CCIQ welcomes QCA consideration of business concerns over electricity price increases
The Chamber of Commerce and Industry Queensland (CCIQ) welcomed today’s release of the final determination on regulated electricity tariffs by the Queensland Competition Authority (QCA), saying that it was largely a good outcome for Queensland businesses.
For many small and medium businesses with average electricity usage, the recommended tariffs will result in an increase of only 0.9 per cent with some users benefiting from a 0.5-1.0 per cent decrease in annual electricity charges.
This represents a dramatic turnaround on the double digit price increases of the previous several years. Electricity prices across the previous 5 years under the previous methodology have risen by 64 per cent.
Of significant importance to business users with electricity use above the average, who previously were facing possible price increases of between 20% and 100% due to the forced shift to new
tariffs and/or market contracts, the QCA has recommended a twelve month transitionary period which will see price increases capped at between 10% and 20% depending on a business’s existing tariffs.
CCIQ President Mr David Goodwin said that he was pleased that the QCA had taken on board the concerns raised by CCIQ about the significant impact of dramatic increases in electricity prices brought about by the forced shift to market contracts.
The transitionary period will give businesses an additional 12 months to review their operations and power use and consider the impact of moving to the new tariffs.
“What we need to keep in mind is that energy use is not directly reflective of business size.
“There are many small and medium businesses across south-east Queensland, some only employing 5-10 workers, but who are classified as large business users in an electricity usage
“These businesses were facing almost certain closure if they were forced to shift to uncompetitive tariff rates and absorb up to a 100 per cent increase in electricity costs.”
Mr Goodwin said that the concurrent announcement by the Queensland Government of the Independent Review Panel (IRP) to oversee the reform of electricity market would also help secure a more realistic approach to setting electricity prices into the future.
CCIQ welcomes the opportunity to engage with the IRP throughout their review process.