Power Price Crisis Sparks Policy Solutions
In recent CCIQ research, power prices were the number one hot topic facing business in Queensland and CCIQ is pleased to see both sides of politics attempt to address this key business issue in the first week of the election campaign.
With over 170,000 jobs at risk as a result of ever increasing prices, CCIQ is delighted that a line has been drawn in the sand on the battleground of electricity prices and steps are being made to put forward policies that will make both a short term and long term difference to the cost of such an essential utility.
CCIQ’s General Manager of Advocacy, Kate Whittle, welcomed the LNP announcement of their Cheap Electricity Policy, saying that it will address many of the concerns that business and the community has about energy affordability, “It is no secret that energy costs in Queensland have spiraled out of control in the last decade, resulting in some of the highest energy prices on the planet hitting Queenslanders hard. We welcome the Cheap Electricity Policy as it contains measures that will alleviate some of the pain Queensland businesses have felt.
“It was great to see the opposition have listened to our advocacy and read our submissions. Yesterday’s policy highlights that the Opposition understand the problem and what levers need to be pulled to drive prices down.
“The $2bn write down of the Regulated Asset Base (RAB) will have consequences to the State Budget bottom line, but any avenue to fix the problem was always going to come at a cost.
The Cheap Electricity Policy also included the restructuring of Queensland generators, CS Energy and Stanwell Corporation to return them to three entities to increase competition in the generation market. Early this year ACCC Chairman Rod Sims raised concerns about the lack of competition in Queensland and had previously made comments about returning the generators to three.
“CCIQ supports increased competition and efficient markets, an increase in competition in our generators will hopefully see an end to the price gouging of previous years.”
The policy also included a commitment to scrap the Government 50 per cent Renewable Energy Target.
“Modelling done earlier this year showed that a commitment to 50 per cent renewables drove the price of electricity up for businesses. We at CCIQ are technology neutral and support the Paris Agreement to reduce our emissions, however as our members have repeatedly told us, it cannot come at the cost of the sustainability of their businesses.”
Other commitments included:
- Freezing executive bonuses until electricity prices decreased
- End subsidies for renewable energy post 2020
- Remove Ergon non-reversion policy
- Put consumer representatives on Boards of networks
There was also a commitment to build a private sector high-efficiency, low emissions coal-fired power station in North Queensland.
CCIQ’s Kate Whittle, said the business case would need to stack up for business to support the building of the new power station. “CCIQ is reserving judgement on the HELE project. We support infrastructure that serves a practical purpose, that creates jobs and is needed. We will wait to see the business case of the project however from reading the recently released Department of Water and Supply report and comments by energy industry experts to date we are not convinced the project is warranted and can stand on its own legs.”
CCIQ is still hoping to see commitments from either party to:
- Remove the competitive neutrality charge from networks
- Abolish the Solar Bonus Scheme post 2020
- Adopt 5-minute settlement period
- Introduce regional retail competition
“The Cheap Electricity Policy contains some very beneficial elements for business and will help to mitigate the pain of power prices, however in the run up to the 25 November poll, we would like to see more to be done by all parties to address electricity prices as it is the number one business issue and impacts significantly on the future growth and employment across the state, but particularly in regional Queensland.” said Ms Whittle.