Senate debates
Monday, 30 November 2009
Carbon Pollution Reduction Scheme Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (Consequential Amendments) Bill 2009 [No. 2]; Australian Climate Change Regulatory Authority Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (Charges — Customs) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (Charges — Excise) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (Charges — General) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (CPRS Fuel Credits) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme (CPRS Fuel Credits) (Consequential Amendments) Bill 2009 [No. 2]; Excise Tariff Amendment (Carbon Pollution Reduction Scheme) Bill 2009 [No. 2]; Customs Tariff Amendment (Carbon Pollution Reduction Scheme) Bill 2009 [No. 2]; Carbon Pollution Reduction Scheme Amendment (Household Assistance) Bill 2009 [No. 2]
In Committee
3:23 pm
Nick Xenophon (SA, Independent) Share this | Hansard source
I think both you and John Olsen would say thank goodness for that! At that time Danny Price and the consultancy he was working for made certain predictions about price rises if the Olsen government adopted a particular model for privatisation. Madam Temporary Chair, I think you were also there at that time. I still remember question times when the then Liberal government would seem to pick on me and Danny Price, much to the relief of some of the Labor members in the upper house. They were quite delighted and I remember being thanked because the opposition ignored the then Liberal government. This does not mean that Danny Price’s predictions will always come to fruition, but his predictions were uncannily accurate. He predicted a 30 to 35 per cent rise in electricity prices and the ultimate figure was 32 per cent. I believe this was because of the way the privatisation was structured.
This firm has form in terms of looking at electricity markets and emissions trading schemes. The first mandatory emissions trading scheme anywhere in the world was implemented by New South Wales Premier Bob Carr 10 years ago. That scheme was designed and implemented by Frontier. It was a baseline and credit scheme. To put it in perspective, this is not a baseline and credit scheme—it is a modification; an intensity based scheme. Given the constraints set by the Carr government, a state government, it was a very successful scheme in terms of abatement. It was a greenhouse gas abatement scheme, a GGAS, that worked to encourage investment in low emission technologies and to encourage landfill gas management and the like. These are good things. Even with the constraints the scheme still took millions of tonnes of CO2 out of the atmosphere—a welcome development. Frontier Economics has form in designing an emissions trading scheme and taking into account the various factors in working out how it will work in practical terms.
The minister says there will be no compensation to households under the Frontier scheme. The minister is right in saying that, but that is because you do not need to compensate households, for two simple reasons: firstly, there will not be the same spike in electricity prices—
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