Mr STIRLING - 2000-06-13
Average electricity prices in the Northern Territory are 13.88 per kilowatt hour compared to an average across Australia of just 8.59. That means Territorians pay 62% more than the Australian average. Power bills for households will rise a further 8.7% from 1 July under the GST that you and your government colleagues have so wholeheartedly supported. Isn’t 26 years of CLP rule enough time to bring Territory power prices down in line with the rest of Australia?
ANSWER
This is a hoary old chestnut, Mr Speaker. The opposition, as long as I can remember discussions in this House, have been talking about the difficulties with Territorians paying their power bill, and we frankly admit that we would like to bring power prices down and we have done that. We have done it in two ways. We have reduced commercial tariffs and we did it again in this budget, and we have also been able to, through very good financial management, peg tariffs. The member who has asked this question will remember the last debates in this parliament when we did the appropriation bill last year where he admitted on the parliamentary record: ‘Oh yes, I can understand that by pegging prices like that it is actually a real cut’.
We are quite proud of the fact that we have been able to bring electricity prices down. We would like to do it even more. We would like to have Territorians paying as little as possible for their electricity. Unfortunately, that is not a reality in the short term for a number of reasons, particularly because we had to build such an enormous infrastructure when this place came about. We had aging power generation facilities. Those of us who lived here in the Commonwealth’s day will remember that power blackouts were the norm. Certainly it was at least a weekly or bi-weekly experience for many of us. We had a generation capacity that ran on terrible fuel. It was an environmental problem. It was a forward-looking Territory government that put in a massive amount of infrastructure including a pipeline that goes the whole length of the Northern Territory, some 16 000 kms to Channel Island. Later this week I’ll be launching or kicking off the new generator at Channel Island which is a $33m investment. We are talking about something that is very costly to the Territory budget. It is really important that the Power and Water Authority constructs itself so that it operates on a commercial footing and that unfortunately means our power tariffs are likely to stay the way they are in the foreseeable future.
We are very optimistic with the advent of the off-shore gas. We believe that we may be in the fortunate position of being able to negotiate much cheaper tariffs for our gas, and my colleague the Minister for Resource Development is unflagging in his endeavours to secure the best price for Territorians.
It should be pointed out also that an independent association, the Electricity Supply Association of Australia, which has a publication called Electricity Prices in Australia 1999-2000, an independent commentator, had this to say about ourselves and our next door neighbour, Western Australia, when it came to electricity prices:
Electricity prices in the Northern Territory and Western Australia are higher than in other jurisdictions as generation and distribution costs are higher. Major fuel sources for electricity generation in the two jurisdictions are natural gas, diesel and distillate. They are relatively more expensive than the brown coal and the black coal that are widely used in the states.
The two jurisdictions combined, cover half the nation’s territory and only 11% of the population. Their network systems are relatively small and physically isolated from the rest of the country. The costs associated with delivering electricity to the sparsely populated areas are also reflected in the higher electricity prices.
I finish by pointing out that it is this government’s wish to take electricity prices down as low as we possibly can, and this budget again sees a cut in commercial tariffs. I am proud that we have been able to balance our budget and pass these savings onto consumers.
ANSWER
This is a hoary old chestnut, Mr Speaker. The opposition, as long as I can remember discussions in this House, have been talking about the difficulties with Territorians paying their power bill, and we frankly admit that we would like to bring power prices down and we have done that. We have done it in two ways. We have reduced commercial tariffs and we did it again in this budget, and we have also been able to, through very good financial management, peg tariffs. The member who has asked this question will remember the last debates in this parliament when we did the appropriation bill last year where he admitted on the parliamentary record: ‘Oh yes, I can understand that by pegging prices like that it is actually a real cut’.
We are quite proud of the fact that we have been able to bring electricity prices down. We would like to do it even more. We would like to have Territorians paying as little as possible for their electricity. Unfortunately, that is not a reality in the short term for a number of reasons, particularly because we had to build such an enormous infrastructure when this place came about. We had aging power generation facilities. Those of us who lived here in the Commonwealth’s day will remember that power blackouts were the norm. Certainly it was at least a weekly or bi-weekly experience for many of us. We had a generation capacity that ran on terrible fuel. It was an environmental problem. It was a forward-looking Territory government that put in a massive amount of infrastructure including a pipeline that goes the whole length of the Northern Territory, some 16 000 kms to Channel Island. Later this week I’ll be launching or kicking off the new generator at Channel Island which is a $33m investment. We are talking about something that is very costly to the Territory budget. It is really important that the Power and Water Authority constructs itself so that it operates on a commercial footing and that unfortunately means our power tariffs are likely to stay the way they are in the foreseeable future.
We are very optimistic with the advent of the off-shore gas. We believe that we may be in the fortunate position of being able to negotiate much cheaper tariffs for our gas, and my colleague the Minister for Resource Development is unflagging in his endeavours to secure the best price for Territorians.
It should be pointed out also that an independent association, the Electricity Supply Association of Australia, which has a publication called Electricity Prices in Australia 1999-2000, an independent commentator, had this to say about ourselves and our next door neighbour, Western Australia, when it came to electricity prices:
Electricity prices in the Northern Territory and Western Australia are higher than in other jurisdictions as generation and distribution costs are higher. Major fuel sources for electricity generation in the two jurisdictions are natural gas, diesel and distillate. They are relatively more expensive than the brown coal and the black coal that are widely used in the states.
The two jurisdictions combined, cover half the nation’s territory and only 11% of the population. Their network systems are relatively small and physically isolated from the rest of the country. The costs associated with delivering electricity to the sparsely populated areas are also reflected in the higher electricity prices.
I finish by pointing out that it is this government’s wish to take electricity prices down as low as we possibly can, and this budget again sees a cut in commercial tariffs. I am proud that we have been able to balance our budget and pass these savings onto consumers.
Last updated: 09 Aug 2016