Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

I would like to raise a point on the crisis we have in our nation with regard to the cost of electricity. Less than two years ago, the wholesale price of electricity in New South Wales was around $40 per megawatt hour. In the middle of last year, it was between $45 and $50 per megawatt hour. The latest wholesale price of electricity for New South Wales is over $120 per megawatt hour. That is a more than 100 per cent increase in less than 12 months in the wholesale price of electricity, clearly caused by the removal of coal-fired electricity generators from the system.

Let's look at what is currently happening to the cost of electricity in this country. This morning, between 10.30 am and 11 am, the wholesale price of electricity was not $40, $50 or $100 per megawatt hour, which is where it had been. It was $283 per megawatt hour. That is five to six times the price of what it regularly was less than two years ago. In South Australia, the situation was even worse. The price was $298 a megawatt hour. We are not talking about the middle of summer when there is a heatwave and everyone has their air conditioning on. We are talking about a mild autumn day—not at the peak at night when everyone is coming home—between 10.30 am and 11 am. These are the prices.

These high wholesale prices will flow through to an increase in the retail prices paid by consumers of between 30 and 40 per cent. I ask everyone in this parliament how they are going to explain to their constituents that their electricity bills are going to go up between 30 and 40 per cent. The reason why we had this boost in costs this morning is simply the wind was not blowing. Around the nation, we have over 4,390 megawatts of installed capacity of wind power. Between 10.30 am and 11 am, that was operating at a capacity of around one per cent. For the something like $1 billion worth of subsidies that we are paying, today we were getting 50 megawatts of electricity generated by wind turbines. Between 10 am and 11 am today, we needed 22,000 megawatts of electricity for the east coast grid, including Tasmania and South Australia. Of that 22,000 megawatts that was needed, wind was supplying 50 megawatts. That is one-quarter of one per cent.

Delta Electricity has done some sums about what this will cost each state. Their sums are that, in the next financial year alone, consumers in New South Wales will be paying an extra $4 billion for their electricity. That is $4 billion that will have to come out of people's pay packets to pay their electricity bills. In Victoria, it is estimated at an extra $2.8 billion. In Queensland, it will be an extra $2 billion. In South Australia, it will be an extra $1.08 billion. That is close to $10 billion extra, and this is on top of some the electricity prices that are already the highest in the world. There will be an extra $10 billion, just in four states, that will come out of those consumers' pockets to pay for our electricity.

What about the effect on industry?

You only have to listen to the words of Glencore. They have warned that we are beyond the 'tipping point' in industrial 'demand destruction'. They said that unless we make decisions really quickly, in the next 12 months, to re-establish base load electricity, which can be only coal or gas, we will have no chance of sustaining the economy in the shape that it is now.

The entire prosperity of the nation is at risk because of this mad obsession that we have with renewable energy. We have to call this out. We have to act. We cannot stand by and watch this happen to our nation.