NSW electricity sale delayed at the cost of small business
Last week, the New South Wales government announced a delay in the sale of its
electricity retail assets, namely, Integral
Energy, Country Energy and
EnergyAustralia. The proposed reform is felt
to be quite complex by many, with investors being put off by levels
of uncertainty around the whole privatisation and introduction of
the 'Gentrader' concept.
The energy reform was intended to encourage new market entrants at three main levels in the sector:
And ultimately assist in creating a competitive market enviroment. Industry insiders now however believe that the pause in the sell off will last until after the next election, with a very strong likelihood of the scheme being scrapped entirely.
Make It Cheaper
says: "Rather than focus on the elaborate assett sell-off
in New South Wales, the State government should be asking the local
regulator IPART to improve what it's doing in creating a market
environment which will allow companies to enter the market and
"All businesses care about is getting cheaper energy bills, they don't care who ships it to them or how it's generated. Currently, IPART only allow retailers to make a margin (profit) of 5.4%, which doesn't come close to providing an effective incentive for a new retailer to enter NSW and compete in an aggressive manner with local incumbent retailers."
"As soon as IPART improves what they're doing, it's entirely likely that businesses will start to see some real cuts in energy costs. And with energy bills estimated to rise by over $5,000 over the next 4 years, it's about time the regulator allowed real competition to exist in New South Wales as it will only benefit the business owner."