Energy minister Ferguson favors time of day pricing

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Federal energy minister Martin Ferguson has told The Australian that those who are running appliances constantly are contributing to rising electricity prices for everyone.

Speaking to News Limited, Ferguson said that higher power costs would force energy users to re-think their consumption patterns.

By habits changing during peak periods, he says it would allow energy companies to reduce the number of poles and wires they are building which is the greatest contributor to price increases.

"When you are cooking a meal, why would you put the washing machine or the clothes dryer on at that particular time (peak period), adding to the peak demand and forcing up prices?" He said to the newspaper.

A fan of pricing, dependant on the time of day, Ferguson feels that such a scheme will benefit consumers.

His comments come as the Sydney Morning Herald reports that the effect of the carbon tax has been less than Treasury modelling thought.

Predictions said that the tax would push up the Consumer Price Index (CPI) by 0.7 per cent in the September quarter but recent data shows it only rose by 0.44 per cent.

Melbourne price rises in power bills were 13.6 per cent in the September quarter, short of the 19 and 21 per cent jumps seen in the September quarters of 2011 and 2010.

By Charlie Moore