Western Australian electricity consumers do not pay the true price for their power which is putting an unacceptable strain on the budget bottom line, says the Chamber of Commerce and Industry of Western Australia (CCI).
CCI Chief Economist Rick Newnham said electricity bills should reflect how much it actually costs to provide electricity to households.
“Under our current system, the way prices are charged bears very little resemblance to the actual cost of supply – we pay too little for being connected to the grid, and too much for the actual electricity we use,” Mr Newnham said.
“This means electricity pricing in Western Australia is unsustainable and a drag on the budget bottom line – at a time when our state can least afford it.
“This financial year there was a $300 million difference between how much consumers paid for power and how much that service actually costs to provide. This shortfall then gets covered by the public purse – given the current pressures on state finances, no area of government expenditure should escape review.
“The new State Government should prioritise electricity market reform and introduce electricity tariffs that more accurately capture the true fixed and variable cost of power. Consumers should be individually responsible for paying for accessing and using electricity, to ensure the long-term sustainability and security of our energy system and to reduce pressure on the state budget, whilst ensuring changes take appropriate account for the most vulnerable in our community.
“The business community supports Treasurer Ben Wyatt in putting this issue on the agenda and looks forward to working with the State Government on further electricity market reforms.”
Media contact: Kate Hodges – 0448 928 22