Labor’s dirty diesel deal exposed


The State Government has revealed the former Labor Government’s deal for eight diesel generators would have cost South Australian taxpayers a staggering $609.5 million over their lifetime.

A report into the diesel generators by Mr Mark Livesey QC, tabled in State Parliament today, shows that the total price of the former Labor Government’s energy plan would have been at least $814.5 million but maybe more – a blow out of approximately 50 per cent more than initially budgeted.

“These shocking sums of taxpayer’s money highlight the real cost of the former Labor Government’s failed energy policies,” said Minister for Energy and Mining Dan van Holst Pellekaan.

“The former Labor Government’s repeated claim that their energy plan would cost no more than $550 million has been exposed as a complete fallacy.

“Labor were happy to let these generators sit idle and inflict unnecessary financial pain on South Australians while they continued to play politics with people’s electricity bills.

“The report is a sobering read, and a damning indictment on the previous Labor Government’s decision-making, highlighting serious concerns with the procurement process.

“It exposes how, seemingly without any expert advice, Labor rushed into owning permanent generators at huge expense which will likely not be needed in the future.

“The $609.5 million cost of the diesel generators dwarfs the amounts from the Renewable Technology Fund and the amounts committed to accelerating gas to market.”

Mr Livesey QC requested access to documents which would have assisted the review however access was denied by the Leader of the Opposition.

The State Government will today provide a market notice that it will undertake an open Lease by Tender process to operate the generators for a 25-year period subject to strict controls to ensure that they operate to help deliver more affordable and reliable power in South Australia.

“In all likelihood these generators will not be needed for emergencies into the future and by leasing them for 25 years they can help deliver more affordable and reliable power,” said Minister van Holst Pellekaan.

“By leasing these generators it means they will actually be used and not sit idle while also preventing South Australian taxpayers from bearing the full $609.5 million cost over the lifetime of these assets.

“The Marshall Government will seek to protect South Australian taxpayers at every turn and will always make the best decision to deliver cheaper and more reliable electricity for South Australian households and businesses.

“The Marshall Government is moving forward with our Energy Solution which is centered around the world’s largest roll-out of home battery storage, an expansion in grid scale storage, and accelerating the interconnector with NSW.”

The State Government has determined that some of the capacity may be required to provide emergency generation in the SA market until autumn 2020. The Tender process is expected to commence in early November to enable completion of negotiations with parties by April 2019.