Vow to end power monopoly

The West Australian, September 8, 2016:

Households and small businesses in Perth and the South West will be able to choose where they buy electricity for the first time within three years under plans by WA Energy Minister Mike Nahan.

Dr Nahan has pledged to end State-owned power provider Synergy’s monopoly in the small-scale electricity market by July 2019 if the Government is re-elected in March.

And in comments that could have big implications for Synergy, Dr Nahan said he would bring in so-called full retail contestability (FRC) regardless of whether the prices the utility charged covered its costs.

The pledge drew scorn from the Opposition, which noted Dr Nahan had already delayed his own deadline for FRC and the Government had done almost nothing to promote the concept in eight years.

Synergy will receive $320 million from taxpayers this financial year to subsidise the electricity it provides to the residential market.

Mike Nahan has pledged to end State-owned power provider Synergy’s monopoly in the small-scale electricity market.

Dr Nahan suggested private companies could also be eligible if they provided power cheaper.

“Whether it’s splitting Synergy up or allowing private competition, what we will commit to do is have full retail contestability even if the subsidy exists by July 1, 2019,” Dr Nahan said.

“We are going to go to a process to allow open competition to the small business and residential (markets) even if there are subsidies.

“There are ways by which you can allocate the subsidies to private providers as well as Synergy.

“The exact structure by which we do that, whether Synergy is whole and private retailers come in like Perth Energy or Alinta or whatever, is yet to be determined.

“But without competition and choice you’re not going to get the efficiency you need in this system.”

Shadow energy minister Bill Johnston said while ending Synergy’s monopoly was the “inevitable consequence” of the previous Labor government’s break-up of the old Western Power, he put no store in the minister’s competition pledge.

“We’ve been surprised the Liberal Party has not deregulated the small-business tariff — they could have done that years ago,” he said.