Ordered that second-reading speech be incorporated into Hansard on motion of Ms TIERNEY (Minister for Training and Skills).
Ms TIERNEY (Minister for Training and Skills) — I move:
That the bill be now read a second time.
Incorporated speech as follows:
This week marks the eighth anniversary of the Black Saturday bushfires of 7 February 2009. We reflect on the fact that powerline ignitions caused the loss of 159 of the 173 lives lost and contributed to the loss of over 2000 homes and $4.4 billion suffered by Victorians in this tragic event.
The Electricity Safety Amendment (Bushfire Mitigation Civil Penalties Scheme) Bill 2017 (the bill) is an important measure to reduce the bushfire threat posed by powerline faults to regional and rural Victorian communities. The bill will provide powers in the Electricity Safety Act 1998 (the act) for the director of energy safety and the Minister for Energy, Environment and Climate Change to pursue civil penalties against the electricity distribution businesses as a measure of last resort to ensure that the distribution businesses deliver specified bushfire safety measures on time and to the correct standard. This bill will ensure that the electricity distribution businesses meet enhanced powerline fault detection and suppression obligations and replace bare wires with covered conductor or undergrounded powerlines in areas of the state of highest bushfire risk. The bill will also amend the act to allow the director of energy safety to compel more transparent reporting from the distribution businesses on how they plan and deliver the enhanced standards and their broader bushfire mitigation activities.
Through this strengthened compliance mechanism, the bill seeks to provide Victorian regional and rural communities with an assurance that they will receive the full safety benefit from enhanced bushfire mitigation technology.
The bill will require the distribution businesses to achieve these bushfire mitigation obligations by prescribed program delivery milestones.
The first obligation specifies that AusNet Services, Powercor and Jemena must demonstrate compliance with the enhanced fault detection and suppression standards on all 22-kilovolt powerlines emanating from their share of 45 targeted zone substations in rural and regional Victoria. The bill requires the businesses to deliver these upgrades according to a ‘points’ scheme. The businesses must achieve 30 points of zone substations by 1 May 2019, 55 points by 1 May 2021 and all residual points by 2023. This obligation does not specify a type of technology, but the distribution businesses may meet the prescribed fault detection and suppression capability by deploying rapid earth fault current limiters (REFCLs).
The second obligation in the bill specifies that the distribution businesses must construct or replace high-voltage bare-wire powerlines in 33 specified electric line construction areas, either by undergrounding or constructing covered conductors. These powerlines must be compliant with this standard upon inspection by Energy Safe Victoria (ESV).
The third obligation in the bill requires that the distribution businesses deliver all remaining single wire earth return (SWER) powerline automatic circuit reclosers (ACRs) by 31 December 2020.
The current Electricity Safety (Bushfire Mitigation) Regulations 2013 will retain the obligation of the distribution businesses to include the three enhanced bushfire mitigation standards in their bushfire mitigation plans (BMPs).
The bill applies civil penalties for non-compliance with these obligations on both an initial and an accrued daily basis. The businesses will be penalised a maximum of $2 million for every point under the total required for each delivery milestone for the 45 zone substations and $5500 for every day of non-compliance following. Distribution businesses will face a maximum initial civil penalty of $350 000 for every kilometre of installed powerline in the 33 specified electric line construction areas that has been found to be non-compliant with the new standards, with $1000 for every kilometre each day after; and a maximum initial penalty of $50 000 for each SWER ACR not installed and $150 for each day following.
The bill also includes specific reporting and audit powers in the act in relation to the bushfire mitigation obligations and broader distribution network bushfire safety performance.
The bill will amend the act to require the electricity distribution businesses to demonstrate to the director of energy safety annually in dedicated bushfire mitigation obligation reports how they are complying with the new bushfire mitigation obligations. These status reports must detail the actions and works that the businesses have undertaken to deliver the new bushfire mitigation obligations in the last 12 months and provide delivery plans for the next 12 months, covering 1 May to 30 April each year. These annual reports shall be signed off by the businesses at a board level and should reflect a rolling plan to be included in the businesses’ BMPs. Failure by the electricity distribution business to submit these reports by 31 July each year from 2018, at the required standard, will incur a maximum civil penalty of $10 000 in the first instance and $1000 for each day until rectified.
The bill contains new provisions to allow ESV to require an electricity distribution business to obtain an independent audit with respect to its progress towards complying with the new direct bushfire mitigation requirements. The results of these reports must be provided to ESV. This amendment will also allow ESV to conduct these audits itself. Failure to deliver these reports to a standard satisfactory to ESV will attract a maximum initial civil penalty of $50 000 and a $5000 daily penalty until rectified.
As an additional compliance mechanism, the bill will give ESV new audit and information notice powers in relation to the new bushfire mitigation obligations. This will allow ESV to verify the information provided by the distribution businesses regarding delivery of the new bushfire mitigation obligations. The bill will also expand ESV’s existing information notice powers to allow interrogation of all bushfire mitigation activities undertaken by the distribution businesses in the performance of their existing obligations under the act.
The bill aims to provide greater bushfire risk reduction safety. However, there may be limited cases where delivery timelines or full compliance with the fault detection and suppression standards cannot be met.
The bill allows distribution businesses to seek timeline variations for specific zone substations where the full standards can still be met. Under the act, ESV may set a new delivery date for full compliance in consultation with the Minister for Energy, Environment and Climate Change.
In cases where the fault detection and suppression standards cannot be met for specific zone substations, the distribution businesses may apply to ESV to advise the minister to seek a Governor in Council exemption. Every effort must be made and evidenced before any exemption is considered. These exemptions are subject to such terms and conditions as are specified and will consider requirements for electricity network infrastructure capital works that deliver equivalent powerline bushfire risk reduction.
This bill will establish a stronger compliance mechanism which will ensure that the powerline bushfire protection benefits recommended by the Victorian Bushfires Royal Commission (VBRC) are safeguarded for Victorians.
I commend the bill to the house.
Debate adjourned for Mrs PEULICH (South Eastern Metropolitan) on motion of Mr Ondarchie.
Debate adjourned until Thursday, 2 March.