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House of Assembly - Fifty-Second Parliament, First Session (52-1)
2011-07-28 Daily Xml
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CARBON TAX

Mrs REDMOND (Heysen—Leader of the Opposition) (14:24): My question is to the Minister for Health. How much will Labor's carbon tax cost the state's health system each year and how much federal compensation will be given to offset that increased cost?

The Hon. J.D. HILL (Kaurna—Minister for Health, Minister for Mental Health and Substance Abuse, Minister for the Southern Suburbs, Minister Assisting the Premier in the Arts) (14:25): I thank the member for that question. It is an issue that we have been spending some time contemplating in our portfolio. Of course, the legislation has yet to go through so it is not entirely certain what will be the final elements of it, but can I—

Members interjecting:

The Hon. J.D. HILL: The member is reflecting on your leadership, member for Heysen; I am not sure.

Members interjecting:

The SPEAKER: Order! The member for Hammond is being very vocal today.

The Hon. J.D. HILL: I am happy to provide some information—

Members interjecting:

The SPEAKER: Order!

The Hon. J.D. HILL: In 2009-10, South Australian Health consumed 52 per cent of South Australian government building energy use. In absolute terms, the portfolio—

The Hon. P.F. Conlon interjecting:

The Hon. J.D. HILL: Thank you, very much. In absolute terms, the portfolio consumed 6 per cent less energy in 2009-10 than it did in 2000-01. So, even though we have got a bigger health service and we are doing more work, we have reduced the amount of energy we have used, which is a reflection on the good work that has been done. Energy use per square metre of occupied healthcare space has decreased, Madam Speaker, you will be pleased to know, by 18 per cent, in fact, since 2000-01.

From 1 July 2014, the South Australian government has committed to increasing its purchase of accredited green power from the current 20 per cent to 50 per cent. Shared Services SA is undertaking modelling work to estimate the likely impact of a proposed carbon tax on that premium. In relation to the new RAH, for example, it is anticipated a projected—

Members interjecting:

The SPEAKER: Order!

The Hon. J.D. HILL: —decrease in carbon emissions at the new RAH compared to the existing RAH, based on 2009-10 emissions, of approximately 18,600 tonnes of carbon dioxide per annum. On the basis of imposing a carbon tax of $23 per tonne, this projected decrease in carbon emissions equates to a cost avoidance of $425,000 per annum when you compare it with the old RAH. If you looked at the new RAH compared to the old RAH, it, in fact, would save money as a result of it. So, that is one of the benefits of it.

In terms of building energy use, assuming a full pass through of the $23 per tonne carbon tax to the end user, SA Health will be subject to an increase in electricity and gas costs in 2012-13 of approximately $4.1 million—a 13.7 per cent increase in real terms. In relation to transport fuel, it is unclear at this stage if SA Health's fleet and ambulance transport fuel will be subject to the proposed carbon tax. I am advised that, should it be so subject, it will result in an increase of approximately $254,000 in 2012-13, which is about a 4.6 per cent increase.

We as a state and SA Health have made a large investment in energy efficiency over the past decade. For example, the 240-panel solar hot water array installed at Flinders Medical Centre 18 months ago is the largest in South Australia and, as a single measure, has reduced FMC's greenhouse emissions by 1,100 tonne per annum. Under a $23 per tonne carbon tax, the cost avoidance due to the installation of the solar panels will be approximately $25,300. So, the point is: we have known for a while that carbon was going to be priced in some way, so we have made investments in our existing infrastructure and in our planning for our new infrastructure to make sure that we are not as exposed as we would be if we kept with what we have.

Mr Williams interjecting:

The Hon. J.D. HILL: Well, they have four more stars than you have, Deputy Leader of the Opposition.

The Hon. P.F. Conlon: One more star than he had votes.

The Hon. J.D. HILL: Yes, that is right.

The Hon. M.D. Rann interjecting:

The Hon. J.D. HILL: That is right—double the number of votes he had. The Green Star healthcare tool is utilised to guide all major SA Health redevelopment projects. As part of the Green Star assessment process, a sophisticated energy modelling technique is employed to determine the theoretical greenhouse emissions of the proposed facility, relative to a like facility, had it been built to the minimum energy efficiency standards established by the Building Code of Australia.

No doubt there will be other costs that will come through. We obviously need to identify those. There is a whole range of issues that have to be worked through. As I say, the commonwealth's legislation has not been finalised yet; so, at the moment, all this is hypothetical, but we have done some work. There are a range of costs that we may be subject to and, of course, we will work through them.

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