Stopping LNP electricity privatisation lowers electricity prices: study

The Palaszczuk Government’s decision to stop LNP plans to privatise the State’s electricity generation, transmission and distribution assets means that household power bill increases should be $146 lower this financial year on average and $210 lower next financial year (2018-19), an independent study has found.

Premier Annastacia Palaszczuk said respected energy sector modellers ACIL Allen assessed the impact of the Government’s reinvestment of returns to place downward pressure on bills and other price interventions on the electricity prices paid by households, commercial and industrial users*.

“By retaining these electricity businesses and their returns – Stanwell, CS Energy, Ergon, Energex and Powerlink – in public ownership, the Government has been able to put maximum downward pressure on electricity prices,” she said.

“It is the failure of the national market and private ownership in other State’s that’s impacting on prices in Queensland from a shortfall in generation. That’s why there needs to be a rewrite of the national electricity market rules. It is simply not fair on Queenslanders.

“Tim Nicholls and the LNP tried to privatise our electricity assets when they were in office. This means the returns of these businesses would have gone offshore or interstate. My Government stopped these plans after the election, and have gone about ensuring these business deliver secure and affordable electricity for Queenslanders."

ACIL Allen is the independent modeller for the Queensland Competition Authority on electricity price determinations and was commissioned by former Prime Minister Tony Abbott to review the national Renewable Energy Target in 2013-14. It assessed the Government’s decisions for:

• directing Energex and Ergon Energy (Ergon) not to appeal the Australian Energy Regulator’s (AER) determination
• Powerlink to not appeal the AER’s determination
• removing the costs of the Solar Bonus Scheme from network tariffs
• recommissioning Swanbank E gas-fired power station and directing Stanwell Corporation to adjust its wholesale market offers in order to lower wholesale prices

“Combined these initiatives will lower electricity price rises by a massive 16% for households, commercial and industrial users by next financial year. That’s a saving of $210 per the typical Queensland household, a $72,050 saving for commercial business and a $124,850 saving for an industrial customer," Ms Palaszczuk said.

The Premier said only her Government has honoured - and will continue to honour - its commitment to retain these assets in public ownership.

“Queensland now has the most secure electricity system of the mainland NEM States because unlike other States we have kept our power stations, poles and wires in public hands,” she said.

“Over the term of our government average prices for households have increased an average of just 1.9% per year compared to 43% over the term of the LNP Newman-Nicholls Government.”

“Tim Nicholls said at the last election that selling our electricity assets including our poles and wires would lower power prices. He doesn’t believe in Government ownership, and will move quickly to restart privatisation if he gets the chance.”

“Every time Tim Nicholls and the LNP talk about power prices and blames Government ownership he is trying to build his case for a fire-sale of Queenslanders strategic income-earning assets.

“The LNP’s plan to sell our power assets would mean higher prices and threaten our energy security and manufacturing jobs."

*The assumed energy usage is residential 4.8 MWh/user/year; commercial 2,898 MWh/user/year; industrial 6,037MWh/user/year.

Media contact: Michelle Wellington 0437 323 834