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House of Assembly - Fifty-Second Parliament, First Session (52-1)
2010-10-28 Daily Xml
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ELECTRICITY (RENEWABLE ENERGY PRICE) AMENDMENT BILL

Introduction and First Reading

Mr WILLIAMS (MacKillop—Deputy Leader of the Opposition) (10:42): Obtained leave and introduced a bill for an act to amend the Electricity Act 1996. Read a first time.

Second Reading

Mr WILLIAMS (MacKillop—Deputy Leader of the Opposition) (10:42): I move:

That this bill be now read a second time.

This is I think the fourth time or it may be the third time that I have raised this matter in the house over a couple years. This bill is about obliging retailers who have, as consumers, people with photovoltaic cells which are pumping electricity back into the grid, electricity which those retailers then onsell as renewable energy at a premium to other consumers. This bill is about obliging those retailers to pay for that electricity which they currently onsell.

When the electricity feed-in legislation passed through this parliament (the feed-in scheme was established at the beginning of July 2008), I commented at the time that I thought that the bill was more about getting a headline than anything else. Subsequent actions of the government have proved to me that my words at that time were very prophetic.

The Hon. M.J. Atkinson: As always.

Mr WILLIAMS: 'As always,' compliments the former attorney-general. I enjoy his compliments; he recognises the wisdom on this side of the house on a regular basis. The feed-in bill was designed to encourage people to install photovoltaic cells on the roofs of their homes, in particular, and it was designed to encourage that as a practice by rewarding people who did it.

The reward is paid by the general electricity consumer in South Australia. It is not paid from the largesse of the government; it is paid by the general electricity consumer as it turns up as an increase in the rate they pay for the electricity they consume. Nevertheless, it is designed to encourage the installation of photovoltaic cells.

There are a lot of question marks over the sensibilities of such schemes. For one, I am not necessarily convinced that photovoltaic cells are the best and most efficient way for us to be producing electricity. Notwithstanding that, they are quite popular because they are usually associated with considerable grants, particularly from the federal government and things like feed-in schemes, which do make them financially attractive over a period of time, but I question whether it is the best way for our society to move forward in a carbon-constrained world. The original legislation is quite silent on the matter of whether electricity retailers pay for the electricity which is fed into the grid and which they subsequently onsell.

Interestingly, before the feed-in scheme started, the major electricity retailers in South Australia—Origin Energy, AGL and TRUenergy—were all paying in the order of 20¢ per kilowatt hour to the owners of such photovoltaic systems. They were all paying around about that rate. As soon as the feed-in tariff was introduced (which is 44¢ per kilowatt area), one of those retailers stopped paying, another one was paying at a very much reduced rate at about 6¢, and TRUenergy continued to pay at 20¢ for a substantial time but has since dropped back to 6¢. I think all three retailers are currently paying around 6¢.

Interestingly, one of the reasons I think they fell to the 6¢ payment is that a backbencher of the government, when we were debating this matter on one occasion, suggested that advice to the government was that 6¢ was about all they should be paying. Before that, TRUenergy was paying 20¢. All the retailers before the introduction of the feed-in tariff were paying about 20¢, but the government, both through its inaction and statements made by a backbencher (in this case the member for Light) has discouraged retailers from doing the right thing to the detriment of owners of photovoltaic systems. It is a really interesting scenario.

The other thing is that, when the original legislation went through the parliament, it was envisaged that there would be a review of the scheme and the review would happen either at a particular time or when the take-up of photovoltaics reached the level where the total production of electricity in South Australia reached 10 megawatt hours. That was reached very quickly; in fact, in May last year (2009) that target was met. I remember that it was when we were debating one of my earlier bills on this matter in June of last year that the member for Light made the comments he did.

Amongst the things he said at the time, he said that the government was already holding its review and would be able to report the results back to the parliament some time in September. I waited patiently and nothing was said in September. I was on radio FIVEaa at the end of October last year arguing the case for the review to occur, arguing the case for the retailers to be obliged to pay for the electricity that they were onselling and a number of other matters regarding the feed-in scheme. I think that was on 29 October last year, and I think it was either the next day or the subsequent day that the minister announced the review. In that announcement he also said that the review would be held and would report back to the government before the end of the year.

I think every South Australian who had an interest in this—and there is quite a number of them, and a number of them talked to me and to my office—expected that review to be completed by the end of December, as the minister said it would be, and that there would be some sort of response from the government. They were expecting that response before the election which was held in March, but the government remained quite tight-lipped, would not even admit that it had received the report from the review, and nothing was said about it until well after the election.

There are a number of recommendations made in that review, some of which I believe the government is going to take up. I asked the minister in the estimates committee specifically which recommendations were and were not going to be taken up. The minister's response to the estimates committee was that he would be introducing a bill later on and we would have to wait and see the bill, then we would know which of those recommendations the government was going to pick up and which ones it was not.

One of my opposition colleagues also has in this place a bill to include other technologies in the feed-in scheme, and I know that that is one of the things that is recommended by the review. I am still unaware of the government's attitude to that recommendation, because the government remains silent on that matter. Notwithstanding that, this is at least the third time I have had a bill on this matter. I am pretty that sure this bill is identical to the one I introduced in the last parliament.

It obliges the retailers to pay for net feed-in electricity produced by small-scale photovoltaic cells as defined under the act at a rate currently published by ESCOSA (the Essential Services Commissioner) which is the default rate. ESCOSA publishes that figure and republishes it regularly. It probably varies slightly from time to time, but it is around 17¢ a kilowatt hour, substantially more than the 6¢ people are getting now, and that should be added on top of the 44¢ they get from the feed-in scheme itself. So those who operate small-scale photovoltaic systems in South Australia should be getting a return for the net electricity feed-in scheme of something around 60¢ or just a little over that.

That is what they should be getting; it is what they should have been getting ever since the feed-in scheme was introduced, as I said, on 1 July 2008. Again, the government has failed to address this matter, and the review that it was obliged to hold under the act was probably 12 months later than when the parliament instructed the government to carry it out. We know we have an arrogant government, and not only is it arrogant with the people of South Australia: it is arrogant with the instructions that it receives from this parliament, and I think that is lamentable as well. I commend this bill to the house and I sincerely hope that the minister, because he has been so tardy in bringing forth his own legislation, supports my legislation to fix up this anomaly.

Debate adjourned on motion of Mrs Geraghty.

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