House of Assembly Fifty-Third Parliament, Second Session (53-2) 53 2 Parliament of South Australia House of Assembly published Question Time National Energy Guarantee National Energy Guarantee The Hon. J.M. RANKINE House of Assembly Wright National Energy Guarantee The Hon. J.M. RANKINE (Wright) (14:45): My question is to the Minister for Mineral Resources and Energy. Minister. How will the commonwealth government's National Energy Guarantee advantage or disadvantage South Australian consumers? The Speaker House of Assembly The SPEAKER: Is the minister able to help the house? The Hon. A. KOUTSANTONIS House of Assembly West Torrens Minister for Finance Minister for State Development Minister for Mineral Resources and Energy The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (14:45): I will do my best to assist, sir. I thank the member for the question and note her interest in ensuring we have a sound national energy policy that helps put downward pressure on prices for all South Australians. The National Energy Guarantee (NEG) was announced by the commonwealth government on 17 October after directing the Energy Security Board to work in secret for six weeks on an energy solution acceptable to Tony Abbott. Make no mistake: this policy is a complete capitulation to Tony Abbott, which amounts to a subsidy for coal at the expense of renewable generation. Critically, it has never been explained why the federal government is no longer considering a clean energy target, a mechanism which, although widely accepted as not the first best option, had at least been based on exhaustive consultation and detailed modelling from the nation's Chief Scientist through a cooperative COAG process. The CET, or the 50^th of Dr Finkel's recommendations, was wildly accepted and should be proceeded with. It has still not been explained why this is no longer the case. Compared to the NEG, on the little information we have, the CET would drive the transformation to renewables rather than the NEG, which is solely designed to stifle it. Many industry groups have already pointed out that the NEG will give coal and high emitting generators a lifeline but would see a flatlining in investment in renewables. The state government has written to Energy Security Board Chair, Kerry Schott, requesting evidence to support claims made by the Prime Minister that the NEG would result in average savings of $100 to $115 between 2020 and 2030. Ms Schott in her— Mr Marshall interjecting: The Speaker House of Assembly The SPEAKER: The leader is warned for the second and final time. There will not be further warnings. Treasurer. The Hon. A. KOUTSANTONIS House of Assembly The Hon. A. KOUTSANTONIS: Ms Schott, in her written response, conceded that the wholesale retail price reductions that were noted were, and I quote, 'not based on detailed modelling'. As far as we can interpret with the scant amount of detail provided, what the NEG will potentially do is entrench the market power of the vertically integrated gentailers such as Origin and AGL, which may actually increase prices for consumers. On the face of it, the NEG is likely to push up prices in South Australia because of the lack of retail and wholesale competition due to the privatisation of ETSA, gifted to us by the opposition. We on this side of the house will not accept this proposition simply because the Prime Minister cannot get a better scheme through the coal lobby that is his party room. The Coalition might eventually wake up to this, but the National Energy Guarantee also places a price on carbon. It might be too low to make any difference, but there is unequivocally a value placed on carbon as part of this policy. Even if we took the Prime Minister at his word, the NEG will strangle the renewable energy industry, destroying jobs for a lousy 50¢ in three years' time. It sounds very similar to another Liberal Party plan. To demonstrate the sloppy and rushed nature of the work, representatives from across Australia's energy companies were contacted last Thursday night and were given less than 24 hours' notice to travel to Sydney to discuss the proposed approach to modelling for the National Energy Guarantee. This was nine days after releasing the plan and the ESB thought it prudent to then reach out to industry. The facts are that the commonwealth government is doing everything it can to avoid the energy COAG, everything it can to avoid scrutiny, they are doing their modelling in secret and they are giving no-one time to consult. They do not want to raise any awareness about what is actually occurring in their modelling because it is a house of straws.