WEDNESDAY 05 DECEMBER, 2012 |
Fix Distribution Network Regulation, Slash Electricity Bills
$100 a year could be shaved off Australian households' electricity bill if governments fix
issues relating to the regulation of distribution networks say the Grattan
Grattan Institute Energy Program Director Tony Wood says reducing the enormous profits
monopoly distribution businesses generate could save consumers a total of $2.2 billion a
"People are worried about rising electricity bills. There are things governments can do
to make a difference, and this report explains what they are".
The report - "Putting the customer back in front: How to make electricity prices cheaper"
details how electricity distributors have made changes over the years to the
detriment of consumers.
The report states governments should direct and empower the Australian Energy Regulator (AER) to set the
parameters that ultimately determine customer costs and company profits in what
is a low risk sector.
The Grattan Institute also states the responsibility for setting reliability standards
should be shifted from state governments to the Australian Energy Market
Commission (AEMC) and the AER.
Another big issue recently in the headlines relates to the "gold-plating
of infrastructure. Grattan says the AER should be empowered to review
companies' capital expenditure forecasts annually against credible market demand forecasts,
and ensure any apparent over-expenditure is subjected to a rigorous cost-benefit
Importantly, regulators should be directed to act in the long-term interests of consumers, while not
hindering distribution companies from making fair and reasonable profits.
The Grattan Institute's report can be downloaded
There will be all manner of argy-bargy over the next couple of years in relation
to cutting electricity costs - AGL has already come out swinging against price
cuts recommended by the Essential Services Commission of South Australia (ESCOSA)
and is apparently now taking
against the body.
Against this backdrop of bickering, consumers continue to suffer chronic pain at
the power-point. But there is literally light at the end of the tunnel for some
households. Instead of waiting for government action - the results of which are
far from set in stone nor guaranteed to provide real relief - households can
slash or even wipe out their power bills by installing
solar panel systems
One thing that has certainly changed for the better in recent times is the
portrayal of solar
being the primary villain of electricity price rises; with the
finger now being pointed squarely back at some of those who originally
started and/or perpetuated the myth.
Other news for Wednesday 05 December, 2012
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