Ms CLOVER MOORE (Sydney) [6.44 p.m.]: My constituents and New South Wales residents are concerned that they will pay up to 64 per cent more for electricity over the next three years, mainly to fund $16.4 billion in transmission and distribution network upgrades, largely because of an expected growth in peak demand. Growth in peak demand is around double that of total energy consumption and the Australian Energy Regulator Chairman, Steve Edwell, points out that peak demand growth is being driven by increased air-conditioning used on a few hot days. Expanding network capacity to provide additional peak supply is environmentally irresponsible, unsustainable and significantly more costly, particularly because the system gets underused most of the time. Demand management schemes should be the first step to cut peak demand before any network or generation expansions are conducted.

Expert research shows that, while price increase alone will not reduce overall demand, consumers do cut peak use, such as at 4.00 p.m. in summer and 7.00 p.m. in winter, in response to time-of-use pricing. This requires meters to measure quantity and time of electricity use. I understand the State Government is trialling smart meters in new and newly renovated buildings. The submission of the Nature Conservation Council of New South Wales on proposed new power stations points out that Energy Australia achieved a total daily power consumption drop of between 5.5 and 7.8 per cent when a critical peak pricing event occurred during this trial.

Ontario has had time-of-use pricing since 2006 and New York saved more than 70 gigawatt hours each year and 5 megawatts during its summer peak through its Peak Load Reduction Program. Only about 30 per cent of energy from distant coal-fired power stations reaches the consumer; much is lost during transmission. We should transfer investment in this inefficient network to decentralised electricity generation, which does not suffer the same energy loss through transmission, requiring less infrastructure investment.

I welcome the Government's gross feed-in tariff to encourage the take-up of solar panels, but we also need a long-term plan to expand trigeneration, which uses natural and waste gas for electricity and captures waste heat for heating and cooling, providing greener energy. Energy efficiency can minimise the need for new expensive infrastructure. In California energy efficiency schemes have kept electricity consumption relatively static since the 1970s. The aim of the New South Wales Government's Energy Efficiency Strategy is to "delay the need to construct additional energy generation and distribution infrastructure" and it should strengthen the scheme to include trade-exposed and emission-intensive industries before sanctioning further network expansions.

All appliances need regulated and enforced minimum performance standards. As air-conditioning is one of the biggest causes of peak demand growth, tighter enforcement of energy star labelling of air conditioners is needed. Independent testing found some models that overstate their efficiency or do not even meet minimum performance standards. Appliances such as electric hot water heaters should be phased out. Higher energy efficiency standards should be required for new houses and renovations.

New multi-unit dwellings should be required to achieve 40 per cent energy efficiency improvements under the Building and Sustainability Index and a similar program is needed for commercial development. Retrofit schemes are also needed for existing buildings. In New York all commercial buildings have 15 years to upgrade their lighting and all equipment replacements must meet tough performance standards. While climate change sceptics blame the proposed Carbon Pollution Reduction Scheme for proposed electricity price increases, an emissions trading scheme could help to prevent network upgrades limiting price increases.

Energy efficiency is an essential part of the City's strategy to reduce our overall energy use by 20 per cent by 2012. We are trialling sustainable LED street lighting, upgrading heating and air conditioning, and installing intelligent building monitoring and control systems, as well as solar panels, including the CBD's largest photovoltaic array on Sydney Town Hall. The City's Green Infrastructure Master Plan aims to set in place a practical strategy to reshape our city for a low carbon future, with 70 per cent emission reductions by 2030 in the local government area. It includes efficient local energy generation through trigeneration.

Our libraries also loan PowerMates to households, helping them measure the cost of using appliances and to calculate their energy use and emissions. Centralised fossil fuel power stations and costly transmission networks are not the answer to meeting the State's short- or long-term energy needs in a carbon-constrained future. The technology exists for cheaper, decentralised electricity generation, with efficient energy use and better demand management. I call on the Government to require State-owned electricity network businesses to give priority to local power generation, peak demand management and energy efficiency options prior to any network expansions.

Ms LYLEA McMAHON (Shellharbour—Parliamentary Secretary) [6.48 p.m.]: I thank the member for Sydney for bringing to the attention of the House these issues. In my electorate of Shellharbour Integral Energy is the main provider. Up to 50 per cent of the proposed price increases relates to the Federal Carbon Pollution Reduction Scheme, which has not yet been passed by the Senate. Kevin Rudd has indicated that he will compensate families directly. As to the remaining price increases, the New South Wales Government is providing assistance to families by extending pensioner rebates, increasing the amount of the pensioner rebate and increasing the funding available for people in crisis to obtain electricity vouchers.

Furthermore, we have strengthened the disconnection provisions so that people now have to be provided with a payment plan on at least two occasions before they are disconnected. The Government has done a significant amount of work through the working party in relation to not only how we will provide future electricity but also demand management. Information is available to the community on the website in relation to management of their own demand. I acknowledge the comments of the member for Sydney that the community welcomes the gross feed-in tariff.