News

News Power Cuts or Power Bill Cuts – Does it really come down to a choice?
Power Cuts or Power Bill Cuts – Does it really come down to a choice?

Power Cuts or Power Bill Cuts – Does it really come down to a choice?

Tags: Consumer Action Consumer Quickshot Energy Information FiftyUp Club Tips and Tricks Cost of Living FiftyUp Club News
Last updated by Chris Zinn on

Who do you believe – the energy regulator charged with putting the long-term interests of consumers first? Or the NSW ‘poles and wires’ companies which actually deliver the stuff? 

That’s essentially the argument behind a high stakes legal stoush which will determine the size of planned 5-12% reductions to your next electricity bills.

And it’s especially important for older Australians who generally face higher bills. They are at home more, spend a higher proportion of their income on electricity; and are hit harder by climbing supply charges.

But those big savings promised to consumers are now under threat as the poles and wires companies and the NSW state government which owns them launch legal appeals against planned price cuts due on July 1.

So the FiftyUp Club is going to launch an appeal of its own: from today we’re asking you, the members, to send us your views on the legal battle, and tell us how higher electricity costs have impacted on your wallet and way of life.

Click Here to have your say by answering a few questions and commenting in our FiftyUp Forum

Read on to see what’s at stake, send in your comments and ideas and we’ll package them up for the tribunal hearing the case to ensure your voice is heard.

THE FULL STORY

The Australian Energy Regulator (AER) has fixed a five-year pricing determination which cut the amounts the NSW state-owned poles and wires businesses could charge us by some $6 billion to 2019.

It adds up to big savings for the consumer of between $100 and $300 a year depending where you live. It is aimed to bring the costs of delivery to NSW households in line with those levied by the privately-owned networks in SA and Victoria. Presently they can be twice as much.

We’re told those networks are more efficient and employ less workers, delivering lower costs to consumers. Falling demand for electricity means there’s also less need to build expensive ‘gold plated’ networks.

It was the massive investment and poorly controlled spending in the high-tech and high-cost ‘poles and wires’, including pylons and transformers, which saw many bills blow out by more than 70% in the past five years.

Network costs can add up to almost 60% of some people’s energy bills especially if they live in the higher cost of service rural areas.

But the NSW government and their poles and wires companies have lodged appeals to the Australian Competition Tribunal, claiming the cuts to their revenue mean they can’t operate safely or reliably.

They are backed by the trade unions as 2,200 jobs are at stake. The network companies say they have already shaved more than $3 billion and 3000 jobs from their capital and operating programs.

They also claim the cuts mean they can’t manage vegetation growth in rural areas, which, as the 2009 Victorian bushfires demonstrated, can carry serious risks.

Their arguments may sound convincing but have drawn fire from numerous quarters.

The ALP says the AER’s decision is fair and the NSW Government only wants to increase the waning value of the networks – a large part of which are up for a $13 billion long-term lease.

Groups representing consumers, welfare and business have also attacked the appeal and the Public Interest Advocacy Centre has brought its own legal challenge arguing for even bigger spending cuts on the networks.

To have your say, help us put together a submission to the Competition Tribunal.  Spend a few minutes answering the snap poll above on how power prices have affected your life, and leave a comment in our forum below.

We will report back soon on the next steps and make sure the voice of FiftyUps is heard.

From Christopher Zinn & The FiftyUp Club Team

Useful Links:

Daily Telegraph, 21 May, 2105, "Networks NSW will appeal energy regulators decision to cut the price of power bills for consumers": www.dailytelegraph.com.au/news/nsw/networks-nsw-will-appeal-energy-regulators-decision-to-cut-the-price-of-power-bills-for-consumers/story-fni0cx12-1227363388780

Sydney Morning Herald, 21 May 2015, "Electricity price cuts, privatisation plans under threat as power networks set up fight with regulator": www.smh.com.au/business/electricity-price-cuts-privatisation-plans-under-threat-as-power-networks-set-up-fight-with-regulator-20150521-gh6meh.html

The Australian, 21 May, 2015, "NSW power networks to fight cuts in court": http://www.theaustralian.com.au/business/nsw-power-networks-to-fight-cuts-in-court/story-e6frg8zx-1227364313737

 

 

 

Originally posted on .

Join the conversation

FiftyUp Club
Power Cuts or Power Bill Cuts – Does it really come down to a choice?

Share your views with other members. 

Want to leave a comment? or .
Read our moderation policy here.
Wendy
Wendy from NSW commented:

Since privatization of the power we have seen electricity costs rise significantly and with The privatization of poles and wires costs to the consumer are likely to become prohibitive. Say no to privatization. 

Barry
Barry from NSW commented:

AGL recently sent a notice that my discounts for combined Gas/Electricity were going down. I yelled and they not only restored the old discounts but increased then by another 2%. Pity it's only on the usage, not the supply costs! But every little helps. Negotiate! 

Nicholas
Nicholas from VIC commented:

Power, water, and health should be government owned Both labor and liberal governments have been responsible for priviatisation. In Victoria the infrastructure is owned by Singapore and China that is ridiculous. Utilities are major costs to business and have accelarated the loss of manufacturing to overseas. 

Joe
Joe from VIC commented:

There should be a bigger push for Solar Panels. 

Bruce
Bruce from QLD commented:

The market will drive the prices. Funny how Origin have continually pleaded that I return to them after switching providers. Who, seriously, would trust either level of government to organise a household budget let alone promise that you will get savings? Always it will have to come at a cost and unfortunately, that means job losses. There is only one way to get savings and that is to get rid of State Governments, full stop. 

robert
robert from NSW commented:

My supply fee is a third of my total bill each quarter. I think it is a form of extortion. 

Dianne
Dianne from QLD commented:

Electricity prices in far nth Qld are a concern, but with only one service provider Ergon nothing is going to change. 

Anne
Anne from ACT commented:

I wish that you could do something in the ACT. We have just had an offer from Origin to give us a month free electricity (even though we already have a connection in the Snowy Mountains, all suppliers are just too dear, especially when they attach the supply fee. What is that anyway???, all I know is that it costs as much as the actual electricity supplied. 

Linda
Linda from NSW commented:

Thank you for the support you provide to us over fifty; am always unsure if it includes us who live in rural NSW to be able to get the benefits. Kind regards Linda Castelletto Linda. Casta8@gmail.com 

Dean
Dean from NSW commented:

I worked for The Sydney County Council for over ten years back in the 70/80's. It was then a statutory body that injected vast amounts of cash into the State coffers and the network was keenly maintained and expanded. The then Griener Government was so blind and could only see the dollars that it could make and so privatised the supply of electricity and look what we have got now. 

Allan
Allan from NSW replied to Dean:

Agreed Dean - Spot on ! I worked for the Electricity Commission of NSW. We had control over costs and not only delivered secure service, at cheap prices(do you remember) but also paid a whopping big "dividend" to the State Government every year. This long term security they surrendered for short term bucks to make them look good and secure another term in office. Social Espionage I reckon. 

Comment Guidelines