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Queenslanders facing $400 a year power bill increase

Talk about a shocking bolt. Power bills to go up 21% in Queensland - about $400 a year.
Talk about a shocking bolt. Power bills to go up 21% in Queensland - about $400 a year. Contributed

UPDATE: Queensland households are facing 21% hikes in electricity charges which will add more than $400 to the average power bill a year.

Businesses will also be hit with a 15.7% hike under the recommended changes.

The Queensland Competition Authority (QCA) today released a draft determination foreshadowing increases in regulated pricing.

"The draft determination forecasts a price increase of 21.4% for the common household tariff (Tariff 11) and 15.7% for small business customers (Tariff 20) across Queensland,'' QCA Chairman Malcolm Roberts said.

"Unfortunately, escalating network and other costs mean regulated prices will have to rise in 2013-14."

"In SEQ, network charges, including the cost of the Solar Bonus Scheme, are expected to rise by 23%.

The exact extent of this cost increase will be known when the Australian Energy Regulator approves network revenue proposals for 2013-14." Dr Roberts said.

"Wholesale energy costs are also expected to rise in 2013-14.

"Green schemes, including the Commonwealth's carbon tax, account for a significant share (11%) of costs.

"The end of the temporary freeze on Tariff 11 will see higher network costs passed on to residential customers.''

Likely price increases for the most common regulated retail electricity tariffs

Tariff 11 - Residential $1,184  to $1,437, a $253 increase or 21.4%

Tariff 31 - Night rate (super economy) $242 to 278, $36 or 15.0%

Tariff 33 - Controlled supply (economy) $343 to $408, $65 or 18.9%

Tariff 20 - Small Business (flat rate) $1,615 to $1,868, $253 or 15.7%

Tariff 22 - Small Business (time of use) $3,638 to $4,070, $432 or 11.9%

"The QCA understands that price increases are never welcome news"

"Most customers in SEQ have already chosen market contracts which usually offer lower prices than the regulated tariffs. It makes sense for customers who can change from regulated tariffs to test the market,'' Dr Roberts said.

The QCA is inviting submissions from all interested parties and will be holding workshops across Queensland to discuss its draft determination.

A final determination will be released on 31 May setting 2013-14 prices.

Business groups condemn massive power cost increase

THE Chamber Of Commerce and Industry Queensland (CCIQ) has today come out firing, saying that any attempt to claim this as a good outcome is disconnected from the reality of doing business.

CCIQ General Manager of Advocacy Nick Behrens said that any suggestion that this is a "reasonable" price rise is erroneous and CCIQ will fight hard to ensure that the recommended price increases do not go ahead.

"Electricity is an essential input into every business, and whilst we have started to see signs of recovery, Queensland businesses are far from being out of the woods."

"Including this years proposed increases, the cost of electricity for Queensland businesses has increased by nearly 100% over the past 7 years - a cost which is simply unsustainable"

CCIQ has now called on the State and Federal Governments to not only fast track reforms that will improve the efficiency and operation of the electricity market, but also to recognise that there are many instances of bad policy adding to the electricity price pain.

The fact that network charges were the key factor contributing to this year's excessive price increases suggests there are serious flaws in the way that network prices are being set, not to mention the serious questions which hang over the distributors' large revenue allowed by the AER.

Massive power bill slug on way: 'It's all Newman's fault'

THE electricity industry claims a price freeze by the Newman Government is to blame for a huge hike in power costs which is tipped to be announced today.

Matthew Warren, the CEO of the Energy Supply Association of Australia, said the double-digit increases expected were simply the industry catching up with rising costs.

He said the State Government should not be interfering with prices but allow industry competition and discounts to give consumers better deals.

He denied that the industry was carrying out unnecessary upgrades to meet rising power demands.

"There is obviously a lot of people getting very frustrated by costs increases but its absolutely necessary that we upgrade our systems,'' he said.

Mr Warren argued that Queensland customers would become more upset about blackouts on hot days when they needed their air-conditioners.

Mr Newman claimed evidence from other states, including South Australia, showed deregulation, and greater competition, had led to lower prices.

"When governments get out of the business of trying to regulate prices, then we see big savings for ordinary households,'' he told ABC radio.

Peter Beattie to blame for original power price hikes

Many in Queensland have argued that prices have only gone up since deregulation of the industry by then premier Peter Beattie.

Mr Warren argued there had been discounts of 9% to 16% in South Australia since de-regulation in December.

He said Victoria's increases had been less than Queensland's because of deregulation.

The Newman Government put a price cap on the tariff 11 which will be lifted - costing the average household about $120 a year.

But Mr Warren claimed the market should be allowed to determine pricing.

"If the Newman Government can get out of the business of regulating prices as soon as possible then households will be in a much better place.''

Today's price increase will be announced by the Queensland Competition Authority.

The authority determines pricing using a range of information, including from energy retailers themselves.

Topics:  campbell newman consumers energy politics power prices



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