QLD Electricity price freeze – short-term relief

Monday’s announcement that the Queensland Government would freeze Electricity Tariff 11 – the tariff paid by most households – for a year has been welcomed with qualification.

QCOSS CEO Mark Henley warned, “... this can only be a temporary measure and we look forward to the review of pricing announced by the government. This should ensure a sensible long-term approach to pricing as well as better, more targeted options for concessions to disadvantaged Queenslanders.”

The Queensland Competition Authority’s proposal for increased fixed charges and an inclining block tariff for usage charges would have seen some pensioners and others who had cut their usage to extremely low levels hit by overall cost increases of up to 100 per cent.

The price freeze applies only to tariff 11 and not to off-peak tariffs 31 and 33, which consumers have been encouraged to use. “Under the QCA’s draft decision these would increase by 29.8 and 25.9 per cent respectively so there could still be additional price increases for those who have off-peak tariffs,” says Mark.

QCOSS President Karyn Walsh says the community sector would like to see an open and transparent review of pricing options that it can engage with on behalf of disadvantaged Queenslanders.

“The review should model consumer impacts, ensure retailers are paid only fair and reasonable costs and margins, and provide targeted assistance where needed,” says Karyn. “Changes to the pricing structure should be accompanied by consumer education and programs to assist with energy efficiency.

“The current assistance schemes need to be reviewed in conjunction with price impact modelling to make them more equitable and efficient. At present they exclude some people on low working incomes and Newstart and youth allowance payments. It is essential that this support framework is at least extended to all health care card holders, as is the case in other Australian states.

24 April 2012.