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House of Assembly - Fifty-First Parliament, Third Session (51-3)
2009-02-03 Daily Xml
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ELECTRICITY SUPPLY

Mr WILLIAMS (MacKillop) (15:43): My question is, again, to the Minister for Transport, the Minister for Energy and the Minister for Infrastructure. Minister, what action have you taken to address the shortfall of electricity for South Australia identified in the June 2004 annual report of the Electricity Supply Industry Planning Council and similar issues identified in subsequent reports? In a media release dated 15 June 2004, the Minister for Energy stated:

I understand that tomorrow the Electricity Supply Industry Planning Council's draft annual report will show a 188 megawatt shortfall in the reserve margin required for South Australia and Victoria's electricity supply next year.

The executive summary of the most recent report, published at the end of June 2008, states:

Calculation for the combined South Australian/Victorian region shows that, while there should be sufficient capacity to meet demand, the combined region will not have as much of a safety margin as the industry would like.

The Hon. P.F. CONLON (Elder—Minister for Transport, Minister for Infrastructure, Minister for Energy) (15:45): A little bit of knowledge is a dangerous thing. One of the things I do is talk to the industry all the time. I am reliably advised that the shadow minister has never met Lew Owens or met with ETSA. He has never met Lew Owens or met with ETSA and that is why he does not know a great deal.

Mr Williams: That is totally incorrect and untruthful.

The Hon. P.F. CONLON: That is my advice, but I will check it if you like. Is it as untruthful as the New South Wales interconnector?

Members interjecting:

The SPEAKER: Order!

The Hon. P.F. CONLON: I do not know what you like more: my happiness or their pain. It is a finely run thing. The truth is that what occurred with the recognition of a lack of adequate reserves in the year before last was that NEMMCO operated a reserve trader provision, which caused an increase in the cost of electricity. This year, having seen the information from the energy supplier, having done its own assessment and having had the ANC's recent assessment on reliability, it did not believe there was a necessity for a reserve trader provision. That was not me, Mitch, but, rather, all those experts. Members may recall that I turned the sod at the quarantine station sometime ago, and I can say that very soon I will be going down there for the energising of Origin's new 120 megawatt peaker—which will be a welcome addition to our reserve capacity.

At the end of the day, the question of reserve capacity is addressed by a reserve trader. The experts did not consider that that was necessary. We have developed a proposal in South Australia to make a more nimble and responsive reserve trader approach, and we will be discussing that with NEMMCO soon. The other side of the equation is that you encourage industry to invest, but since your act of genius some years ago that is a private sector decision. Members opposite had one policy on electricity: sell it off and hope for the best! Then they ask, 'Why haven't we fixed it?' We will be going down there—

Mr Williams interjecting:

The SPEAKER: Order! The member for MacKillop will come to order.

The Hon. P.F. CONLON: I feel sorry for the animals the honourable member raises down there. We only get him for question time. The truth is that if you look at that assessment South Australia—the place we govern—is probably going better for investment than Victoria in that regard, but it is always in a system—

Mr Williams interjecting:

The Hon. P.F. CONLON: Goodness me! I reckon after question time we should jump in a car with Mitch and drive out to the interconnector with New South Wales and find out why it is not sending us power. I cannot wait to get into a car with Mitch. He will be navigating because I do not know where it is! Members opposite never had a policy on energy other than to sell it and forget it. We have had to manage a system in difficult times. We have the best carbon footprint in mainland Australia. It is an outstanding outcome, given that we have no hydro—

Mr Pengilly interjecting:

The SPEAKER: Order, the member for Finniss!

The Hon. P.F. CONLON: We shed 3 per cent of the load for the first time in eight years as a result of a problem in Tasmania. That is the long and the short of it.

Mr Williams interjecting:

The Hon. P.F. CONLON: Apparently, we are also connected to Tasmania because that line goes to Victoria. The bottom line is that we are in a big complex grid. We have had a fine balance between supply and demand for some years. It has not been assisted by the refusal of the honourable member's colleagues in the former federal government to have a greenhouse policy, which has created a great deal of uncertainty for investors. It has not been helped by that at all but, fortunately, we have a new federal government that will take us into a more certain future. I can tell you that nothing has been helped by the opposition.

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