Barnett plan to jack up power supply charges by 1000% is highway robbery

WA Premier Colin Barnett's proposal for a one-size-fits-all electricity access charge is grossly unfair because it forces  energy-responsible Australians and the poor to subsidise  the cost of supplying power to energy hogs.

Speaking on Fairfax Radio yesterday, Barnett said: "It's fair to say that electricity consumers, all of us, whether we've got solar panels or not, maybe we should be paying a fixed component for all the infrastructure, particularly the power line system.” 

Energy security analysts Zero Emissions Australia has calculated that the Premier's proposal translates to a 500 to 1000 percent increase in daily supply charges.

"The plan discriminates against those West Australians who are doing the right thing, who are practising energy efficiency by upgrading their homes and businesses, using less electricity and installing solar,” said Zero Emissions executive director Matthew Wright.

"Currently customers in Perth pay around 43cents a day to connect to the electricity grid.  Under Colin Barnett’s plan this would increase to between $2.50 and $5 a day.

"At present the network infrastructure is funded through daily supply charges combined with a proportion of each unit of energy  that consumers extract from the grid,” Mr Wright explained.

“Customers who use less energy contribute less to network costs and more often than not they are not significant contributors to peak demand, which is the single largest dictator of network expenditure.

“If all the fixed network costs are shifted onto daily supply charges, as suggested by the Premier, customers would be asked to pay a full $4 a day extra.. However if he wants to raise fixed to cover every bit of fixed infrastructure including the legacy coal and gas power plants then the price would double to as much as $8 per day

“The only way to avoid this extra charge would be to disconnect entirely from the grid. This option is not feasible yet because batteries that can dispense stored energy at night are not commercially viable in 2013.’’

Mr Wright likened the Premier’s proposal to a scheme that takes away money from poorer and more energy-conscious households to pay for luxuries such as running air-conditioners all day, heating indoor swimming pools or switching on home theatres every evening in a neighbour’s house down the road.

"A high, fixed, daily supply charge is grossly unfair. It is a perverse highway robbery that steals from the poor to give to the rich ,’’ Mr Wright said.

Zero Emissions proposes an alternative fixed charging model that combines smart meters with incremental steps starting at $250 for 1kW of capacity and rising by $250 for each additional kW of prepaid capacity.

Under the proposal an average home would prepay say $1000 for a capped 4kW of energy and would be limited to that capacity during peak periods.

A more energy efficient household could buy just 1kW of capacity and pay just $250 for network access.

Per kWh pricing would be reduced to reflect the shifting of network access charges to the new cost model.

"This would allow future network upgrades to be tested against distributed solar with onsite storage.  Opening the market up to true competition and saving West Australians money.

"We must restructure our electricity markets so that user preference and the most economic options can come into play for the market participants.  Protectionist proposals from the WA Premier will discriminate against households doing the right thing and it is unlikely thoughtful energy users are going to sit on the sidelines and let the state’s monopoly businesses sting them like this,” Mr Wright said.

FOR COMMENT: Matthew Wright Executive Director 0421 616 733