 Thanks very much, John, and today what I'm wanting to do is skate across a whole range of dimensions of Australia's energy policy. The reason for that is, twofold, one, I think we're in a rather precarious stage with our energy policy and energy markets policy, and two, that not long ago I finished a report on this very issue for the Consumer Action Law Centre who were keen to look ahead five to ten years to see what emerging issues there were that that the consumer movement should be starting to engage with now and to play a role in that. And that policy, that policy paper anyway, is one that I hope will be something that that does start to influence particularly consumer groups who have to date been focusing on some very important issues, hardship policy and a number of other things, but not focusing a whole lot on some of the big structural issues and the competency of the economic regulators and others who are really going to be making decisions that add up to huge amounts of consumer dollars, but in my view, and perhaps this reflects ten years in Europe where there is a much greater acceptance of the imperatives of climate change, a policy that's going to work for sustainability. And so this particular seminar, one of the themes that I'd like to raise is what I've described as a policy trilemma. And I don't think Australia has come to grips with it. We're still at the stage, especially in the energy area of considering the final stages of liberalisation of the market. And so the economic regulators are still pretty much locked into how can we make the market more and more contestable. How can our economic regulation be about, you know, RPI minus X formulas for efficiency and getting more out of assets and not the important balance between, as I would see it, affordability, which is a really vital thing. Prices in Australia for most energy sources have doubled over the last three years. And I think I can predict fairly confidently that they'll double again in the next two to three years and that energy prices are going to remain not only a key political issue, but are going to become increasingly the source of social distress. More and more of the Australian population, the folk living on the fringes of society, are going to be propelled into an estate known widely in Britain as energy poverty. And that is going to be a serious issue. So that's the first part of the Trilemma is affordability of energy. The second dimension is about security of energy. And that cuts a number of different ways. Energy security is about ensuring that networks are able to deliver what people want and where and when. But the way in which that's been approached in Australia so far is predicated upon the continuing almost permanent dominance of coal fired generation, 70% of our current generation, and where renewables are still seen as rather outsiders. And although policy mandates like 20% renewables by 2020 are leading to investment, the policies simply don't recognize the validity of that. And there are all sorts of implications for system security as the proportion of renewables going into the grid gets above 10%. We don't seem to have those planned into our system at all. And indeed, with a very aging network of transmission lines and a lot of the generating sets, energy security itself becomes an important point. The third part of the policy Trilemma is about sustainability. And as I suggested earlier, I don't think that policymakers in Australia genuinely recognize the imperatives of climate change. And so we have even even the much thought over carbon tax is actually quite a trivial issue in terms of changing investment decisions to a more decarbonized future. And I contrast that again with the UK, where instead of talking about 20% by 2020, the UK has long since passed 50% renewables by 2050, and they're talking about 100% renewables over the next 60 years or so. Now, that's partly about removing carbon from the economy. It's also partly about energy security. Britain has gone through a number of severe shocks brought about by an increasing dependence on North Sea gas and oil from fields that are no longer owned by British companies. Indeed, most of the energy companies in the UK are now owned abroad. And so those three dimensions of affordability, security and sustainability are three legs of a policy that I think are absolutely necessary if we're to have some real progress in these areas. And just 30 seconds then about Femag. This is a Regnet seminar, but Femag, the Foundation for Effective Markets and Governance, which is hosted by Regnet, is a group of people. Many of them are also involved with Regnet. But our whole purpose is looking at areas in which markets are failing the interests of consumers. And we've always defined the interests of consumers in that classical sustainability model of looking at the social, the environmental, as well as the economic. And to see markets where those things get out of whack mean that consumer welfare suffers in the long term and often in the short term as well. And so that's why the policy Trilemma report was written in the first place. Australia is now 15 years into liberalised energy markets. And that started off with the classical way of vertical and horizontal disaggregation of generators, splitting them up in the idea of having competing producers, of course, monopoly regulation of networks, and then to have contestability in supply with competing retailers. And Australia, like the UK and many other countries, went down that route. It's my contention that we're still rather stuck in that model now that many others who also went down that route see that there are some profound limitations in that market model. And that most recently, this was reaffirmed in the publication late last year of the Energy White Paper. Now, the Energy White Paper, in my view, represents another interesting dilemma for Australian policy. Up until last year, energy policy at the Council of Australian Governments level was managed by a ministerial council on energy. But last year, that was subsumed into a much wider group that also looks at production. And Australia is after all the ninth largest energy producer in the world, where the second largest LNG exporter, the largest coal exporter. And in my view, what's happened is that over the last year or so, the interests of Australia's trade policy has come to dominate our domestic energy policy as well, which is now somewhat subservient to that industry policy. Australia is very intent, and I can understand why, in continuing to win international markets, firstly for coal, but increasingly for gas. And that Australia is very much marching down the path of joining the global LNG market. And there are implications for that that I'll come on to in a second. But what it means is that the national agenda, which in the past had been about the gradual liberalisation of markets, the privatisation of state assets for generation and supply, and then issues about affordability, issues about consumer protection, and making markets work. These are now moving more and more to a national framework. Indeed, from July last year, Australia was due to implement uniform national consumer protection laws for energy consumers as well. But just weeks, really, before that date for everybody to cut over to new forms of regulation, four of the states actually withdrew from that arrangement. And we still now have quite inconsistent state-based regulation for much of consumer protection in energy. And that's a real problem. So the question that I was seeking to answer in the report, and one that I'd like to explore right now is, is whether the market structure, the regulatory framework, the conduct of enterprises in the market are really delivering for consumers. And my answer is no, they're not. And in most respects, some of the key ones are ones that are going to cause problems with price, quality, and performance of all of those suppliers, and that consumers are going to be the big losers. And I'd like to contrast that, not that the UK has policies that are working, but after 20 years or so of liberalised markets, the regulator in the UK and the government, remember, it's a Conservative government, so this is quite an extraordinary conclusion, ministers, the parliament, and the regulators have concluded that the liberalised market is essentially failing British consumers, and that there are some quite draconian interventions that are being made that re-regulate it to the point where you would no longer say that it meets classical definitions of a liberalised market at all. And that would include, for example, a requirement that energy retailers provide only four products instead of the multiplicity, hundreds. In fact, when I was working in the UK, at one time, there were 3,200 possible tariffs across the suppliers in any particular part of the UK. So an individual trying to use by a power to optimise their own welfare faced what commentators described as the confusopoly, much the same as Australian telecommunications markets, financial services markets and energy markets. It's an area in which there's a real paradigm problem, I would say, and that to date, I believe Australian economic regulators and certainly in the policy departments are still straightjacketed by the view that mere contestability, the mere availability of competing range of services is somehow the equivalent of delivered welfare outcomes to consumers. And that I point to some seminal research by Professor Catherine Waddams in the United Kingdom, where she was able to track a whole cohort of consumers who'd switched their energy contracts and that more than a third of them switched to products which were actually more expensive than the ones they switched from. And that is something that's inconceivable to people of a particular market persuasion, but to those involved in consumer protection, it's eminently understandable. And the explanation is quite simply that people almost never initiate the change of their energy supply contract. It's pretty well always initiated by somebody else. And in the UK, the overwhelming proportion of those were by people knocking on their doors and persuading them through deception, confusion and all sorts of other means, sometimes threats even, that they should change their contract. When I was working in the UK, there was a particular outsourced organisation in Scotland who contracted with a group of marketers. And if you failed to respond to their offer to you at the front door, a fair chance that your car door would be scratched or that you'd be insulted or assaulted. And there were practices of that sort. Even Virgin Energy set up stands out the front of the Virgin Megastores, inviting young adults and teenagers to sign a form in return for a free CD. That form happened to switch their family's energy accounts from Virgin supply. Another agent set up in a local library near where I was living and just got stacks and stacks of electoral rolls and wrote out hundreds and thousands of contracts, just changing people from one account to the other. And that this sort of ruthlessness in retail markets almost led in 2000 to the end of the liberalised market in the UK. And it was with the significant government intervention, the establishment of the body that I worked for energy watch, which more or less turned some of those things around. But I fear that in Australia, while there are some good regulatory interventions, they're somewhat patchy, and they are still against this backdrop, where the assumption is that switching is an excellent measure of gains in consumer welfare. And I just don't think there is any evidence to support that. So at that policy level, and then it even higher one for economic regulation. And that about four years ago, three, three and a half four years ago, there were some rule changes to the way in which the economic regulator was able to determine the satisfactory arrangements for the asset base of regulated enterprises, the transmission companies, and they were still in the main state owned. There are some places where that's not so, but they're pretty well all state owned. And so state governments have actually got quite an unhealthy interest in high charges for for for their assets because they've come to rely for revenue on taxation of their government business enterprises. And it's at that level that some of the rules were changed that made it very hard for the Australian energy regulator to assess the adequacy and the need for some of the network investments. I'm sure everyone has heard claims of gold plating in the in the networks, which ironically was one of the very important points about the first deregulation in 15 years ago, which was about ensuring that assets worked hard and weren't over specified. Now there's been a lot of policy debate about that and I'm pleased to say that some rule changes that will give the regulator a greater degree of independence and capacity to deal with those things does look as though it's again achievable. But still that's been a big contributor to many of the retail price rises that we've seen and many that are still to come. And I'll touch on some other drivers of those prices in a second as well. So I said that I'd touch again on the issue of Australia being part of the global market for LNG. At the moment, I guess most analysts would say there are three markets. There's the export market that we're involved in which has got long term supply contracts to Taiwan, Japan, China, increasingly to India and South Asia. There's a European market and then a North American market. These are all now coalescing and that the problem with that is that in North America, especially where there are severe winters, the demand for LNG can just spike very suddenly and very steeply and with a price responsiveness that draws supplies from pretty well everywhere that supply that market as Australia becomes more integrated into that market. So too, the supply and price issues for our LNG, which and natural gas, which up until now have been rather distinct from international trade are going to be caught up in that market. And we will face the sort of price spikes that the UK has seen where wholesale prices of gas can double and treble in the space of a week. And as Australia switches over more and more of its power generation from coal to natural gas, this cycle is going to become more and more significant. And so one of the things that I've recommended is that Australia pay a much greater role in looking at the international antitrust dimensions of that. Throughout Europe and the US, there is a linkage between gas prices and oil prices. It's a historical one because initially they all came from the same production process. In fact, gas was seen as a pesky contaminant to oil. And in many places in Russia even now, most of that gas that's co-produced with oil is burned. And so there's more gas just flared in Russia than the whole annual consumption in the UK. And as those markets tend to converge, oil prices of course can spike even when there is no shortage of natural gas. And that Australia is going to be somewhat subject to this sort of phenomenon in years to come. Now there are some imponderables there. If coal seam gas continues to develop at the rate that it is in Australia and in the US, it might well be that that global market power is somewhat broken down. But that comes also at some other costs of environmental issues that need to be dealt with. And I fear that these things which seem to me to be part of the international debate and have been for five years just sailed right past the authors of the Energy White Paper. And so that's why I say there's a trinema, but Australia hasn't properly engaged with that. With economic regulation as well. I think that our regulators are often set still on what is essentially a policy. And it's been a policy that's delivered huge welfare gains. So I'm not overly critical of it, of ensuring greater degree of efficiency in production and distribution and the development of market mechanisms for retail. But since the climate change issues require forms of intervention that typically Australia has been reluctant to engage in. And that we have a largely hands-off approach. Which means that when changes are necessary. And in my view within a decade global trade rules and lots of other international instruments won't just encourage or enable, but will require major trading partners to start imposing taxes to pick up the externalities of Australia's laxity in policy. In other words our exports of these products are going to find themselves under taxation pressure. And that Australia will be forced one way or another to recognise this at a time where a lot of the intellectual property in mitigation measures and things is going to be developed, owned and rolled out by countries who are economically our competitors. And that we face an economic future where there are going to be limitations on our ability to recover those things. And so there is a scope for Australia to play a much more active role in this area with the international energy agency and international agencies as well. I won't say anything more about that. The white paper and lots of critiques of it are readily available for people to look at. There is again around lots of the world an evolution in the sorts of people who provide energy and that instead of a retailer simply providing you with the gas or electricity that you want and metering it they're morphing into what are called energy service providers. So that the theory is that you don't actually want to buy a certain amount of gas or you don't want to buy a certain amount of electricity. What you want is delivered heating or comfort or the ability to cook and things like that. And that by contracting with people to provide a wider range of services perhaps using smart networks and demand control and metering and different market mechanisms that we can get much closer to meeting some of the needs of the changing grid. And smart meters are a big issue now in Australia some states have now regulated to prevent their rollout while some others are mandating their rollout which shows a lot of confusion about the role of smart metering in our system. And that's partly because a self-evident problem that the designers of the policy failed in the first place to adequately consider the consumer dimension. Whether people would really be able to to understand what was happening giving people choice and the price effects that that was going to have. And I predict that the smart meter issue will roll on for the next five to seven years as a major issue of contention. And more generally though the role of consumers in energy markets in Australia has been largely underplayed. And while there are a number of very useful devices there's a body that does provide some funding for consumer research. Indeed it was such a body that funded that report. At the institutional level there are no real national, there's no real national voice for the demand side of the marketplace. Consumer groups often have disparate interests partly because of the different regulatory settings in the states from which they come or the sectors from which they come. People from a welfare background have an understandable focus on issues of price support and things like that whereas some from more economic backgrounds are looking at market structures. But when it comes to this issue there is now a proposal that was adopted by the Council of Australian Governments at the end of last year to develop a national advocacy body for energy consumers. And that's a noble ambition and it sort of mirrors what's happened in the telecommunications sector in that the Commonwealth established the Australian Communications Consumer Action Network which has given voice to groups from consumers with disability to rural groups to small business groups and others to be involved in national discussions on issues like the national broadband policy and roll out and pricing and regulation and they've just recently spent a mammoth two years in a struggle to redo a lot of the self-regulatory codes co-regulatory codes in that sector. In energy such a voice isn't available but the proposal that's been made I think is rather flawed in that it currently proposes that the consumer body will be a voice for all consumers from the smallest to the largest and the idea of big business consumer purchases being part of a lobby with individual or micro business consumers is just not a very sensible one there their interests are quite different and the capacity of big business consumers to make their views known is already more than adequately dealt with and so I have a bit of a concern that that body is is not going to be as successful as it could be added to that its mandate doesn't seem to me to extend at all to issues of sustainability which I've suggested is a very very powerful feature now even though it's not recognised and that policies do need to take that into account for the future and that's an issue that's open now and there are debates going on and I rather hope that that circumstance can be improved somewhat the the issue of network structure is a highly technical one but the use the development of the national broadband network even with the modifications proposed by Mr Turnbull today still enable us to be able to use a national communication system to bring an order of magnitude improvement to efficiency and effectiveness of management of energy and itself could make a huge difference to the peak demand for power in Australia you see we are one of the countries with the highest summer peaks in the world partly because of the the load of air conditioning and things like that and that means that some huge proportion and I think it's somewhere around 25% of the entire investment in transmission and distribution systems which adds up to many billions of dollars a year is about meeting the peak demands for just four or five days a year whereas a much greater concentration on efficiency there and use of things like load management, smart metering and a better roll out it's starting to work quite well of solar voltaic systems can slash that peak demand and lead with nothing more to quite massive savings in the needed investment and the price flow through to consumers there are things again which I thought should have been front and centre in the white paper but really don't seem to have got the amount of treatment that it should have got I could speak also about renewables and a number of other things but I do want to provide opportunities for people to raise some issues that I could respond to in that way so I think perhaps I should finish there and just see whether there are aspects of that that people would like to take up from I'll speak on behalf of of FEMAG there that we remain ready, willing and able to work with anyone who wants to get better consumer outcomes in energy markets but we're ready, willing and able to work against anybody who doesn't