Origin and TRUenergy Winners in NSW Energy Deal
Origin and TRUenergy are the winners in New South Wales big energy sell off. Origin Energy are set to acquire 1.6 million Country Energy and Integral Energy retail customers, and TRUenergy acquire 1.4 million Energy Australia retail customers, NSW single largest retailer
At the same time, NSW customers are facing proposed 15% price increase in 2011.
The general consensus appears to be that Origin Energy and TRUenergy are picking up a bargain, with the proposed value of $5bn, three times less than the $15bn the NSW government was expecting.
The key to this sale is competition. NSW competition has been largely ineffective up to the last 6 months following the price increase in July 2010. The government need to ensure that this sale provides some serious economies of scale and allows some of the underlying supply costs to be driven down.
We want to see more retailers, some smaller, come into the NSW market and start competing for both home owners and businesses.
There's currently between 5-10% saving available to NSW customers, and we strongly advise customers who have been hurt by price increases this year to take action and switch to a cheaper retailer.
Whilst this sale is going through, this leaves the door open for retailers like AGL, Red Energy, Australian Power & Gas who want to steal a march on Origin and TRU and start eating into their customer bases.