April 16, 2014
The State Government says the removal of “prescriptive” reliability standards from electricity distributors on July 1 will save $2 billion over the next 15 years and put downward pressure on electricity prices.
But the move has been slammed by the Electrical Trades Union which says it will inevitably lead to more frequent blackouts and leave networks less able to cope with storms and natural disasters.
Energy Minister Mark McArdle described the changes as “common sense” and said they provided greater flexibility on future electricity infrastructure decisions.
“These reforms will allow Energex, Ergon Energy and Powerlink to deliver the most cost effective and reliable electricity supply while recognising customer values and achieving minimum service standards,” he said.
Mr McArdle said the Interdepartmental Committee on Electricity Sector Reform had recommended the removal of standards which required back-up infrastructure be built even though it might only be required on rare occasions.
However an ETU spokesman said the government’s claim that reducing reliability standards would put downward pressure on prices was “debatable”.
“When you consider the fact that Victoria where reliability standards have been peeled back still has higher residential prices than Queensland and its privatised network is also facing class actions associated with maintenance failures implicated in the Black Saturday bushfires, (it’s) hardly a win-win,” the spokesman said.
“This is all spin, with the government trying to neutralise the fact that privatised electricity networks cost consumers more.
“If the government was fair dinkum about reducing power prices we have already shown through the (Orion report) how they could reduce power bills by more than $300 per year immediately by giving profits from State energy companies back to consumers – without sacrificing reliability standards or privatising the assets.”
