Energy Security Target

Mr VAN HOLST PELLEKAAN (Stuart) (14:43): My question is again to the Minister for Energy. Why has the government delayed the start of its energy security target until 2020, given that the minister said when announcing it that it would reduce electricity prices for all South Australians?

Mr Marshall interjecting:

The SPEAKER: Who was making that noise?

Mr Marshall: I think that might have been myself, sir, and I apologise.

The SPEAKER: I suggest that the leader depart under the sessional order for the next 15 minutes and compose himself.

The honourable member for Dunstan having withdrawn from the chamber:

The Hon. T.R. Kenyon: You generally bow when you walk out.

The SPEAKER: The member for Newland is warned for the second and final time.

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (14:44): The energy security target is a very important plank of Our Energy Plan. The energy plan has many aspects to it. Of course, the first and most important one was legislation to make sure we had more powers to intervene in the market in the interests of South Australians—powers that were taken away from us during the privatisation of ETSA; of course, getting more gas out of the ground, hence the PACE gas scheme was introduced, to make sure that we could get more gas out of the ground; a tender for our own power to get a new competitor into the South Australian market, which excluded the large retailers who were exerting monopoly powers—

Mr VAN HOLST PELLEKAAN: Point of order, sir: I ask you to bring the minister back to the substance of the question. I remind you of your ruling yesterday in which it was inappropriate for a minister to provide information that is readily available to the public. He has used the same information in a previous answer and it is being advertised for millions of dollars across the state. Please bring him back to the substance of the question.

The SPEAKER: It is about why the government has delayed its energy target.

Mr VAN HOLST PELLEKAAN: He is going through the list again.

The SPEAKER: That's the question. Minister.

The Hon. A. KOUTSANTONIS: The energy security target, just as background for the Speaker, was part of the state government's energy plan. It was part of the announcement that the Premier and I made when we announced our intervention into the market. I am going through the way that the energy security target fits in comparison with the rest of those plans. Of course, when we announced our—

Mr PISONI: Point of order, sir: can I draw your attention to the clock—it is not moving.

The SPEAKER: Yes, fair point.

The Hon. A. KOUTSANTONIS: The energy security target was, again, a critical part of that plank. Importantly, we wanted to make sure that there were more competitive tensions in the South Australian market because the energy security target is there to try to design a system much like an energy intensity scheme or even a CET, where retailers are required to provide more contracts into the market; we want more contracting activity into the market.

Unfortunately, the carryover from the privatisation was a number of retailers exerting an undue amount of monopoly power in the market. Quite frankly, until our solar thermal plant is built, being able to offer competitive ranges into the market as part of Our Energy Plan, I would be uncomfortable with the energy security target playing that role, given it might actually not do what we were planning it to do.

The energy security target has a number of factors. The first one is to make sure that there is a base load number of generators that are offering more contracts to try to lower price and improve energy security. Two, is to try to break up the monopoly power that the opposition gave us through the privatisation of ETSA, which is why the first plank of the plan was more important, which is to get the competitive tension into the market.

What we have done is we have been able to adapt. For example, whenever you release a plan these things are fluid. Whole aspects of the plans have changed and been amended as we have been rolling them out to suit circumstances. For example, the temporary generators are actually the final generators that we will be using but they will be operating at two temporary sites on diesel, but once this summer is completed they will be moved to a single site and operate like a gas-fired generator as backup and offer inertia into the system, which is exactly what we said.

What we were able to do was to kill two birds with one stone, that is, have security for this summer that provides backup, and have our final solution for generation. Much the same with the energy security target. What we are doing is we are adapting the plan to make sure it suits the South Australian conditions. What we are saying is we want a competitive market. With a competitive market in place, an energy security target or a CET or an energy intensity scheme, whatever the market mechanism is that the commonwealth government chooses, can be folded into our energy security target.

We have been arguing long and hard for there to be a national market mechanism. What we have said is that, given that the commonwealth government cannot come to grips with its internal problems in Canberra, the Queensland government, the Victorian government, the Australian Capital Territory government and the South Australian government have asked the Australian Energy Market Commission to begin the work of implementing a clean energy target in these jurisdictions. An energy security target is much like that.