Federal Labor responsible for pole and wire spending blowout

Most of the “gold plating” of electricity poles and wires has occurred under rules administered by the Federal Government which refuses to establish a truly independent Australian Energy Regulator (AER) to police it.

Ahead of the Standing Committee on Energy and Resources (SCER) meeting on Friday, Queensland Energy Minister Mark McArdle again called on the Gillard Government to acknowledge the failure of the Commonwealth’s AER to take control of  spiralling “pole and wire” spending.

Mr McArdle said it was time the Commonwealth Government owned up to the fact that it was the AER that determined total “pole and wire” expenditure and not the states.

“Over the past five years the AER has overseen an explosion in construction of poles and wires.” Mr McArdle said.

“Under the Commonwealth’s watch, capital expenditure in Ergon, Energex and Powerlink in the five years from 2006/07 to 2010/11, increased by $11.3 billion.

“This capital was mostly for additional poles and wires which was added to the asset base on which the AER determined the allowable income for network companies.

“The Commonwealth refuses to acknowledge that this is what is driving up network costs.”

Mr McArdle said long before the LNP was elected in Queensland, it was clear that “poles and wires” were driving up electricity prices.

“It appears that the Prime Minister is only now realising that the “gold plating” that the AER allowed, combined with the Carbon Tax and and other Federal Green Schemes, is hurting struggling families and businesses,” he said.

“A proper review of the entire approval process is urgently required and I will once again be raising this issue at SCER.”

[ENDS] 19 November 2012

Media contact: Minister’s Office 07 3896 3690 /0417 277 905