Start- ups have win on energy deposits

BUSINESS start- ups appear to have had a win with relief from big security deposits being charged to connect to power by Ergon Energy.

But while the Townsville Chamber of Commerce expects reductions to be substantial, an Ergon Energy spokesman would only say they were confident it would provide “relief for some customers”.

“We don’t know the numbers yet,” an Ergon spokesman said.

Ergon has announced a sixmonth trial where new businesses can pay a deposit or prepay their monthly or quarterly bills.

How much businesses pay still depends on a risk assessment by Ergon.

Previously, businesses could be asked to pay deposits of up to 37.5 per cent of an estimated annual bill which for some businesses, such as bakeries, can be as much as $ 20,000.

In a statement, Ergon executive general manager retail Cheryl Hopkins said the six- month trial was developed to assist small businesses in a challenging trading environment.

“We recognise business is tough for our customers and one of the most significant improvements is the introduction of a trial prepayment of monthly or quarterly bills in lieu of a security deposit,” Ms Hopkins said.

“Some business customers have indicated this would significantly assist them by not paying both but having the choice of the deposit or bill payment.

“Small business customers interested in this option are still subject to a risk assessment and credit checks.

“Lower risk will flow through to a lower security deposit.”

Last month, Bakery on Primrose partner Frank Aspland accused Ergon of being “anti- business” after asking him for $ 30,000 to reconnect two premises, one for $ 20,000 and the other for $ 10,000, as part of a business expansion.

Business brokers and property agents also said the deposits were spoiling potential deals.

Chamber board member Michael Kopittke said Ergon had engaged with the chamber and delivered better options for new and start- up businesses.

“On average, we believe that there will be substantial reductions in set- up costs for electricity in regional Queensland,” Mr Kopittke said.

He said the chamber and Ergon had agreed to meet quarterly to further discuss communicating to small businesses the best available options for electricity costs.