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Legislative Council - Fifty-Fifth Parliament, First Session (55-1)
2023-02-23 Daily Xml
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Answers to Questions

Government Procurement

157 The Hon. H.M. GIROLAMO ().28 September 2022). Can the Treasurer advise:

1. What major IT procurements are planned for 2022-23?

2. What is the status of the electricity procurement contract?

3. Who will be the provider?

4. What is the term and total value of the contract?

5. What portion of the contract has the government underwritten?

The Hon. K.J. MAHER (Minister for Aboriginal Affairs, Attorney-General, Minister for Industrial Relations and Public Sector): The Treasurer has advised:

1. The major IT procurements planned for 2022-23 are:

Telecommunication services marketplace–a tender for the provision of telecommunication services including fixed telephony, mobility services and data and internet services. The new panel contract will replace the network carriage services and network internet services contracts that expire in October 2023.

Network hardware and services marketplace–a tender for the provision of management services for the state's central data network and agency networks, including the provision of network hardware. The new panel contract will replace the network devices panel, which will expire in September 2023.

Microsoft software and licensing–direct negotiations to renew the across government enterprise agreement, which expires in June 2023 and covers the desktop licencing subscriptions of approximately 90,000 users and devices.

2. The status of the electricity procurement contract is summarised as follows:

The Across Government Electricity Retail Agreement (AGERA) with ZEN Energy commenced on 1 November 2020 and was established with a 10-year and two-month term initial term, and an option to extend for a further five years.

Under the AGERA, ZEN Energy committed to facilitate the construction, commissioning and operation of the following two new electricity generation and storage projects:

280MW solar farm at Cultana (near Whyalla) by 30 April 2022; and

100MW utility battery at Playford (near Port Augusta) by 31 March 2023.

These new assets were to be built by SIMEC Energy Pty Ltd (SIMEC), which is part of the GFG alliance, under a subcontract arrangement with ZEN Energy.

Due to third-party financing issues, ZEN Energy has been unable to honour its contracted commitments to the State for the two generation and storage projects.

As a result, the state government has negotiated a variation to the AGERA which addresses and remedies ZEN Energy's inability to deliver the two projects. The key aspects addressed in the variation agreement include:

Replacing the two electricity generation and storage projects with a comparable alternative in the form of a project titled 'Solar River', which includes a 200MW solar farm and 100MW battery near Robertstown;

Providing financial compensation to the state;

Maintaining comparable investment commitments to the South Australian economy through job creation, local supply, and market benefits; and

Extension of the contract term to 31 December 2035.

3. ZEN Energy has been selected as the contracted sole provider of electricity to state government sites under the AGERA.

4. The term of the AGERA is 15 years and two months, having commenced on 1 November 2020 and due to expire on 31 December 2035, with a total estimated contract value of $1.534 billion.

5. The state government has not underwritten any portion of the AGERA.'

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