NSW Electricity Bills to Soar by 22 Per Cent
The NSW Government has brought forward a $272 million assistance package originally announced to soften the impact of its $6 billion energy privatization on consumers after a substantial price rise was confirmed yesterday.Metropolitan NSW householders will be paying up to 21.7pc more for electricity from July 1 to pay for maintenance and upgrading of power networks and an increase in wholesale purchase costs. Power bills for customers of Country Energy will be about 18percent more. The Independent Pricing and Regulatory Tribunal said that, without the price rise, power companies might not invest in new technology.“If electricity costs allowance in insufficient, some retailers may be unwilling to supply customers and incentives to invest in new generation capacity when it is needed may be inadequate,” tribunal chairman Michael Keating said.The price rise includes a national increase in network charges, which the NSW government lobbies against, determine by the federal Australian Energy Regulator this month.IPART called on the government to bring forward its $272 million assistance package, which had been promised as a sweetener for the proposed sell-off of electricity assets. “I and pleased to see that the NSW government has been successful in reducing charges and smoothing out he impact on families and businesses, leading to increases almost 3 percent lower that they would have been otherwise,” Energy Minister Ian Macdonald said. “These price increases will help maintain out energy reliability standards, and prevent mass blackouts, which happen in California, so families and businesses don not have to suffer.”Shadow Treasurer Mike Baird said the government had failed to keep prices down.“After IPART’s draft determination in March this year Energy Minister Ian Macdonald huffed and puffed about eh in crease being too high and promise to amend the prices, “he said.“Well he has failed and once again it is the people of NSW who will be paying the price.”Retailers Energy Australia, Integral Energy and Country Energy will be sold under the government’s rehashed energy privatization plan, with the trading function of generators and hew development site for power stations.It is understood the government favours a structure to allow a new entrant to build a vertically integrated power company from the ground up. The Rees government will release more detail about the structure and timing of the sale after completing a final round of market consultations with potential domestic bidders.AGL and Origin Energy are considered front-runners to buy the assets, although Finance Minister Joe Tripodi has said bidders consulted during a recent overseas trip indicated they were keen to participate. Australian Financial Review Thursday 21 May 2009.
