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Legislative Assembly for the ACT: 2002 Week 13 Hansard (19 November) . . Page.. 3741 ..

MR QUINLAN (continuing):

obligations under national competition policy. These obligations could be avoided only if it was in our public interest to stay within the old system. Because of the changes in Actew and the changes in the national electricity systems, the public benefit resides in moving to FRC. To do otherwise exposes us to a risk of losing annual payments from the Commonwealth relating to national competition policy obligations. For these reasons, it is time to complete the implementation of FRC, while acting in the best interests of the ACT consumers.

To be fully informed on the issue, I referred the matter to the Independent Competition and Regulatory Commission in December 2001. Let me say immediately that that was probably a reference made to the ICRC late in the day. But the previous government, consistent with quite a number of fronts on which it did nothing, had not taken any action-not only no action to change or not change, but no action to inform itself of, or get advice on, the public benefit. So it was, in fact, one of the first things that I did in assuming this particular ministerial portfolio.

I tabled the report of the ICRC in August 2002. Because it was late in the day and we are over-deadline as far as the competition commission is concerned in the implementation of full retail contestability, I received an interim report from the ICRC back in March. I used that interim report not to give any direction, but to give to ActewAGL the advice that was available at the time and the conclusions that the ICRC could have made at the time that its final answer would probably be that it was in the public interest to introduce full retail contestability. I did that so that at least ActewAGL could move where it thought appropriate. It was, if you like, fair warning of a distinctly probable outcome.

In completing the report, the ICRC took into consideration a range of matters relating to the costs associated with implementation of FRC for consumers using less than 100 megawatt hours of electricity per annum and the benefits that would be realised. In the broader national context, the move to a competitive retail sector in the electricity market marks a major step in the evolution of the national energy market. The ACT will benefit from this so long as the competition is genuine and the benefits of competition are passed to the consumers.

Further reform is going to happen. The Ministerial Energy Council, under COAG, commissioned the energy market review, chaired by Warwick Parer, to report on further necessary reform-as they see it, let me add. A draft report outlining a way forward for the energy sector for the national economy "will soon be released" it says here, but I think now has been effectively broadcast if not officially released. The national energy market represents a large element of that sector and the report has looked at ways in which it may be able to deliver even greater benefits to the end user-and let me say that it is the economic rationalist's summary.

The government has decided to join in the national electricity market reform because, on balance, we believe it is in the best interests of the people of the ACT in the longer term. This is a judgment we have made. I make no apology for that because there simply is no precise data to make life simple for the government or to make life simple for anybody else who might want to form a firm opinion on this. You look at the facts and you have to ask: in the long term, will the ACT be better off or not as a result of opening up the competition?

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