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House of Assembly - Fifty-First Parliament, Third Session (51-3)
2009-11-18 Daily Xml
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PUBLIC WORKS COMMITTEE: ADELAIDE DESALINATION PROJECT

Ms CICCARELLO (Norwood) (11:17): I move:

That the 336th report of the committee, entitled Adelaide Desalination Project 100 Gigalitre Expansion Works, be noted.

In December 2007, the government announced a package of water security commitments, which included a proposed desalination plant with a capacity of 50 gigalitres per annum and costing $1,374 million. In May 2009, cabinet approved an expansion of the desalination plant capacity to 100 gigalitres per annum. The initial requirements, approvals and authorisations obtained for the plant included consideration of the requirements to augment the supply of up to 100 gigalitres per annum. So, there is no need to acquire further property interests as part of the expansion works.

Mobil has entered into a contract of sale for land to SA Water and has granted a lease to SA Water for land for construction laydown and facilities. Mobil has also granted a bridging lease for land needed for preliminary works and bulk earthworks. The expansion works comprise: additional desalination plant works, transfer pipeline systems works, network infrastructure and associated ETSA substation upgrade works, and temporary site works, facilities and upgrades to site access and infrastructure.

The works will not adversely affect the ecologically sustainable development strategies noted in the Public Works Committee's earlier report. The energy consumption target specified for the 50 gigalitre per annum desalination plant and marine works will remain the same for the 100 gigalitre per annum capacity. This energy consumption target is a value of below 4.5 megawatt hour per megalitre of drinking water produced, unless the sea water quality falls outside certain prescribed levels.

The consumption of electricity to operate the expanded plant has been assessed as part of the major development approval process for which approval has been obtained. SA Water will purchase renewable energy for the plant. The security of the state's water supply is critically important and numerous initiatives are in place to manage existing resources, deliver alternative supply options and reduce demand.

The Water Proofing Adelaide strategy aims to increase the reliability of Adelaide's water supply and reduce reliance on traditional resources, while allowing the state to grow and develop. Accordingly, the primary objective of the 100 gigalitre expansion works for the Adelaide desalination project is to further secure water supply by delivering a climate-independent supply of up to 100 gigalitres of drinking water per year.

Approximately 75 per cent of the state's population, and the majority of the state's employment—high-value manufacturing capacity, construction and tertiary services—are situated in Adelaide and reliant on a secure water system. Investment in long-term water security for Adelaide is therefore necessary to continue to support the prosperity, viability and future growth of the state.

Implementing the 100 gigalitre expansion works will satisfy this need and achieve a number of significant benefits. These include: increased security of economic output of businesses, social benefits to householders from gardening and internal water use, domestic and commercial horticulture, and environmental impacts associated with the potential availability of additional water to the River Murray for environmental flows.

The economic impact of the expansion works has been assessed as part of the Greater Adelaide desalination project. While the cost of the proposal is to be borne by water consumers, in addition to commonwealth funding, the impact of the significant capital expenditure of this project and direct job creation will result in a net benefit to South Australian gross state product.

If the inflows to the River Murray remain low or continue to fall in the future, sustainable economic benefits of the proposed development will increase further as it provides greater water security to the metropolitan population and state economy. The plant will provide a level of insurance in water supply that is not climate dependent and is further enhanced by implementing the expansion works.

A significant drought adversely affects gross state product and community welfare and, if more severe water restrictions increase in frequency and duration, these effects are correspondingly greater. The Australian government has committed a further $228 million to the Adelaide desalination plant if capacity is expanded from 50 gigalitres to 100 gigalitres per annum. This funding is in addition to $100 million already committed for the 50 gigalitre plant.

In addition to the other benefits already mentioned, the increased capacity of the desalination plant to 100 gigalitres per annum will provide additional supply capacity to meet forecast demand from population and economic growth. The expansion works will reach practical completion by August 2012, with handover occurring by the end of 2012.

On that basis, based upon the evidence it has considered, and pursuant to section 12C of the Parliamentary Committees Act 1991, the Public Works Committee reports to parliament that it recommends the proposed public work.

Mr PISONI (Unley) (11:23): Again, this was another very interesting Public Works hearing. It was particularly interesting because we know that when the Liberal Party proposed a desalination plant for South Australia in 2006 we were told by the then minister that it was not necessary, that it would cost too much, that we did not know what we were talking about.

Then of course, the government announced a 50 gigalitre desalination plant about six or seven months later. When that came to the Public Works Committee we were told that there was an extra $79 million going on to the cost of that desalination plant to speed it up. There was criticism of a good idea brought forward by the Liberal Party by this government, a delay of six months, and then an extra $79 million of water users' money to speed up the process, to play catch-up for the 50 gigalitre desalination plant.

Then, of course, the Liberal Party announced a stormwater plan about 18 months ago, where we identified 13 aquifers around the metropolitan area where we could return and treat stormwater, and, of course, bring it back into the water supply. The government, led by the Attorney-General, I think it was, was out of the gates with its spurs on saying that it was an outrageous idea. A campaign about not being able to drink stormwater began instantly, and consequently the government has spent the last 18 months or so criticising any stormwater plans.

It is interesting that in the lead-up to an election we hear an announcement of stormwater in South Australia by the Premier. I think the member for Mitchell summed it up very well in his letter to the editor today about the science of water in South Australia—and, of course, it is political science; it is not any other form of science. It is not the sort of science that you would expect our students to learn in high school or primary school, but, of course, political science that we learn in the back room of the ALP head office.

What was interesting about this project, the additional 50 gigalitres, was that it did not include any transfer pipe infrastructure from the southern reservoirs to the northern reservoirs. So, of course, it means that only those in the southern suburbs will get the benefit of the desalination plant, because we do not know when the transfer pipeline is going to happen. We have not seen any money for that yet. Consequently, those in the northern suburbs, those in the seat of Light, will be paying double for their water bills, but will not have any access to desalinated water.

If there is an increase in the number of reservoirs in the south, due to the pumping from the desalination plant, there will be no benefit to those in the north. I am not quite sure how the government will address that, but it certainly was not made clear in the Public Works Committee.

This government's idea of water security is not providing more water but locking it up. The idea of water security is to have a mix and a broad draw of water, a combination of stormwater, harvest, reservoirs and desalination. So, there is some concern about having all your eggs in one basket with half the state's water supply coming out of one plant.

In Perth they have built a second plant instead of doubling the size of the existing plant. They are also reclaiming water and putting it into industry, and they are also addressing their aquifer situation by monitoring and securing their underground water. As we know, Perth is best with underground water. It has a lot of underground water because of its sandy soils, and a lot of the water ends up underground.

One of the difficulties that we have had here in capturing our stormwater is the tremendous increase in hard services. The government has said that it is ahead with its plans to increase the population in South Australia to two million. Originally, it was going to be in 2050. We are now seeing figures quoted by the Premier and the minister responsible for population of around about 2027, but, of course, the infrastructure program is not matching that, and that will be a concern. I can understand the letters to the editor from members of the public who are concerned about water, in particular, and resources and public transport. Anybody who has been travelling the same route in Adelaide over the last 10 years will have noticed how much longer it takes to get into the city in peak hour traffic, because we are seeing more people on the roads and there are also more people using public transport.

In my electorate the streets of Unley, North Unley, Parkside and Eastwood are clogged up with all-day parkers as they drive in from the outer suburbs and walk into the city via that lovely walk across the Parklands. That is a growing problem that the council has had to address by putting more time parking signs around the place, but, of course, that simply shifts the problem. We need to look at planning on a statewide basis. This is an early warning as to what we will be seeing in the longer term, and we need to address that.

We are still waiting, in Public Works, to hear about the plans to double the size of the Mount Bold reservoir. It was announced in the 2006-07 budget, I believe, but it has mysteriously fallen off the agenda. I am sure that many South Australians were convinced by this government to believe that it was never going to rain again and how this government could not make it rain. South Australians were disappointed to see all of that water running over the top of the walls at our various reservoirs around South Australia that was not being captured. I think it is a pity that the government gave up so early on a change in the weather and that we did not move forward with that Mount Bold project or something similar. It was not even replaced. The money was pooled and it was not even replaced, and I think that is very disappointing for the people of South Australia.

Here we have an 'all our eggs in one basket' project at Lonsdale where we are relying entirely on one plant for half of the city's water supply and we are told it is going to be entirely powered by green power. It is a very complicated formula. We heard the Premier trying to simplify that, but I do not think South Australians are convinced about the Premier's green credentials, particularly on the desalination project.

The Hon. R.B. SUCH (Fisher) (11:31): This project is to be considered in the context of a form of insurance. There are some aspects to it which I think we need to put a question mark after, one being the environmental impact. One would hope that is minimal but, given the location and the fact that it is on the edge of a gulf, it has to have a question mark put after it in terms of environmental aspects.

The other significant point is the cost of electricity and the cost of running this plant. I was told recently by a senior executive in one of the power supply companies that the gas supplies for South Australia are somewhat limited in terms of years available. As we know, we generate much of our electricity using gas. I do not think you have to be too talented to work out that electricity is going to cost a lot more in the future, and the demands of the desalination plant for electricity will help push that price up even more. We will get extra water from the project, but we will not only be paying more for water but we will be paying more for electricity as well.

In terms of electricity supply to the plant, it is a pity—and I have raised this before—that the government did not follow the Victorian example of undergrounding the high voltage powerlines to the plant. They have done that in Victoria in the provision of power to the Wonthaggi desalination plant, and I think that is something that should have been done here.

An interesting question—and I do not have the answer but it is a homework question for members—is: why is the ocean saline? I guess the easy answer is that it just is, but why? If there are any learned scholars here who know the answer to that, I will be interested to hear it. I guess the related question is: why is it so saline? Obviously, if it was not saline, we would not need a desal plant at all. If anyone has the answer to that question, after doing their homework, I will be pleased to hear it.

As I said, this project is a form of insurance. In a modern city like Adelaide with a population of a million or more in the metropolitan area, we need to have guaranteed water supplies. I think it has been shown in recent times that the public is very sensitive to this issue of water availability and usage, and this project will no doubt contribute to the provision of water. I think it is necessary as a form of insurance fundamentally and should not be used as an excuse not to tackle issues such as greater use of stormwater and grey water. I support this project with a couple of question marks relating to the environment and the impact on the cost of electricity.

Mr PEDERICK (Hammond) (11:35): I rise to make a few comments about the final decision to build a 100 gigalitre desalination plant for Adelaide. I note the work that we, on this side of the house, in the Liberal Party did back in 2006 where we took the time to look into this. Most of us went over and had a look at the Perth plant. That is about a 50 gigalitre plant. We instigated that in our policy in late 2006.

It is interesting to note that that initial plant in Perth cost only $300 million to build and then it took $87 million for the piping infrastructure. We have noted that over time, because this government has not had water as a priority and has only started building the desalination plant this year in 2009, with so many cities around Australia building desalination plants prices have risen incredibly. I think the numbers are that, for a 50 gigalitre desalination plant, it would have been $1.4 billion and for this plant now being built at Port Stanvac it is $1.8 billion, and we still will not have it connected to anywhere near most of the metropolitan area.

What troubles me with this is that the government was not taking water seriously in 2006. We have had dry years since 2002 (including 2002) and we have had a government that is so concerned about its coffers and the money it can extract from SA Water that in no way known would it promote people with private options for getting water supply into communities.

We have had the issue recently where River Murray water will be piped to Ceduna. I think that is totally ridiculous. They have had struggles with their local suppliers over there, but a bit of forward thinking would not go astray. In fact, third parties and consortia went to the government wanting to build private desalination plants on the far West Coast but they were not allowed access—

Mr Pisoni interjecting:

Mr PEDERICK: Yes. They were not allowed access to the SA Water pipes. These SA Water pipes seem sacrosanct, and people cannot come up with potable water supply options to run in these systems. We have a structure of pipelines in this state that are probably worth $7 billion or $8 billion, so why would you duplicate it? You can put in duplicated systems when you are building new developments, but it would be far too expensive for a state with a budget at the moment of around $14 billion or $15 billion to reproduce another pipe system.

Options for desalination have been put up, and we certainly introduced three bills into the other place regarding the use of rainwater, recycled water and better use of blackwater, but the Labor Party voted them down, while all the time panicking about a potable supply to Adelaide because of its lack of action. The government said it would build a $20 million weir at Wellington but, thankfully, that has been pushed out into the wilderness—only because, I believe, of polling done by the Labor Party, which showed that it was a totally untenable idea and that it should be doing far more to negotiate a better deal for this state to gain an appropriate water supply.

It is often heard in the Eastern States that, if our end of the river, including Lake Albert and Lake Alexandrina, was in close proximity to Sydney, it would be in pristine condition. Not enough has been done, but now we see a massive capital expenditure, whereby we are tied, potentially, to 50 per cent of the needs of the city and country towns River Murray licence going into an energy hungry desalination plant and, to an extent, that is fine, and we even proposed to build a 50 gigalitre plant.

They should have used more imagination—and it does not take a lot—because collecting stormwater and cleaning it to a potable standard has been done around the world. You only have to go to Orange in New South Wales or to Singapore, where they drink stormwater. However, we just kept being told that it was too risky and too dangerous. But, hang on, if we have the technology to clean up sea water, we have the technology to clean up stormwater.

It is all about the government keeping control of everything down to minute detail so that it can extract the maximum profit. In fact, since it has been in government, I think that $2.8 billion has been extracted from general revenue from SA Water, yet we have no water security in this state. We have irrigators who have to fight for their share of water, we have an environment which is dying before our very eyes and a government which, because of polling, suddenly makes grand statements that it recognises that there is a problem in the Lower Lakes. It is amazing what polling can do to a government.

We also have plenty of people down at Point Sturt and Hindmarsh Island who are only just getting pipelines with potable water, but there are still people indicating that they will not have the opportunity to hook up to those pipelines. So, it is a major issue, and it just reflects the city-centric attitude of this government, that is, 'We'll fix the city, and it'll be right.'

I return to my comments on desalination on the West Coast and an area on Eyre Peninsula that has so much potential and so much mining potential; you only have to see how well they have done in the farming sector with the good rains this year, and I wish them all the best. There is so much opportunity, yet all this government does is give them a drip feed from the Murray and pipe it 700 or 800 kilometres, and I find that totally ridiculous.

Because this government has dillydallied over getting up any desalination plant, we still have water restrictions, although they have been relaxed because of pressure from this side of the house. As I said before, we also have irrigators who are struggling and an environment that I would say has just about gone past the brink of what it needs to survive into the future.

As to the energy needs of the Adelaide plant, I estimate that, if it is contracted to windmills, it will need about 100 wind turbines contracted through the grid. Really, it is a bit of an accountancy thing: you plug in the desal plant to the black grid and sign a document that states you are getting green power, and that can have all sorts of flaws and depends on which way you look at it.

I think what needs to be explored are options such as the CETO technology. I think they are moving ahead as private operators to build their plants and utilise wave technology, with buoys mounted to pumps on the seafloor under the surface of the water. They operate on wave action and can not only pump water for a desalination plant but also pump enough water to generate electricity and certainly generate spare electricity to go back into the grid. A couple of years ago in Sydney, I witnessed a presentation on that technology, so it is out there and it can be done.

As the member for Unley indicated, about 18 months ago we on this side of the house put up our policy on stormwater for 89 gigalitres to offset the needs of Adelaide and this state. It is a far better proposal to have a broad mix, recycling some greywater, capturing some stormwater and having desalination in the mix. We must ease our reliance on the Murray, and we must think bigger than anything this government has been doing, especially in relation to regional water infrastructure.

This government sells the regions down the drain on water supply and thinks it can get away with building a desalination plant which, when we do have water in the River Murray, it will completely switch off and still charge us double for our water. I firmly believe that is what it will do, when any spare water in our Murray licence could have gone to irrigators or shared between them and the environment.

Motion carried.

The ACTING SPEAKER (Mr Pengilly): The member for Giles.

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