Rowan Ramsey (Grey, Liberal Party) Share this | Hansard source

I am not surprised that the member for Port Adelaide has brought forward the issue of energy, particularly in South Australia, in this place. South Australia has suffered some terrible losses in the last two weeks and continues to suffer losses today as some of our biggest employers and the bigger users of electricity remain out of production. In that case, I mention BHP up at Roxby Downs, Nyrstar at Port Pirie and I think OZ Minerals at Prominent Hill is still struggling to get back on line.

But I am surprised that he has fallen into the trap of protecting Tom Koutsantonis and the state government. Muhammad Ali used to have a method when he was in the boxing ring; it was called 'rope a dope'. Tom Koutsantonis has certainly found his here in the federal parliament, because they are, in fact, defending the indefensible. This team in South Australia is going down. They will be judged on their poor management of the South Australian electricity system. They will be judged on the fact that they ignored the warnings that have come over time about what would happen in South Australia if they drove the base load generators out of business before they reached a stage where the renewable energy sector was able to supply a stable and fully reliable load.

Australia has a very good target for renewable energy; it is 23 per cent by 2020. It was only in the second half of last year that the Labor Party in this place supported that new target. But they seem to have a different target now. I think that, during the election, I heard it was about 50 per cent. So there you go. They did not stay with that target for all that long.

This is 23 per cent for all of Australia's energy users. But in that time the South Australian government has targeted investment in this area—and you could say, 'That's well and good'—to the point where we have 41 per cent of our electricity load, on average, now being delivered by wind. Some would say that is very smart of the state government, but they have not heeded the warnings about the instability in the grid, the frequency becoming variable, if you like. It is like having thin electricity: it is not always there when you need it. And so many of our industries and our households need reliable electricity.

It is all very well to move to renewable energy, and I support the moves to renewable energy. But they have to insist on storage. There are mechanisms, there are some technologies coming onstream at the moment, and there are a couple of projects that are looking at investing in my electorate. The federal government is doing a powerful amount to ensure that these investments come off, particularly through the renewable energy target. I think they offer some possibility for the future. But we cannot expect to attract new investment to South Australia. We cannot expect people like BHP to continue to reinvest in South Australia when, as the member for Barker has just pointed out, our electricity prices in the last six months have doubled. Our wholesale electricity prices in South Australia in the last six months have in fact more than doubled. For the householder, over the next 12 months this will mean that they are likely to face increases of around 15 to 20 per cent in their electricity bill. It will take them from around 30c a kilowatt hour to around 35c or 36c. That is going to be pretty tough to wear, particularly for people on low incomes.

You can imagine: these high-end energy consumers that actually buy at a small marginal rate above the wholesale cost—maybe 8c or 9c a kilowatt hour—are likely to see, because of that shift, an 80 per cent increase in their cost of electricity. In fact, they already have. If a business like Nyrstar or like BHP that buys electricity not in the millions but in the tens of millions of dollars a year faces an 80 per cent increase on the bottom line or an 80 per cent increase in electricity bills, we have a serious problem—they have a serious problem. If we want industries to keep investing in South Australia, that needs to be addressed. It is a crisis point at the moment. I suspect that there will be a severe backlash for the South Australian government for mismanaging this transition. (Time expired)

See this speech in context