Power Outages

In reply to the Hon. R.A. SIMMS ().28 November 2023).

The Hon. C.M. SCRIVEN (Minister for Primary Industries and Regional Development, Minister for Forest Industries): Response by Hon. A. Koutsantonis:

The record shows that the minister provided a detailed answer to the second of the Hon. Robert Simms' questions at the time it was asked.

In answer to the first question, as previously advised, the Malinauskas Labor government believes that the privatisation of the electricity system by the then Liberal government in 1999 was a mistake which has not delivered optimal outcomes for consumers. However, also as previously advised, to reverse the privatisation would be complex and costly. It would raise issues of sovereign risk which could deter investors from funding projects in South Australia. Reversing privatisation would require compensation to be paid by taxpayers to the companies which now operate the electricity system.

The Australian Energy Regulator (AER) assesses the regulated asset bases of the network businesses in South Australia—distributor SA Power Networks (SAPN) and transmission provider ElectraNet. In the current determination period, the AER estimated SAPN's regulated asset base would be $4.9 billion as at June 2025. For ElectraNet, the AER determined the asset base at $3.9 billion on 1 July 2023, rising to $4.4 billion by June 2028. As well as their asset bases, the network providers might have a claim to other value elements of their businesses in the eventuality of a privatisation reversal.

In generation, any proposed compulsory acquisition would be even more complex. There are more than 40 major generation plants in the state and a significant number more of commercial scale while not being market participants in their own right. These vary in technology, scale, plant age and condition, ownership structure and other factors.

With South Australia already linked to Victoria for transmission and soon to be linked to New South Wales, there would be further complexity as some companies operate portfolio generation across multiple plants, influencing the value of an individual asset.

Generation assets would amount to billions of dollars of invested capital. These identified costs would be the minimum burden on taxpayers from a privatisation reversal.

At this point in time, the Malinauskas government does not agree that a commission of inquiry into returning the electricity system to public hands would be a prudent use of taxpayer funds and government resources. Therefore, we will not be supporting the Greens' proposal.

Rather the Malinauskas government is focused on delivering a state-owned enterprise to run the Hydrogen Jobs Plan assets and business.

We are also developing a comprehensive suite of policies on the energy transition to ensure initiatives act in concert across sectors. The Department for Energy and Mining published a green paper to stimulate discussion, held discussions with stakeholders and invited comment and submissions. That work is well advanced.

The government is focused on regulatory and structural reforms to deliver cleaner, affordable, and reliable energy to all South Australians, including the most financially vulnerable.