Probe on power prices ACCC to hold hearing on state- owned ‘ monopoly’
A STATE Government- owned energy corporation’s effective monopoly on retail pricing and alleged anti- competitive policies in regional Queensland will come under the spotlight of an electricity inquiry forum in Townsville on Monday.
The forum is part of the Australian Competition and Consumer Commission’s national inquiry into electricity pricing which will also delve into allegations state- owned generators have been gaming the market to boost profits and dividends to government at the expense of consumers.
ACCC commissioner Roger Featherston told the Bulletin complaints had been raised with the corporate watchdog by businesses concerned about an Ergon Energy policy preventing the businesses from switching back if they chose to move to another retailer.
“That’s something we will be looking at,” Mr Featherston said. “If that’s the case, we would regard that as a fairly anti- competitive policy. It does seem to be an odd policy.
“It would appear to be designed to discourage customers from leaving Ergon Energy.”
Mr Featherston said the ACCC would also investigate the regulated market in regional Queensland where the government subsidised Ergon to deliver a uniform tariff. He said the policy provided a big advantage to Ergon and meant it dominated the retail market.
“One of the things we will be looking at is how that works and whether that’s a good thing and causing other problems,” he said. “It’s something that’s unusual when compared with other states.”
Attention has been focused on Queensland state- owned generators Stanwell and CS Energy after federal Energy Minister Josh Frydenberg last month accused them of using their market power to raise wholesale prices at peak demand periods.
While the generators have denied doing anything illegal, Queensland forward contract wholesale prices suddenly fell 20 per cent when State Energy Minister Mark Bailey in June directed generators to change their bidding practices.
Mr Featherston said several submissions had called for more generators to lift com- petition and the ACCC’s preliminary thinking was that they agreed with this.
“We do believe it’s quite likely generators can game the system, take advantage of the market, because the generation market is so concentrated,” he said. “There should be more competition. The question is how or where that can be achieved.”
The ACCC is encouraging people to attend the Townsville forum, which will be held at Rydges from 5- 7pm on Monday. For more information visit www. accc. gov. au