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Energy Networks Association enters electricity prices debate

Reports emerged last week (March 21) that Australians are paying record electricity prices - up to 130 per cent more than Canadian residents and 70 per cent more than the American average.

These figures were released soon after energy minister Martin Ferguson claimed that Australian prices were lower than the OECD average.

Now many industry groups are bringing their opinions into this forum, including the National Generators Forum.

In an interview with the Daily Telegraph on March 21, the association's executive director, Tim Reardon, said that mild weather, a reduction in manufacturing and decreased household energy use were lowering the wholesale price of electricity.

He blamed networks for the fact that consumers are still paying record prices.

However the Energy Networks Association (ENA) has challenged Mr Reardon's assertion, claiming that network prices are increasing due to higher costs of capital in the wake of the global financial crisis, combined with increased peak demand.

ENA chief executive officer Malcolm Roberts said: "As more households use more energy hungry appliances, such as air conditioners, the spikes in peak demand are becoming even sharper.

"Generators may benefit from peak demand in terms of higher prices but the reverse is true for networks - peak demand drives costs up for networks."

Posted by Charlie Moore