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Legislative Assembly for the ACT: 1998 Week 3 Hansard (28 May) . . Page.. 703 ..

MR SMYTH (continuing):

Mr Speaker, it is important that the objectives of existing gas legislation and functions of the Gas Authority in relation to the protection of consumer interests do not get overlooked in the translation to a new framework for a competitive gas industry. The Gas Supply Bill 1998 provides for a Gas Technical Regulator to amalgamate the roles of both the Gas Authority Secretariat and the Gas Technical Controller, thereby continuing the public and industry interface functions, while strengthening the system of control that is needed to ensure technical and safety compliance by the gas industry.

The Gas Supply Bill 1998 also provides for the authorisation of the gas transmission; gas distribution, through networks; and gas supply, retail, businesses - replacing the single authorisation given to AGL as a "bundled" networks and retail business. The operation of East Australian Pipeline Ltd in the ACT is currently not covered by an authorisation, as the Gas Act 1992 applies only to distribution pipelines. Conditions of authorisation will establish specific prudential and technical criteria for gas businesses and set out requirements for reporting, accounting and compliance with ACT laws, in addition to conditions in relation to infrastructure standards, so as to ensure a safe and continuous supply of natural gas to ACT consumers. The objective in cost-effective regulation of the gas industry is to identify the actual cost of regulation and to recover that cost from the authorised businesses in the market through the authorisation fee. This method has been adopted in New South Wales.

Mr Speaker, the Gas Supply Bill 1998 repeals the Gas Act 1992 and the Gas Levy Act 1991. This means that the gas levy and the energy research and development levy will no longer apply, consistent with the High Court ruling in 1997 that limits the ACT raising revenue based on a quantum of sales. These levies had previously been identified as being anti-competitive in nature and have since been removed in the New South Wales gas legislation. The removal of these levies is a matter which should be drawn to the attention of the ACT Independent Pricing and Regulatory Commission in its first review of charges, so that the benefits of competition can be passed on to consumers.

The introduction of competition in both the ACT and New South Wales would also mean that other gas retailers can compete in those markets - again, a benefit to consumers of these new arrangements. In New South Wales, the Independent Pricing and Regulatory Tribunal's determination of AGL's gas transport charges made a substantial impact on those charges, and these benefits are expected to flow on to the large number of users, including retail gas businesses, in the ACT over the next three years. Existing funds in the Energy R and D Trust will continue to be used in energy and gas industry-related development projects, such as the current evaluation of natural gas vehicles in the bus and light vehicle fleets.

Mr Speaker, I will conclude by saying that the Gas Supply Bill 1998 complements the Gas Pipelines Access Bill 1998. Both Bills are primarily aimed at price benefits for gas consumers in the ACT, as well as enabling the ACT to conform with the requirements of the gas pipelines access agreement to create a national gas market. By participating in the national gas market, the ACT Government will be able to ensure that long-term gas demands can be met from a range of competing producers, pipeliners and retailers.

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