Regions call for end to ‘free ride’ for solar and wind farms
Coorong council is going in to bat for regional South Australians claiming they are missing out on much-needed funds.
A 25-year-old legal loophole which excuses power generation companies from paying council rates must be closed, representatives of one regional council say.
Acting mayor of the Coorong district Jonathan Pietzsch has written to Premier Peter Malinauskas requesting a change to a law which he says has disadvantaged councils around regional South Australia and the communities which depend on them.
Coorong councillors were told at a recent meeting that efforts to change the law, which had been championed by former state MP Frank Pangallo, had stalled since Pangallo’s failure to win re-election in March.
Pietzsch said the loophole had cost his council up to $500,000 in lost revenue each year.
That was the equivalent of about four per cent of its annual budget, or an additional cost of about $55 per year to an average residential ratepayer.
The biggest energy-generating development in the Coorong district, Vena Energy’s Tailem Bend Solar Farm, was built at a cost of more than $200 million over the past decade.
“Rate holidays are a thing – it’s how you push development, it’s how you get people to come to the district – but they have to have a sunset clause,” Pietzsch said.
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“These operators are getting a free ride off the back of ratepayers.
“We’re calling on the premier to put that sunset clause in and say ‘enough is enough’.
“It’s a great industry, but it’s about time it started paying its way.”
One Nation MP Jason Virgo – whose electorate of MacKillop stretches from the Coorong down to the South East – said multiple councils had approached him about the issue.
He described it as “absolutely something One Nation and I can get around”.
It wasn’t just about the everyday working families who wound up paying more in council rates, he claimed – it was also about the loss of council-funded services in the regions.
“It’s absolutely outrageous,” he said.
“The people of the Coorong are potentially subsidising intermittent power by up to five per cent of their council’s rate revenue.
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“These intermittent power companies should be paying their fair share, and I’m concerned that data centres may go down the same path.”
He hoped to draft and introduce legislation that would close the loophole.
Several councils are also expected to raise the issue at the annual general meeting of peak body LGA SA in December.
The local government association has lobbied along similar lines in the past.
LGA SA president Heather Holmes-Ross estimated last year that South Australian councils were missing out on a total of $6.3 million per year.
“In many cases, the biggest energy companies aren’t even based in South Australia – they’re often interstate or overseas – yet they’re effectively taking money out of the pockets of hardworking local families or businesses who are already struggling to make ends meet in the current economic climate,” she said.
“That’s money that could be used to put downward pressure on rates and provide much-needed cost of living relief for ratepayers.
“We strongly support the growth of green power … however, the renewables transition should also deliver tangible benefits to regional economies by ensuring large energy companies contribute their fair share.”
Change would only increase power bills, spokesperson says
Local Government Minister Rhiannon Pearce was contacted for comment, and a state government spokesperson responded saying that closing the legislative loophole was not a priority at this time.
“The state government is not currently looking into changing this legislative framework,” he said.
“Increasing costs for energy generation would inevitably be passed on to consumers through higher power bills.”
The spokesman blamed former Treasurer Rob Lucas for keeping the council rates exemption in place following the privatisation of ETSA in 1999.
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