Page 1912 - Week 05 - Thursday, 3 May 2012
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support. We recognise that at times you have to make an up-front investment in order to deliver long-term benefits and real cost-of-living savings in the long run that will actually make a difference to households. It is not simply a case of saying, “It’s terrible that the price of electricity is going up.” It is about encapsulating the idea that the cheapest unit of energy is the one that you never buy.
Another key strength of the scheme is the focus on vulnerable households. As the regulatory impact statement for this bill notes, low income households spend a much greater proportion of their budget, nearly double, on energy than wealthier households do. The opportunity for these households to invest in energy efficiency measures is also reduced, compounding the issue. In light of this, the specification of priority households in the legislation is one of its real strengths.
Given that 20 per cent of ACT residents are defined to be low income, the requirement for suppliers to focus 25 per cent of their energy efficiency activities upon such households ensures that they will become net beneficiaries under the scheme. The strong penalties for suppliers’ failing to meet the priority household target, which are additional to the penalties attached to meeting the scheme’s overall energy reduction targets, indicates that the scheme will lead to a marked improvement in the cost of living for the ACT’s most vulnerable households—not to mention, of course, an improvement in the quality of life. That is an issue I have discussed before in another debate in this place around rental housing standards.
Following on from that, members will recall that both the Greens and I have continuing concerns about assisting those who live in rental properties. We believe this legislation will help address some of the split incentive issues that I have raised in this place before. Certainly, the experience in South Australia has been that renters participate in this scheme just as much as homeowners do. Given that all that is required for most renters to participate is the permission of their landlord—and since the changes are beneficial to the property and cost-neutral for the landlord—there is little disincentive for the landlord to participate. In fact, under the South Australian scheme the number of participating renters has actually increased in recent years, as have their reported energy and bill savings.
In relation to the scheme’s contribution to reducing ACT emissions, we understand it is forecast to deliver cuts of 6.2 per cent in stationary emissions by 2015, with ongoing annual reductions of 4.7 per cent—even if the scheme ceases.
In assessing the scheme there were, of course, questions that arose for us. We took those concerns up with the Environment and Sustainable Development Directorate. We had a good discussion with them and it certainly cleared up and clarified a number of the issues. I would like to reflect on a few of those as I think it is important, in the context of debating this legislation, to make clear what some of those concerns were and also the answers to some of those questions.
Our first concern related to the inclusion of the definition of eligible activities, particularly the inclusion of appliances such as whitegoods, televisions, light bulbs and power boards. We are aware that the inclusion of such measures has created problems in other jurisdictions which have already implemented these schemes,
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