BID TO SLASH POWER PRICES
Review told competition trial in Cairns energy market must happen
CAIRNS should have its energy market thrown open to competition in a trial that would bring down bills and end subsidies being funded by taxpayers.
The Queensland Competition Authority’s (QCA) review to set regional electricity prices for 2018-19 has been told growing subsidies of more than $500 million a year and rising that bring down prices for regional households and business are getting out of control and Ergon must be forced to compete against new retailers.
The Chamber of Commerce and Industry Queensland wants a deregulated market in the north that mirrors the southeast.
The CCIQ argues the Palaszczuk Government should introduce a deregulated market before businesses take matters into their own hands and go off grid with their own power-generating assets.
“CCIQ supports the principle of not penalising regional, rural and remote small businesses for their geographic location, however continuing to subsidise at a cost of over a half a billion dollars annually is not a sustainable long-term solution,” its submission says.
Policy adviser Joseph Kelly said if the set-up worked in the southeast, it should be trialled in Cairns and Townsville, with the idea of rolling out deregulation across regional centres
He said allowing new retailers to set up would force Ergon to up their game, make savings and compete for customers.
It would also allow new retailers to set up in regional areas and eventually invest in their own power sources, like renewable energy, to sell more cheaply to customers in the long-term.
Otherwise, businesses would increasingly invest in their own power generators, leaving fewer customers to pay for grid power in what has been termed a “death spiral” of higher costs, Mr Kelly said.
“Regional businesses crying out for relief, they need options, they need relief,” he said.
The QCA will hold meetings around the state in March and report its pricing decision mid-year.