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Legislative Council - Fifty-Second Parliament, First Session (52-1)
2011-05-19 Daily Xml
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ELECTRICITY PRICES, COOBER PEDY

The Hon. J.A. DARLEY (15:00): I seek leave to make a brief explanation before asking the Leader of the Government, representing the Minister for Energy, a question regarding electricity tariffs in Coober Pedy.

Leave granted.

The Hon. J.A. DARLEY: As the minister would be aware, the residents of Coober Pedy have recently expressed their anger and concern over the increased cost of electricity to their town and others in the region, including Andamooka, Marree and Yunta. I understand that in previous years the Energy Division of the Department for Transport, Energy and Infrastructure would engage with the Coober Pedy council to discuss any proposed increases in the electricity tariff.

I have been informed that this process usually occurred with considerable advance notice (usually two to three months) prior to any proposed increase to allow the council's finance manager to prepare a number of tariff models to present to the Energy Division. I am told that, through this process, the Energy Division and the Coober Pedy council would work together to establish the rate of tariff increase. I understand that this process worked well for all parties involved. However, I am told that this process was not followed for the most recent tariff increases and that the council was merely notified via email of the tariff increases 17 days before the increase was to take effect. My questions are:

1. Can the minister advise why consultation with the council regarding the tariff increases did not occur as previously had been the case?

2. Given the lack of consultation, will the minister withdraw the increase until such time that the KPMG review is complete?

3. Can the minister advise how much will be spent on the KPMG review, and does the minister not agree that this money could be of better use if it was put towards the $1.3 million increase in electricity costs for Coober Pedy?

The Hon. G.E. GAGO (Minister for Regional Development, Minister for Public Sector Management, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises, Minister for Gambling) (15:02): I thank the honourable member for his most important questions. We will refer those detailed questions to the Minister for Energy in another place, and we will be happy to bring back a response.

However, just by way of some general comments, I have been advised that a revised Remote Area Energy Supplies tariff schedule was implemented from 7 March 2011. On 13 May this year, the government announced that the tariff increase will now be phased in over two years. I have been advised that the government has provided additional resources of $1.3 million to the Department for Transport, Energy and Infrastructure over two years to introduce this phase-in agreement.

General supply customers will still have a tariff increase from 7 March 2011, although significantly reduced from the increase announced on 18 February, followed by further increases in the following two years. Tariffs for domestic customers will remain consistent with those announced, I am advised, in March 2011. I am advised that small to medium domestic customers will pay on average 4 per cent higher than equivalent on-grid customers, and I am advised that this is well within the scheme's principle of small to medium domestic customers paying no more than the equivalent of on-grid price plus 10 per cent.

The tariffs, I have been advised, have not kept pace with the recent increases in on-grid prices. Small to medium domestic customers were paying less than equivalent on-grid customers. An average domestic customer consuming about 5,000 kilowatts per annum will therefore see an increase of about 18 per cent compared with their pre-March bill, so I am advised, and larger domestic customers, I am advised, will see an increase of somewhere between 15 to 35 per cent compared with their pre-March bill as they move towards these reflective tariffs.

Under the revised tariffs, I am advised that all general supply customers outside Coober Pedy will see between 5 to 15 per cent compared with their pre-March bills. In Coober Pedy about 90 per cent, I am advised, of general supply customers consuming up to 70,000 kilowatts per annum will face increases of 10 per cent or less. A small number of customers consuming between 70,000 and 400,000 kilowatts per annum will see increases of up to 40 per cent. One or two very large customers, I am advised, may see a 50 to 60 per cent increase.

I am further advised that the state government is undertaking a review of the scheme to determine what opportunities there are for connecting towns to the national electricity grid, with consequent lower tariffs, while also considering incentives to try to reduce energy use, and the potential for alternative and renewable energy options. Businesses consuming more than 30 megawatts per annum have been offered energy audits and subsidies for changes to their infrastructure to improve energy efficiency and thus reduce their energy consumption.

The Australian government funded Renewable Remote Power Generation Program is administered by DTEI, and a number of customers in Coober Pedy have already taken up this offer, so I am advised, and expect to see a very significant improvement in the energy efficiency of their business. As I said, in relation to the specific questions asked, I will refer those to the relevant minister and bring back a response.

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