Electricity price reforms announced for QLD

Electricity prices target of qld reforms 16000646 800506193 0 0 7006328 300

Queensland government reforms to electricity prices will better allow consumers to shop around for the best deals.

This is according to energy minister Mark McArdle, who said planned changes should encourage people to compare electricity agreements and pick the best one for them.

Proposed changes include the removal of electricity prices regulation in south-east Queensland by July 1 2015, as well as the introduction of price monitoring.

The state government said this will improve competition in the sector and create downward pressure on bills.

Under the new policy, the Queensland Competition Authority (QCA) will be tasked with overseeing price monitoring and scrutinising electricity deals put together by retailers.

"This system is currently used in Victoria and South Australia and allows consumers to compare prices and shop around," Mr McArdle explained.

"This model encourages electricity retailers to offer the best price because they are aware that customers can compare prices and change if they can find a better offer."

He went on to say that price regulation has failed to keep energy bills down, so removing it will be an effective way of providing households with greater options.

Price monitoring, alongside additional electricity sector changes being considered by the government, should begin to have an effect on electricity prices almost immediately, the minister continued.

"While there is no overnight solution to deliver benefits to customers, improving competition by removing regulation that does not work is an important issue within the government's control."

The reforms are part of a 30-year strategy, with the government moving to a supervisory position on prices once pre-conditions are met.

Mr McArdle said the QCA's existing role of setting prices will continue in the Ergon area until the government has confirmed a way of boosting competition in regional Queensland.

"Customers in the Ergon area benefit from more than $600 million in price support through the Uniform Tariff Policy and further work is required before full retail competition can be introduced to regional Queensland," he stated.

These changes are just some of the energy reforms announced by the state government yesterday (June 16), with politicians also proposing to merge Ergon and Energex into one company.

The government said it could save $580 million over seven years, reducing duplication, boosting network efficiency and passing these savings on to customers.

However, the plans are subject to consultations with employees from the two organisations.

Posted by Charlie Moore