Electricity Prices

Mr VAN HOLST PELLEKAAN (Stuart) (14:21): Supplementary question, sir: given the minister's answer, including reference to the Finkel report, why did he say after the Finkel report was released three times comments that 'it will lower prices', 'our plan will lower prices' and 'will ultimately lower prices'? Is the minister walking away from his commitment to lower electricity prices in South Australia?

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (14:21): No, sir. Again—

Mr van Holst Pellekaan interjecting:

The SPEAKER: That's right. He did.

The Hon. A. KOUTSANTONIS: Whenever you are giving an answer to a question in the media, nuance and complex issues can't be solved in a seven-second grab.

Mr Pisoni interjecting:

The SPEAKER: The member for Unley is warned.

Mr Pisoni: Thank you, sir.

The SPEAKER: My pleasure.

The Hon. A. KOUTSANTONIS: The face of the Liberal Party. The idea that complex solutions can be boiled down to a seven-second grab, the government is well aware that with our plan, the Finkel plan, the idea of more renewables being able to firm each other—whether it is batteries and wind, solar and wind, solar thermal, other forms of energy—you will get a much lower cost into the system. But the only way you will get these types of new investments in the South Australian and National Electricity Market is with a policy overlay.

We have done our bit in South Australia. On the day when the Premier announced Our Energy Plan, he made it very clear that our energy security target is designed to be folded in to a national mechanism. We want there to be a national mechanism for new investment. All these plans working together will lower prices, but in the absence of the commonwealth government adopting the Finkel inquiry, it will be very difficult. You need to have a national plan, you need to have national coordination of new investment, but members opposite just want—

Mr Whetstone interjecting:

The SPEAKER: The member for Chaffey is on two warnings.

The Hon. A. KOUTSANTONIS: —to howl at the moon. These are complex issues that take a long time to explain and they are not suitable to be explained in sound bites. This is a difficult issue. That is why Dr Finkel has come up with a 50-point recommendation for a very complex issue. The point that I make is when politicians just get up and say, 'Vote for me. I will lower prices,' it doesn't work that way. It is not that simple. What you do is you have a plan. You integrate that plan nationally with national plans and you work with companies, and what you are seeing is a coordinated approach. We want more gas explored, not less. Why do we want more gas? Because we have an abundance of gas. A more liquid gas market—

Mr Duluk interjecting:

The SPEAKER: The member for Davenport is called to order.

The Hon. A. KOUTSANTONIS: —means cheaper prices because there is more gas available. Members opposite want to ban gas.

Mr Bell interjecting:

The SPEAKER: The member for Mount Gambier is warned.

The Hon. A. KOUTSANTONIS: They want to ban the exploration of unconventional gas in some parts of the state, which will limit the amount of gas we have in South Australia, which will push prices up. We also want to have more renewable energy, and they want less. We also want to have more batteries, but they don't believe in that technology. There needs to be a coordination—

Mr PISONI: Point of order: the Treasurer attempting to contrast what the government is doing with what the opposition is doing is surely debate.

The SPEAKER: No, it isn't. The question is about lowering electricity prices and the Treasurer is arguing that if entrepreneurs are permitted to explore for gas unconventionally there would be a greater supply of gas and, therefore, a lesser rise in electricity prices. It is really quite easy to follow. Treasurer.

The Hon. A. KOUTSANTONIS: Sir, the whole—

Mr WILLIAMS: Point of order: given your ruling just then, sir, does that give the minister leave to make statements about the opposition which are incorrect?

The SPEAKER: It doesn't give him leave to say very much about the opposition. He is to supply us with information. However, if in question time the minister could not compare and contrast policies, there would not be much point coming here, would there?

Mr WILLIAMS: I put it to you, sir, that he is suggesting policies of the opposition which are not policies of the opposition.

The SPEAKER: That, of course, is an entirely bogus point of order designed to sustain an impromptu speech, but because of your venerability I am going to forgive you. Treasurer.

The Hon. A. KOUTSANTONIS: Plans are complex and they take a long time to explain and they take a long time to implement. What we are attempting is a very simple method. It is the same thing Dr Finkel is attempting to do, it is the same thing that the New South Wales minister wants to do, it is the same thing that the Victorian minister wants to do: we want to go back to a period of oversupply. We want to create a national electricity market where there is an oversupply of electrons, lowering prices.

That was the model that Tom Playford developed and that was the model we had under ETSA. We built more capacity than we needed, and we overproduced and we maintained cheaper prices. When those assets were sold—by members opposite—the market did what the market does best and got a return for their shareholders. How? They did it by having a monopoly market that was captive to the purchase of their product. They withdrew supply, made less of them, and they increased the prices—and now they blame us for it.