Power Prices

Mr PATTERSON (Morphett) (15:11): My question is to the Minister for Small and Family Business. Have power prices for small businesses increased under the Malinauskas government and, if so, why and what action is the Minister for Small and Family Business taking? With your leave, sir, and that of the house, I will explain.

Leave granted.

Mr PATTERSON: The Essential Services Commission's most recent report confirms that power prices for small businesses are rising by nearly $1,700 (or 46 per cent) since Labor came to office.

The Hon. A. KOUTSANTONIS (West Torrens—Minister for Infrastructure and Transport, Minister for Energy and Mining) (15:12): First things first: that report looks backwards not forwards. It is true to say that across the country power prices have increased. Members opposite might not want to believe it, but the truth is that the events in Ukraine and the gas shortages have caused serious shocks to gas prices, so much so that for the first time in a long time there are measures to put a cap on gas prices by Minister Bowen, who has capped gas prices at $12—he does allow exemptions between there—and, of course, the code of conduct that is in place for gas explorers and producers.

What that has seen is the price of gas in comparison to our competitors out of Saudi Arabia and the United States. Where they are seeing gas at $2 a gigajoule, we are seeing gas prices here of over $12 a gigajoule. Those prices are very hard for businesses to absorb, along with other inflationary pressures that are occurring in the economy as a result of the Reserve Bank lifting interest rates, and is causing a lot of problems.

The other problem, of course, is that the investment that has been made into the gas markets here in Australia has largely been made by international investors for international markets. Of course, domestic investment in gas markets has been limited. That is for a couple of reasons: (1) activism, (2) political interference and (3) the actual resources are declining.

There has been a lot of talk about the decline in Bass Strait and the Cooper Basin. I am confident that we can recover in the Cooper Basin and see Santos and Beach and other companies invest in the Cooper Basin to see gas stocks increase. I understand that there are some long-term contracts that are coming to their expiry on the east coast that could see that gas redirected here to South Australia to help, of course, with our gas-fuelled turbines. Those gas-fired turbines, if they are operating at a cheaper rate, because there is more gas available and there is more liquidity in the market, we will see those prices drop. But ultimately, this is about the cost of firming renewable energy and that is the gap that we are paying for in our prices and it is not a uniquely South Australian problem: it is an Australian problem.