The average Queensland household may pay up to nearly $200 extra annually for electricity from July next year.
As we mentioned yesterday, the added financial pain that Victorians will start experiencing from January 1 will soon spread to other states.
The Queensland Competition Authority (QCA) has released its draft decision on electricity prices, to apply from 1 July 2014.
“The typical residential customer, consuming about 4,100 kWh per annum, is likely to see an increase of 13.6% or $192 in their annual bill (if the carbon tax continues),” says the QCA.
“If the carbon tax is repealed from 1 July 2014, the increase would be 5.4% or $76.”
In 2014–15, business tariffs are expected to rise by about 10% to 15% if the carbon tax continues and much less if it is repealed.
Wholesale generation and network charges make up approximately 61% of the increases and the Solar Bonus Scheme approximately 30%. However, it should be noted that solar power systems have helped rein in wholesale electricity costs – without its influence the increases in wholesale energy costs could be much higher.
Australia’s rooftop solar power systems are saving between an estimated $300 million and $670 million each year in wholesale electricity costs as well as slashing or even wiping out the bills those who install solar panels.
A major beneficiary of the upcoming electricity price hikes will be the Queensland government. Queensland’s networks are state owned and according to an analysis carried out earlier this year, the large increases in the state’s power prices have also delivered massive financial benefits to the Queensland Government – a compounding 114% growth in financial returns every year.
While the removal of the carbon tax would hold down the increases, the remainder illustrates something else we’ve mentioned previously – repeal of the carbon tax will only provide short term relief as that financial relief will be relatively quickly gobbled up by other factors; such as the rapidly increasing price of gas for power generation. Instead of what is a band-aid over a gaping wound, what is needed is real electricity pricing reform.
The QCA’s final decision for 2014–15 pricing will be released by 31 May 2014.
