Page 2631 - Week 07 - Wednesday, 2 July 2008

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extended to consider the implications of this bill and applied to a broader range of low-income households. To solve this problem, as well as providing an incentive for householders and businesses to lower their energy use, varying rates should be introduced—a lower rate for low consumption and higher rates for higher consumption. This is already done for water, whereby, when people use more than a certain amount, excess water is charged at a higher rate. I believe this was proposed in a submission by the Essential Services Consumer Council.

This skewing of energy costs is exacerbated by the fact that high-income households often have many more appliances, including air conditioning systems, which they often use during peak time or mid-afternoon. If energy were priced at a higher rate in the afternoon, costs could be more fairly spread across income brackets as well as providing an incentive for those households with air conditioning to be more energy efficient, to be more solar aware and to get better insulation. It must be noted that low-income households are already subsidising households and large corporate buildings which use air conditioning by using electricity at a peak time but paying a standard rate. We believe this subsidy is far larger than the additional cost of a feed-in tariff from photovoltaic installations would be.

It is an indubitable fact that energy prices are going to go up, feed-in tariff or not, emissions trading or not. We have just seen the ICRC recommend a rise in tariffs, and this has happened without either of those things being in place. We are going to be having similar debates around this as we are having around petrol at the moment. I think we are being done a disservice by the Rudd government here. It is a great pity that we do not talk about climate change; we do not talk about the fact that oil is a finite resource. Instead we talk about the price of petrol. We are going to have to face more expensive electricity costs. We do have to work out a way to make it equitable, but we cannot avoid the fact that that will happen. If we want to stop climate change, that might happen a bit more, but we owe it to future generations to have a go at it, Mr Mulcahy.

MR MULCAHY (Molonglo) (5.09): So as not to offend against the standing order in relation to repetitive and tedious comment, I will be brief. I simply say that I am pleased to support any initiative that is directed at taking into account the position of low-income earners. I do not believe that matters in relation to the treatment of concession holders will go far enough. My view of those who will be impacted goes beyond those who might be holding benefits cards of various sorts. My concern relates to mainstream families who are finding it extremely difficult.

I agree with a fair chunk of what Dr Foskey said—things will go up in price. When we see the looming impact on gas, we will also see those energy costs escalate, as we are seeing with electricity, due to external events which so far have not impacted on the eastern seaboard in the same way as they have in the west. Initiatives that can go towards addressing climate change through energy conservation all do make sense.

I reiterate that I am concerned about measures that will further hurt those who are suffering from the escalating cost of energy. I am under no illusion that we are going to see substantially more increases, just as we are seeing them on the fuel front and on the food front. A lot of these things are interrelated, of course. I think the amendment is certainly a step in the right direction. I am a bit curious why Mr Gentleman will not support this initiative. I think the principle behind what Dr Foskey is saying is sound.

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