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House of Assembly - Fifty-Second Parliament, Second Session (52-2)
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STATUTES AMENDMENT (SMART METERS) BILL

Second Reading

Adjourned debate on second reading.

(Continued from 11 September 2013.)

Mr HAMILTON-SMITH (Waite) (11:02): I rise to signal that the opposition will be supporting this very long-overdue measure. Of course, it comes after many years of Labor state government which have seen, since 2002, power bills rise extraordinarily year on year on year. There have been well over 135 per cent increases during a period in which inflation has been relatively modest. This government has handled energy poorly, and this measure before us today is an effort, in the 12th or 13th year of this tired Labor government's term in office, towards fixing the mess they have largely created.

It was introduced by the minister on 11 September. South Australia is the lead legislator for the National Energy Retail Law and the National Electricity Law. The South Australian government has introduced this bill as part of a key Standing Council on Energy and Resources (SCER) market reform initiative. This is not purely an initiative of this state government: this is an initiative of the SCER, and the minister and the government have been given the job of introducing it on behalf of the nation because we will be the lead legislator. It represents the initial legislative stage for the eventual widespread introduction of smart meters and related technologies, in our view.

Of course, we do not know if that is the view of the government, because the government has been relatively silent on whether it even has an energy policy at all at the moment. The last energy policy we saw from this government was back four years ago at the last election. Since then, we have bumbled along from year to year. There is no energy policy that we can see.

The opposition put its energy policy out a couple of weeks ago. We have staked our claim, but we still do not know whether the government intends to introduce smart meters or how it intends to do so. We have this bill, which is part of national arrangements, but this bill does not give us any indication as to what this government intends to do about smart meters. There have been hints on talkback radio that, 'Yes, well, this is something that we were going to do anyway'—whatever—but there has been nothing specific.

The SPEAKER: You are quoting someone then?

Mr HAMILTON-SMITH: No; I am generally describing events that I have listened to in the public space.

Mr Gardner: It's the vibe.

The SPEAKER: It's the vibe, says the member for Morialta.

Mr HAMILTON-SMITH: So, we are still very unclear on what the government's plans are. Currently, 99 per cent of South Australia's electricity households and businesses are fitted with accumulation meters that monitor overall usage. Retailers monitor overall usage on site at quarterly intervals. This old technology requires inspectors to visit properties to read meters and gives little visibility of usage. The old meters cannot be used to manage demand. The cost of this old technology, I understand, is around about $50 per year and I understand that even now, as new residential developments are undertaken, we are still rolling out old technology meters—they might be digitised, but essentially dumb meters—as we speak.

So, we have not smartened up and come into the 21st century even yet. These old meters are inefficient, they see the need for millions and millions of dollars to be spent every year around the nation on going out to read meters, they do not provide timely indications to consumers of their usage and they are, essentially, extremely old and outdated technology. Smart meters digitally monitor usage at 30 minute intervals providing more detailed data to retailers and consumers on their real-time use of electricity. Regular monitoring of usage will empower the consumer as to the true nature of their electricity demands. A complete smart meter with remote monitoring technology is estimated to be, and there are various prices out there, in the order of about $150 per unit, according to government advisers when I received my briefing, although I have heard of other higher estimates, depending on the type of meter, etc.

There are considerable benefits to smart meters, which is one of the reasons why we are not only supporting this bill but why we have come out with a policy, as an opposition, and said that we will support the installation of smart meters. Regular interval monitoring by smart meters allows for the introduction of voluntary time-sensitive pricing. This allows retail companies to offer variable prices, depending on the time of day and demands on energy networks. This would give customers an incentive to use their non-essential appliances at off-peak times and charge consumers for the true price of electricity generation and network use.

One of the principal reasons for SA's high power prices has been rapid peaks in demand, particularly as a result of air conditioning and reverse cycle heating, and this has been well debated over the years. This peakiness really does distort pricing and has an impact at the household and small business levels. High demand peaks require large investment in the capacity of the electricity networks to cope, with very few hours per year of extremely high demand. The Productivity Commission indicates that those costs could be as much as 25 per cent of what bill payers are handing over just to cope with that 30 to 40 hours a year of peakiness and to provide certainty of supply during that period.

A lot of consumers, if they were given the choice: would you rather have a 25 to 30 per cent reduction in your bill and a risk of brownouts, or would you rather have no risk of brownouts and pay 25 to 30 per cent more, might very well say, 'Well, I'll risk the brownouts, thank you. I will risk the odd blackout and I'll have the cheaper bill.' That is a point that was addressed fulsomely by the Productivity Commission. The cost of this rarely used network capacity is ultimately passed onto consumers, indirectly. Sharp increases in demand also require generators to rapidly ramp up production, which creates a higher wholesale spot price. These costs are also indirectly passed on to consumers by retailers, as I have mentioned.

Smart meters may be fitted with remote monitoring devices. This allows retailers to more efficiently monitor usage from a central hub without on-site readings, thereby lowering costs and reducing associated nuisances, such as locked gates. Smart meters may also be fitted with direct load control devices which allow the consumer or the retailer to directly or remotely turn off or on air-conditioning appliances at convenient times.

The Victorian experience of smart meter rollout is worth noting. In 2006, the Victorian government commenced a mandated rollout of smart meters by a single network distribution company. The measure attracted considerable negative response due to excessive up-front costs that were borne directly by consumers. The program was rushed by the government and led to significant market and pricing distortions. Despite significant errors in implementation, currently around 90 per cent of Victorian electricity consumers, I am advised, are monitored by smart meters. September saw the introduction of time-sensitive pricing which will see significant long-term savings being made in Victoria in future years.

That SA experience of course is quite different. After 12 years in office, state Labor has taken no action to implement smart meters, with less than 1 per cent of users fitted with the technology, mostly as part of trials. I have heard the minister claim that the government is conducting trials. Of course, that is not correct. SA Power Networks—a private company—is conducting trials. My understanding is that it has nothing to do with the government, but I will let the minister talk to that point when he responds.

SCER has resolved that future implementation of smart meters must be in a competitive market led by retailers, not a monopoly network company, and that they must be incremental. This has forced state Labor to do something. After 12 years of doing nothing, SCER—the standing council of energy ministers—has forced them to actually do something in the form of this bill. The cost-effective adoption of smart meters requires widespread adoption and steady implementation to minimise manufacture and installation costs, but of course we have heard nothing from the government, as I have mentioned, about how they might deal with those issues and what their plan might be. South Australia is currently conducting smart meter trials in the northern suburbs assessing their effectiveness, as I have mentioned, and my discussions with stakeholders indicate that that is progressing well.

For all these reasons relative to the bill, the opposition has made its view on energy reform, and particularly its view on smart meters, very clear indeed. As I have mentioned, this measure comes before the house in the context of a 133 to 135 per cent increase in bills since 2002 while over the same time line, CPI has increased by just 36 per cent. Our bills have skyrocketed and struggling families and small businesses cannot endure these kinds of price increases any longer. Households need to be empowered to control their energy spend, and we must begin to fix the current problems in the regulatory system—the subject of another matter which I am looking forward to enormously immediately at the conclusion of this bill. Otherwise we will not get prices under control.

A particular challenge in the SA market, as I have mentioned, is the profile of our consumption and the peaks, particularly in the evenings at certain times of the year, but of course that peakiness moves depending on the weather and a range of other factors. The generation capacity in the South Australian grid is therefore constructed to meet this peak demand. There are equally long periods of time in the 24-hour cycle when its installed generating capacity is underutilised. If we cannot even out our consumption patterns more, then we can draw more of our usage in periods of lower cost per kilowatt hour and this reduces our reliance on expensive and unnecessary infrastructure in energy generation.

Consumers need to know more about their current electricity use. They must be given more choice in the marketplace from different energy packages from retailers so that they can understand what changes they can make in order to get their electricity costs down. That is why the opposition is of the view that we must embrace serious regulatory reform. This is the single biggest issue that is failing South Australian consumers. The fact that this government has sat on its hands for 12 years, the fact that not enough has been done over the last 12 years to streamline the regulatory arrangements to make them work, is the principal cause for our exorbitant increase in electricity prices.

Urgent reform of the regulatory arrangements is needed, and the Productivity Commission has made it perfectly clear: the reforms need to contain spiralling network costs and inefficiencies resulting from flaws in the regulatory environment. We need to resolve benchmarking and interconnector problems, we need to reduce so-called gold plating of infrastructure by modifying reliability requirements to promote efficiency, and we need to improve demand management, and that is where this bill and smart meters come in.

More efficient planning is needed for large transmission investments. There need to be changes to regulatory arrangements and network business ownership in certain other states that impact on us, better support and coordination with advocacy groups, and a review of the role of the Australian Energy Regulator, the Australian Energy Market Commission, and the Australian Energy Market Operator, with the object of increased powers for the regulator and better enforcement of the rules. In particular, we need new rules to crack down on market irregularities. That is the subject for another matter, so I am not going to dwell on it, but I make the point because it sets the context for this bill on smart meters. Unless we reform the regulatory environment smart meters will only be one small step in the right direction.

The other thing that we need—and the opposition have make this very clear in our policy—is monthly billing cycles. I was delighted this week to see retailers coming out and saying, 'Okay, then, we'll consider offering it; we'll offer monthly billing cycles.' It is very, very important in the opposition's opinion, because if we enable households and small businesses to regularly monitor their energy use and allow them to pay a monthly basis based on actual usage—not on estimation—then we empower them, we give them information.

The opposition has stated in its policy that we believe that process should be entirely at the discretion of the consumer. No consumer will have to make a change under a future Liberal government if they do not wish to. Monthly billing needs to be allowable on an actual basis rather than retailers predicting your consumption for the month. That is why this bill is going to be supported, because we need smart meters to enable actual usage. Consumers should be charged on their actual energy use, which is achieved where a smart meter is installed on the premises.

Monthly charges for actual energy use, as I have mentioned, will assist households and small business—let us not forget them—to balance their budgets. Monthly billing provides an alternative for small businesses and families who may find it much easier to manage the household budget by paying the power bill once a month instead of once per quarter. Quarterly bills can provide a real shock if consumption is higher than anticipated. Families currently have to budget for their energy bills every three months based in effect on guesswork, and that has to change. Monthly billing will give a better understanding of consumption on a more regular basis. If the family receives a monthly bill that is higher than usual, then they can alter their usage and avoid bill shock.

I would love to know the government's view on monthly bills. They are silent. They have no policy; it is a policy free zone over there. We have dream sheets—$36 billion dream sheets—glossy brochures, policy by glossy brochure, but we have not even had a glossy brochure yet on energy. I am really disappointed. At least we could have a glossy brochure let alone something with some substance in it, but there is nothing but silence, only these bills that the minister is told by SCER to introduce because we are the lead legislator.

Monthly bills would be a new direction that would help consumers to better manage their household budget, better manage their usage habits, and allow for a more fluid marketplace. Telstra did it recently (not that long ago) with its billing arrangements when it went to monthly. It is particularly helpful for low income households because they can better manage their affairs. One aspect of facilitating the rollout of smart meters is the replacement of energy meters with new technology.

The house might be shocked to know that SA Power Networks each year replace anything up to 30,000 old electricity meters with new. The trouble is that they are not really new; they are just replacing old technology meters with more old technology meters. They might be digitised but they are not smart meters. This is a disgrace—30,000 meters every year being changed over. It is like buying 30,000 FJ Holdens and, when they wear out, buying another 30,000 FJ Holdens.

The world has changed. We live in a world of smart technology. We live in a world of mobile phones, iPads and computers. We live in a world where technology is increasing, driving everything we do, except for a very small group in the community: the Australian Labor Party. Apparently they like old meters. That is why over 99 per cent of South Australians still have this old technology in their homes while the rest of the world has moved forward. The next thing we know they will be banning iPhones and iPads and going back to the days of the knitting needle. That is where Labor wants to take us.

So what is Labor's policy on smart meters? Are they going to introduce them or not? How are they going to roll them out? Is it going to be using SA Power Networks? Are they going to allow retailers to do it? Will it be a combination of both? Will it be mandatory or voluntary? Just how are they going to make it work? Will there be an up-front charge or not? Will it be rolled into contracts? The opposition has answered all these question. We are out there; we have a policy. It is the government that is the policy-free zone. We have a bill but we have no policy. A bill with no policy—for heavens sake, we need a new government.

Importantly, the household or business under our plan will have control of the meter; they will own the meter, and no retailer will be able to use installation as a lever to try to keep the customer from switching to another retailer. What we are saying to retailers is, 'We'll let you monthly bill. As a result, consumers and small business will be advantaged.' However, to be fair, retailers will also be advantaged because they will get paid more regularly. They will get their bills paid monthly, there will be fewer defaults and few bill payers will need to be chased up for late payments, so they will get their cash in, and that is good for them.

I have met with all of the retailers. I have met with the Retailers Association. I have had dinner with all of them state and nationally. They all argue that they are keen and willing and prepared as retailers to get out and offer in a competitive marketplace smart meters to people with no up-front charge. They will roll it into the contract pricing and they argue that, with competition, that charge will be minimal. Now, let's see what the marketplace delivers, but at least we have done the work. At least we have spoken to the stakeholders. We have a policy out. We have a plan. I am waiting to hear the government's plan, because smart meters are in fact one of the keys. They are not as important as regulatory reform but, with monthly billing, the two go together as an important step towards demand management, which is what this bill is in effect about.

The installation of smart meters under our plan will be entirely voluntary and undertaken through electricity retailers and SA Power Networks, where appropriate. I imagine there will be occasions when retailers are not the right people to put in a meter. For example, if Hickinbotham or one of our other major developers are putting in a 2,000 household development, in all likelihood the developers will be engaging SA Power Networks to connect those houses up to the grid. It may well be in that instance that SA Power Networks is competing with others to put in those smart meters. So SA Power Networks will be a player and the retailers will be a player. It is all voluntary under our plan. No-one will be made to do it, but those who do will be empowered enormously to get their bills down.

Well into the 21st century these old technology meters are antiquated and at odds with current times and current developments and they also provide an unnecessary cost from electricity retailers to consumers. The old technology provides very limited data, making it almost impossible, as I have mentioned, for a family to understand when it is using energy and how they can shift consumption patterns to get costs down.

This is a very important point: we have the off-peak system at the moment with the hot water service hardwired to the meter so that you can run your hot water service off peak. However, you cannot do the ironing, use the washing machine, pool filter, or whatever other device you are running in the home in off-peak periods because you do not have a smart meter. Smart meters will enable you to do this. They will also allow consumers the opportunity to receive differential pricing, as I mentioned, on electricity usage based on different times of the day.

The Essential Services Commission of South Australia under our plan will be tasked to monitor and roll out smart meters and develop a framework to introduce differential pricing, as well as a consumer engagement strategy to encourage the take-up of more flexible models from retailers. So, we will keep the system honest.

Time-sensitive differential pricing will allow providers to take information of their customers' energy usage and offer tailored contracts to consumers to take advantage of low energy usage periods throughout the 24-hour cycle. This will reduce demand on infrastructure, and that is a good thing because our infrastructure, as I mentioned, is splitting at the seams during those peaky times and, as a consequence, is soaking up millions and millions of dollars of investment, which may or may not be necessary.

In the future, there is a high likelihood that smart meters will be able to communicate with appliances directly, as I mentioned earlier, and it would therefore be possible to have the smart meter start your washing machine once the market price gets below a certain level. It would equally be feasible to have your smart meter turn off your air conditioner if the rate got above a certain level, all on a voluntary basis under our plan and, of course, under a mysterious cloud under Labor's plan, which at this stage does not appear to exist.

Smart meters could even predict upcoming usage and communicate this through to retailers so that they can better predict their purchasing in the wholesale market and give longer demand signals to the market, allowing generators more predictability over generation peaks and troughs.

Finally, we are calling on the government to scrap the Residential Energy Efficiency Scheme (REES), which fits with this whole arrangement. It has run its course. The REES is poorly targeted and adds pressure to household energy bills. The Liberal Party will end the REES to immediately reduce the cost of energy for families by as much as $14 per annum. I cannot find anyone defending the REES. Even SACOSS and those groups working with the needy are not defending this scheme. It has run its course. Door snakes, light bulbs and energy efficiency kits—MPs have had them delivered to our offices. It has been a waste not of the taxpayers' money but of consumers' money because it has been added onto their bill. Let's scrap that scheme.

This bill is fine. This bill is good. We will be supporting it. What is missing are the other key elements of a cogent energy policy around this bill that make sense for consumers, because the Labor state government is a policy-free zone. They have lots of glossy brochures but, when it comes to substance, there is not a great deal. They have lost sight of the need to act at all times in the best interests of consumers, small businesses and particularly low-income families.

I will address some of the things that have been said about smart meters by the Productivity Commission. In its April 2013 report into Electricity Network Regulatory Frameworks, the Productivity Commission argued strongly for smart meters. On page 19, it stated:

Realistically, consumers cannot be charged time-based prices unless they, (along with network businesses and retailers), receive real-time information about usage patterns. Smart meters enable the measurement of electricity consumption over time and can achieve other (sizeable) operational efficiencies in networks, such as remote meter reading and fault detection.

The Commission’s preferred approach is that, like other expenditure, distribution businesses would be able to include smart meter rollouts as part of their regulatory proposals to the AER (subject to the usual oversight by the AER of the claimed need for, and efficiency of, the expenditures proposed by network businesses). Currently, the Rules effectively preclude this. As for other expenditure under incentive regulation, in the ensuing regulatory period, the businesses would be free to determine the number, timing and location of smart meters. However, under the Regulatory Investment Test for Distribution, network businesses undertaking any significant rollout (or other large-scale investment) would have to produce a report that substantiated whether the investments passed a cost-benefit test. Incentive arrangements intended to address the wider efficiency gains of demand management in other parts of the energy supply chain would need to be strengthened.

Smart meters should be subject to an appropriate, preferably international, minimum standard that allows interoperability with add-on technologies. All relevant parties would be able to access data, subject to privacy laws. Retailers and third parties (given prior customer agreement) would also be able to install smart meters, make modular additions to existing smart meters, and develop complementary technologies (such as in-home displays and software apps) that help reduce people's bills, while also relieving pressure on the network and generation at peak times. Retailers and third parties may choose to do this to differentiate their business proposition from competitors and make it more appealing to consumers.

That is what the Productivity Commission says about smart meters, and it is a ringing endorsement of the state Liberals' policy on smart meters. We are yet to have a policy from the Labor Party. When we do, we will see how it measures up against the Productivity Commission's report.

The parliament needs to be aware, and South Australians need to be aware, that the Productivity Commission has strongly endorsed the use of smart meters. I do not know why the state Labor government is so lacking in courage on this issue. I do not know why, when we announced it a few weeks ago that if we formed government we would introduce them, they were not out there loudly supporting our initiative. The minister was positively sheepish and sort of half-hearted about it: 'Well, yeah, we sort of—you know, that's what we want to do, but we're not quite sure how or when.' When I read the transcript, it is great.

There is a little bit of criticism of this measure, and there has been some in the media. One of the arguments is that there is a public health hazard, and claims have been made that if you fit these smart meters to your home, you might electrify the brain or develop some horrible cancer. The argument is that there might be some technological problem. The Productivity Commission has found that you could save up to $200 a year by putting a smart meter into your home, but the opponents are saying, 'Well, you'll be electrified if you do.' It is similar to the arguments when mobile phones were first introduced.

Claims have been made that some international organisations—I think the World Health Organisation—have made statements to the effect that smart meters are not safe. Well, I have checked that out. I do not think that is true. I do not think that is correct at all. I am looking at a report on smart meters and whether they are dangerous by Jonathan Borwein, Laureate Professor of Mathematics at the University of Newcastle. In an online piece, he deals with many of these issues and calls for a discussion of the matter based on the facts. He says:

...smart meters worldwide use conventional cell phone networks to transmit their data. In the largest study conducted so far, researchers in Denmark found no increased risk of brain tumours from long-term usage of cell phones.

So, even the mobile phone is safe as houses, and this technology, smart meters, which uses the same technology and by the way is not attached to your ear (it is out in the meter box), is the same technology. It is quite safe. 'But even if some minute health risk was ultimately found for heavy cell phone usage, microwave exposure from smart meters is only a microscopic fraction,' Professor Borwein says in his report. He further states:

Smart meters only transmit data for roughly 1.4 seconds per day, at very low wattage. According to B.C. Hydro in Canada: 'Exposure to radio frequency during a 20-year life span of a smart meter is equivalent to the exposure during a single 30-minute cell phone call.'

So where is this evidence that cell phones are somehow dangerous to one's health? It seems not to be substantiated by the facts anywhere. Professor Borwein continues:

In any event, it strikes the present authors that the proponents of the anti-smart meter movement are, at the least, being highly inconsistent. If they truly believe their health is at risk from microwave exposure via smart meter broadcasts, they should immediately cease using cell phones (including smart phones and iPads), and should not permit anyone to carry or use such a device on their property.

In effect, this article goes on to say that there is no scientific basis anywhere in the world to support the argument that smart meters present any health risk whatsoever. If that is not enough, there are plenty of other sources that can be used in regard to examining whether there is any evidence in the writings on electromagnetic fields and public health to support the argument that smart phones are a risk.

The fact is there is no evidence, and if there is any evidence I would like people to explain where it is. I now read from an article entitled 'Base stations and wireless technologies: backgrounder' dated May 2006 which is in regard to the World Health Organisation which some have claimed has made some sort of statement to the effect that smart meters are a risk. It states:

WHO, through the International EMF Project, has established a programme to monitor the EMF scientific literature, to evaluate the health effects from exposure to EMF in the range from 0 to 300 GHz, to provide advice about possible EMF hazards and to identify suitable mitigation measures. Following extensive international reviews, the International EMF project has promoted research to fill gaps in knowledge. In response national governments and research institutes have funded over $250 million in EMF research over the past 10 years.

While no health effects are expected from exposure to RF fields from base stations and wireless networks, research is still being promoted by WHO to determine whether there are any health consequences from higher RF exposures from mobile devices.

Essentially, there is no evidence but, if there is, if someone could bring it to the parliament the opposition would be delighted to read it. Those going out there banging a drum saying that these smart meters are somehow a risk to anyone's health need to stump up the facts—we need to see the evidence.

I also make reference on this matter to an opinion piece that was offered publicly by Mr Matthew Warren, CEO of the Energy Supply Association. It is a very interesting read and it is worth the house's noting its content. It is an extract of an article that appeared in the Adelaide Advertiser on 22 October 2013. In response to the announcement of the opposition's policy that we would be supporting a voluntary rollout of smart meters by retailers, Mr Warren said:

Supposed experts have turned up on Adelaide's airwaves likening it to the Vietnam War, claiming the World Health Organisation has linked it with cancer (it hasn't), and that dubious government agencies are all trying to rip off battling SA households.

Smart meters aren't part of a government plot to control your energy use. A smart meter is nothing more, and nothing less, than a 21st century electricity meter. Comparing a smart meter to the old mechanical electricity meter is like comparing a computer with a typewriter or iTunes with a record player.

A smart meter can be read remotely, which is cheaper and easier than manual reading. It means consumers can be billed more frequently (if that's what they would prefer). It makes things like moving house faster and easier.

Smart meters can automatically report faults and outages. That means the problem can often be fixed before you get home. This isn't some radical new technology. Victoria recently completed a smart meter roll-out. The most common concern raised about smart meters is that they emit large amounts of electromagnetic radiation. They don't. The wireless signals they send and emit are a fraction of those that come from mobile phones, baby monitors and wireless internet.

The new meter will need to deliver savings greater than what it costs to install. That seems possible. The independent Productivity Commission estimates a cost of between $50 and $100 a year. These savings come from retailers offering deals that reflect the real cost of generating and distributing electricity at different times of day.

I want to stop the quote there to underline that very important point. These meters can be rolled out by the retailers and the costs of installing can be largely met within the context of the deals that will reflect the real cost of generating and distributing electricity at different times of the day rather than the estimated costs under the current regime. Mr Warren then goes on to say:

Use more energy when it's cheaper—and save on your bills. Appliances like pool pumps, dishwashers and washing machines can be easily switched on during off-peak times. SA has one of the highest penetration rates of renewable energy in the world. Technologies like wind and solar aren't always there when you need them. Smart meters can help the network manage these new supplies better.

Energy markets are transforming in front of our eyes—from smart meters to wind energy, solar power, batteries and even electric cars. It's important to discuss these changing technologies and how we can make sure they work for us. They're not problems. They're solutions.

I commend the article. This is a necessary measure. What is missing, though, is a policy from the government around this measure to explain what they have in mind to make it a reality. I want to address some remarks specifically to the bill, because it represents the initial legislative stage to enable the eventual widespread introduction of smart meters and related technologies around the country.

The bill establishes the rule-making mechanism by which a rollout of the smart meters can be established. The bill does not implement the full recommendations of the SCER process and is deliberately not overly prescriptive, given that different jurisdictions will seek to incentivise or encourage the adoption of smart meters in different manners; and Victoria, as I have mentioned, has already implemented its own scheme. The bill allows the South Australian Minister for Energy to implement the initial National Electricity Rules amendments to ensure that consumer protections are in place in early 2014.

I assume we are going to get a glossy brochure some time between now and the election—I can only hope so—with the 3D flyover. I can see it now. There will be a camera zooming over North Adelaide looking at somebody's smart meter, and zooming away. There will be little digital things going. I can see it now. There will be some guy in an SA Power Networks substation pressing buttons and they will say, 'We've got this great idea.' The only trouble the government has is that we have been out there making it our position for quite some time now. The rest of the country got with it months or years ago.

The Johnny-come-lately to all this is the government. Maybe it left it so that it could have another announcement in the lead-up to the election, but it would have been better for consumers if we had been here debating this bill two, three or four years ago, getting with the future. We should have been implementing a retail-driven rollout of smart meters years ago. It should have been done by the current minister's predecessor but it was not. At the very least, this minister should have immediately driven it the moment he stepped into the chair. We did not really need this bill in order to make it happen. Victoria proved that. They handled it poorly. I think we could have handled it much better. But there is no reason why the government could not have got moving on this a long, long time ago.

The bill, of course, also removes the power for the minister to issue a mandate for broadscale smart meter rollout determination as occurred in Victoria. In other words, it means that the minister cannot rule that SA Power Networks will go out and install these things and, by removing that power, it does incentivise retailers and frees up the market to get out there and compete with SA Power Networks to put these things in, and that is a measure that we welcome.

Of course, the minister could have signalled that a year or two ago. The government could have made it clear that it had no intention of doing that. We could have got moving on this a long time ago and we did not.

SCER has agreed that any future rollout of smart meters should be market-driven and competitive, exactly what the state Liberals have proposed, and which is supported by the Productivity Commission—market driven and competitive. We want to see the retailers and SA Power Networks out there offering these devices to people. By removing the minister's power to mandate rollout by SA Power Networks, the door is open for others to enter the market without that risk in prospect.

The bill retains, however, the ability of ministers to mandate limited trials or assessments, as is currently being conducted in the northern suburbs. The bill provides for some basic consumer protections, in particular: full tariff structure disclosure within billing rules and content; direct load control or supply capacity control measures that could be implemented by retailers who will require full consumer disclosure and consent included as part of the connection contract, and management of restoration of power in case of an emergency; and standing offers to smart meter consumers that may included prescribed tariff structures by the jurisdiction of regulators, all of which will be supported. We do not intend to try and amend the measure.

With regard to consultation, we note that SCER, as with most regulatory reforms, has ensured that the bill proceeded to substantial consultation and review after 2007. There is considerable consensus among the energy sector and consumers on the potential benefits of smart meters. That is why I am astounded that the government has not come up with a clear statement of position on this.

However, the management of implementation issues will require due diligence. Important issues that have been raised in this process include the following: the rollout of smart meters must be market based and competitive; second, consumer protections should be harmonised and simple; third, consumers must have the option between a flat tariff and flexible pricing; next, tools and resources are required to make use of smart meter data and independent price comparators must be available.

Provided those issues are dealt with there is no reason why we cannot get on with it. Although Labor has taken no action to facilitate smart meter rollout, this bill is an initial SCER measure to establish the harmonised national regulatory environment for a market-driven rollout of smart meters. So, it is here now. All we need is some action from the government.

The measures contained within the bill are modest and have been subjected to lengthy review and consultation since 2007. Smart meter technology offers considerable benefits for driving down peak demand and reducing the costs from network charges and peak demand energy generation.

In conclusion, the opposition is supporting the measure and encourages everyone to vote for it. The next step would need to be for a state government to simply get off its backside and do something, to take action, to incentivise retailers and SA Power Networks to get on with the job of rolling out this technology. It is sad that 90 per cent of householders in Victoria have it and we have virtually none, except those involved in a trial. There may be a need for further regulation, administrative action and the involvement of ESCOSA (which we would strongly encourage), but we simply need an indication from the government quite apart from this bill as to whether or not they actually have a plan to do anything.

Apart from this bill, which has been quietly brought into the parliament without a great deal of fanfare and without any accompanying policy statement—there has been no glossy brochure on this one—there has been silence from the government. Perhaps the minister can get up and announce the government's energy policy after other contributors have finished their remarks. With that contribution, I commend the bill to the house.

Mr PEDERICK (Hammond) (11:50): I rise to speak to the Statutes Amendment (Smart Meters) Bill 2013, and commend the speech by the member for Waite. I also commend his contribution and his work in developing our policy on smart meters and their benefits for the South Australian public if people choose to take them up. I note that this bill was introduced by the minister on 11 September this year (2013).

South Australia is the lead legislator with regard to national energy retail law and national electricity law, and so the government introduced this bill as part of a key standing council on energy and resources market reform initiative. The bill represents the initial legislative stage for the eventual widespread introduction of smart meters and related technology.

I note what the member for Waite was saying about how electricity is measured in this state; we use what is called 'accumulation meters', and retailers with these meters can only manage to monitor overall usage onsite at quarterly intervals. This old technology requires inspectors to visit properties to read meters and gives little visibility of usage, and these meters cannot be used to manage demand. It is noted that the cost of this old technology is around $50 per user.

I note there are a lot of issues with some meters being read by meter readers. Generally, in the main, it can work very well, but sometimes there are occasions where estimated readings have to take place. For instance, if people do not have access to a meter for whatever reason (it could be behind a locked gate or around the back of the house and there is no access, and there are a couple of German shepherds in the way) the meter reader makes a recommendation for an estimated reading.

I can say from personal experience that estimated readings can be a fair way out. In the last 12 months or so we made the decision to go down the solar panel path at home on the farm, and put in a five-kilowatt system. We are on the single-wire return (the SWIR line), so that was the maximum that we could put in. The power provider made an estimated reading of our power bill and it was quite substantial. I thought, 'Well, we've got a good way to get around this,' because we had the actual meter reading from when the new input-output meter was put in by the company that put on the solar panels, and so we could easily contest their claim of a bill that was many, many hundreds of dollars out of range of where it should have been.

This has occurred at times when the people have had access, but I note that because there is a work order put in when something like solar panels goes on, as I indicated from my personal experience on the farm at Coomandook, instantly there is a reading taken. I was a bit stunned that there was an estimated reading, because the meter is quite accessible (it is probably 150 metres away from the house on a pine post), but that is what happened at the time.

Thankfully, we managed to deal with this, but certainly, with the high price of electricity in this state, you do have to be careful. I know many people and many businesses in my area can have bills well above $700 and up to $1,000 a quarter, and some are much higher than that. You do not have to be a very big operation to have bills of that size.

One thing that these smart meters will let happen is to make monthly billing accessible for consumers if they choose to take up the smart meter technology, so consumers will not have that bill shock. We have seen in this state over time more than a 250 per cent increase in water prices. We have seen a massive increase in power prices. We have seen different rates and taxes go up incredibly under this state Labor government and people are sick of it, quite frankly. It is a huge bill shock when some of these bills come in altogether, especially if they are quarterly bills that come in either at the same time or at a very similar time.

With regard to how these smart meters actually work, they digitally monitor the usage at 30-minute intervals, giving that real-time data in the use of the electricity. It will let the consumer, using real-time data, work out the true nature of their demands and when is the best time to use their appliances and some of their equipment, whether it is washing machines, dishwashers or other equipment that is not so time sensitive that they can be used at times when they can enjoy a lower electricity price. We note that a smart meter with the monitoring technology will probably cost somewhere in the range of $150 to $200 a unit, and note that it will be part of a competitive framework where power suppliers will have to use it as part of their sell to consumers and incorporate the price in a package so that people can decide whether they take up the smart meter technology or not.

In recent weeks, I have had some correspondence from one of my constituents at Goolwa who was a bit concerned about smart meters. He was concerned that they are quite possibly bad for your health and can lead to increased bills, but as we have heard here today there is not really a health issue with regard to the emissions from a smart meter. It is a regular but very brief signal and, as we heard from the member for Waite, it uses very similar technology to mobile phones for roughly 1.4 seconds per day at a very low wattage.

The World Health Organisation, in fact, has found that, 'considering the very low exposure levels and research results collected to date, there is no convincing scientific evidence that the weak RF signals from base stations and wireless networks cause adverse health effects.' Certainly, from what we have heard and from what we understand, I would be very surprised if bills went up with the use of smart meters because people can monitor their use and use their appliances and equipment at times that suit them and to help sort out how their power usage works in their home and in their business. I gave the obvious response to this constituent, but he was being very firm saying, 'I, for one, do not want one and I want the choice to say no.'

On this side of the house we are certainly giving that choice and I think, from what I see, the bill gives that choice as well and I think that is a good idea because we are the party of choice on this side of the house and people can decide whether they want to install this technology so they can have the benefits of remote reading and they can have accurate readings done with these smart meters. If constituents like this person from Goolwa who said, 'Well, look, I have already put solar panels on. I am getting lower power costs. I am quite happy with where I am', then that is their democratic right if they do not think they want to go through with the installation of the technology.

It is always an issue with power demand, and especially in South Australia where we have a very high peaking power load It has been an issue for many years, especially in summer. Obviously reverse cycle heating in the winter when it is cool is an issue. In summer there can be some very peaky demand slots in South Australia. We have had the weird situation in South Australia over time where different areas of the state, different suburbs in the city, etc. have had to be switched off at intervals because the peaking supply could not be guaranteed to keep everyone's air conditioners going.

I think about the way electricity was rolled out through the state. It came through urban areas a lot earlier than it got down to us at Coomandook. I think it came through our area in about 1966 and it was not that long ago. It has been a boon to have access to that generated power. It has been a real problem with this peaking power and I would like to think that, with the massive take-up of solar panel technology throughout the state, we do not have to go down that path of having to shut off different areas of the state at certain times when there is very peaky electricity demand.

Solar panels do not work at 100 per cent efficiency when it is very hot but they run reasonably efficiently on a hot day. They get overheated and cannot generate the full amount that they are rated at but with the amount that is in use in South Australia now, there would be quite a massive amount of energy that obviously does come online and go through the input/output meters at people's houses or industrial installations of solar panels.

It is interesting now that you have regulators talking about—and it was only in the media last week I think—how we have all these solar panels in place and they are a bit concerned that we do not have to send all this power down the line. Well, I guess you can't have it both ways. Obviously electricity is still going down the lines and I think we need the solar panels that we have implemented, whether it was with the initial scheme which I think was the 44¢ per kilowatt hour scheme or the 26¢ scheme which is the scheme at the minute which wound up in September but is still applicable for another two years, and that takes in about 9.8¢ of government rebate. It is a real boon for taking some of the sting out of the price of power. We have a range of technologies so that power is distributed throughout the state.

In regard to the rollout it is interesting that we are going to a system here in this state where it can be individual choice. The Victorian government since 2006 commenced the mandated rollout and I think there were a few issues with that. The program was rushed and it caused some market and pricing distortions. At the moment we understand that there is about 90 per cent of Victorian electricity consumers who are monitored by smart meters. In Victoria they have had time sensitive pricing which will see significant long-term savings being made in Victoria and I am hopeful that with the introduction of this bill, if it comes to an act, that we will see those benefits of time sensitive pricing come through to South Australia.

I note in the bill that initial rule changes will need to be made in implementing this system but then the minister will have no power to make further rules under the bill and rules can only be made on the recommendation of the Standing Council on Energy and Resources. As I indicated earlier the bill does not give the power to the minister to issue a mandate on a broad scale smart meter rollout, and the implementation of the smart meters should be market driven and competitive.

In regard to consumer protections for smart meters, some of these involve full tariff structure disclosure within billing rules and content; direct load control or supply capacity control measures, which can be implemented by retailers, will require full consumer disclosure and consent to be included as part of a connection contract and management and restoration of power in case of an emergency; and standing offers to smart meter consumers may include prescribed tariff structures by the jurisdiction or regulators.

As I indicated earlier, important issues that have come up since the consultation and review took place in 2007 are that the rollout of smart meters must be market-based and competitive; consumer protections should be harmonised and simple; consumers must have the option between a flat tariff and flexible pricing; tools and resources will be required to make use of smart meter data; and independent price comparators must be available.

I acknowledge that, if this bill goes through and becomes an act in the very near future, this would be a great way forward for people in this state who want to take up the option of smart meters. Certainly, one of the reasons I decided to put solar on my house was that the price of power has been getting ridiculously high.

Mr Venning interjecting:

Mr PEDERICK: I won't respond to the interjections from my colleagues, Mr Deputy Speaker. The price of power is a significant input cost in running the family home and all the costs involved in that. We know that many people now have a double income, and people are flat out paying their bills. Also, power cost for people running businesses can be huge. For major businesses, their power bills would be in the hundreds of thousands of dollars per quarter, and that is something else that has to be passed down the line to the consumers of products or goods those businesses supply to the public. So, anything that can reduce input costs, such as the introduction of smart meters, would be a great thing for the state.

The thing I do like about this is that it is not mandated that these smart meters be installed. As my constituent at Goolwa has indicated to me, he wants the right not to have it—and he has stated that very firmly in his correspondence to me and my office—and that is great. He is happy to get a reduced power price by installing solar panels; he has already made that contribution.

Another interesting line is that there is always talk about people who do not have solar paying for the people with solar getting cheaper power. What is forgotten many times in that debate is that people do have to put in the funding in the initial stages, and with the 44¢ rebate that came in initially it could have been $20,000 for a five kilowatt system and obviously more for a bigger system.

So, there have been big expenditures made by people installing solar power, but I do understand the argument, to a degree, that people without solar are helping pay for it. I must say that it should, in my mind, remove the need to switch off either areas of the city or the country when we do have that peaking power demand South Australia is so famous for. With those few remarks, I commend the bill to the house and also show my support for it.

Mr WHETSTONE (Chaffey) (12:09): I, too, rise today to support the bill introduced by the Minister for Energy in September this year. South Australia has been a lead legislator for the National Energy Retail Law and National Electricity Law, and I am pleased to be able to support the bill which represents an initial step for the eventual widespread introduction of the use of smart meters and related technologies. It is a welcome relief to finally see the state Labor government doing something about this issue because after 12 years in government it has failed to take any action to implement smart meters, despite the widely recognised benefits of the technology.

At the moment, as some of my colleagues have already said, 99 per cent of households and businesses using electricity in South Australia are using the old bakelite accumulation meter. This type of meter measures overall usage. It is largely dated technology and it puts extensive burdens on the cost of having those meters read.

In the electorate of Chaffey there are a lot of particularly small irrigators; there are a lot of medium-size irrigators and there are some large irrigators. Over time I have watched the meter reader, come down the track through the property in order to access and read the meters on my properties—particularly on the river. Even if it is only 100 metres or 500 metres away—or in some cases a bit further—that meter reader has to go back out onto the main road and then enter the next property, and it takes considerable time for them to get down there to read the meter. That is at a significant cost to retailers and that cost is obviously passed on down the line. Physically visiting the properties to read meters also gives very little visibility of usage and, quite simply, the old meters cannot be used to manage the demand.

Smart meters will make life dramatically easier for electricity providers and consumers. The meters will digitally monitor the usage at about 30-minute intervals and provide more detailed, accurate and up-to-date data for retailers and consumers. Really, that is what it is about today: it is about having the edge or being able to find efficiencies within power usage.

The people of Chaffey have been significantly impacted by drought and water was one of the big issues for a number of years. However, gradually now with the rising cost of power—with high demand in hotter times, when everyone wants their air conditioning on and everyone is using power at a premium—we are having significant issues with brownouts, as the member for Waite has said and, in some cases, we have lines that are switched off when we have significant overload, I guess you would call it, on that particular line.

There are a lot of issues around smart meters, but it is like looking at the older technology of a Badger water meter. If we look at today's technology and what we are trying to achieve, we are now seeing the mag meters that are being introduced to measure water consumption. I think that reflects looking at smart meters and being able to remotely observe what is happening with power prices—it is a little bit like the mag meters. In today's world, an irrigator does not have to trudge down to their pump shed to look at their water meter. Nowadays, an irrigator sits in their office and can read what their power usage is and what their water usage is.

Many of today's technologies—and I will reflect again on the mag meters—can tell the irrigator if they have a burst main or if they are using excessive amounts of water because that will come up with an alarm. It is much like the smart meter, using that technology and monitoring to enable us to knock off the inaccuracies or other issues.

Along the way, in my experience of pumping quite significant amounts water, a service has come out of Victoria called UtiliCor. It is now in South Australia under the name Progressive Green. That service is offered to potentially larger pumpers, larger irrigators, who are using quite significant amounts of power. To put that into context, I have irrigators who in some instances are using in excess of $3 million worth of power each year. A medium irrigator uses potentially between $150,000 to $250,000 worth of power a year to pump water. Of course, we have smaller irrigators, from very small properties and with less power consumption, up to average irrigators, who would be using around $50,000 to $80,000 worth of power a year.

It shows the significant rise in the cost of power, the significant technology they are using nowadays, and to become competitive and water efficient we are now using more drip irrigation, more monitoring and more technology for when we actually water plants. It is of course when we have usage in the middle of the day—high demand is normally around heat. The technology is about watering a plant when it needs to be watered, so when they are using the high amount of power, when everyone else wants to keep cool in offices, when everyone else wants to maintain a lifestyle and keep comfortable, that conflicts with what irrigators are using when it comes to watering their crops.

Again, the retailers can introduce the voluntary time-sensitive pricing, but Progressive Green is giving a service to notify irrigators of when they see spikes coming in the prices of power. I have had my own experience, but I have irrigators who come to me and tell me that about 2¢ to 7¢ a kilowatt hour is a buy-in price. A lot of irrigators nowadays are not signing contracts but playing the market. This Progressive Green monitoring service normally gives them about a 24-hour notice of price spikes, because again it can vary from 2¢ to 7¢ a kilowatt hour, and in some cases irrigators are paying up to $10 a kilowatt hour.

If you look at the comparison between the 2¢ to 7¢ up to $10 (which does not happen very often), they are some of the impacts. With technology, watering plants when they need to be watered in the middle of the day, this service tells them that there is a spike on its way and allows them to make a decision. It allows them to say, 'I'm not prepared to keep my pump going and paying exorbitant prices for power.' It gives them the option to be well informed and the option to install a diesel, and when the price of power is out of the realm of reality they can turn off their electric motors and start up their diesel pumps. It gives them an opportunity.

The smart meters can be monitored and have that service to allow them the option to turn off or turn on. That is something that has to be a part of today's world to keep us price competitive because, again, I hear too often from my constituents who have irrigation properties in South Australia and in Victoria, and they look at the price of power and the options they have in Victoria versus South Australia—because that is what they do—and Victoria is running rings around what we are provided with here in South Australia.

It is of real concern that we have to deal with old technology, but it is great to see that finally we have the government on board to look at smart meters. Also, these smart meters being fitted with the remote monitoring devices means that not only does it help drive down the price of power on your overall bill but also allows you to know that potentially you are entering a peak demand phase, and you can make informed decisions on exactly how you will address that.

Moving on from there, I guess what I am trying to really get across here is that, potentially for my constituents, we have to be competitive. We have to embrace these efficiency gains so that we can actually grow a product and be competitive with our neighbours in Victoria because, essentially, we are all going into those domestic markets, and the price of power now is having a significant impact on the bottom line of a grower's business.

Whether we are going into a domestic market or whether we are going into these ever-emerging export markets, we have to be able to drive efficiencies. Whether they are efficiencies within our own business, in managing the business, or whether it is being informed to know exactly when the peak price of power is coming at us, we need to know that so that we can actually make good, informed decisions, and that is where I think the smart meters really are going to play a significant part.

This current Labor government has been out of touch with the ever-increasing cost of living and the pressures that all South Australians are facing as a result of the electricity prices. I have heard a number of significant players—irrigators and water businesses—in my electorate saying that, once we get the basin plan in place and once we actually get to look at some reform around water, the next big issue will be the price of power.

The smart meter is a way in which we can initially address the price of power and be informed on the high use of power. As I said, for big irrigators using in excess of $3 million of power a year, every smaller increase in the cost of power is a huge drag on their bottom line. Of course, those medium irrigators are now being severely impacted on. Most of the medium irrigators are, I would say, large family farms, so that is playing on their bottom line. Whether or not the cost of power takes the edge off their bottom line, it is having a significant impact.

Just as important are the small irrigators—the family farmers—who are there working away, trying to drive efficiencies and trying to be cost competitive in a very competitive marketplace. They need to have those options as well, so the smart meter is something that needs to be addressed. With the cost of living pressures and the cost of running a small business, we need to have efficiency gains, and I think the smart meters will do that.

In closing, I must note that I was sitting here in this chamber, and I noticed that the member for Waite asked minister Koutsantonis (Minister for Energy) a question about the price of power. The minister said that the actual price of power had decreased by 9 to 18 per cent. Sadly, he had to be corrected by the Essential Services Commission, which pointed out that the average household market offers price had increased by $64 since 31 January. It really is something that the minister has been slow to act on, and for him to say that the price of power had actually decreased shows that he is not across what the real world is experiencing. With that contribution, I support the bill and commend it to the house.

Mr VENNING (Schubert) (12:23): Having only nine days left, I will take every opportunity to raise matters like this. I rise to support this bill and appreciate it will have support from both sides of the house. I also note that we, as lead legislators on this issue, have been asked by the standing council of ministers to bring this in here, so that is the reason for our joint support. I commend the member for Waite (the shadow minister) on his very good presentation this morning and for outlining our position very clearly and strongly. We certainly await the minister's response, for whom I have some respect, as to how he will get himself out of this.

The Hon. A. Koutsantonis interjecting:

Mr VENNING: I'm sure I'll get paid out for that one. I have always been a very strong supporter of the issues in relation to this, particularly the technology that we are using to meter our power, the device the sets out the bills and how much we are going to pay, commonly known as accumulation meters. I very much support the changes because the current meters cannot be used to manage the demand. I have been looking at this for many years. We, as a family, have installed a large solar array system and it is interesting to note the power usage when you get your bills. We do not really have control and we do not know what is happening as it goes through. Even though we have the large solar array, I would still welcome the capacity to have that smart meter.

The old meters are what we call dumb meters. I cannot understand how they are still rolling them out. We should not be making old technology available to people. But, as the minister will tell you, we should not force anybody to have them; I can read his mind. We are not going to make it mandatory, but I am sure that once people live with them they will see it is worth the few dollars they will cost. The current meters are inefficient and they do not provide consumers with any information, that is why when they get these bills they are quite shocked. Smart meters provide real-time use of electricity.

We support the installation of smart meters, as the member for Waite has said, which pick up very clearly the rapid peaks in demand which have caused the high increase in our power prices. This came home to me when I inspected the diesel generator set at Angaston: 12 massive diesel generators that are only switched on on peak days—I think it is 1,000 per cent extra when they start those motors up. They only have to run for a few hours a year to pay for themselves. They are privately run and they come on on peak demand and, as I said, it is hugely expensive when they do. Peak power, this is when the big bills come in: 12 massive generators with a huge thirst, so much so that when they are using them there is a fuel tanker outside all the time filling up the tanks—they have not done all that many hours.

We need to level out the highs and the lows of our electricity consumption. When it is cheap we ought to be encouraged to plug in, anything we can use electricity-wise when there is the low tariff, anything that you can hold off or carryover to a peak day. Many farmers have generators on their farms and there are generators all over the city, particularly in our hospitals and other public utilities. I have said in this house for many years that it is sad to know that these generators are not utilised, only for the sake of emergencies. Why can't they be used on peak power demand days, as long as it does not put the hospital at any risk, and I do not believe it would or should? It is also good for those generators to get a run. They have to run them for an hour or two a year just to make sure that they are in serviceable condition so why not put them to active use and bring them onstream on those high days, again through a smart meter system?

It is the same thing with farmers: as well as the solar cells, we do have them at home. On very hot nights we are a part of the problem, part of the peak power cost crisis, when the solar cells are not working and we are drawing peak power. With a smart meter we would turn on our diesel generator, if we had one—we do not have one yet, but we would be encouraged, if we had a smart meter, to fit one because it would not take you very long to pay for it if you were on a high demand at peak power. A smart meter would make it smart to switch off the grid and go for an alternative. If you could take the peaks off that it would certainly benefit you in the pocket.

Smart meter technology too, as I think the member for Chaffey said, is changing. Just having returned from China, you would be amazed at the technology that is coming out through the mobile phones now. As we have just heard, a lot of the technology within the smart meters is the same technology as within telephones, so it makes monitoring the smart meter very easy indeed. Not only do you have a monitoring panel in your home and you know, by looking at it, what sort of peak range you are in, whether you are in the maximum range and you should be doing something about it, even a quiet warning device telling you that you have just moved into the peak power range, or if you are at work your phone will do the same thing. In fact, technology is such that you can control the smart meter with your telephone.

Things are certainly moving quickly and this bill should have been before the house, as the member for Waite said, three or four years ago. In terms of the cost demand, it is very important that we give people these opportunities. Also, smart meters will be able to be controlled from any other device. We have appreciated the monthly billing cycles in this bill but, as the member said, I think that is an option people can take depending on how their finances stack up and we have made that an open-ended policy.

We came out with this policy two weeks ago and I have just read it, because I was not here. I have it here in front of me. I am very impressed with the presentation and I again commend the shadow minister for that. I just ask the premier-elect, the minister, when he stands up to espouse to us what the policy is. Certainly he is looking pretty good at the moment, because everybody else is falling away, but he stands there strong and resolute and he will push the policy.

We support this bill. We are asked and told to introduce this, as I said earlier, as the nation's head legislator by a direction of the standing council. At this point in time, most unusually, I have to declare an interest in this matter: my son is in the senior management of SA Power Networks. He has not been for very long and, can I say, he certainly enjoys his job. I am very impressed by what I have learned from him talking about what he does at work. Looking at their management processes, I am very impressed by the dynamism and the professionalism of their young people. I am very pleased about that.

I certainly support scrapping the residential efficiency scheme. It will reduce costs to all families. It really is a mickey mouse attempt. I was here in the house when it was brought in and I joined in and did what I could, but I thought at the time that it was a very soft way of addressing a serious problem. We support this, so I will now—because I think I am the last speaker—ask the minister: what is the government policy? We have made our policy quite clear. We support the smart meters but we will not force that on anybody and it will be completely voluntary. It is a great move but it is coming far too late.

Mr PEGLER (Mount Gambier) (12:32): I rise to support this smart meters bill particularly because it is a voluntary initiative. I think it is a great initiative to perhaps help those many struggling families and businesses out there that are now paying exorbitant costs in electricity prices. These prices have gone up mainly because of the carbon tax and the solar feed-in tariff scheme etc., and of course the electricity companies are making a lot of money. We did once own those companies and unfortunately they were sold by previous governments. If you have a look at today, if we still owned those companies, this state would be in a much better financial position.

The smart meters and monthly bills, I think, are a great initiative, in that people will be able to see what their consumption of power is at different times and how much power is consumed by different things they have within their households and within their businesses. They will be able to monitor their power in a much better way. Monthly billing, particularly, is there all the time whereas at the moment with three-monthly billing, people can be using power over that three months and probably not find up for about four months that all of a sudden they have this massive bill because they were going through a heap more power than they realised.

It will also have a benefit to the power companies themselves in that they will be able to take out a lot of those spikes in consumption because consumers will be using power in a much better way so that their consumption will be much more in line with the production from the power companies.

The one problem I do have with this bill, though, is that I do not think it is going to help many of those poor families out there who are struggling very much to pay their electricity bills now and particularly those people living in rental accommodation. They will not have the capital to put in these smart meters, and often the landlords will not be putting them in either, so those people will not be the beneficiaries of this, and they are probably the ones that are struggling the most.

I certainly support the bill, but I think we should be looking in a much better way at how we can help those families that are struggling to pay the exorbitant electricity bills that they currently have. Thank you.

The Hon. R.B. SUCH (Fisher) (12:35): I support this bill. I think it is appropriate that the smart meter provisions are not mandatory, as has happened in Victoria, with a significant downside to the practice there. What we need, probably more than smart meters, is a smart electricity system. Currently, I believe consumers in South Australia are being gouged, ripped off (whatever phrase you want to use), because in effect we have what are close to monopolies running the system. I know the minister has tried to bring about some changes, which could result in lower electricity prices, and I would urge him to keep doing that, but currently we are paying a lot more for electricity than we should.

We have had cheaper electricity offered through some of the off-peak tariffs. I think the member for Chaffey talked about the irrigators. We have the night-time off-peak, which has traditionally been for people who had an electric hot water service, usually in their roof. There is no reason why that type of concept could not be extended to other times during the week; weekends in particular.

There has been criticism that the system has had a lot of so-called gold plating, over-engineered distribution. Members may have seen Four Corners last night, which focused on the cause of many bushfires as being the inadequately maintained electricity infrastructure. I think we have to be careful about advocating for substandard maintenance or old equipment. New equipment should be installed so that not only do you reduce the risk of bushfires but you also get greater efficiency in transmission.

As the member for Mount Gambier has pointed out, this measure (smart meters) may not help everyone in the community. There will be people who are often living in tight circumstances, renting and so on, who may not get any benefit out of this opportunity, and they are the people who need the greatest help.

I support this bill. I think it is a good initiative, but I renew my call for the minister to push vigorously to get greater reforms into the whole network so that the current high prices for electricity can be lowered over time.

We have noticed that in Australia there has been a reduction in the consumption of electricity in recent years, but we still do not have a system which delivers electricity at prices that it should. We have some of the highest electricity prices in the world. I think that is the issue that should be addressed in a smart way, to make sure we have generation capacity, appropriate distribution networks, and that electricity is sold at a price which is realistic and fair, and not the current system that makes life very difficult for a lot of people.

Mr BROCK (Frome) (12:39): I also rise to speak on this bill. I certainly will be supporting the bill, as it applies in a voluntary manner. It has been very evident from speakers on this side of the house, including my fellow Independent colleagues on my left-hand side, that this is going to assist some people to manage—and I say 'only manage'—their expenditure on the cost of power. We must remember, Mr Deputy Speaker, that the cost of power will still be, over a period of time, the same unless these people start to use power in times of best opportunity.

I will just relate my own personal experience. Like many on this side of the house, we have solar panels, so we are able to manage our power costs. My partner has a hairdressing salon and she has a habit of always leaving power points on when they are not being utilised. My office gives kits to residents to be able to manage how much power is being utilised when power points are on. I think that is one of the biggest issues we have. We have power coming from power points and, if you have double adapters connected, you are still using standby power. I think that is what we have to get through to our residents.

The member for Chaffey has already indicated that he has citrus growers pumping water, etc. The electorate of Frome is no different; we have grape growers in the Clare Valley. The biggest challenge we have is not only the cost of electricity, but also the exorbitant cost of water in the electorate of Frome because we have industrial users. Whilst this is a separate subject, the cost of water is another area we need to look at, because our local councils are finding it very hard to manage the cost of not only their electricity but also their water.

I think the member for Schubert mentioned that the current technology is certainly outdated; it has been there for many years. With the exception of a couple of power suppliers just recently supplying bills on a monthly basis, you usually get them every three or four months. By that time you have already used the power and whether or not it has been efficiently used, you still have to pay that bill.

Even though these smart meters are voluntary, I will certainly be promoting them once this bill gets through and the system comes into place. I will be encouraging my constituents to look at that opportunity and try to prove that this is a way of being able to use power at the most opportune time. Whether it is a freezer, a washing machine, or whatever it may be, people should manage and utilise their appliances at the best opportunity.

The member for Fisher has also indicated that the use of power across South Australia has reduced dramatically, but the cost itself has continued to rise, and that is a big issue in this state. The biggest thing this state ever did was to sell some of our essential services, and the Electricity Trust was one of those. We are never going to get them back. Unfortunately, the grain facility is going the same way. We are now getting away from co-ops and we are having monopolies. We have deregulated power in South Australia. Power suppliers in South Australia, as I understand, have been deregulated, so there is plenty of opportunity there. I encourage my constituents to look at every opportunity.

In Port Pirie, for argument's sake, we have 13 power suppliers that we are able to utilise. I encourage my constituents to use those suppliers and put them against each other to get the best price, but I will also be pushing very strongly for these smart meters. However, regarding the cost of power—and I am looking to the minister again—I think that the federal side is not deregulated. There is no deregulation, so again there is a monopoly there.

Consumers certainly need to know now how much power they are using on a daily basis and when is the best time to use it, and certainly not get a bill in three or four months' time. I will be supporting this bill, but I think this state needs to actually look at new ways to assess people in need, whether it is industries, but certainly pensioners in particular, people on fixed incomes, because they are really struggling at the moment. I think that is an issue that both sides of the house here needs to take into consideration. We need to work cooperatively to ensure that we get the best costs and systems for those less fortunate people out there and also to encourage more industries to come here.

As the member for Mount Gambier has indicated, this is not going to help everybody. However, I will certainly be supporting this bill. I will be encouraging my constituents to look at smart meters, pointing out the benefits that could be available to them. Once this happens, I will be one of the first to install a smart meter at my house to show people how it can be done. However, again, we need to look at ways of reducing the cost of power full stop. I commend the bill to the house.

The Hon. A. KOUTSANTONIS (West Torrens—Minister for Transport and Infrastructure, Minister for Mineral Resources and Energy, Minister for Housing and Urban Development) (12:44): First of all, I thank members who have made contributions to this bill. I think this is an important reform that the Standing Council on Energy and Resources ministers were reluctant to pursue. The reason they were reluctant to pursue it was the experience in Victoria. I think it is fair to say that smart meters are a controversial topic. I listened with intent to the shadow minister for energy's contribution when he lamented 30,000 metres per year being changed and them not being rolled out to new smart meters.

This policy will allow people to maintain their old meters. I assume what he was saying in his remarks is that, if he were the minister for energy, he would compel people to put a smart meter in their homes if they were changing their meter or building a new development. That is very different from the policy that he released. I welcome that he has released a policy on energy. I think that is a good thing and we will have more to say about that policy very soon, and then I will thank him personally.

I think it is fair to say that when a government gets criticised for introducing notice of a bill before your opponents release a policy asking you to do exactly what it is you have put in the bill, it is really a compliment. Fancy being criticised for not having done this sooner. I have looked back at the member for Waite's remarks before he released his policy calling on me to bring in smart meters and I found no evidence of it at all. When the government deregulated electricity pricing in this state, the first thing that the opposition said was that we should have done it sooner. So, I went and checked and, of course, there were no calls for us to deregulate before we did it. Now it is the same.

I also note that we have submitted rule changes on behalf of the standing council. Officials have submitted a rule change request to the AEMC, which seeks to implement a competitive rollout of smart meters—retailers, distributors or registered third parties. That is why I am doing this. That is why I said I was doing this. So, it is disingenuous in the extreme for members opposite to say that we have no policy when we have a bill before the parliament. Who is going to take you seriously when you say that? We are actually here voting on a bill to take away my powers to roll out smart meters so that we can have a competitive market on smart meters, and he says, 'Where is your policy on it?' We are about to vote on it. How much clearer can we be?

Mr Hamilton-Smith: Policy, you galah! How are you going to roll them out? Is it going to be retailers or SA Power Networks?

The DEPUTY SPEAKER: Order! The minister has the call.

The Hon. A. KOUTSANTONIS: I sat and listened quietly to the member for Waite but, of course, given his short temper, he is unable to do the same for others. He is about to go bright red, which is—

Mr Hamilton-Smith interjecting:

The Hon. A. KOUTSANTONIS: Here it comes. Pink first and then red. As I said earlier, we have already submitted the rule change to allow third parties—SA Power Networks or distributors—to roll out a competitive rollout of smart meters. As soon as I say that he asks, 'Well, what's your policy?' What, other than a competitive rollout? Other than removing my ability to mandate smart meters and create a market, what is your policy? Is that seriously your argument? If it is, I do not think you understand the market, because no-one is going to set up a business selling smart meters while I have the power to intervene and compel everyone else to use another smart meter, hence the bill you are voting on. But, again, I suppose this is all a bit too much for the shadow minister. I am glad that he is so supportive of our policy that he is going to support the bill through its entire stages, and I look forward to it passing in the upper house.

I will say that the SCER has worked very cooperatively on this, and former minister Martin Ferguson deserves a lot of the credit for this. There was a lot of opposition, especially from the Victorian government. Their position was one that was based, quite frankly, on good science. Their view was that smart meters had been rolled out compulsorily in Victoria and that was a bad thing, and I agree with Michael O'Brien, the now Treasurer of Victoria. I think that was a mistake. I understand it continues to roll out like that in Victoria, and I think that is a mistake. They are moving to a voluntary system, which I think would be a good thing, because the worst part about the rollout of smart meters in Victoria is that a very good technology has been completely turned on by commentators and by people who do not necessarily understand the impacts smart meters can have.

I will say this, though: smart meters are not the solution; they are just part of the puzzle. Smart meters also have extra costs that the current so-called 'dumb meters' do not. Do not forget that there will be a communications package to go with all these smart meters, so while the costs may be relatively cheap, there will still be the required SIM and communications package, which could exceed the costs of the collection of data from the accumulation meters. I would not necessarily say that the opposition's policy will actually reduce the cost of collection of data. It will certainly give people more information and give them more ability to control their use and know what they are doing, but it does not necessarily mean it will be cheaper. That is the mix we have to get right.

As I have said, I do not want to see a mandatory rollout of these meters. I do not want to see people who want to maintain their accumulation meters being forced to take smart meters, unlike the shadow minister in his remarks being so disappointed that there were 30,000 of these accumulation meters being rolled out in new developments per year. I am not going to tell a single developer that he needs to roll out smart meters, but what I am going to do is create a competitive market where people can choose and give the consumer a choice.

I am not going to mandate anyone to do anything on this matter, and in fact, just recently, people who have introduced smart meters into their homes in the trial have asked to go back to the accumulation meters, and I have signed exemptions allowing them to do so. I do not agree with the shadow minister on that and I think it is important that we give consumers choice.

I am concerned about some regional areas where there is not the ability to have communications. There are some rural and remote communities where there is no mobile service coverage where there is on-grid power. That will be a very big concern. We have to work out exactly how we do that, whether we have a rollout of a hard-wired connection to some sort of facility a bit further up where there is mobile service coverage. That could be very expensive.

Obviously, we will have to do some work, and I will flag to the department that we need to do some work about that, because we do not want to have regional consumers who want to take up smart meters not being able to simply because they do not have mobile phone coverage where their meter boxes are. So, we have to work out a way, whether we can use a static landline or some other—

Mr Whetstone interjecting:

The Hon. A. KOUTSANTONIS: Or satellite, of course, but we have to make sure that the cost of that communications package does not exceed any benefit you get from the rollout of smart meters. What we also do not want people who want to maintain their old accumulation meters being disadvantaged and basically sent to a point where you must switch because it becomes so cost prohibitive to remain on an accumulation meter and you have to roll out and spend the $100 to $200 to buy a new meter. I think it is very important that we get the mix right.

Despite all the politics of what the shadow minister was trying to introduce here, saying 'Too little, too late,' despite never having called for it before, and despite him putting it in his policy well after I had tabled it in the parliament—and I also note his performance on FIVEaa in regard to trying to sell this, and I encourage all members to read the transcript. It is one of his finest performances, I think. I think it is a true representation of his political skills, right there on display on FIVEaa. It was a really impressive piece of transcript. I thought it was very impressive the way he was able to be comprehensively clean-bowled by Leon Byner.

Electricity is a very controversial subject and the SCER process is a very difficult one because there are entrenched biases within the SCER process. Those biases are from our Eastern States colleagues (whether they be Labor or Liberal) and the government-owned assets of Queensland and New South Wales. They protect their consumer advantage very well and that consumer advantage is to profit from other consumers and maintain the profitability of their own assets. They use regulations and the national electricity law to their advantage to benefit their own taxpayers.

It was very difficult to get this reform through the SCER because there was a lot of opposition, as indeed there was with the other bill coming up concerning the Limited Merits Review, which was not supported by a majority of the conservative states until last-minute lobbying convinced them otherwise. When we get to that bill I want to thank the personal efforts of the new Minister for Energy in Victoria, the Hon. Nicholas Kotsiras, who is a very close friend of mine and a very good minister. He is someone who has replaced a very competent minister—they are big shoes to fill—Michael O'Brien.

Michael O'Brien knows his stuff and is a rising star within the Napthine government. He is someone who will probably lead the Liberal Party in Victoria one day and he had some very strong views on the national electricity market, the role of the Australian Energy Regulator, the way a national competition should work, and about where the AER should be located. He is someone who I definitely listen to and take a lot of advice from.

I encourage the shadow minister to go over and meet Michael O'Brien if he has not done so already—and I am sure he has. He can probably teach the opposition a thing or two about how to operate in a deregulated market, which is probably a new world for them. I am not quite sure how they respond to market-driven policies given that they are all agrarian socialists, so I look forward to them entering the 21st century.

I also note the way that the shadow minister mocked people who had concerns about the health impacts of smart meters. I do not believe there are health impacts arising from smart meters but I am not going to mock people who think there are. I think people's diverse views on these issues should be respected rather than laughed at and ridiculed within parliament.

I also note with interest the work that Leon Byner has done on FIVEaa to promote some of the alternative views on these issues, and I think those views should be considered and listened to, and not mocked in the way the shadow minister has. With those few remarks, I thank my staff for the work that they have done and I commend the bill to the house.

Bill read a second time.

Third Reading

The Hon. A. KOUTSANTONIS (West Torrens—Minister for Transport and Infrastructure, Minister for Mineral Resources and Energy, Minister for Housing and Urban Development) (12:58): I move:

That this bill be now read a third time.

Mr HAMILTON-SMITH (Waite) (12:58): I am going to use the next two minutes to just clarify something with the minister.

The Hon. A. Koutsantonis interjecting:

Mr HAMILTON-SMITH: We will see. The minister again repeated in his remarks that, in regard to the Limited Merits Review, Coalition ministers had opposed the measure. Is that still his view? Minister? Right, well the minister accused me on radio this morning of having made dishonest comments. I foreshadow to him now that I take offence at those remarks and that unless there is an apology made within 48 hours, he will be hearing from me more formally.

I have contacted each of the Coalition ministers since his comments this morning to ascertain their position, and I suggest he does the same, particularly in regard to Victoria. The Victorian government advocated for the changes and the regulatory regime to get better outcomes for consumers and was 'a leader in pushing for the changes'.

The same has been said by minister Macfarlane's office, minister Chris Hartcher's office, minister Nicholas Kotsiras' office in Victoria, and in minister McArdle's comments. I believe the comments made by the minister this morning that the Limited Merits Review was opposed by the Coalition states are untruthful. I suggest he checks it. They all voted for it unanimously. There was a consensus view. They believe they have advocated for it.

I can tell him that I take considerable offence at his assertion that my saying that they supported these measures was dishonest. You have 48 hours. I suggest you consider an apology. I think 891 would be the appropriate place to make it, because that is where you made that statement. It is actionable. Minister, you just have to stop it. You just have to say things that are true, stop abusing people, make points that are—

The Hon. A. KOUTSANTONIS: Point of order, sir. The member has accused me of being dishonest. I say: do it through a substantive motion or withdraw.

The DEPUTY SPEAKER: Can the member withdraw the comment about being dishonest?

Mr HAMILTON-SMITH: Certainly. I am more than happy to withdraw any offence, and I suggest the minister does the same on 891 radio. You cannot assert that Coalition ministers opposed a reform measure when they have all told me this morning that they supported it and they voted for it, and then make an actionable statement that I have said something dishonest by asserting that they supported these changes. The facts are that they did.

You are wrong factually. I suggest you check your facts. Ring the ministers on the SCER. You have got it wrong. I would ask you to do the decent thing and withdraw those remarks. You raced into it this morning, you raced out of a breakfast and you did it again—you led with your chin. You are wrong. You had better clarify it and do the right thing. I always try to do so, and I suggest you do as well. It is in the interests of public debate to do so.

The Hon. A. KOUTSANTONIS: First and foremost, if I have caused the member any offence, I apologise. Secondly—

Mr Hamilton-Smith interjecting:

The Hon. A. KOUTSANTONIS: I'm doing it in the parliament. Secondly, I lobbied intensely to change the minds of members on that SCER, so it is dishonest to say that I did not attempt to get this Limited Merits Review up. Indeed—

Mr Hamilton-Smith interjecting:

The Hon. A. KOUTSANTONIS: Yes, you did say that. Indeed—

Mr HAMILTON-SMITH: Point of order, Mr Speaker. I made no such assertion. I am sure the minister worked very hard on that. But, then, again, he has just repeated the offence. I just ask you to withdraw it. There is no need to make these sorts of assertions, minister. You made statements on 891 and I suggest you withdraw them on 891.

Bill read a third time and passed.


[Sitting suspended from 13:02 to 14:00]


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