Liberal leader to stand up for South Australia. South Australians cannot and should not have to wait for Malcolm Turnbull's lightbulb thought bubble around the Snowy hydro scheme.

I read somewhere just recently that this $2 billion expansion of the Snowy hydro scheme, for which no work has been undertaken, would only be possible, if in fact it ever comes to fruition, because the federal government was unable to push through a proposed privatisation of this iconic power source a couple of years ago. This announcement was made because the PM was caught out badly—playing politics, damning this state because of the results of a severe storm. It went badly and he had to come up with something.

The Weatherill government has not just prepared a plan and developed a clearly articulated document outlining the plan, we are taking action now to implement it. The bill in this place we are debating this week will allow immediate intervention by the minister when necessary and it is in the interests of South Australians and South Australian businesses. Expressions of interest for the provision of substantial battery storage were called for a little over a week ago, and it would appear that interest is overwhelming.

We have announced $24 million in PACE grants to accelerate gas exploration. It is estimated that the Cooper Basin has reserves that will provide gas for South Australia for the next 200 years. These grants are about unlocking these supplies. Yesterday, the Premier announced the opening of expressions of interest in relation to the construction of South Australia's state-owned gas-fired power station, a power station that will provide energy in minutes in times of shortage. South Australians know that we need to modernise our power supply. They overwhelmingly support renewable energy. The only ones who do not are sitting opposite. Let me quote the assessment undertaken by Frontier Economics. They said:

The government’s suite of policy measures provides a technically and cost effective response to the immediate and long term needs in terms of power system security and reliability...the acquisition of new plant will ensure the government receives value for money. Finally, the suite of measures will ensure greater competition and...once the competitiveness of the market improves through the effects of the policies, lower prices to consumers than otherwise and absolutely.

I have said that this is a defining issue, just as the sale of ETSA was. The assistance being provided to the less well off in our community also defines the difference between Labor and Liberal. There is the medical heating and cooling concession, introduced by this government, to give relief to those reliant on power to assist with a disability or serious health complaint. There are also the free energy audits and the Cost of Living Concession.

This is a cracker: the Liberals in Canberra cut the $30 million worth of concessions provided to pensioners to help with their council rates—just wiped them away. This government provided the Cost of Living Concession to compensate for that, and it increased it and extended it to those renting their homes. There are the recently announced grants for schools to install solar panels and LED lighting, as well as solar panels for 400 Housing Trust homes.

The Leader of the Opposition, in his contribution yesterday, asked, 'Why have we got in this situation?' The answer, Liberal leader, is that your party started the ball rolling when it sold ETSA. The Liberals in this state have no plan—in fact, they have no idea. The Liberals in South Australia do not stand up for South Australia. The Liberal leadership is non-existent and there is a complete lack of leadership in Canberra. It is clear that not only South Australia is suffering but other states are as well.

This is in the face of the closure of nine coal-fired power stations, soon to be 10, around Australia—five of them in New South Wales alone and three in Victoria. Nearly 5,000 megawatts of power are no longer in the system. Why? Because it is outdated, not sustainable and not profitable. South Australians know, and history shows, that Liberals cannot be trusted with essential services. If we want smart, modern, reliable power in this state, there is only one government that can deliver it—and that work is well underway. This bill is an important part of this package.

The Hon. T.R. KENYON (Newland) (17:46): I rise to add my support to this bill. It is somewhat ironic that its main purpose is to give powers to the state Minister for Energy to declare an energy emergency, as opposed to a state of emergency, and then allow him to intervene in some ways to direct generators, and so on and so forth. This is a power that ministers for energy have formally had in the past, over a long period of time in South Australia's history, because we owned the assets. We owned the generators, we owned the distribution network and we owned the retailer. We were able to intervene in all parts of the electricity industry because they were ours.

It just goes to show how disastrous the sale of ETSA was economically, and in terms of reliability and price in this state, because it took away the power of the state government to manage adequately and efficiently the big issues around electricity—the everyday supply of power, of course, but also some of the big issues around electricity in our state. This is obviously part of the electricity package of the government, and I have to say that it has been very well received in my electorate. We have been out there extensively, talking to people about it. They like the fact that we are building a generator; they think that is a good idea and they like the idea of the batteries. They have both gone down very well.

They understand the need for more gas supply, so they are supportive of the PACE initiatives to improve gas supply into the state. I might add that is an extension of the initial PACE program that began in 2004 under minister Holloway at the time. It was a revolutionary policy that continues to be successful and is now so flexible that it is finding use assisting us with our energy issues and helping to improve gas supply. I think it is important to remember the contribution of minister Holloway in the development of that package and that, after 12 and coming into 13 years (I think it was April 2004), it is still contributing to public policy in a really good way, and that should be commended.

All these issues are very well received in my electorate. People are happy to see that the government is taking action. Almost all of them were very pleased to see the Premier standing up for South Australia a couple of weeks ago, and I think there is a genuine degree of satisfaction now that they are seeing that action is being taken to improve our energy supply. We saw proof of that today with the announcement around the Pelican Point power station, and we are already seeing changes in the energy market, which obviously have effects and causes right across the country.

However, we are starting to see the market adapt to conditions and we are starting to see the changes in the reliance on gas that the state government has been championing for some time now and the importance of gas generation as a swing fuel or a swing form of generation over the next few years to get us through to a much more renewable future, which all members of this house seem to support.

Even those opposite seem to be agreeing with the need for more renewable energy; many of them have said so in this debate. Gas is rapidly becoming the transition fuel of choice, as evidenced by today's announcement and all the other things that have been happening. With those few words, I commend the bill to the house and look forward to its passage.

The Hon. A. PICCOLO (Light) (17:50): I would like to make a contribution to the debate on this bill. This bill is one of the key planks of the Labor government's energy plan, a plan which looks towards the future and, very importantly, a very positive view of the future.

The first element of this plan is the bill we are debating today. That involves introducing some additional powers for the minister in the case of an emergency situation arising. This is a very important part of the plan because we have seen what happens when the government is unable to intervene in the energy market. So this is a very important part of it, and worthy of our support.

It was interesting to note that a number of speakers on this issue—and there have been quite a few, particularly speakers on the other side—have used words like 'crisis', 'emergency', 'urgent', etc., throughout their speeches, yet when we introduced this bill yesterday they actually wanted to adjourn it. According to them we have—

Mr van Holst Pellekaan: We wanted five minutes to read it.

The DEPUTY SPEAKER: Order!

Mr van Holst Pellekaan: You didn't let us read it.

The DEPUTY SPEAKER: Member for Stuart!

The Hon. A. PICCOLO: They have gone on for months and months about how urgent this issue is and then we actually bring a bill to this parliament and what do they do? They seek to delay it. It was something brand new, they were not actually aware that we had announced a policy two weeks ago, and we did announce that we would be introducing legislation to give the minister these additional powers. That has been publicly flagged, and I would have thought that any competent opposition would realise that the government will introduce that bill into this—

Mr van Holst Pellekaan: It wasn't on the Notice Paper.

The DEPUTY SPEAKER: The member for Stuart is on two warnings and will leave the room for six minutes if he says another word. There is no need for it. You are aware of the standing orders. It is disrespectful to other members.

The Hon. A. PICCOLO: Thank you, Deputy Speaker. I have not interrupted any other speakers, so I would appreciate the courtesy—

The DEPUTY SPEAKER: Order! Back to the speech.

The Hon. A. PICCOLO: This is very important. First of all, the Liberal Party try to delay this. On one hand, they actually said that it is so urgent, in fact so critical, that we need to address this matter, but at the very first opportunity what do they do? A negative response; they tried to delay this proposal. I will come to other issues about how they have been inconsistent through this whole policy area for months since we have been discussing it.

The second important part of our policy is a state-owned gas power plant. This is an important element for a number of reasons. It is important because it ensures that we have a much more reliable system and, secondly, it introduces a new player into the marketplace. That is important from a competitive point of view; it would be an important plank to ensure that we put downward pressure on energy prices.

We talk about energy prices, and for months the Liberal Party has been criticising the government about prices. I understand today's spot price was minus 45, and the opposition got up and criticised us for that as well—again, another inconsistency in their policy. On the one hand, we are responsible for the higher prices, but we actually are not responsible for the low prices. That is very important, and I will explain why the Liberal Party has a number of inconsistent positions on this whole energy policy.

This new generation provides important backup energy. This state-owned gas provides additional play in a marketplace, and therefore provides competition, which is very important, and it also sends a very clear message to the market that the government is intervening, and we will not tolerate an unstable national market. The third part about this policy is that the government will provide incentives for increasing gas exploration, and I think that is very important. Exploration of any type is a risky business. By providing incentives, we remove an element of that risk which means the private sector will undertake additional exploration and increase its supply of gas. I seek leave to continue my remarks.

Leave granted; debate adjourned.