HANSARD
SITTING CALENDAR
SEARCH
LIVE BROADCAST
Hansard Dynamic Subject Index
House of Assembly - Fifty-Second Parliament, First Session (52-1)
2011-05-19 Daily Xml
Contents
Pdf Xml

ELECTRICITY (MISCELLANEOUS) AMENDMENT BILL

Second Reading

Adjourned debate on second reading.

(Continued from 6 April 2011.)

Mr WILLIAMS (MacKillop—Deputy Leader of the Opposition) (15:43): I indicate that I will be the lead speaker for the opposition on this matter. I start off by saying that I do not think any piece of legislation or any scheme introduced into this parliament and put upon the people of South Australia has failed so miserably as this piece of legislation. It has failed the people of South Australia in many, many ways, and I am going to outline most of that over the next few minutes.

The problem with this piece of legislation—and I am not talking about the amendment we are looking at today; I am talking about the original legislation—is that it was introduced for pure political purposes, and it has cost the people of South Australia dearly; and now, with the amendments that the government is being forced to make, it is going to cost an industry that has been established in this state and it is going to bring that industry to its knees. It has delivered very little benefit to anyone.

The Premier had to make a speech to a solar cities conference being held in Adelaide a couple of years ago, and the Premier wanted South Australia to be the first jurisdiction in this nation to have a solar feed-in tariff. That is the only reason we have been through this fiasco, and a hell of a lot of people are going to be hurt before it is finished.

If I go back, the government decided that it was necessary to get a headline. The headline was going to be about the Premier's green credentials. It was decided that it would be built around PV systems and installations in South Australia and that we needed to be the first state in the nation, as I said, to have a solar feed-in scheme legislated. The scheme was legislated to start on 1 July 2008 and it offered a fairly generous feed-in rebate.

I remember that, when debating the original legislation with the previous minister, I made the comment at the time that this was about a headline, not about genuine carbon abatement. This was about the Premier having to make that speech at the solar cities conference which was due, I think, in February 2008. I am going from memory there. I think it was at about that time. The Premier wanted to make a speech and wanted to be able to laud his green credentials.

The generosity of the scheme saw that those who installed small-scale photovoltaic cells on their home got a net feed-in of 44¢ for each kilowatt hour that they put back into the grid. At the first instance, the people who were encouraged to take advantage of the scheme were those genuine people who believed they could make a difference. They were encouraged by a rather generous scheme which gave them a payback on their systems. In that early stage, the payback was about 17 years.

What we have seen in the meantime is that the cost of the systems—the photovoltaic cells, in particular—has decreased dramatically. We have had a range of changes at the federal level. There has been a range of systems of rebates applied to the initial capital expenditure, and that has changed all over the place, and we have seen the real price of electricity go up substantially. That has all meant that, even if the existing scheme was left alone, the payback time for somebody putting in a system today would be well under 10 years. I think it is probably getting down to the order of five or six years, which is a giant step from where we were only those few years ago.

The reality is that we were rapidly approaching the point where people would be encouraged to put in PV systems without any subsidy from the taxpayer whatsoever. We were rapidly approaching that situation and I would suggest that, within probably as few as four or five years, certainly inside 10 years, people will be ahead of the game by putting in PV systems without any subsidy whatsoever, but the story gets worse.

In the original legislation, there was a clause that said, when the installed capacity in the state reached 10 megawatts, that would trigger a review of the scheme. I believe that occurred about May 2009, when the installed capacity in South Australia reached that trigger point, yet there was no review instigated by the then minister. I am well aware of this because I have put in a series of private members' bills before the house in an endeavour to have retailers, who are benefiting from electricity being fed back into the system and then onselling that energy, obliged to pay for it.

As I said, there have been several attempts to do that. I remember in June 2009 (I have not gone back to the Hansard but I think it was around 15, 17 or 18 June) when we debated that in private members' business. The government voted it down. The member for Light spoke on behalf of the government and said that the review was under way and that in the government's opinion the real value of electricity fed back in should be about 6¢, and that we should have the government answers to the review by September.

The reality was that no review had been instigated at that stage and, in late October 2009, when both the former minister and myself were on the Leon Byner show, I raised the fact that the minister was obliged to have a review into the scheme, and months and months after he still had not instigated the review. It was about two days after that, it might have been the next day, it was about 29 October from memory, that the minister announced the review, and he announced that the review would be completed by the end of that year.

Everybody in the industry expected that the government would make an announcement on its response to the review prior to the March 2010 election. Everybody in the industry expected that that is what the review was about. Yet we heard nothing from the government, remembering in the meantime those other factors that I talked about a few minutes ago: the decrease in price of the systems; various changes at the federal level; and the increasing real price of electricity—all mitigating towards further encouragement and inducement for people to install schemes. The government had taken its eye right off the ball.

Finally, we got a response from the former minister in August of last year. In fact I think the response came from the Premier. I think he made an announcement about the government's response to the review, and, amongst other things, he announced the matters which are encompassed in the bill that we are debating today, including an increase in the feed-in tariff from 44¢ to 54¢. At this point the opposition will be opposing that because we think it is sheer madness.

Since the government made that announcement in August of last year, some 40,000 systems have been installed in South Australia—either installed or ordered and ready to be installed, and will be installed over the ensuing months. I cannot believe that the government is seriously going to progress with that increase when it has already seen what the current demand is.

The government also announced that it would cut the scheme off when it reached an installed capacity of about 60 megawatts. The reality is that we have probably sailed straight past that, and by the time we get to the end of September when the scheme is due to be cut off, the installed capacity will possibly be of the order of 110 megawatts, maybe more.

The scheme, if we accept the government's proposal in this bill, will be shut off at the end of September but, as I understand it, that will not be shut off to those participants or entrants who have installed their system and have it up and running. It will be shut off to those who have signed their contract and ordered their system at that point. So we are not quite sure what the installed capacity will get to. It will certainly be well over 110 megawatts.

The government's proposal is that all of those who have signed up to the scheme at that point will receive a 54¢ rebate and a payment from their retailer for a value from the energy that is put back into the system, but those who have not signed up by that date will not only get nothing if they seek to put in PV cells at a later date but also they will spend the next 17 years paying that money to those who have signed up.

What the feed-in tariff has done is transferred wealth from those who are least able to afford it to those who are most wealthy. Those who have installed PV systems in South Australia are not those who cannot afford to pay their electricity bills; it is those who have thousands of dollars of spare cash to afford to put in systems. Those who struggle to pay their electricity bills are, in fact, paying an additional amount to those who have the spare capital to put in these systems.

The net result of the South Australian feed-in tariff has been to create a bubble in the PV industry. Since August last year we have seen this huge uptake of 40,000 people wanting to put in these systems, so we have created this huge bubble. We have a significant number of people working flat out installing schemes, and now we have come to the point where we are going to put even a bit more pressure into that bubble because we have announced an additional rebate and also that the scheme will cut off so you have to get in by a certain date. That has created an avalanche of applications, but it has also created a huge amount of work which is going to come to an absolute standstill some time post October this year.

The reasoning for starting the scheme in the first place was flawed. The scheme was not, in my opinion, developed on good science or good public policy. The review that was held was not held in a timely fashion, and the response to the review was certainly not given in a timely fashion. The government has failed to recognise the changing circumstances and has seriously failed to recognise the impact of its proposed changes.

The fact that it made announcements last August which were not going to come into effect for over a year has created this bubble, which is going to burst and put a lot of people out of work; it will cost a lot of people who have invested in this industry a lot of money and create a lot of heartache; and it is going to continue, for another 17 years, to shift wealth from those least able to afford it to those who do not need a handout.

So, it is the equivalent of a regressive tax. It is a very shoddy piece of public policy. It will cost South Australian mum and dad electricity consumers for another 17 years; and the government, notwithstanding the statements made last August, should understand the problems that have been created and should be addressing those problems. The government should not be proceeding with this piece of legislation. It should be recognising the mistakes that have been made and come out with something much more sensible.

I would suggest that there are opportunities for the government to change or modify the scheme dramatically. Firstly, I would argue that we should never increase the feed-in tariff from 44¢ to 54¢. That is just sheer wanton stupidity, and it is only proceeding because the Premier announced it last August. Notwithstanding what has happened since then, the government does not have the wit to understand that it was a stupid thing to do and it should change its position.

If the feed-in tariff ever had any sound basis, it was in order to aid a fledgling industry and to encourage those who would want to do something for the environment. If that is what the scheme was designed to do, we could modify the scheme dramatically and still achieve those ends, without putting an ongoing burden onto the rest of South Australia's electricity consumers and without destroying the industry that has been developed overnight.

The scheme should be changed, in my opinion, so that, as the real price of electricity increases, the feed-in tariff decreases. You could do that quite readily without impacting on the payback time to those who have invested in small-scale photovoltaic systems. In fact, I would argue, as I said a few minutes ago, that it will not be long before the real price of electricity will be such that people will be able to afford to put in a PV system without any subsidy at all; it will be a good business decision and stand on its own merits. However, this government does not recognise that. Certainly, if we had the scheme extend in time but with a much reduced feed-in tariff, which was reducing commensurate with the real price increase of electricity, we would not see the bubble burst later this year. The industry would continue. The industry would have some time to adjust.

I do not blame the current minister because he has not been in the role very long, and I am sure that, if he had been in the role for longer, he would have been much more diligent and kept his eye on this scheme. The previous minister, unfortunately, did not care. He got the headline for his Premier and I do not think he had his eye on the scheme or what was going on at all. I do not think he cared.

It is pity—a grave pity—that the government does not go back to the drawing board and have a serious rethink about this. It will have a little egg on its face, I am sure, but the reality is that, if the government had the will, it could quite easily mount the case and make a valid argument that the scheme needs to be rejigged. Those who signed up in the early days of the scheme did so with an estimated payback period, as I said, of some 17 years, so even if the rebates were reduced substantially, taking into account the real price increases in electricity over the last few years, they would still see their payback period well inside that 17 years. They would not be any worse off than the position they signed up to.

People who have signed up more recently might wear a little more pain because they have signed up under much more favourable circumstances, but I still for the life of me cannot understand why the government is not game enough to go out and say, 'As circumstances are changing quite rapidly in the energy market, we can modify the scheme as we go forward. Individuals will not be worse off. You will be protected, yet we will not be foisting this additional burden on all those others in the community who have not installed PV systems'—in many cases, members of the community who struggle to pay their electricity bills.

I reiterate that the opposition will oppose the clause which seeks to increase the feed-in tariff from 44¢ to 54¢. We will not oppose the rest of the measures in this particular bill, but I still urge the government to rethink its position, for all the reasons I have laid before the house.

Mr MARSHALL (Norwood) (16:06): I also rise to speak on this flawed piece of legislation which the government has brought to this house today. It is difficult to understand who has actually informed this legislation. Who has the government actually been out there and consulted with? Like the member for MacKillop, I suspect this is another example of this government developing policy based around the opportunity to get a press release out to the people of South Australia. It is very difficult to see who will be the major beneficiaries, apart from this lame government which is intoxicated by spin.

I can tell you who will suffer from this legislation. As the member for MacKillop has already pointed out, the rebate which is paid to people who have installed these systems is not paid for by the government; in fact it is paid for by every other member of the public in South Australia who pays an electricity bill. It is a very strong point that the member for MacKillop makes: it is the people in our community who are less able to pay for this subsidy who are going to be the ones to suffer.

This is very unfortunate, and the proposal in this amendment in the legislation to raise the rebate to 54¢ will attack every other person in South Australia who is paying for electricity. Of course, the other major group of people who will suffer from this flawed legislation is the industry which revolves around the solar industry here in South Australia.

They, of course, have not been lobbying the government to increase the rebate to 54¢—nothing of the sort. They have put up a number of suggestions to the government which would be cost-neutral on the taxpayers of South Australia and, to my mind, seem far more sensible than the legislation which is brought before the house today.

They claim (and quite rightly so) that this will have a major detrimental effect on the industry in South Australia. I understand that this industry is leading Australia in many ways. There are more than 1,000 people—in fact more than 1,250 people—directly employed in this industry. People in this industry talk to me about their plans for the future, not only to install systems in South Australia, but many of them are making significant capital investments in the manufacture of these cells for South Australia.

That is all going to be lost, Madam Deputy Speaker. People who are directly employed in this industry, and also the capital that is flowing into this industry in South Australia, will all be lost. The original aim of this legislation—to develop an industry in South Australia which is going to be supporting the environment—is all going to be lost because the government basically has not got the courage to recognise that this bill before the house today is flawed.

It needs to go back to the drawing board. It needs to consult with the people who are going to be affected, it needs to speak to the people who are going to lose their jobs, it needs to speak to the people who are going to have to pay this ridiculous 54¢ rebate which has never been called for by the industry. It needs to go back to the drawing board and to consider this very, very carefully.

This is really legislation at its worst. It is legislation which is being driven by a press release, by an announcement. It is ill-conceived, and it must be considered again before it goes through both houses of this parliament.

Mr PENGILLY (Finniss) (16:10): I also support the shadow minister and the words that the member for Norwood has had to say on this legislation. I just would have thought that any reasonable, sensible cabinet would have thought through this and not brought this, as the member for Norwood says, seriously flawed legislation into the parliament. Unfortunately, the current member is wearing the nonsense of his predecessor. He probably could not put anything together by way of legislation. What has happened is that the current minister, who does have some knowledge of business and industry, is having to carry this nonsense through the parliament when it is seriously flawed and not required.

This government is a government in freefall. We are looking at 24 per cent, and I am wondering—and I am almost prepared to take money on it—if it is going to go lower. Why? Because the government is not listening to people. It is not listening to people on this particular bill, it is not listening to people on forestry, and it is not listening to people on marine parks. It has totally failed to listen to anything and, quite frankly, it has the political version of golden staphylococcus. It is gone. It is dead and buried. It is an irretrievable position and it is finished. I have no mercy for it whatsoever. How it fronts up in 2014 will not matter. It is that much on the nose with the people of South Australia and it has such a political stench about it that any sort of medicine that it tries to administer is not going to work.

This particular bill is ridiculous. We have companies in South Australia; for example, ZEN. ZEN is the seventh fastest growing company in Australia. It is South Australian based, and particularly active. The chairman of directors is Mr Raymond Spencer, who also happens to be on the Economic Development Board. When is it going to start listening to these people? The solar industry has been terrific.

The Premier has lauded his conservation and environmental credentials. It is well known outside this place that the Premier has been promised a job by Dr David Suzuki, if he keeps going down the same line when he leaves this place. That is the message loud and clear outside. He is going to wave goodbye. He has done all these things and he is out the door and gone. Heavens to Betsy, we know that my children, your children and our grandchildren are going to pick up this almighty mess in South Australia for the next couple of generations.

This is just bloody stupid legislation, Madam Deputy Speaker, I am sorry. It is stupid. Why are you seeking to destroy a solar industry that is leading the nation? Why do you want to go out and do this? There is no sense in it whatsoever. If government members had the courage of their convictions, they would go back into cabinet and say, 'This is foolish; this is stupid. We'll pull the legislation and not go on with it.'

I have a huge uptake of solar panels and the solar industry in my electorate. A regular number of constituents come in with problems with installation, and this and that. Generally speaking, we can fix them up. They are not government instrumentalities, but the private companies are very good and they go back, and if there is a mess made, they do it.

There is a no greater example of environmentally friendly construction, a way forward for future, than the Beyond development on the road to Port Elliot run by Mr Steve Wright and his family. It is well worth looking at. I do not know whether any member of this place has been there, apart from myself. The minister may have, I do not know—in fact, he may well have been. It is a stupid decision to bring in this legislation and to persevere with it in this place when we have a burgeoning and growing solar industry in South Australia.

Heaven alone knows that we need the industry to continue. We lost Mitsubishi—3,000 jobs. We have a promise of things to come in the mining industry, but there is a long way to go there. You are going to kill the solar industry—kill it, or mortally wound it, and it will be mortally wounded alongside a mortally wounded government, quite frankly. It is absolutely ridiculous. I call on the government to pull the legislation, to go away and think about it, and come back.

Ms SANDERSON (Adelaide) (16:15): I rise to speak on the bill before the house which I believe has some extremely detrimental effects on both the uptake of solar panels and the industry as a whole, with around 1,000 predicted job losses. For years now this government has lauded Adelaide as the green capital of Australia, with the Premier regularly raising in this house and in the media his green energy vision for South Australia. On 20 July 2010, the Premier stated his desire for South Australia to:

...be in an internationally leading position by having 33 per cent of our electricity supply being generated by green sources by 2020.

The Premier's plan is to turn our state into a green powerhouse of energy for the rest of the country, so how can it be that this government is now turning its back on the development of green energy? The installation of solar power and the onselling of solar powered electricity to the grid is an opportunity for families and households in South Australia to meaningfully contribute to the generation of sustainable energy.

On 2 June 2009, the Premier recognised that investment by South Australian families in solar power generated, grid-feed electricity reduces greenhouse gas emissions and importantly creates jobs for South Australians now and into the future. Similar to the expected loss of jobs by this government's planned sale of the harvesting rights of our forests, this legislation will mean the loss of renewable energy jobs in our state. It is predicted within the industry that approximately 1,000 jobs will be lost. The loss of jobs in what is considered a future industry in our state is absolutely unacceptable.

The Clean Energy Council advises that, within the solar feed-in grid industry, there are approximately 1,500 people employed and millions of dollars of investment in skills and equipment. The council does not agree with the bill's plan to raise the tariff for existing customers. It states that it is unnecessary and overly generous for existing customers. The council believes that a lower rate available for potential customers would benefit both the industry and consumers. The council has estimated that the cost of the proposed increase to existing customers is $85 million. The council believes that this money should be used to continue to assist the industry by providing an incentive, albeit at a lower rate, for new customers until grid parity is reached.

The majority of jobs threatened by this legislation are in small businesses. One such business is Natural Technology Systems, a small business within my electorate. The family-owned business has grown to a staff of 14 employees. However, the future of that business and the livelihood of the majority of its employees will be prejudiced if this bill becomes law.

I ask whether the government has consulted with the Clean Energy Council in relation to the proposed legislation. On the face of it, one would assume that the government has not consulted with the council or the small businesses and the 1,500 employees who will be affected by this proposed legislation. In closing, I quote from the Clean Energy Council briefing paper on this bill:

The next few years are a crucial window for solar energy...the industry is in a critical phase of employment and economic activity for decades to come. Now is exactly the wrong time to put the brakes on the industry.

The Hon. M.F. O'BRIEN (Napier—Minister for Agriculture and Fisheries, Minister for Forests, Minister for Energy, Minister for the Northern Suburbs) (16:18): The member for MacKillop's contribution, I thought, was very solid and very well argued, but there are a few areas to which I take exception. One is the failure of the scheme. At the time of closing off later this year, there will be between 70,000 and 80,000 South Australian households that have taken up this technology. If that is failure, I would like to see success because that is a truly remarkable take-up rate. When the scheme was introduced we were going to review it at 10 megawatts. When we closed down the scheme, we will probably settle at around 100 to 110.

So, the take-up has been ten-fold greater than originally intended, and rather than the 7,000 or 8,000 households in South Australia, we have between 70,000 and 80,000 households—a truly significant success which mirrors what has happened elsewhere in Australia, and also elsewhere in the world. There have been similar outcomes in Germany, Spain and Italy, and the result of what has occurred in Europe and Australia is that a boutique industry that was producing a panel with a high unit cost—through the actions of governments internationally and nationally—has allowed a fledgling industry to get the economies of scale that have brought down the cost of this technology remarkably, in a very short space of time.

In fact, we are now at the situation where, within probably four to six years, if not sooner, we may have brought down the cost of PV solar panels to the point where the payback period is a matter of a year or two, and these panels can generate electricity at the same cost as a large number of baseload generators. In fact, there is one technology in the United States that is not relying on the current swag of technology but is looking at very thin metal as the electricity generator, and there is speculation in technical circles that the cost of this technology will be of breakthrough proportions, in terms of it being very cheap and able to generate large amounts of electricity at very low unit costs.

The member for MacKillop may be aware of the actions of the New South Wales government within the last 48 hours where—to put too fine a point on it—it seems to be reneging on an election commitment made to the people of New South Wales, that it would maintain the fundamentals of the feed-in regime that was in place in New South Wales. Within the last 48 hours, my understanding is that it has closed down the scheme without any warning whatsoever and has retrospectively reduced the feed-in tariff.

The result of this was a rally of 1,000 individuals on the steps of the Opera House yesterday, and the dropping of its reference to the solar feed-in tariff from the New South Wales Liberal party website. So, I just say to the Liberal Party, in opposing our stated position in this legislation, of moving from 44¢ to 54¢, you may bring upon yourselves the travails that are currently afflicting the Liberal Party in New South Wales.

The member for MacKillop also talked about the wealth distribution effects of this scheme, and I would just say to him that, in large part, these wealth distribution effects are the results of a Liberal Party/Greens agreed position in the Legislative Council when the original legislation was introduced, where the Liberal Party supported an amendment from the Greens to extend the tariff feed-in period from five to 20 years. Our legislation saw a five-year period to kick-start the industry. We are now in a situation where this will go on for another, I think, 18 years.

The member for Norwood talked about proposals from industry. I have had some modelling done, and if we look at their proposal to run another scheme—a complementary scheme—for a period of 10 years, with a feed-in tariff of around 33¢—that was one proposal that I saw—the impact of that will be an additional $3 a year on those households that do not have the panels. Over the 10 years of the scheme, put to me by industry, that will add $30 to an electricity bill in South Australia.

The member for Finniss, again, alluded to the scheme and talked about the impact of cutting the scheme off. He talked about the uptake. He did not name Victor Harbor but I know he was referring to Victor Harbor, where we have had one of the highest take-ups in the state. We put that down to a very proactive local council—the Victor Harbor council, as are a number of councils around the state—and a large retiree population. Our analysis of the marketplace tends to indicate that there has been a large take-up from retirees.

Again, the impact of the scheme, as it currently stands, is around a $27 to $32 cross-subsidy from those who do not have the panels to those who do. Unfortunately, the scheme, as I said, has been a tearaway success but there has been a consequence. What we are dealing with, in large part, is that particular issue and the fact that the industry is now at a point where it is largely self sustainable, where the cost of the technology is coming down day by day and may, as I said, reach a situation within several years where we are looking at a whole host of new technologies that we will be able to generate electricity at a cost comparable to that that can be provided by a baseload generator.

In fact, if we were to heed the advice of the member for Finniss and do nothing with this technology, we could find that, within a number of years, we have a situation where, for argument's sake, two-thirds of South Australians have panels of any description on their roofs and are effectively being subsidised by the remaining one-third. That is our fear and that is why we have introduced the legislation, in addition to the legislation having done its job in taking a boutique industry into mainstream South Australian life.

The member for Adelaide made some points. I have consulted with the Clean Energy Council and with other individual companies. I have looked at their proposals. I have had modelling done on them, which I have alluded to, and, as far as we are concerned, it poses more risk than solving the problem. I think, the conclusion we have come to is that, both the commonwealth government's scheme (which subsidises the price of the panels) and our scheme of feed-in tariff have achieved the objective.

We have flagged our intention well in advance. I think we have given industry a period of nearly 12 months notice prior to cut off. We do not believe that there are consequences flowing from the legislation. We believe that the massive take-up—as I said, some 10 to 11 times our initial expectation—is due, in large part, to the extremely generous commonwealth government incentives and the fact that it has announced a bringing forward or the phasing out of those incentives.

The four-times multiplier was brought forward 12 months and I think it announced, within the last week to fortnight, that the three-times multiplier would be brought forward as well. It is our understanding that that factor, in particular, has brought forward purchase—and these are purchases that may have been made over the next two, three, four or five years—and industry at this particular point in time is the beneficiary. Irrespective of what we do with our feed-in tariff, it would have very little impact in terms of altering those particular purchase decisions.

In summary, I am pleased that the opposition is generally supportive. I have had two meetings with the member for MacKillop where we worked through the issues in quite some depth, and it is certainly the way that I prefer to do business. We have done modelling for the member for MacKillop on issues that he has raised, and I am hopeful that the detail of analysis that we provided him was adequate.

We have a disagreement on one point only in the legislation and that is the move from 44¢ to 54¢. Our view is that people have made purchase decisions on the basis of the 54¢ incentive. I did some talkback radio the same morning as the member for MacKillop. I think he was dealing with a slightly different issue. One individual who phoned in wanted surety that the 54¢ proposition would remain in place. My understanding is that the Department of the Premier and Cabinet, the division that is responsible for a lot of this work in the renewable energy sector, has received a large number of phone calls also wanting assurance that the level of incentive would remain in place. People are pointing out that they did their financial calculations on the basis of the feed-in tariff being increased. I really do not feel that it is fair to those South Australians, and we are now literally talking about tens of thousands of South Australians who have made a decision over the last few months, that we can effectively renege on that undertaking.

Bill read a second time.

Committee Stage

In committee.

Clause 1.

Ms CHAPMAN: I have a general question for the minister on clause 1. I think he indicated that there are many more than 40,000—I think something like 70,000 or so—who are expected to complete the take-up, and he also mentioned that a significant number of people in the Victor Harbor region have apparently availed themselves of this. Do I assume from that, minister, that you actually have a record of the addresses of all these people who have taken this up? I am not asking for the addresses, but is there a way to identify numbers by council region or preferably by state electorate? I am not asking for them today necessarily, but is that information available? It may be on a website.

The Hon. M.F. O'BRIEN: I thank the honourable member for the question. I asked an identical question myself, and obviously ETSA has a record of where the installations have occurred because it has to approve them. My understanding is that, at this point, ETSA does not have the software written into its general business program that can print out a report that gives a postcode by postcode rundown of the number of households with the PV panels installed. A body of work commissioned by AGL gives some understanding of the spread, and I believe that other work is being done.

Apparently, since having asked the question some weeks ago, it was discovered that ETSA can do it. It is wonderful what can happen when you ask. I have a printout here, which I can make available to the member.

Clause passed.

Clauses 2 to 6 passed.

Clause 7.

Mr VAN HOLST PELLEKAAN: I have one quick question. I was contacted about 15 minutes ago by a young business woman in Stuart who is clearly bound for greatness because she has either impeccable timing or great ESP. I would like to have something clarified. She runs bed and breakfast businesses in the town of Orroroo and has signed up for seven of these systems under four different entity names—a different combination of family businesses and partnerships, and that sort of thing.

My question really is about retrospectivity. I understand that one person or entity under this new legislation will only be entitled to one set of benefits. She signed up after October 2010 but will have all of her systems installed before the end of June 2011. Can you tell me how retrospectivity will apply to her case specifically?

The Hon. M.F. O'BRIEN: The simple answer is that if she has separate corporate structures, in law, they are treated as separate entities; and if she is running her business affairs in that manner, she would find that she can take advantage of the legislation for one site per separate legal entity, and that is the intent of the legislation.

When we get into the hazy areas where we do not have a strictly defined legal entity, then it is within ETSA's purview to make a decision. But I think, from what the member for Stuart was saying, we are talking about a hybrid of partnerships and corporations.

Mr VAN HOLST PELLEKAAN: The question was more about the retrospectivity. Could you outline exactly how it applies to her? I think she is quite well organised with regard to her entities, and I am sure that it is all 100 per cent above board. She has two operating businesses in each of three different entities and one operating business in one fourth entity. The query is more about how the retrospectivity catches her, given that she will have them all installed, I believe, before this actually comes into effect.

The Hon. M.F. O'BRIEN: The Premier made an announcement on 31 August 2010 in which he outlined the intended objectives of this piece of legislation. We have taken that as the point at which people were informed. The cut-off is 1 October 2011, and there is some leeway. If an application is made to ETSA prior to 1 October 2011 and it takes, say, three months for installation to occur, they still sit within the scheme.

From what you have said, I think she sits within the scheme as outlined in this piece of legislation. If she had made application to ETSA prior to 31 August 2010, then the provisions of the act as it currently stands would apply. However, I think, from what you are saying, she would be caught up in the current legislation, which only allows her one site.

Mr WILLIAMS: I move:

Page 5, line 29 [clause 7, inserted section 36AE(1)(b)]—Delete '$0.54 per kWh' and substitute '$0.44 per kWh'

The effect of this amendment would be to leave the feed-in rate at 44¢ rather than increasing it to 54¢. As I mentioned in my second reading contribution, there has been an incredible take-up—and it has been less than 12 months—based on a number of factors. I do not think the 10¢ increase is the determining factor in that take-up. In fact, in his summing up the minister said—and I hope I have this right; it is largely right (I wrote it down when he said it)—'Irrespective of what we do with the feed-in tariff, it will have very little effect on the uptake.'

The minister was talking about the implications of the federal decisions. He was suggesting that the announcements by the federal government to drop down the multiplier with respect to the rebate that it pays into PV installations is driving the uptake. So, the minister has even admitted, when summing up the second reading, that he does not think that it is the increase from 44¢ to 54¢ that has been driving people's decisions. I think that probably is the case.

In any case, I think it is nonsensical for this parliament to increase this feed-in tariff from 44¢ to 54¢, bearing in mind that this scheme and those who will be lucky enough to get in on this scheme will be paid at that rate for another 17 years. I think it is nonsensical. We all know that within a very short time—probably a matter of only a few years—the cost of electricity for people who have put in a PV scheme will be such that they will be making money out of their PV scheme without any feed-in tariff at all. Why on earth would we be increasing the tariff from 44¢ to 54¢? It is almost a 25 per cent increase on what has already been proved to be a very, very generous incentive.

The Hon. M.F. O'BRIEN: The government cannot accept the amendment. The Premier went to the people of South Australia on 31 August last year and informed them that the feed-in tariff would increase from 44¢ to 54¢. I indicated earlier that a large number of individuals have contacted the Department of the Premier and Cabinet to gain certainty that the government will persist with the increase. We believe that it would be widely viewed by a large number of South Australians—and it may be around 30,000 to 40,000—that the government has reneged on a very clear undertaking to the community. So, for that reason we will stay the course on this particular decision.

Mr WILLIAMS: I thank the minister for his explanation. I was suspicious, and I hinted at that in my second reading contribution, that the reason the government will not take the sensible decision to go back and revisit this is that the Premier made an announcement at the end of August last year. Might I remind the house that the Premier promised the people of South Australia that there would be no privatisations, yet he is going to sell the forests. He promised the people of South Australia that he particularly would not sell the forests, yet he is leading a government that is now committed to selling our forests.

Mr Marshall interjecting:

Mr WILLIAMS: My colleague the member for Norwood reminds us that the Premier said that we were going to spend about $890 million rebuilding Mount Bold reservoir to hold two years' worth of water. We were going to build a new prison at Mobilong.

The Hon. M.F. O'BRIEN: Point of order.

The CHAIR: Certainly. Excuse me, member for MacKillop, there is a point of order.

The Hon. M.F. O'BRIEN: Relevance. I think the member for MacKillop is raising a whole range of totally extraneous issues. This really does come down to the 44¢ or 54¢ feed-in issue, not Mount Bold or the forests in the South-East.

The CHAIR: Yes, there is a point of order. I accept that. Carry on, member for MacKillop.

Mr WILLIAMS: Madam Chair, in my defence—

The CHAIR: No, you do not need to defend yourself.

Mr WILLIAMS: No, I—

The CHAIR: Member for MacKillop, sit down. The thing is that when the Chair or the Speaker makes that ruling, that is it!

Mr WILLIAMS: Thank you, Madam Chair. I simply respond to the point raised by the minister that the reason we seem to be travelling down this path of stupidity is that the Premier made an announcement. I am just pointing out to the house that, as strange as it might seem, the Premier is capable of changing his position. To reinforce that that is the case, I wish to put before the house a number of cases where the Premier has changed his position.

I remember the Premier telling the people of South Australia that the home of football was at West Lakes, and I think he has changed his position. I will not bore the house with the full range of examples where the Premier has changed his position. The reality is that it is not unique, it is not even rare for this Premier to change his position; he does it almost on a daily basis.

Amendment negatived; clause passed.

Remaining clause (8), schedule and title passed.

Bill reported without amendment.

Third Reading

The Hon. M.F. O'BRIEN (Napier—Minister for Agriculture and Fisheries, Minister for Forests, Minister for Energy, Minister for the Northern Suburbs) (16:45): I move:

That this bill be now read a third time.

Bill read a third time and passed.


[Sitting extended beyond 17:00 on motion of Hon. J.R. Rau]


PARLIAMENTARY BUSINESS
MEMBERS
GET INVOLVED
ABOUT PARLIAMENT
VISIT
LEGISLATIVE COUNCIL
HOUSE OF ASSEMBLY
CONTACT