Consumers launch first ever legal challenge to electricity network revenue

On behalf of NSW consumers, the Public Interest Advocacy Centre (PIAC) has today launched a legal challenge to the Australian Energy Regulator’s (AER) recent electricity network revenue decisions. PIAC believes those decisions allow the NSW electricity networks to operate inefficiently over the next four years, keeping electricity prices unnecessarily high for consumers. 

PIAC today applied for the Australian Competition Tribunal to review the AER’s recent revenue determinations for the NSW network businesses (Ausgrid, Endeavour Energy and Essential Energy). This will be the first time a consumer organisation has ever appeared before the Tribunal.

‘We are taking this action because we believe the revenue granted to these businesses is excessive and therefore NSW consumers will be forced to pay too much for network services over the next four years,’ said PIAC CEO Edward Santow. 

‘Changes were made to the National Electricity Law in 2013 to improve access for consumer groups to the review process. 

‘No consumer group has ever been heard in the Tribunal. Until now, only networks have challenged the AER’s decisions,’ said Mr Santow. 

‘Network prices in NSW are now double what they are in Victoria – in other words, it costs twice as much to get electricity from a power station in NSW to a consumer than in does in Victoria,’ Dr Gabrielle Kuiper, Senior Policy Officer in PIAC’s Energy + Water Consumer Advocacy Program said.

‘This is bad news for the productivity of the NSW economy, especially for small businesses. It is also bad news for families, such as the 33,000 households who were disconnected from electricity for non-payment last year,’ she said. 

‘PIAC is particularly concerned about the changes that were made between the AER’s draft determinations late last year and the final determinations made on 30 April, which allocated an additional $2.3 billion to capital and operating expenses across the businesses. The Law requires expenditure to be efficient and we don’t believe the final determination reflects efficient costs for consumers’.

MEDIA CONTACT: PIAC Senior Media Officer, Gemma Pearce 0478 739 280.

Photo: Flickr/Niclazo

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