Government intervenes to continue electricity price stability

In Energy, Featured, Government/Policy, Latest News

An immediate intervention by the Palaszczuk Government will slash the expected increase in regional electricity prices – set by the independent Queensland Competition Authority (QCA) – by more than half.

Treasurer Curtis Pitt said the QCA’s final determination on regulated retail electricity prices for regional Queensland in 2017-18 released today is unacceptable and the Palaszczuk Government had taken swift action.

“We will not tolerate a return to the massive electricity price surges inflicted on Queenslanders by Campbell Newman and the LNP,” the Treasurer said.

“In a major cost-of-living initiative from the 2017-18 Budget in two weeks, we will invest $770 million over three years to back consumers and lower electricity prices from what the QCA has announced.

“The Palaszczuk Government’s actions will reduce the household bill increase in regional Queensland from 7.1 per cent down to 3.3 per cent, an ongoing estimated saving of $51 per year compared to the original QCA outcome.

“This is also a good result for a typical small business, which will now see a much smaller increase of 4.1 per cent instead of the QCA’s 8.2 per cent, resulting in a saving of around $90.

“We’ve directed government-owned corporation Energy Queensland to reduce network charges and in doing so we are ensuring Queenslanders will benefit from stabilised electricity prices and help with cost of living pressures.

“This unprecedented intervention is possible for two reasons.

“Labor’s responsible Budget management over the past two years has put us in a position to provide such a significant benefit to customers and also our commitment to keeping our Government Owned Corporations in public hands means we can pass on these savings to Queenslanders.

“Under Tim Nicholls’ asset sales plan, these businesses would be gouging customers purely for profits, with no regard for what is best for Queensland.

“The QCA has advised these price increases are driven by rising wholesale energy costs and represent a failure of the National Electricity Market.

“A lack of federal leadership on climate and energy policy under Tony Abbott and Malcolm Turnbull has also created uncertainty for investors which has prevented new supply coming online, driving up prices.

“The extreme heatwaves and record demand over the recent summer have also contributed – something which was not taken into account by the QCA in publishing their draft determination earlier this year.

“To protect Queensland consumers from these increases, the Palaszczuk Government has directed Energy Queensland to remove the costs of the solar bonus scheme from network charges until at least 2020.”

Energy Minister Mark Bailey said consumers in south-east Queensland would also see benefits.

“I have written to retailers in the south-east outlining my very clear expectation that these network cost savings are passed through in full,” he said.

“I want to make it clear that this change will not impact payments to eligible customers under the state’s solar bonus scheme, it merely means the costs of the scheme will be met by the government instead of consumers over the next three years.

“I have issued a new pricing delegation for the QCA, with revised prices to be released by 16 June.

“Large businesses and customers on transitional tariffs will also see the benefits of lower electricity prices through this change, with outcomes for these customers to be advised in the QCA’s final determination.”

Mr Bailey said the government continues to deliver on its commitment to stabilise electricity prices after double digit price increases were the norm under Campbell Newman and Tim Nicholls.

“This action builds on the Palaszczuk Government’s direction to not appeal the AER’s revenue determination in 2015, which stabilised network prices.  This action is only possible because we’ve kept our energy businesses in Government’s hands and not sold them off like the LNP want to do,” he said.

“This means household electricity bills in Queensland will have risen by just 1.9 per cent per year on average over the three years of the Palaszczuk Government, compared to 43 per cent over the full term of the previous Newman-Nicholls government.

“We also made it possible for 157,000 extra Queensland families with Commonwealth Health Care Cards to apply for electricity concessions savings $330 a year on their energy bills.  Action the LNP could have done while in government but didn’t.”

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