Adjusting the fixed price of power is a critical step towards long-term budget repair and lower power prices in the future, says Western Australia’s peak business advocate.
The Chamber of Commerce and Industry of Western Australia (CCI) says increases to the fixed charge component of electricity bills – as announced by the State Government today – will benefit the budget bottom line by significantly reducing the electricity subsidy the government currently pays to Synergy.
“Western Australian electricity consumers do not pay the full price for their power, which is putting an unacceptable strain on the budget bottom line,” said CCI Chief Economist Rick Newnham.
“The shortfall between how much consumers pay for power and how much that service actually costs to provide gets covered by the public purse – electricity subsidies are expected to cost the State Government $420 million this financial year and this cost will only continue to grow, which is simply not sustainable for the budget bottom line.
“Customers should be paying bills that accurately capture how much it truly costs to generate, transmit, distribute and sell power – introducing this cost reflectivity into the system will create the appropriate environment for other electricity retailers to enter the WA market, creating greater competition in power prices and driving costs down for the long-term benefit of consumers.
“The business community supports the McGowan Government and Treasurer Ben Wyatt in progressing with electricity market reform and CCI looks forward to working with the State Government to identify further budget repair measures.”
Media contact: Kate Hodges – 0448 928 227