IPART calls for removal of electricity price controls

The Independent Pricing and Regulatory Tribunal (IPART) has backed calls to remove electricity pricing controls.

According to the organisation, the current system has failed to deliver results for consumers.

"Retail price regulation has not protected consumers from electricity price shocks.

"A well-functioning retail market - in which there is competitive rivalry between electricity retailers - is the best way to ensure that … electricity prices are driven towards the efficient cost of retail supply," IPART chairman Peter Boxall said.

Rises in electricity prices have been about 20 per cent for those on government-regulated pricing contracts and the number of those contracts makes up about half of all consumers across the state of New South Wales.

Competition in the marketplace of NSW is currently being studied, but price controls are expected to remain in place until 2015 when the next state election is due to occur.

The state government has committed itself to not allowing electricity prices to rise above the rate of inflation, although retailers may seek a price rise because of the cost of the federal government's renewable energy scheme.

Posted by Charlie Moore