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House of Assembly - Fifty-Third Parliament, First Session (53-1)
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Bills

Pastoral Land Management and Conservation (Renewable Energy) Amendment Bill

Committee Stage

In committee.

(Continued from 18 September 2014.)

Clause 10.

Mr VAN HOLST PELLEKAAN: I refer to clause 10, division 4, 49A under 'Interpretation'. I will recommence with this section if that is okay. In this division, examples of 'access agreement' are given in sections 49A(a) and 49A(b). Section 49A(a) is pretty straightforward and relates to an agreement, essentially, between an applicant and a pastoral lessee for access to the land so they can use it for potential development. However, I have a query about section 49A(b).

I understand exactly what section 49A(a) is saying; namely, 'access agreement' means if a resources tenement is held over the land—an agreement between an applicant for a wind farm licence in relation to the land and the holder of the resources tenement for access to the land, or infrastructure on the land, by the resources tenement holder during construction and operation of the wind farm. That is pretty straightforward.

What I am looking to clarify are the two paragraphs (a) and (b), and as I read it they are separate examples of what could happen. Paragraph (b) does not include the pastoral lessee anywhere. So, is there an implication that if there is a resources tenement held over the land no agreement needs to be reached with the pastoral lessee?

The Hon. S.E. CLOSE: I am advised that although the two are articulated independently I presume what you are looking for is that there is someone who holds a pastoral lease and then sitting on top of part, or all of that land, there is a mineral resources leaseholder and then a wind farm wants to go in on top, then paragraph (b) refers to how they would manage the relationship with the holder of the minerals resources licence, but paragraph (a) still refers to the relationship with the landholder. In that instance, both would be in use rather than paragraph (b) superseding paragraph (a) and making paragraph (a) redundant.

Mr VAN HOLST PELLEKAAN: Just for clarification, the pastoral lessee will always be part of the negotiations, part of the agreement and part of the equation. I understand that, of course, these things can only happen on pastoral land, but it says that each of the following are access agreements: one includes the pastoral lessee and one does not.

The Hon. S.E. CLOSE: In that instance there would be two land-access agreements: one with the pastoral lessee and one with any tenement holder.

Mr VAN HOLST PELLEKAAN: Moving down the page but still under 'Interpretation', I refer to a 'prescribed interested party'. I am fully supportive of native title holders and people with gender and cultural attachment to the land being recognised under this bill. Paragraph (d) states:

if there is no native title declaration for the land—all persons who hold, or may hold, native title in the land;

My question is really about the 'or may hold' part. What has the government done with regard to trying to identify the potential scope, or the potential number of people, or even how would you really get to the bottom of whether a group falls into that category of 'may hold' native title?

The Hon. S.E. CLOSE: The bill allows for prescribed interested parties to include all persons who hold or may hold native title in the land. This means that it is open for registered claimants to request payment. Payments will be made on an equitable basis, and it would need to be established as to where the persons who have not yet established a legal interest in the land have an equitable interest in the fund. I am advised that this gives the responsibility to the minister to make a determination about someone who is not even a registered applicant. You can understand that people have already had the determination, the people who are registered applicants, but with this other group the minister would have to make a determination about whether there was a fair interest in that fund.

Mr VAN HOLST PELLEKAAN: The people who may hold the interest, in the main, would be the people who have registered an interest, but there has not been a determination, so that is broadly the people we are looking at. Then there is another small group, there may be another category of people, who have not even registered an interest yet, and then the minister would have full discretion as to whether he included them or not?

The Hon. S.E. CLOSE: That is absolutely my advice, yes.

Mr VAN HOLST PELLEKAAN: With regard to the small footnote 1 (and I apologise that I am not fully across the Native Title Act), I am sure it covers the people who may hold native title by virtue of the fact that they have registered an interest. Does it also cover the people who have not yet registered an interest? I suspect it will not, and if it does not is there any obligation to seek out those people or is it up to those people to try to be on their game and be aware that there is something going on in this pastoral lease with regard to renewable energy and, if they want to, they come forward?

The Hon. S.E. CLOSE: The Crown Solicitor's Office deals with the processing of native title claimants and would be the source of information for the minister in this instance to know who might have an interest without yet being a registered claimant. I do not have the particulars on the interaction with the Native Title Act; I am happy to seek further advice for you, but I cannot give you an answer this morning.

Mr VAN HOLST PELLEKAAN: Can I just ask a more general question: is it the intention of the Minister for Environment to seek people out, or is it the intention of the minister to let themselves be responsible for coming forward under these circumstances?

The Hon. S.E. CLOSE: Without wishing to speak explicitly and definitively on behalf of the minister in the other place, it is my expectation that he would expect people to make themselves known, rather than engaging in any process to find people.

Mr VAN HOLST PELLEKAAN: I just want to make a very brief comment with regard to new section 49B, and I thank the minister and his staff for significant improvements, in my opinion, that were made to 49B over the course of our negotiations over the last several months. I think all people involved are being treated very fairly by the final outcome and I am grateful that the minister saw fit to make those changes.

The Hon. S.E. CLOSE: I thank you for that.

Mr VAN HOLST PELLEKAAN: I now refer to 49E—Rights under licence. I am just looking at new subsection (1) right now:

(1) A wind farm licence may grant such rights as the Minister considers necessary for the proper functioning of the wind farm to which the licence relates and may include the right to exclude the lessee or any other person from infrastructure associated with the wind farm…

That is quite sensible, and pastoralists and Aboriginal people with an interest should certainly accept the fact that they need to stay away from key infrastructure and that sort of thing. What I would really like to know though, with regard to that, is: is it just specifically the physical infrastructure? Are there any guidelines with regard to buffer zones, or any information at all that you can provide, minister, that gives a guideline to pastoralists about how that might be implemented?

The Hon. S.E. CLOSE: My advice is that any 'buffer', as it may be called (that is, anything that exists outside the physical infrastructure itself) would be fenced, so that there would not be an expectation of any buffer that is not fenced. So, a substation would be enclosed within a fence and the fence would form the boundary. A shed would be locked and would not require fencing, but any other area that required no access would have to have a fence around it.

Mr VAN HOLST PELLEKAAN: Are there guidelines specifically with regard to the wind towers and the turbines? Is there a standard distance? I imagine that there should be a buffer zone around the base of the tower; is that the case?

The Hon. S.E. CLOSE: No; in fact, you can go right up and touch the bottom of a tower. You can farm all the way up on the freehold land, and we expect that to be the same for the lessees.

Mr VAN HOLST PELLEKAAN: That is great; I did not expect that, so that is terrific. Will consideration be given to pastoralists for pre-existing use of airspace? As you probably know, most pastoralists use light aircraft of one sort or another for mustering. I am not talking about people who want to take a joy flight around and have a look and get close, or anything silly like that, but there are sections of pastoral land where they have historically used the airspace for their pastoral activities. Will consideration of that pre-existing use be taken into consideration when negotiating these buffer zones?

The Hon. S.E. CLOSE: Yes, of course, the buffer zone that I referred to being fenced is a ground buffer zone and naturally aerial activity would be affected by the actions of wind farms. In the land access agreement the sensitive use that would need to be negotiated would include, and would probably largely comprise, the necessity to have access to the air space for that kind of activity, so our expectation would be that that would be negotiated through the land access agreement, taking into account the leaseholder's need to have access.

Mr VAN HOLST PELLEKAAN: With regard to new section 49F—Minister to fix terms and conditions, I would like to know whether the terms and conditions that are negotiated by the minister on behalf of the public essentially (with the pastoralists, Aboriginal people and resources tenement holders being the key interested public) include a requirement that the wind farm stays operational?

The Hon. S.E. CLOSE: Specifically with your question about whether that would be part of the terms and conditions, no, it is not anticipated to be, but I think this takes us back to where we were a couple of weeks ago when we were discussing what happens if the company stops functioning and needs to have the material removed or sold on, and our expectation is that that is what would happen. The infrastructure is very expensive and therefore needs to be producing income, so our expectation is that, if one company, for whatever reason, was unable to maintain the operations, it would be sold and there would not be an expectation that there would be idle wind farms for any significant period of time.

Mr VAN HOLST PELLEKAAN: You can imagine my constituents are a bit concerned about the potential, through unforeseen circumstances, that they end up with a wind farm junkyard in 20, 30 or 50 years' time, so I am just trying to cover off on some of those things, and I appreciate your answer. We discussed rehabilitation and removal of equipment a few weeks ago when we were last debating this bill and you said that if all else failed, as a last resort, the government would take full responsibility for that rehabilitation if necessary, but I just want to be sure that rehabilitation removal, and that sort of thing, would be part of the terms and conditions that are negotiated with the licensing.

The Hon. S.E. CLOSE: If I can refer you to 49O, that clause in fact gives powers to the minister for requiring remediation under the crown lands act—the second one, the one that does apply, rather than the one that does not apply

Mr VAN HOLST PELLEKAAN: Could you just repeat your answer?

The Hon. S.E. CLOSE: If you look at new section 49O, subsection (2) refers to division 3 of the Crown Lands Management Act which applies to a wind farm licence. I am advised that that entails the capacity for a minister to require remediation.

Mr VAN HOLST PELLEKAAN: Good. The next one is still on 49F, moving down to subsection (4), 'if more than 1 licence is granted'. Could you just give examples of how it might eventuate that more than one licence would be granted?

The Hon. S.E. CLOSE: I am advised that the structure of the way that the wind farm industry works now is that quite frequently there will be different parties who own different elements, so one might own the turbine and another might own the transmission infrastructure. That would require two licences with that landholder.

Mr VAN HOLST PELLEKAAN: But, even though some of the terms and conditions would only be in one licence, they would both be fully responsible to those terms and conditions as they were relevant to their part of the operation?

The Hon. S.E. CLOSE: Yes, and I believe that would be operationalised through a head licence.

Mr VAN HOLST PELLEKAAN: Subsection (5) provides that a licence must be granted for 25 years and give the licensee a right to renew the licence. The way I read that is that there must be a requirement not only for the first 25 years but for the second 25-year right of renewal. What renewal conditions would be attached to that right of renewal, and how does that fit into the fact that they must be given the right to renew?

The Hon. S.E. CLOSE: The clause is fairly strongly written and does give the licensee that right to renew. Obviously, that is partly about the security for the capital cost of infrastructure, that it is not that someone else can come in and try to take a second 25 years, that that particular licence holder has the right to continue for the full 50 years, but it does create a break in the lease.

Mr VAN HOLST PELLEKAAN: Over and above the normal conditions that would go with the first 25 years, there are no other conditions that have to be met to access the second 25 years, if that is what the licensee would like.

The Hon. S.E. CLOSE: That is correct.

Mr VAN HOLST PELLEKAAN: Moving on, subsection (6) states:

In determining the licence fees...the Minister must not take into account the value of any work carried out by the licensee—

which makes good sense; the licensee is going to have to invest in that and bear those costs—

or any other improvements on the land that do not belong to the Crown.

That category will be improvements that do belong to the pastoral lessee, such as roads and things like that. The minister cannot charge the licensee for those. Can the pastoral lessee charge the licensee for access to the pastoral lessee's infrastructure on the land, if it is needed?

The Hon. S.E. CLOSE: The expectation is that the licence fee that is being paid per turbine will be far in excess of any repayment value for access to roads that the pastoral lessee might have put in. It is considered to be detached from that value and to be far in excess.

Mr VAN HOLST PELLEKAAN: I understand that it could be an all-encompassing sort of a fee used for road access and so on. What about, potentially, accommodation or some other infrastructure the pastoral lessee owns on the land? Would that all be wrapped up in the licence fee as well? In the negotiation the minister does for the licence fee, which as you have just said would include access to roads, for example, where do you draw the line with what would be included in the negotiation and what would be left out for the lessee to negotiate with the licensee?

The Hon. S.E. CLOSE: Accommodation is a really good example. Our expectation would be that they would have a separate commercial arrangement if they were to offer accommodation that might be used by the wind farm owner, that they would be able to enter into that quite independently.

Mr VAN HOLST PELLEKAAN: The licence agreement will clearly identify what infrastructure access and what service is included in that, and anything that is not clearly identified there would be up to the lessee and the licensee to work through together?

The Hon. S.E. CLOSE: Yes, I think that would be rolled-gold version of the licence, and we would expect people to work very intelligently and diligently to make that occur.

Mr VAN HOLST PELLEKAAN: New section 49G is a biggie, and it is one of those in my negotiations and considerations that I am very uncomfortable has been left so wide open, but I guess I made a decision that you do not get everything you want when trying to come to a resolution. Giving essentially carte blanche to waive any conditions, including payment, timing, or whatever, is an enormous responsibility to give to a minister, and I accept that sometimes that is just what you have to do: you have to trust that person. He or she, Liberal or Labor, whoever it happens to be down the track, will need to do that.

I would just like an assurance that due consideration will be given to the interests of all prescribed interested parties and that they will have the opportunity to put forward a case for or against any of the things that a minister in future might be considering, if ever considering using this power of waiver.

The Hon. S.E. CLOSE: I note your discomfort with this and appreciate that you are nonetheless allowing this clause to go through in the interests of the wider bill. The clause itself, as I understand it, is already in the pastoral act, so leaseholders are already subject to this kind of fairly broad ministerial power.

We read that the minister needs to be satisfied that it is reasonable in the circumstances. My expectation would be that that would absolutely entail taking into account the interests of the people as listed at the front of the bill. Also, of course, the ERD Court is a place where people can go if they are unhappy about any aspect of the implementation. I know that people do not necessarily want to have to go to court but, nonetheless, the notion of reasonableness is one that is well understood within the courts and would be very much on the mind of the minister in taking any action under this clause.

Mr VAN HOLST PELLEKAAN: I want to move to 49I—Cancellation of licences. We have touched on this twice before. I am not trying to be difficult, but I would like to be absolutely sure on the rehabilitation removal issue. There will be a licence which includes obligations. If the licence is cancelled for some reason then, of course, those obligations no longer exist either. I just want to be sure that clause 49O, to which you referred me before, would still have effect, would still have power, even if the licence has been cancelled and therefore does not exist anymore.

The Hon. S.E. CLOSE: The operational effect that the government expects is that rehabilitation would be required. Whether that requires an expectation that is lodged before the cancellation of a licence in terms of how to make that work, I am unclear, but the expectation would be, very clearly, that if there is a turbine there that needs to be removed, then the timing of the cancellation of a licence would not be allowed to interfere with the remediation being required from that company.

Mr VAN HOLST PELLEKAAN: And if, by chance, that all fell apart, the government would still take that responsibility?

The Hon. S.E. CLOSE: Yes.

Mr VAN HOLST PELLEKAAN: Yes; okay.

The Hon. S.E. CLOSE: The thing is that the Crown remains the last resort.

Mr VAN HOLST PELLEKAAN: Clause 49J provides that:

A person who intends to apply for a wind farm licence may, with the approval of the Minister, enter and occupy…land.

That makes good sense, and it is a bit parallel to mining exploration. You have a right to look around for some prospecting, then you have a right to do some proper exploration, and then down the track, if all goes well, you can actually do mining production. At what point in time, after being given initial access to the land, does the person have to enter into an access agreement?

The Hon. S.E. CLOSE: The way that this clause is written does give the minister a fair amount of discretion, and, again, the reasonableness test is always what is applied to the actions of ministers. However, the advice I am receiving is that, probably at the point of any piece of infrastructure going on for the monitoring testing, it would need to move into an access agreement arrangement, but there would be reasons why. It might have happened earlier, it might happen a bit later, but they would need to be sound reasons.

Mr VAN HOLST PELLEKAAN: Okay; that is great. So, essentially, in broad expectation, as soon as something needs to be fixed to the property, that is about the time that an access agreement would need to be entered into. Thank you for that. With regard to fees, there is a fee for an access agreement, and then there is also a fee for a licence agreement. Is it the expectation that they would be negotiated essentially in the same way? The bill does go into a bit of detail about negotiating fees for a licence agreement, but it does not say a lot about the fee for an access agreement. Is it fair to assume that the same means and the same approach would be taken?

The Hon. S.E. CLOSE: Yes, you are right: the process would be expected to be the same.

Mr VAN HOLST PELLEKAAN: Looking at that same section 49J, subsection (2) provides:

A person who intends to enter and occupy pastoral land under subsection (1)—

which is the broader access we were just talking about—

must give the prescribed interested party at least 14 days notice…

Would this also include those people who have, or may have, native title? I have got some questions that I am sort of leading to, just to let you know, about where a person, a company or a group might be more than one of the categories of interested parties, if that makes sense; just so you know where I am heading there. Would those people still have to give 14 days prior notice?

The Hon. S.E. CLOSE: Our expectation is that the prescribed interested parties refers to those up to the registered claimants and not beyond. When you look at proposed section 49K, which is one you may well be coming to—I do not want to interrupt your flow, but proposed section 49K(4) refers to not including those who are not already native title holders as part of the payment. Reading those two sections together, it does put the emphasis on the known interested parties and not on those who would be difficult to identify.

Mr VAN HOLST PELLEKAAN: That is very helpful, minister, and I was certainly coming to proposed section 49K, which essentially says that somebody who may have native title cannot access the land for this sort of thing. However, I was also wondering about somebody who might already have access to the land and a very genuine right to access the land for another purpose, like mineral exploration or native title access, or something like that. If they already have access for a different reason to the same piece of land, do they need to wait 14 days if they want to access the land for pursuit of some renewable energy project or, given that they already have access to the land for another purpose, can they use that other access to pursue renewable energy, if they have an interest in it?

The Hon. S.E. CLOSE: My reading of this is that it is not about who the individual is and what existing rights they have but for what purpose they are having access. So, even someone who has access because they are a native title holder and who then becomes interested in running a wind turbine would need to engage in the process from the beginning.

Mr VAN HOLST PELLEKAAN: Proposed section 49K is another section that gives a lot of authority to the minister and another one similar to the waiver section that I referred to before, which certainly my constituents and I, and everybody who might see themselves on one side or another of these dealings down the track, will have to trust the minister on. With regard to payments, does the minister have any intention or is there any information that can be shared with regard to how payments might be meted out—annually in advance, monthly, or anything like that—or will all of that be left until probably the first of these licences is entered into and then that might set a precedent?

The Hon. S.E. CLOSE: This would be a matter of negotiation, obviously, with the people who are proposing to build a wind farm, but our expectation would be, going into that negotiation, that it would be more frequently than annually.

Mr VAN HOLST PELLEKAAN: Is it your expectation that the scale of the payments would be roughly in line with what currently happens in freehold land? I know you cannot answer that and I am not looking for a dollar value, or anything like that, but the expectation is that all prescribed interested parties would have their share of an access to a fund that would be broadly in line with what the market is currently with freehold land in South Australia.

The Hon. S.E. CLOSE: I understand that the government is on record saying that it would expect to be broadly commensurate with that, but it would take into account any differentiation. Building in arid land might be more expensive, but there is an overall notion not only of equity but also competitive neutrality so that they are not being given a leg-up or being disadvantaged in the creation of their wind farm.

Mr VAN HOLST PELLEKAAN: Will consideration of the compensation payments that go into the fund include infrastructure as well as the towers? On freehold land, people typically just concentrate on how many turbines you have on your land, but will it also consider transmission lines and transformer stations and a range of infrastructure requirements which would have to be there to make the whole project work?

The Hon. S.E. CLOSE: The payment for the landholder would be, in most instances, per turbine because everything is essentially attached to each other; but there are instances, as I understand it, with privately owned land, where transmission lines or a substation might be on someone else's property, in which case that would be separately identified and separately paid for.

Mr VAN HOLST PELLEKAAN: In that sort of example I would assume there would be a separate licence agreement with the neighbouring pastoralist?

The Hon. S.E. CLOSE: Yes, that is the expectation. It is per landholder.

Mr VAN HOLST PELLEKAAN: In regard to 49K again, subsection (2) provides that a payment may not be made under this section to a prescribed interested party that is the holder of a resources tenement over the land. This is getting to the bit that I alluded to before. I am sure that there will be some crossover in the future. There are many very capable pastoralists and native title holders, and some of them are very well resourced as well.

It is not inconceivable that a pastoral lessee might want to develop some renewable energy or a native title holder organisation might want to develop some renewable energy or, going back to the example that I used a few weeks ago, I think it is likely that the holder of a resources tenement would like to develop a renewable energy project to support their resources operation. If you extend that one step further, very often, the owner of the resource tenement also is the pastoral lessee. As one of many real-world examples, BHP owns five, I think it is, pastoral leases around Olympic Dam.

BHP hypothetically could be the holder of the resources tenement, the renewable energy developer and the pastoral lessee, but of course native title holders could fit into that somehow as well. I am sure in future years, that is going to happen. Where it says here that a payment may not be made to a prescribed interested party that is a resources tenement holder, if the resources tenement holder is also the pastoral lessee, it would not seem fair to me that the pastoral lessee would miss out in this instance. Could you tell me what the government intends there?

The Hon. S.E. CLOSE: The interpretation of this clause that we expect to be made is that that is a holder of a resources tenement as a holder of a resources tenement so that if that person/individual company happens also to be a prescribed person under a different category that they would receive whatever payment is appropriate for that category. Even though that would then be an odd artifice—because in the real world they are one company or one person and they are not being paid as a resources tenement holder, they are being paid as a pastoralist. That is our interpretation of the bill.

Mr VAN HOLST PELLEKAAN: If any person or group or body corporate held a role as a prescribed interested party simultaneously other than a holder of a resources tenement, then they would not be ruled out from receiving payment by this clause.

The Hon. S.E. CLOSE: That is our interpretation of that clause.

Mr VAN HOLST PELLEKAAN: I would also like to put on record my thanks to the minister's office for some changes to 49K that were really helpful and all the staff who contributed to that. That made a big difference.

Clause passed.

Title passed.

Bill reported without amendment.

Third Reading

The Hon. S.E. CLOSE (Port Adelaide—Minister for Manufacturing and Innovation, Minister for Automotive Transformation, Minister for the Public Sector) (12:03): I move:

That this bill be now read a third time.

Mr VAN HOLST PELLEKAAN (Stuart) (12:03): I would like to make a few closing comments. This has been a long time coming, getting this bill through. There were facets of it that were very unpalatable for me and the people I represent—who include pastoral lessees, native title holders, native title claimants and resources tenement holders—and I genuinely thank the minister and minister's team for their willingness to work through this. Like all compromises, nothing is perfect. I am sure that there are things that were surrendered that the minister would have preferred not to have surrendered, and I am sure that there are things I would have liked to have gained but I have not, but we have reached a pretty fair compromise, I think.

In my dealing with this, part of my thinking, on behalf of my constituents and the broader groups of people that I represent, was that I did not want to be such a stickler to get every last possible thing that maybe it would all fall over because, while there are very significant impositions upon many of the prescribed interested parties, there are also very significant benefits that will flow out of this bill for those prescribed interested parties as well, and I think that is really critical. It would not be right to sort of try to die in the ditch on every last single issue to the point that pastoral lessees, native titleholders and others could never access the same sort of rental opportunities that their neighbours and colleagues in freehold land are able to do.

I am hopeful that this works out very well for all concerned. It is, of course, important that we try to create opportunities for renewable energy to be developed. There is an entirely separate argument about the value of renewable energy certificates and what does it cost and what is it doing to the cost of electricity, which I will leave totally separate from this issue, but it is important that we create opportunities wherever practically possible to generate renewable electricity, and this bill certainly will contribute to that.

I would also like to thank my staff, and my team of staff comprises Chris Hanna, who helps me incredibly with all of the things I do here in this chamber. So, I put on the record my thanks to him for helping me with all of the homework.

The Hon. S.E. CLOSE (Port Adelaide—Minister for Manufacturing and Innovation, Minister for Automotive Transformation, Minister for the Public Sector) (12:07): I thank the member for Stuart. I wish that more people who watch what we do in question time were also able to see some of the interaction that occurs through bills and see the genuine, constructive approach that is taken by the vast majority of people in this place.

I thank the minister and his staff in the other place for the work that was done on this bill and to say how easy it was for me to take on this bill down here. I particularly thank the two advisers who have been sitting through this process and have been helping me answer the questions.

Bill read a third time and passed.

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