Power Price Stability Locked in for Queenslanders

The Palaszczuk Government has acted to lock in power price stabilisation for Queenslanders following the final determination from the Australian Energy Regulator today.

Premier Annastacia Palaszczuk said the State Government – as the owner of these businesses on behalf of the people of Queensland – will direct Energex and Ergon to lock in these better outcomes, and not appeal the AER decision.

“In recent years there have been very few meetings or conversations I had with Queenslanders where their skyrocketing electricity bills weren’t mentioned,” Premier Palaszczuk said.

“When you have price increases of 43% like we had under the former LNP Government, that’s to be expected.

“But what made it worse was the threat that our energy providers would be sold off to the private sector, taking control of those businesses away from the Government and placing it into the hands of those whose number one goal was to protect profits, not consumers.

“Today, my Government will demonstrate to Queenslanders why they got it right when they elected the Palaszczuk Labor Government at the last election, and saved their energy assets from sale.”

Energy Minister Mark Bailey said the determination should result in stable Queensland electricity prices over the next few years.

“The Newman years of painful electricity price surges are over – enough is enough,” he said.

“We have already seen 2015-16 electricity prices decline on average by half a per cent on average for a typical Queensland customer.

“To ensure Queensland electricity customers are able to obtain the benefit of stable electricity prices over the next five years the Government has taken the decision to direct the network businesses not to appeal specific elements relating to the Weighted Average Cost of Capital (WACC) and Gamma, of the AER’s final revenue determinations.

“This morning I have spoken the Chairs of both Boards to inform them of the Government’s decision. They both understood and accepted the Government’s decision.”

Minister Bailey said the Government considers that the AER’s decision in relation to WACC is balanced, in that it provides the network businesses a reasonable rate of return on their assets as well as providing stable electricity prices over the next five years for customers.

“While the Government acknowledges that the network businesses will need to make adjustments to reflect the lower WACC, it is confident that the network businesses will work with customers to deliver innovative solutions and continue to deliver efficient energy services,” he said.

“The AER’s decisions to reduce Energex and Ergon Energy’s revenues will require them to continue to make further efficiency improvements.

“The Queensland Government remains resolutely committed to no forced redundancies, and we will consult and work with the representatives of our workforce – the unions. Therefore any changes in staff numbers will be achieved through voluntary redundancies and natural attrition.

“This decision to lock in better electricity price outcomes for Queenslanders shows the Palaszczuk Government understands the pain many Queenslanders experience at bill time and we’re locking in the gains by the umpire over coming years.”