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ENERGYENERGY clgclfopit Ecological footprint Greenhouse emissions: Strategic infrastructure Investment Objective 5: consumption-government Energy Objective 3: Competitive businessclimate Objective 1 Link to will contributetoward thefollowingtargets: theachievement of andelectricity),combinedwithmeasures inpeakdemand, tomanage growth (gas networks electricity generation capacity, sources supply andaugmentationof energy alternative throughtimelyinvestment innew energy supplyof areliableProvision of andaffordable Regional infrastructure: SouthAustralia’s :

Attaining Sustainability Building Communities Growing Prosperity and support Build andmaintaininfrastructure todevelop placeto rating astheleastcostly Maintain Adelaide’s consumptioningovernment buildingsby Reduce energy power generation (T3.2) within10years. andleadAustraliainwindsolar 25% within10years will include: Actions within10years. human settlementsandactivities Reduce ourecologicalfootprint toreduce theimpactof period (2008–12).(T3.3) theKyotoAchieve targetduringthefi the targetsinSouthAustralia’s Plan.(T1.16) Strategic tosupportandachieve such astransport,portsandenergy infrastructure,Increase areas investmentinstrategic of (T1.6) theeconomy within10years. a percentage of Match businessinvestmentas orexceedAustralia’s ratio of internationally. (T1.4) study)andcontinueAlternatives toimprove ourposition set upanddobusinessinAustralia(KPMGCompetitive sustainable (T5.11) communitiesinregions. increasing sothatextending theexistingSolarSchoolsProgram energy effi electricity sothat renewable it increasing theuseof at least250schools have solarpowerwithin10years 10 years totalelectricityconsumptionwithin comprises 15%of 2006. (T3.10) a fi bysuchmeansastheintroductionwithin 10years, of ve-star energy requirement housesbyMay forve-star energy new Strategic PlanObjectives ciency of dwellings by10% dwellings of ciency rst rst commitment BUILDING SOUTH AUSTRALIA - INFRASTRUCTURE

Background

The implementation of national energy markets and the Electricity Generation and the Supply/Demand Balance Energy former government’s privatisation of the South Australian As a participant in the National Electricity Market (NEM), with energy supply industry, have seen a fundamental change connections to Victoria via the Murraylink and Heywood in the role of both industry and government. Responsibility interconnectors, electricity demand in South Australia is for funding energy infrastructure investments has been supplied by a combination of local generation and energy transferred to the private owners of the assets. The monopoly from the other states. electricity transmission and distribution network businesses earn revenue controlled by independent economic regulators. The South Australian Electricity Supply Industry Planning Council (ESIPC) plays an important role in providing The privatisation of South Australia’s electricity system information to markets to ensure appropriate investment. has resulted in increased prices charged to business and ESIPC independently develops and reports on electricity household consumers. Augmentation of the system to load forecasts, the performance of the state’s power system meet increased demand has been made more diffi cult by and matters relating to future capacity and reliability. It also privatisation. In public ownership, augmentation of the publishes an annual review of the performance, capability system proceeded somewhat in advance of demand and and reliability of the South Australian power system associated costs were amortised over a long period of time. – an Annual Planning Report. That report contains a full By contrast, private owners require a shorter period of time description of South Australia’s current energy infrastructure. for repayment of the costs of investment, with returns to (http://www.esipc.sa.gov.au/site/page.cfm). shareholders the key criterion for investment decisions. ESIPC has forecast that customer demand for electricity in While responsibility for fi nancing investment in assets has South Australia will continue to grow in line with economic been transferred to the private sector, the government growth, at approximately 2.1% a year. Peak demand is still has a key role to play in ensuring that the interests of expected to grow by 2.5% (100 MW) a year. Investment in new consumers are protected through appropriate regulatory generation capacity, new interconnectors and/or a reduction arrangements and that the private sector delivers investment in electricity consumption via demand side measures will be in a timely manner. Importantly, the government is required on an ongoing basis. responsible for ensuring that the legislative and institutional framework for energy markets addresses market failures and South Australia can produce enough electricity to meet it’s protects consumers. This is demonstrated by the signifi cant peak power demand. Due to privatisation the decisions reforms of market institutions and regulatory processes on further investment in electricity generation are made currently being undertaken in the National Electricity Market by private companies. Proposed expansion of the State’s (NEM) by the Ministerial Council on Energy (MCE). power plants includes Hallett, Quarantine, Pelican Point and Osborne. The new NEM objective will be focused on promoting effi cient investment in and use of electricity services for the long- term interests of consumers with respect to price, quality, reliability, safety and the security of the national electricity system. This will be achieved through: open access, no discrimination between fuel sources, incentives to promote economic effi ciency, effective signals to markets to stimulate appropriate investment, sustainable competitive prices over the long term, improved security of supply and the maximisation of consumer choice.

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ENERGYENERGY high cost of providing for peakdemandinfl high costof on hotsummerdays asairconditioninguseincreases. The inpeakdemandthat determinedbygrowth are occurs largely infrastructure requirementsSouth Australianenergy andcosts shortfalls. avenues sidesolutionstoreserve for demandand/orsupply Market ManagementCompany (NEMMCO) willexplore capacity. investmentinnew timely TheNational Electricity inpromoting investmenttoconsidertheiradequacy for new themarket mechanismsandsignals ESIPC willbereviewing various optionstoremove thisconstraint. ESIPC andElectraNetSAwillcontinue the toinvestigate imports. interconnector thestate andHeywood lower south-eastof present powerstations located inthe combined outputof transmission network doesnothave capacity to transportthe Interconnector.Heywood Itfound that insomesituations the between AdelaideandtheSouthEast,whichincludes there were constraintsinthesoutherntransmissionsystem In its2004Annual PlanningReport,ESIPCconcludedthat SouthAustralian(ESCOSA)respectively.Commission of andtheEssentialServices and ConsumerCommission(ACCC) sector monopolies,regulated bytheAustralianCompetition aretransmission network private byETSAUtilities.They owned andmanagedbyElectraNetSA,thelow-voltage Thehigh-voltagetransmissionnetwork is with consumers. Transmission and distributionnetworks connectgenerators Electricity Transmission andDistributionNetworks both generation andend-use. improved operations, lowercosts,andimproved effi the AboriginalLandsTrust. Theimmediate future focus ison TjarutjaAnangu Pitjantjatjara Landsand Lands,Maralinga electricity suppliestoAboriginalcommunitieslocated inthe managing thecontractfor thegeneration anddistributionof thestate. Thegovernment isalsocurrently northern partsof communities. There are 13suchsitesintheremote currently electricitytoremote Scheme (RAES)supportstheprovision of Supplies RemoteAreas Energy The State Government’s toconsumers. energy cost of uences theoverall ciency in ciency implemented were: fromwill apply 2005.Themostsignifi 1July approachdistribution codeandintroduced that anew theelectricity provisions of relevant ESCOSA reviewed delays fi inreceiving theformula applied and of estimating costs,transparency of electricity distributionsystem.Concernsrelated tothebasis the the chargingsystemfor connectionandaugmentation of concernshave beenexpressedHistorically overaspectsof over that period. by market participantsin generation withinSouthAustralia proceed overthemedium-term,dependinguponinvestment annual couldbeexpectedto planningprocess. Anupgrade the ElectraNetSAandVENCorp aspartof byESIPC, reviewed theVictoriatoSouthAustraliainterconnector willbe upgrade 2005.Optionsto costinJanuary opportunities andtheirlikely augmentation of Committee publishedabroad analysis to SouthAustraliainterconnector. Planning TheInterregional market includingtheVictoria attractive, asbeingpotentially ANTS identifi transmission planningfor eachtransmissionnetwork. The ANTS provides importantnational information toimprove fi theMCEreform process, NEMMCOproducedAs partof the rst Annual Transmissionrst Statement 2004.The (ANTS)inJuly more transparent criteriafor assessingaugmentation pre-determined unitaugmentation costsfor the useof establishing atimeframeinwhichETSAUtilitiesmust contributions for signifi that aremost customers required tomake acontribution quotations, includingtheirbasisandvalidityperiod give ed upgrades of four fl of ed upgrades rm cost quotations. cant projects. owpaths inthenational cant changes BUILDING SOUTH AUSTRALIA - INFRASTRUCTURE

Gas Demand and Supply Balance Gas Transmission and Distribution Networks One of the fi rst actions of the state Labor Government was to With the construction of the SEA Gas pipeline, and the negotiate a doubling of the capacity of the Sea Gas pipeline. planned commissioning of the SESA pipeline (connecting the

The pipeline provided an essential lifeline for the State SEA Gas pipeline to Katnook), gas transmission infrastructure Energy in January 2004 following the explosion at Moomba and will meet market growth requirements for the foreseeable interruptions to supply. future. It is the fi nal link in a system connecting all major gas production facilities with the south-eastern Australian market Gas supplies three distinct markets in South Australia: except perhaps for a sales gas line from Queensland to the electricity generation; industrial, commercial and domestic Moomba pipelines. The physical capacity of the Moomba sales; and liquefi ed petroleum gas (LPG) markets for autogas to Adelaide pipeline (MAP) and SEA Gas pipeline combined and heating and/or cooking at locations that the existing sales exceeds the projected medium term future demand. However gas reticulation grid does not reach. Historically, between much if not all this capacity is currently under contract. 50% and 60% of total sales gas production in South Australia has been used for electricity generation. The sales gas Based on projected Queensland and northern South market depends on gas plant and pipelines and reticulation Australian demand, proponents of the PNG gas supply infrastructure for delivery to customers. The LPG market not scheme anticipate that a new north-south pipeline could be only depends on gas plant and pipelines, but also trucking for built as early as 2009–10. delivery to customers. Liquid Fuels The total South Australian sales gas market is approximately Supply and demand for petrol, diesel and LPG are currently in 110 petajoules (PJ) per year. Estimates of demand growth balance in South Australia. Since closure of the Port Stanvac predict moderate growth to around 150 PJ per year by 2015 Oil Refi nery, South Australia has depended on interstate (i.e. average 3% per annum). The total South Australian LPG and overseas oil refi neries for all its petrol and diesel autogas market is approximately 500 tonnes per day, and the requirements. This has increased the supply time to between heating gas market some 350 tonnes per day. six and eight weeks.

Existing sales gas production contracts and commitments are Since the closure of Port Stanvac the only SA source of suffi cient to meet South Australian gas demand until the end LPG is via trucking from interstate and via a pipeline from of 2012. Beyond this, existing uncontracted reserves in the Moomba to Port Bonython, where the major storage facility Cooper, Otway and Gippsland basins have the potential to is also located. Port Bonython is dependent on the Moomba meet demand until around 2016. Future discoveries in these processing plant for its feedstock. The January 2004 Moomba basins have further potential to extend supply beyond this fi re demonstrated the critical nature of the current supply date. chain. South Australia’s LPG requirements in early 2004 were adequately met with LPG trucked from Victoria. Pending a change in energy supplies, such as commercialisation of large portions of coal seam methane The existing unloading and storage facilities at Port Adelaide and/or geothermal (hot rocks) energy, it is reasonable to limit the size of tankers that can be discharged. The road expect gas from the Timor Sea, North West Shelf or PNG being tanker distribution system may need to be reviewed to allow required within the next 15 years. Reserves in the northern for greater fl exibility to meet surge demand during peak fi elds are suffi cient to meet Australia’s needs well beyond the agricultural periods, holidays and the like. Redevelopment of middle of the century. regional storage facilities in country areas may also need to be considered.

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ENERGYENERGY therefore to: are objectives policy energy demand. Thegovernment’s brought andincreasing onbyeconomicgrowth energy securitystresses andrisks supply-chain equity andenergy South Australiaisnotimmunefrom theenvironmental, Plan aStateEnergy Development of Challenges andOpportunities the state andto capture opportunitiesthat willemerge. confi withthe environment that willprovidein thisnew industry planwillsetoutclearguidelines energy The government’s infrastructure indemand. investmenttomeet growth Australia that willprovide direction for future energy planforThe government South ispreparing anenergy Strategic Priorities tocompetitionandestablish a Remove barriers emissions. reduce gas greenhouse for all energy improve accesstoandaffordability of markets,promote competitive helpraisetherate of energy maintain secure andreliable suppliesof technological take-up innovation of andfast Foster investmentwithbusiness Encourage andalignprivate Ensure themarket operates inthepublicinterest by dence toplanfor neededinfrastructure investmentin advances in energy supply anduse. supply inenergy advances and communitydemands. providing reliable energy. andaffordable sources of industry. to businessesandencouragesinvestmentintheenergy that regime provides certainty transparent regulatory South Australians essentialinfrastructuredeliver sustainable improve economicgrowth, and productivity Strategic Priority supplies. gas SouthAustralian pipeline wouldalsostrengthen thesecurityof theprojects. Aconnection betweentheMAPandSEAGas of demand beingestablished tosupportthecommercial viability including theAdelaideHills,are dependentonsuffi centrespipelines toregional from theSEAGaspipeline, lateral gas anumber of Opportunities for theconstruction of project. provide anappropriatedue course, for commercial this driver (or anothernorthernsource) viatheMoombaarea may, in sourcedfuelled generation Guinea from withgas Papua New Resources’ Roxby Downsmine,with itspossibleon-sitegas WMC Theproposed intheregion. expansionof supply of 2005, which willimprove longer-term security in themiddle of the SEAGaspipeline.SESApipelinecommissioningisexpected has committedtobuildtheSESApipelinelinkKatnook with security.south-west Queenslandwouldimprove supply Origin pipelineconnectionbetweenMoombaandBallerain A gas Gas state gas greaterFacilitate of inter-connectivity to multiple gas supplies at competitive prices. suppliesat competitive to multiplegas toensure thatconnectivity SouthAustraliahasaccess fi transmission pipelinesandadditional gas eld cient BUILDING SOUTH AUSTRALIA - INFRASTRUCTURE

Liquid Fuels Greenhouse gas concerns also have implications for the

Since the decommissioning of the Port Stanvac refi nery and longer-term requirement for new energy infrastructure Energy storage facility, the state is now more dependent upon the investment to keep pace with economic growth. In the near to operation of the Birkenhead tank farm. Opportunities to medium-term, State Government policies will aim to reduce improve the operation of the fuel supply chain in the state uncertainties associated with attracting necessary investment and to make the available assets work more effectively to into the state’s energy systems to ensure demand is met. meet the needs of participants need to be explored. Recent Following the privatisation of the state’s power assets, the changes to regulations allow the blending of biodiesel and infl uence of the government on investment decisions has conventional diesel in South Australia. Biofuels use is forecast been substantially reduced. The South Australian energy to increase in South Australia. and greenhouse plans and sustainable energy policy will complement and infl uence inter-jurisdictional initiatives and thus reduce uncertainty for investors in the energy industry. The energy plan will consider these issues in more detail, as Strategic Priority well as more clearly identifying future opportunities for both investment in new capacity and demand-side management. Facilitate improvements in fuel supply chain and storage facilities to ensure suffi cient capacity to meet demand for fuel. Strategic Priority

Greenhouse and Energy Industry Investment Promote the development of market and regulatory In the short term, the uncertainties for energy industry arrangements that encourage energy industry investors associated with a carbon constrained world carry developments that minimise growth in greenhouse gas market risks. Notwithstanding the environmental benefi ts of emissions. renewable energy, the rapid growth in wind farm capacity and its intermittency of supply may have implications for investment in more conventional generating plant, and the supply-demand balance. While investors in the energy market can make their own judgments about pool prices and trading risks, it is now diffi cult for them to adequately factor in premiums for risk considerations associated with future government policy on greenhouse gas abatement. The failure of the Australian Government to formulate a coherent greenhouse policy has not helped in resolving this problem. The future direction and pace of local and global greenhouse gas abatement credits and markets remain uncertain.

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ENERGYENERGY renewable energy consumptionwillfocus on: energy renewable SouthAustralia’s Plantargetfor Strategic of achievement intheSouthEast,canalsobeexploited.The particularly and geothermalenergy. biomassresources, Thestate’s are wind,solar advantages, comparative based onregional interest toSouthAustralia, The mostpromising of renewables Generation Renewable andDistributedEnergy natural gas. has beenconvertedtobiodieselwiththerest operating on themetropolitan busfl example60%of be successful.For market, thepotentialexiststoexpandproduction shouldthey thediesel have asmallpercentage thecapacity of tosupply to buildabiodieselplantat only Port Adelaide.Whilethey Government froma $7.15millioncapital theFederal grant Fuelshassecured Millicent in2005.AustralianRenewable Fuelisproposing toreinstateFarmers acanolaoilplantat are proposing tobuildbiodieselplants.SouthAustralian usedfor transport.InSouthAustraliatwogroups emissions if Biofuels have the potentialtoreduce andother greenhouse Plan. Energy tobeconsidered indetailthe guide subsequentactivities work ontheseissues,whichwill has undertaken preliminary improved forecasting anddata of systems.ESIPC development side measures or additional fl demand- the easternstates theuseof viainterconnectors; toandbalanceimportsfrom ability toexportwindenergy connection andperformance standards the for windfarms; willdependon additional windenergy Successful useof research anddevelopment, of programs active solarhotwaterincreasing thepenetration rates of geothermal investorinterest inwindfarms, leveraging intermittent windgeneration inconventionalnetworks. managingsignifi the complexitiesof and insolarPVandgeothermalenergy particularly andphotovoltaics(PV) heaters andbiomassplants energy exible generation, aswellthe cant quantities of cant quantitiesof eet years. $320 millionwork investmentoverthenextfi program orare beingprocessed,been granted, leadingtoaforecast geothermal exploration licenceshave recently number of unproven, iscommercially asignifi HDR technology signifi regionally hasthepotentialtoprovide amajorAustralianand (HDR), rocks’ through occurring‘hotdry wellsdrilledintonaturally investment. Geothermalenergy, produced bypumpingfl andhasattracted geothermalexplorationadvantage South Australiaalsohasageothermalresource comparative therate fuels. toconventionalcrude applying oilderived half beraisedoverafi excise willgradually biofuels willremain excisefree 2011.Afterthis, until 1July industries, theAustralianGovernmenthasdecidedthat thebiofuels To of andgrowth encouragethedevelopment Strategic Priority inrenewable Support research anddevelopment viability. energy, toenhancetheirtechnicalandeconomic wind,solarPVandgeothermal technologies, particularly cant sustainable energy supply source. While supply cant sustainable energy ve-year periodtoabout cant ve uid BUILDING SOUTH AUSTRALIA - INFRASTRUCTURE

Managing Peak Demand The development of various measures to manage peak The increased use of air conditioning in the community demand and improve energy effi ciency is the focus of means 33% of the state’s gas and electricity infrastructure is considerable work at state and national levels, and will

required for only 5% of the time. require active programs of research and development, Energy including consideration of how DSM can be incorporated Providing for the growth in peak demand has historically within the NEM. The results of this work will be refl ected in been achieved via supply-side investment in generating plant, the State Energy Plan. Recent developments are outlined interconnectors that take advantage of diversity in energy below: demand profi les between South Australia and Victoria and the rest of the NEM, and augmentation to network infrastructure. Demand Management and Electricity In recent times, the investment responsibility has passed Distribution Network to the private sector, the signals for which in the NEM are ESCOSA will provide $20 million for DSM initiatives by ETSA intended to be provided by prices in the wholesale market, Utilities over the fi ve-year regulatory period, beginning July as well as fi nancial products purchased by participants to 2005. The initiatives include: manage risks associated with operating in the wholesale pilot programs for power factor correction for large market with a high price cap. customers standby generation, direct load control of residential The Electricity Demand-Side Measures Task Force, in its airconditioning and other residential systems June 2002 Final Report, noted that ‘the need to supply large critical peak pricing for customers with interval meters quantities of electricity for short periods of time, largely to already installed meet summer air-conditioning requirements, is leading to an investigation of opportunities for curtailable load unsustainable investment in peaking generation that will lead control and voluntary load control initiatives to increasingly higher costs for South Australian consumers. review of the opportunities for ETSA Utilities to act as a Peak energy demand continues to grow at a faster rate than demand management aggregator total electricity sales. establishment of demand management capabilities within ETSA Utilities. Demand-side management (DSM) measures, such as improvements in the effi ciency of energy use, peak load ETSA Utilities is required to submit a proposed program management and embedded generation, can play a role for implementation of these DSM initiatives to ESCOSA for in addressing growth in peak demand and consequently approval. greenhouse gas emissions. Targeted DSM can provide a cost-effective alternative to infrastructure investment that otherwise may have poor capital use. By reducing the need for new generation and network infrastructure, such measures can contain consumer price increases.

The Australian Government has committed to fast-tracking an Adelaide Solar City trial as the fi rst of several around the country, under a new $75 million, fi ve-year program aimed at demonstrating what a future sustainable (energy) urban environment would look like. The trials are aimed primarily at providing a ‘living model’ of how peak demand management technologies and market signals, with embedded generation technologies (including solar energy), can deliver economic and environmental benefi ts. The project also supports the government’s commitment to promoting Adelaide as a ‘green’ city.

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ENERGYENERGY awareness. general consumercapacity buildingandfi operations, trade andprofessional trainingandaccreditation, effi energy coverbuildings,commercial andindustrial packages theNFEE.Thepolicy that form packages Stage1of policy interconnected On 27August2004,theMCEapproved asetof effi energy technologies andprocesses tosignifi effi energy associated withincreased implementation of unlock thesignifi theNFEEisto inAustralia.Thepurposeand programs of (NFEE) todefi Effi for aNational Energy Framework of development aproposal forIn November2002,theMCEendorsed the Effi forEnergy National Framework rating. afi building toachieve 2006, it will give preference2006, itwillgive toleasingoffi commercial from buildingsectorbystating July that effective effi energy The government isdriving Standards Performance Commercial BuildingEnergy 15%expectedby2010. 2014, withaninterimreduction of 25%by useingovernment buildingsof reduction inenergy that managementprogram targetsa government energy Effi The Energy Effi Energy 10,000 m bysigningupfor the $600millionCityCentralredevelopment rated buildings.Thegovernment hasalsokick-startedenergy 2 ciency, appliances andequipment,government performance. ciency of offi of ciency ciency Action Plan ne future effi directions for energy ciency ActionPlan(EEAP)isawhole-of- ciency ce space, which will be Adelaide’s fi ce space,whichwillbeAdelaide’s cant butuntapped economicpotential ve-star green and energy building andenergy ve-star green cantly improve Australia’scantly ciency inthe ciency ciency ce spaceinfi nancial sector ciency policy policy ciency rst rst offi ciency ciency ve-star cient ce including: effi between energy The Stage1NFEEpresents opportunitiestoform greater links million pa. upto$400 and provide Gross of DomesticProduct (GDP)gains by2015, nationally energy potential tosave around 50PJof Stage1NFEEmeasures hasthe The implementation of Strategic Priority considering peak-demandbenefi incorporating peak-demandperformance ingovernment performance buildingenergy theuseof investigating demand-sidemeasures that Promote theadoptionof considerations inchoosingoffi peakdemand building performance duringtimesof improving rating toolsandstandards asameans of minimum energy performance standards forminimum energy appliances. use of existing infrastructure. use of contribute tomore effi ciency andpeakdemandmanagement, ciency cient energy useandimproved cient energy ce accommodation ts in developing ts indeveloping BUILDING SOUTH AUSTRALIA - INFRASTRUCTURE

Energy Market Development and Reform The Productivity Commission is also currently reviewing The state’s energy plan will recognise the importance of the gas access regime and is investigating its impact on the marketplace to drive infrastructure investment and investment. The recent Council of Australian Governments

innovation. The investment response to the hot summer (COAG) Energy Market Review found that there was scope for Energy of 2000/2001 (the Quarantine, Hallett and Lonsdale power further market development by increasing competition in stations in South Australia, and the Somerton and Valley upstream markets and reducing regulatory uncertainty. The Power investments in Victoria) suggests that the NEM is fi ndings of the review will be considered as part of the current capable of bringing forward generation investment, although program for energy market reforms. private investment timing is cyclical with large, infrequent increments of capacity being added only when strong price Many of these issues will be considered in more detail in the signals emerge and economies of scale can be achieved. state energy plan which will, as part of the energy planning process seek to reduce information gaps and hence address Energy markets are complex with investment impediments potential risks of market failure for future commercial that include uncertain returns and regulatory hurdles and investment. imposts. While the energy market in Australia is in the process of maturing, competition in some segments of the NEM is not yet fully developed (e.g. the retail market for small customers in South Australia, or the extent and diversity of generation Strategic Priorities capacity in certain regions). In addition the NEM has been less effective in ensuring that demand-side management capacity Promote the development of national policy and is fully developed to compete with generation capacity. regulatory arrangements for energy markets that ensure that South Australia secures access to reliable, A proposal for a national Emissions Trading Regime (ETR) sustainable and affordable supplies of energy. within the electricity sector is presently being examined by Promote the integration of sustainable development the states and territories. Such a scheme is a market-based concepts into market decision-making so that non- approach that has the potential to offer a mechanism to cost market costs and benefi ts are included in investment environmental impacts and to develop cost-effective options considerations. to meet Australia’s greenhouse targets. The government will carefully evaluate the ETR proposal to determine its nature, how it will impact on South Australia and whether it will be compatible with international schemes.

The need to encourage greater investment in gas infrastructure is also being addressed by the MCE, which has directed that a high-level policy review be undertaken on the fundamental principles and design concepts for a future gas market. It would aim to encourage transparency, new market entrants, further effi cient investment in gas infrastructure such as storage facilities, and a market mechanism to assist in managing supply and demand interruptions. The long-term security of gas supply, against a background of increasing demand for direct access to gas resources, will also be investigated.

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ENERGY Projects Electricity generation Project Priority # 2005/6– 2010/11– SASP aiiaepiaeivsmn ncnetoa eeaincpct,icuigHlet 1 investmentinconventionalgeneration private Facilitate capacity, includingHallett, h ot at 3.10 2 toprovideExpand bio-dieselproduction fuelfor facilities transportand U/way 1 Lead –privatesector 1.16 U/way the SouthEast biomasspowerstationsContinue in thecommercial toinvestigate viability of 1 Lead –privatesector commensurateConstruct withmarket licensedwindfarms, andnetwork stability Lead –privatesector geothermalpower of Promote thedevelopment Lead –StateGovernment solarwater heaters Encourage theuptake of Renewable energy * Lead–privatesector Quarantine, Pelican Point andOsborne inSouthAustralia omrildmn 1.16 3.10 # rankings. donotrepresent Prioritynumbers Priority –preliminary afi * theproject. andevaluating Lead –leadresponsibility developing for promoting, Lead –privatesector SouthAustralia’s suppliesby: gas Increase thesecurityof Gas 1 Lead –privatesector South Eastwhentheongoing planningprocess demonstrates itseconomicfeasibility Remove theconstraintintransmissionsystembetweenAdelaideand 1 Lead –privatesector commercial demand Expand theelectricitydistributionnetwork tomeetindustry, residential and Electricity transmissionanddistribution Lead –privatesector electricity generation cntutn nadtoa alr oMob ieie 1 2 U/way constructing anadditional BalleratoMoombapipeline connecting theSEAGaspipelinetoMAP system connecting theSEAGaspipelinetoSouthEastgas entities. See the Delivering thePlansectionfor furtherdetails entities. SeetheDelivering 3.3 3.3 5.11 nal commitmentbytheState Governmentorother lead 2009/10 2014/15 Targets 3.10 ❉ ❉ ❉ ❉ ❉ ❉ ❉ ❉ ❉ 3.3 3.3 1.16 5.11 3.3 ❉ ❉ ❉ ❉ ❉ ❉ 3.2 3.2 1.6 1.16 5.11 1.4 BUILDING SOUTH AUSTRALIA - INFRASTRUCTURE

Projects

Project Priority # 2005/6– 2010/11– SASP

2009/10 2014/15 Targets Energy

Encourage further investment in gas infrastructure to connect South Australia, 1 ❉ ❉ 1.16 via the Moomba area, to gas basins to the north and north-west 5.11 Lead – private sector

Promote regional aggregation of demand to encourage expansion of the gas 2 ❉ ❉ 1.6 distribution network Lead – private sector

Liquid Fuels

Ensure that ‘M’ berth at Birkenhead and the associated tank storage site 1 ❉ ❉ 1.16 are able to function effectively as the major delivery and storage point for bulk fuel Lead – private sector

Improve management of regional unloading and storage facilities for liquid fuels 1 ❉ ❉ 5.11 to provide capacity to meet peak demands Lead – private sector

Demand-side Management

Increase the government’s stock of offi ce accommodation that meets fi ve-star U/way ❉ ❉ 3.2 energy rating 3.3 Lead – State Government

Improve energy effi ciency of buildings, appliances and large businesses through U/way ❉ ❉ 3.2 implementing the NFEE Stage 1 measures 3.3 Lead – State Government

Trial innovative methods to reduce peak demand, including through the ETSA 1 ❉ 3.2 demand management program 3.3 Lead – private sector

Implement the South Australian component of the national solar city initiative 1 ❉ ❉ 3.2 Lead – private sector, Australian Government 3.3

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