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Category: Electricity Energy and Utilities / Solar Energy / States and Territories

Row over plans to axe WA power-saving program

Monday, 15 Feb 2016 12:41:26

A 19th century photo displays garden villa life of a French official’s family in Shanghai. — From the book “The History of Shanghai French Concession”

West Australian Treasurer Mike Nahan has dismissed a well-funded lobbying campaign to preserve an expensive power-saving program, labelling the scheme a "rip-off".

Under the demand side management (DSM) program which the State Government plans to axe, businesses are paid by the Government to reduce power use during periods of peak demand.

Dr Nahan said the scheme was rarely used and extremely expensive, and put the cost per megawatt of energy saved in the last eight years at $15 million.

"Let's be honest about it, this is just a bloody rip-off. It used to be a good idea, things have changed and now it's just a rip-off," he said.

"And these people are spending $10 million, ripped out of electricity consumers, for doing nothing and trying to perpetuate that position."

The campaign is being jointly run by the Australian Solar Council (ASC) and another group calling itself Western Australians for Lower Power Prices.

They are spending $10 million in a campaign to misrepresent the issues to the West Australian public so they can maintain flow of money for doing nothing.

Mike Nahan, WA Treasurer

The ASC opposes government moves to increased fixed charges for access to the power grid to offset the reduced revenue from increased solar use.

Western Australians for Lower Power Prices represents organisations currently paid millions under DSM.

The campaign claims the combination of changed pricing arrangements for solar customers and the loss of the DSM scheme will drive up power prices.

The groups sent a convoy of cars around Parliament House on Monday towing signs reading: "The Barnett Government's energy plans will cost WA $107 million a year."

DSM 'really important': Solar Council

Solar Council chief executive John Grimes said the campaign pushed the message that the proposed measures would punish consumers with a 10 per cent price hike.

"We are committed to a substantial campaign. $10 million sounds about right between now and the next state election," Mr Grimes said.

There is either going to be a bigger budget deficit or higher electricity prices."

Bill Johnston, Opposition energy spokesman

There was no spokesperson present from Western Australians for Lower Power Prices, but Mr Grimes defended DSM as an effective alternative to government-funded power generation.

"DSM is really important. It should be used in a more efficient way and should be at the heart of the system, not at the sidelines," he said.

Dr Nahan said with 1,000 megawatts of excess capacity in the system, the DSM scheme was neither necessary nor cost-effective.

"They have been called on for eight [days] in eight years and paid $360 million," he said.

"Put it into context, that's $15 million a megawatt. If you bought it from Synergy, it would be $250," he said.

"They are spending $10 million in a campaign to misrepresent the issues to the West Australian public so they can maintain flow of money for doing nothing."

Axing DSM will cost taxpayers more: Opposition

Labor introduced the system after demand exceeded capacity in the early 2000s.

Now in Opposition, Labor still believes the DSM scheme has value and should be retained.

Opposition energy spokesman Bill Johnston said choosing to generate power rather than reduce consumption added costs and increased pollution.

He said axing the DSM scheme would cost taxpayers more, one way or the other.

"How much of those increased costs are passed direct [to consumers] through the electricity system, and how much are passed through in bigger budget deficits? That's for Dr Nahan to explain," Mr Johnston said.

"But they are the two choices. There is either going to be a bigger budget deficit or higher electricity prices."

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