Electricity price rises a shock for regional small businesses

Wednesday 23 March, 2016 | By: Darrell Giles | Tags: electricity prices, Queensland Competition Authority, electricity deregulation;

The Chamber of Commerce and Industry Queensland (CCIQ) is concerned that many small businesses will be asked to pay an extra 9.3 per cent a year in electricity charges.

The release of the Queensland Competition Authority (QCA) draft determination of regulated retail electricity prices to apply in regional Queensland from July 1, 2016 to June 30, 2017 today reveals the increase in electricity prices.

CCIQ Director of Advocacy Nick Behrens said the draft report provides that in 2016-17, typical customers on the main small business tariff (tariff 20) can expect an average increase of $197 or 9.3 per cent in their annual bill.

Typical small business customers on the seasonal time of use tariff (tariff 22A) can also expect an increase of $569 or 13.6 per cent.

“The increase in electricity prices is said to be driven primarily by higher energy costs and retail costs,” Mr Behrens said.

Wholesale energy costs and the Renewable Energy Target (RET) are estimated to add 4.8 per cent to a typical bill for a small business customer on tariff 20.

Increases in retail costs are estimated to add 3.8 per cent on the typical small business bill.

leccy prices

“CCIQ is extremely disappointed by the draft determination and believes the price increase will come as a shock to small business customers, who last year saw prices starting to stabilise.

“We have concerns about the impact such increases will have, particularly in light of bills already having doubled in recent years.

“Small businesses are becoming disillusioned by the energy sector, particularly after State Government assurances that they had seen the back of electricity price hikes.

“Given the retail prices for residential consumers is only set to increase by 0.6 per cent, CCIQ is fearful that cross-subsidisation between customer classes is starting to reoccur in regional Queensland.”

Mr Behrens said CCIQ strongly urged the QCA to reconsider the risk of continuing to burden small businesses with excessive electricity prices.

“Small businesses in regional Queensland are already disadvantaged by the lack of competition in the retail electricity market,” he said.

“It is important that the QCA carefully considers the impact on regional small businesses when making the final determination on the May 31, 2016.”

(These charges do not apply to South East Queensland customers as retail electricity prices will be deregulated from July 1, 2016).

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