LGA South Australia has welcomed the move from the Hon Frank Pangallo MLC to introduce legislation that will remove a 25-year rates holiday for electricity providers and remove unfair cost burdens being put on regional South Australians.
An independent Equitable Rating of the Energy Sector report published earlier this year found SA councils face a financial disadvantage compared to those in Victoria and Queensland, due to outdated State Government legislation preventing them from properly rating electricity generating companies.
As a result, these corporations receive huge discounts and don’t contribute their fair share to SA’s regional communities, meaning local residents and businesses are subsidising for-profit companies to the tune of millions of dollars.
The proposed Statutes Amendment (Rates-Electricity Generation) Bill 2025 put forward by Mr Pangallo would close this legislative loophole, with independent analysis showing regional families, single homeowners and local businesses in some regional councils could pay up to 5% less on their rates bill as a result.
LGA South Australia President, Mayor Dr Heather Holmes-Ross said the timing was right to remove outdated rate exemptions, as doing so could provide much-needed cost of living relief to regional people doing it tough.
“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,” Mayor Holmes-Ross said.
“That’s money that could be used to put downward pressure on rates and provide much-needed cost of living relief for ratepayers.
“Unfortunately, it’s the regional parts of our state that are the worst impacted as this is where the disproportionate number of electricity generating infrastructure is located, due to land availability.
“It’s also regional councils that foot the bill to repair any roads damaged by heavy vehicles carrying cranes and equipment needed to install large energy infrastructure, such as wind turbines or solar panels.
“We strongly support the growth of green power – through solar, wind and emerging renewable technologies – as an essential step in meeting net zero targets.
“However, the renewables transition should also deliver tangible benefits to regional economies by ensuring large energy companies contribute their fair share through rates.
“Multi-national energy companies making huge profits have had a rates holiday for 25 years and there is no justification for this discount. There is no reason everyday ratepayers should be left to cover the shortfall.
“LGA has been working closely with the Hon Frank Pangallo MLC for more than 12 months on this issue and we’re pleased to see the introduction of his Bill, which we hope will be supported by Parliament.”
Mayor Holmes-Ross said energy companies avoid paying an estimated $6.28 million in rates revenue to regional councils every year, at the expense of communities.
The Australian Energy Market Operator anticipates electricity generation in SA – off the back of the State Government’s recent renewables commitment – could increase by nearly 500 per cent over the next decade in a best case ‘green energy exports scenario’.
She said should this happen, councils and communities could miss out on more than $26 million of rates revenue annually by the year 2031-32 if the current legislation for electricity generators is not improved
