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Category: Electricity Energy and Utilities / Business, Economics and Finance / Industry / Government and Politics / States and Territories

SA Power Network's bid to collect more cash denied

Friday, 28 Oct 2016 07:15:55

State Government and welfare groups argued against the further price hike. (ABC News: Giulio Saggin, file photo)

The Australian Competition Tribunal has found the Australian Energy Regulator (AER) did not make any error in denying an application by SA Power Networks (SAPN) to collect more revenue.

SAPN appealed against last year's decision by the regulator and had sought to earn an extra $250 million in revenue, which opponents feared would lead to a rise in retail power prices.

The company is the sole owner of the state's power distribution network of poles and wires.

AER made a decision on the SAPN revenue allocation for 2015-2020, providing a total revenue allowance of $3.84 billion compared to the $4.53 billion sought by SAPN.

The South Australian Government, industry and welfare groups had also opposed any move which would have increased retail power prices.

SAPN argued that AER made multiple errors and was unreasonable in its judgment and appealed to the tribunal.

UnitingCare told the tribunal that 31,666 South Australian households had an electricity debt, with the average debt being $758 and the state had the highest rate of energy customers on hardship programs.

SA Treasurer and Energy Minister Tom Koutsantonis described the tribunal's decision as a "win".

"This is a huge win for South Australian households and businesses against a monopoly that was initially seeking to raise $700 million more from customers for the distribution of their power over the period to 2020," he said in a statement.

"With 35 per cent of the average annual electricity bill made up of distribution costs, the price increases would have had a devastating impact on costs for families and businesses."

SAPN can appeal the tribunal's decision in the Federal Court.

AustraliaPlus


 

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