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17 Jul 2014 Estimates—Energy and Water Supply 1 THURSDAY, 17 JULY 2014 _______________ ESTIMATES—STATE DEVELOPMENT, INFRASTRUCTURE AND PLANNING COMMITTEE—ENERGY AND WATER SUPPLY Estimates Committee Members EST IMATES—ENER GY AND W ATER SU PPLY Mr DF Gibson (Chair) Hon. TS Mulherin Mr MJ Hart Mr R Katter Ms KN Millard Mr BC Young Mrs JR Miller _______________ Member in Attendance Hon. A Palaszczuk Mr MJ Pucci _______________ In Attendance Hon. MF McArdle, Minister for Energy and Water Supply Mr J Baker, Backbench Liaison Officer/Policy Adviser Mr F Quinivan, Chief of Staff Department of Energy and Water Supply Mr D Hunt, Director-General Mr K Sedgwick, Deputy Director-General, Water Mr B Barr, Acting Deputy Director-General, Energy CS Energy Limited Mr M Moore, Chief Executive Officer Energex Limited Mr T Effeney, Chief Executive Officer Ergon Energy Corporation Limited Mr I McLeod, Chief Executive Powerlink Ms M York, Chief Executive Stanwell Corporation Limited Mr R Van Breda, Chief Executive Officer _______________ Committee met at 9.03 am CHAIR: Good morning, everyone. Welcome to the State Development, Infrastructure and Industry Committee’s second public hearing for the examination of the Appropriation Bill 2014. I would like to introduce the members of the committee. I am David Gibson, the member for Gympie and chair 2 Estimates—Energy and Water Supply 17 Jul 2014 of the committee. The Hon. Tim Mulherin, the member for Mackay, is the deputy chair but he is absent for the first session this morning and I welcome the Leader of the Opposition, who is his replacement. The other committee members with us today are: Mr Michael Hart MP, the member for Burleigh; Mr Rob Katter MP, the member for Mount Isa; Ms Kerry Millard MP, the member for Sandgate; and Mr Bruce Young MP, the member for Keppel. Mr Michael Crandon MP, the member for Coomera, is an apology for today’s hearing. The committee has also granted leave for other members of the parliament to participate in its hearing from time to time throughout the day. The committee will examine the proposed expenditure contained in the Appropriation Bill 2014 within its portfolio responsibilities contained in schedule 6 of the standing rules and orders. The first item for consideration today is the proposed expenditure for the organisational units within the portfolio of the Minister for Energy and Water Supply. On behalf of the committee, I welcome the minister, departmental officers and members of the public to the hearing. The committee will suspend proceedings for the following breaks: from 10.45 am to 11.15 am, from 1 pm to 2 pm and from 3.30 pm to 4 pm. I remind everyone present that any person may be excluded at my discretion as chairperson or by order of the committee under the standing rules and orders of the Legislative Assembly. Today’s committee’s hearing is being broadcast live via the Parliamentary Service’s website and to receivers throughout the parliamentary precinct. I ask everyone to ensure that their mobile phones or other electronic devices are turned off or switched to silent mode. Witnesses, please take note that you will need to turn your microphones on and off when addressing the committee. Everyone, please bear in mind that there are to be no more than two microphones on at a time. I ask departmental officers to identify themselves when they first speak to enable Hansard to record their name and to speak directly into the microphone. I now declare the proposed expenditure for the portfolio of the Minister for Energy and Water Supply open for examination. The question before the committee is— That the proposed expenditure be agreed to. Minister, if you wish, you may make a three-minute opening statement. Mr McARDLE: Mr Chairman, thank you very much. I acknowledge yourself and all members of the committee, and also my staff and my DG and his staff as well. Mr Chairman, the government is determined to develop a strong plan in regard both energy and water for the growth of this great state. The committee would be aware, having been attendees in Mackay and also in Brisbane, that the government is working towards a 30-year plan—that is, the Queensland Plan. That plan has a number of facets. Those facets include a desire for the population growth in regional areas and also the south-east and the growth of the four pillars that this government has enshrined in its approach to Queensland over the 30-year time line. Mr Chairman, those desires and growth must come with the development of both electricity and water strategies. It is with those strategies in mind that I, my office and the department began some time ago now on the development of two plans. Those plans culminated in the release in June this year of WaterQ and PowerQ. The process to achieve those outcomes were lengthy and entailed consultation in both cases, with around 1,500 surveys and submissions together with travelling across the state to engage and understand the desires of not just people in domestic situations but in commercial situations and also large providers of both power and water. Mr Chairman, I have with me a copy of both WaterQ and PowerQ. I seek leave of the committee to table a copy of both of those documents for the reading of the committee at an appropriate time. CHAIR: Is leave granted? There being no objection, leave is granted. Mr McARDLE: Thank you, Mr Chairman, and the committee. I want to first of all talk to PowerQ. There is no doubt, as I said earlier, that electricity will underpin the four pillars of the economy in conjunction with water. The government sees the electricity sector as providing the most expansive opportunities we have in this state to develop the supply and delivery and use of electricity. In particular, we see the resilient cost-effective and consumer focused supply for Queensland as being our paramount consideration. We need to extract real value for customers and promote efficient markets. The power sector across this state, this nation and the globe is changing. It is changing in a dramatic way and has long-term and far-reaching impacts. New technologies are the mainstay of that particular change. At a later time, if chance occurs, I will go into the issue of solar power and battery. But can I just tick off some of the changes that may well be coming through. Microgrids could well be 17 Jul 2014 Estimates—Energy and Water Supply 3 a phase of the future. You may not actually buy your solar panels and batteries; you may lease them in time to come—not that far away. Electric cars are also an element in the future growth and use of electricity. The understanding of the impact of those and other factors in how we develop the sector in this state is critical. The issue in regard to the plan being of 30 years duration is important for this. We are going to enshrine what I have termed in the document an ‘expert panel’. No-one can tell me in 30 years time what the technology will be. No-one would have guessed that the simple iPhone today would develop for the brick sized item we saw back in the late eighties and early nineties. But if we are working in the space mentally of what the technologies may be and understanding the pressures we are under then we have a much better chance of capturing the nuances and understanding of what is coming down the road. I made the comment recently that battery technology is headed towards us like a freight train. I believe that to be the case, and we need to deal with that and understand how it can be of benefit to the state. WaterQ in my opinion is equally an exciting document, again because our population growth and food growth in this state has become a cornerstone to the economic development of Queensland. My colleague Dr John McVeigh is working towards doubling the food production in the period of four months. That means water is essential. But again I come back to two points. The issue of technology again is precedent. Mr Chairman, I hold in my hand here a water meter but it is an advanced water meter that is used in the Mackay Regional Council and would be well known to the member for Mackay. About a month ago I met with Deirdre Comerford, the Mayor of Mackay. They have this advanced meter fitted to several thousands of homes in Mackay. That gives them real-time reading in regard to the use of water, leaks and other issues that the council can use to enable them to potentially defer $100 million of capital investment in the future. That is real savings to the people in Mackay. The Mackay Regional Council have taken this on board because they see that it is of value to them and their population. This may not be the answer to every concern across every town or every city, but it is a great use of technology in understanding what can become available and applying it in a manner that is economical and has long-term consequences. Mr Chairman, the government is committed to working with all sectors across this state, and both the expert panel in PowerQ and that in WaterQ will hopefully be announced in the very near future. Those panels will be charged with providing advice to the government. They will be manned by people who are qualified across the sectors, plus also people who actually have the capacity to see not into the future but of the future to guide us as to where the technology is headed to.