Ms MARTIN - 1999-08-18
Last week the Deputy Chief Minister sought to deny that the Northern Territory has the highest power prices in Australia. I seek leave to table an extract from the recent journal of the independent Electricity Supply Association of Australia Ltd.
Leave granted.
Ms MARTIN: This table shows unequivocally that under this government the Territory does have the highest power prices in Australia. Will the Chief Minister correct the misinformation uttered by his deputy, and will he set out his timetable for bringing the Power and Water Authority’s prices into line with the all-states average?
ANSWER
Mr Speaker, when we consider the cost of electricity alone, the Northern Territory tariff according to the ESAA figures is in fact marginally higher than the rate in Melbourne, Perth and Adelaide. I say ‘marginally’ higher. The Opposition Leader, in the graphs that she herself puts out, accepts that.
But we have to consider the additional cost of energy in southern states, particularly for heating, and also consider the fact that the costs to the consumer are offset to some degree because domestic gas that is provided at a much lower tariff in those jurisdictions - something that the Northern Territory is working diligently to gain by bringing gas onshore from the Timor Sea into the domestic and national grid.
When we look at the cost of electricity per se in the Northern Territory, we should bear in mind first of all that Territorians have built the infrastructure from scratch. We have a single supply source, the Mereenie/Palm Valley area. Getting gas to Darwin requires around 1800 km of pipeline and massive infrastructure costs. All of the electricity in Darwin and the major population centres of the Northern Territory is produced by gas-fired generators.
As I said, we built the infrastructure from scratch. We have a low population base in the Northern Territory, dispersed throughout one-sixth of Australia, and our revenue-raising capability is limited. We also have a low manufacturing base in the Northern Territory, which compounds our revenue-raising limitations. You have to take all of those things into consideration and set them against the massive infrastructure cost of getting environmentally friendly, gas-fired electricity in the Northern Territory. Many other jurisdictions are still relying on coal-fired stations.
Add another little factor: 27% of the population of the Northern Territory live in remote communities, heavily subsidised by the Northern Territory government. The overall tariff across the Northern Territory is the same for every consumer, whether you live in Darwin or whether you live in Yuendumu.
Compare that tariff rate with the rest of Australia and you get a marginal increase over Sydney, Melbourne and Adelaide. I consider that a major success story. If the opposition was honest with Territorians and presented those factors in an honest and truthful way, Territorians would understand that, while the cost of electricity is high …
Members interjecting.
Mr SPEAKER: Order!
Mr BURKE: When the dogs have finished barking I’ll continue.
Territorians would understand that, when we consider all those factors, environmentally friendly electricity is delivered in the Northern Territory at a reasonable tariff rate. But this government is not complacent about the situation. We are making diligent efforts internationally, in every sphere we can, to try to get additional gas resources into the Northern Territory to lower electricity prices. We are working with our own organisation, PAWA, restructuring it to make it more competitive, and introducing competition into the market in a regulated way. That in itself will lower the impost of electricity charges in the Northern Territory.
Compare this government’s approach to Labor’s attitude. The Labor opposition can only criticise the Territory’s efforts. I’ll go immediately to the initial speech that the Opposition Leader gave in this Chamber when she became Leader of the Opposition. In part of her speech she said this:
Increased competition has failed to deliver benefits to domestic consumers elsewhere in settings similar to those in the Northern Territory. [‘Settings similar’ is a broad generalisation, for starters. The Territory is unique in Australian circumstances.] The argument for increased competition cannot be put in the Territory. Industry analysis asserts the electricity market is simply too small for more than one operator.
Well, tell Paul Everingham that. We’re in court with Paul Everingham because he’s so keen to get into the market. So certainly there are private operators who are interested, to say the very least.
Then compare the confusing messages that the Leader of the Opposition puts to Territorians about how she would deal with competition. On the one hand she says in her maiden speech as Labor leader that competition has no place in the Northern Territory. It can’t accommodate it. Then on 15 July, on the Col Newman show, referring to NT Power ...
A member interjecting.
Mr BURKE: Well, we need to be clear on this.
Mrs HICKEY: A point of order, Mr Speaker! The Chief Minister has been on his feet for 10 minutes now. The question was a simple one. We wanted him to correct the misinformation given to us by the Treasurer. He hasn’t done so. Could you direct him to answer the question?
Mr SPEAKER: As I understand it, the Chief Minister is setting out to do that. Perhaps with a little less interjection we would get to the nub of the answer more quickly.
Mr BURKE: Compare the confusing messages she sends to Territorians. On 15 July, in an interview with Col Newman, Newman referred to NT Power and said:
Paul Everingham would like to have his fair share, and part of that for Palmerston.
Martin: Paul Everingham would like to lick the cream off the market and the rest of us will pay more for our domestic power.
Newman: That clears that one up, doesn’t it?
Martin: ‘Absolutely!’
No equivocation there. No mucking around there. Yet in the NT News on 12 August she’s quoted as saying:
If we have a power supplier like NT Power, then with proper regulation and proper assessment there’s no reason why we wouldn’t support them coming in to provide power to the grid.
Territorians can be rightly confused, to say the very least, as to where the Labor opposition stands with regard to competition. They talk about lowering electricity tariffs. How do they intend to do it? By reducing revenue, breaking a Territory company, commandeering an asset of Territorians in such a way that all of a sudden it becomes totally non-competitive? They’re saying they’ll reduce tariffs for Territorians that way, and that’s the proper way to go.
The whole thrust of Labor policy is to reduce revenue and increase spending. Anyone can run those simple lines: Reduce revenue and increase spending. It’s a simple Labor philosophy, tried and failed in Western Australia, tried and failed in Victoria, tried and failed in South Australia, tried and failed federally. It has taken Coalition governments to come in and clear up the mess.
Leave granted.
Ms MARTIN: This table shows unequivocally that under this government the Territory does have the highest power prices in Australia. Will the Chief Minister correct the misinformation uttered by his deputy, and will he set out his timetable for bringing the Power and Water Authority’s prices into line with the all-states average?
ANSWER
Mr Speaker, when we consider the cost of electricity alone, the Northern Territory tariff according to the ESAA figures is in fact marginally higher than the rate in Melbourne, Perth and Adelaide. I say ‘marginally’ higher. The Opposition Leader, in the graphs that she herself puts out, accepts that.
But we have to consider the additional cost of energy in southern states, particularly for heating, and also consider the fact that the costs to the consumer are offset to some degree because domestic gas that is provided at a much lower tariff in those jurisdictions - something that the Northern Territory is working diligently to gain by bringing gas onshore from the Timor Sea into the domestic and national grid.
When we look at the cost of electricity per se in the Northern Territory, we should bear in mind first of all that Territorians have built the infrastructure from scratch. We have a single supply source, the Mereenie/Palm Valley area. Getting gas to Darwin requires around 1800 km of pipeline and massive infrastructure costs. All of the electricity in Darwin and the major population centres of the Northern Territory is produced by gas-fired generators.
As I said, we built the infrastructure from scratch. We have a low population base in the Northern Territory, dispersed throughout one-sixth of Australia, and our revenue-raising capability is limited. We also have a low manufacturing base in the Northern Territory, which compounds our revenue-raising limitations. You have to take all of those things into consideration and set them against the massive infrastructure cost of getting environmentally friendly, gas-fired electricity in the Northern Territory. Many other jurisdictions are still relying on coal-fired stations.
Add another little factor: 27% of the population of the Northern Territory live in remote communities, heavily subsidised by the Northern Territory government. The overall tariff across the Northern Territory is the same for every consumer, whether you live in Darwin or whether you live in Yuendumu.
Compare that tariff rate with the rest of Australia and you get a marginal increase over Sydney, Melbourne and Adelaide. I consider that a major success story. If the opposition was honest with Territorians and presented those factors in an honest and truthful way, Territorians would understand that, while the cost of electricity is high …
Members interjecting.
Mr SPEAKER: Order!
Mr BURKE: When the dogs have finished barking I’ll continue.
Territorians would understand that, when we consider all those factors, environmentally friendly electricity is delivered in the Northern Territory at a reasonable tariff rate. But this government is not complacent about the situation. We are making diligent efforts internationally, in every sphere we can, to try to get additional gas resources into the Northern Territory to lower electricity prices. We are working with our own organisation, PAWA, restructuring it to make it more competitive, and introducing competition into the market in a regulated way. That in itself will lower the impost of electricity charges in the Northern Territory.
Compare this government’s approach to Labor’s attitude. The Labor opposition can only criticise the Territory’s efforts. I’ll go immediately to the initial speech that the Opposition Leader gave in this Chamber when she became Leader of the Opposition. In part of her speech she said this:
Increased competition has failed to deliver benefits to domestic consumers elsewhere in settings similar to those in the Northern Territory. [‘Settings similar’ is a broad generalisation, for starters. The Territory is unique in Australian circumstances.] The argument for increased competition cannot be put in the Territory. Industry analysis asserts the electricity market is simply too small for more than one operator.
Well, tell Paul Everingham that. We’re in court with Paul Everingham because he’s so keen to get into the market. So certainly there are private operators who are interested, to say the very least.
Then compare the confusing messages that the Leader of the Opposition puts to Territorians about how she would deal with competition. On the one hand she says in her maiden speech as Labor leader that competition has no place in the Northern Territory. It can’t accommodate it. Then on 15 July, on the Col Newman show, referring to NT Power ...
A member interjecting.
Mr BURKE: Well, we need to be clear on this.
Mrs HICKEY: A point of order, Mr Speaker! The Chief Minister has been on his feet for 10 minutes now. The question was a simple one. We wanted him to correct the misinformation given to us by the Treasurer. He hasn’t done so. Could you direct him to answer the question?
Mr SPEAKER: As I understand it, the Chief Minister is setting out to do that. Perhaps with a little less interjection we would get to the nub of the answer more quickly.
Mr BURKE: Compare the confusing messages she sends to Territorians. On 15 July, in an interview with Col Newman, Newman referred to NT Power and said:
Paul Everingham would like to have his fair share, and part of that for Palmerston.
Martin: Paul Everingham would like to lick the cream off the market and the rest of us will pay more for our domestic power.
Newman: That clears that one up, doesn’t it?
Martin: ‘Absolutely!’
No equivocation there. No mucking around there. Yet in the NT News on 12 August she’s quoted as saying:
If we have a power supplier like NT Power, then with proper regulation and proper assessment there’s no reason why we wouldn’t support them coming in to provide power to the grid.
Territorians can be rightly confused, to say the very least, as to where the Labor opposition stands with regard to competition. They talk about lowering electricity tariffs. How do they intend to do it? By reducing revenue, breaking a Territory company, commandeering an asset of Territorians in such a way that all of a sudden it becomes totally non-competitive? They’re saying they’ll reduce tariffs for Territorians that way, and that’s the proper way to go.
The whole thrust of Labor policy is to reduce revenue and increase spending. Anyone can run those simple lines: Reduce revenue and increase spending. It’s a simple Labor philosophy, tried and failed in Western Australia, tried and failed in Victoria, tried and failed in South Australia, tried and failed federally. It has taken Coalition governments to come in and clear up the mess.
Last updated: 09 Aug 2016