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NSW Business Chamber
Electricity price increases set for perfect storm
Release Date: 14/04/2011
NSW electricity consumers are set to be battered by the “perfect storm” with IPART foreshadowing electricity price increases of up to 29.7% over the coming two years. Additional increases over and above this 29.7% increase will occur due to the introduction of the Federal Government’s Carbon tax on 1 July 2012.
“The days of cheap energy are over,” said Stephen Cartwright, CEO of NSW Business Chamber.
“This is a crippling blow for every energy-reliant business in NSW, and a savage blow to local exporters who have yet to come to terms with the impacts of a very high Australian Dollar.
“The under-investment in infrastructure, the dividend stripping, the haphazard state governments approach to privatisation and market structure, the lack of competition and the need for additional investments in energy capacity all point to dramatic price increases in coming years.
“All consumers are paying for the bad management of the sector in recent years – and after 1 July 2012, we will all be paying for the Carbon Tax.
Mr Cartwright said it was important to recognise that all of these increases are pre-carbon tax increases.
“Minister Combet clearly stated yesterday that only a fraction of the money collected by the carbon tax will be used to help Australian businesses invest in more efficient energy systems, and that little help can be expected for those energy-intensive businesses who export overseas, or for those businesses that will have to compete with carbon tax exempt imports.
“The costs of all Australian goods will become more expensive, during a time when our currency is at an all-time high. There is no question this will impact business, exports and jobs.
“No-one should sugar coat the goal of the Carbon Tax – its policy intention is to reduce energy consumption through higher prices. I have no doubt it will achieve that goal.
“When it comes to electricity prices, Australian businesses and consumers, need to brace themselves for the coming perfect-storm.” Read more
Sydney Morning Herald
NSW electricity bills to soar
March 18, 2010.
NSW consumers are set to be slugged with the biggest increases in household electricity bills ever seen, the independent tribunal that sets prices says.
From July 1 this year, bills for those on standard tariffs will rise by a cumulative total of up to 64 per cent by 2013. The increases will allow energy providers to increase investment in infrastructure and improve network security and reliability of supply in line with the new licence conditions imposed by the NSW government. The projected rise takes into account the federal government’s planned carbon pollution reduction scheme (CPRS), which still has a start date of 2011-12.
But even without the CPRS, power bills would still rise by up to 42 per cent over the three-year period, under changes announced by the NSW Independent Pricing and Regulatory Tribunal (IPART) today.
Asked if the increases are the biggest ever presided over by IPART, acting chairman and chief executive Jim Cox replied:
“Oh definitely. We’ve been in the business since 1992 and then I think … the early years we’ve had moderate reductions in prices, in more recent years we’ve had modest increases, now we’re moving into a period where more substantial increases seem to be common. I don’t think we’ve had anything as big as this one.”
Mr Cox conceded the NSW increases could point to similar rises in other states.
“We do not welcome these price increases or the adverse effects that they will have for many electricity customers.”
NSW businesses have blamed the forthcoming electricity price rises on the state’s failure to properly manage electricity assets. Read more