Energy supplier SA Power Networks seeking to increase charges to boost its profits

HOUSEHOLDERS have been warned to brace for new power price rises of as much as $60 a year, with energy supplier SA Power Networks seeking to boost its profits.

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HOUSEHOLDERS have been warned to brace for new power price rises of as much as $60 a year, with energy supplier SA Power Networks seeking to increase charges to boost its profits.

The monopoly network company tomorrow begins court action seeking $265 million in extra revenue to pay for its workers’ wage rises, bushfire prevention and pad its bottom line.

It will contest a previous ruling by the Australian Energy Regulator at the Australian Competition Tribunal in Melbourne.

Welfare agencies say a win for the company would add $60 a year to household bills, which would come on top of rises up to $260 a year in power charges announced by electricity retailers last month.

Energy suppliers have come under sustained criticism from South Australian customers who already pay some of the highest power prices in the world.

The latest blow to householders comes just weeks after the State Government had to plead with generators to boost supply amid threats from major companies to shut down in the face of skyrocketing electricity prices.

The legal battle between SA Power Networks and the regulator is over calculations of what is a fair cost the monopoly company can charge to supply electricity up to 2019/20.

Both refused to put a dollar value on the cost to householders, but welfare agency Uniting Communities said it would have a big impact on energy bills.

Uniting Communities spokesman Mark Henley said “if the tribunal approved all that SA Power Networks asked for, that could result in average electricity bills going up $60 a year’’.

“This would come after energy retailers increased bills by 10 to 15 per cent from July 1, which is a huge hit to consumers, especially given hits in the past,’’ he said.

“Energy companies have to realise the community can’t keep forking out for increases which are dramatically above the inflation rate of 1 per cent.’’

After receiving submissions from SA Power Networks, the regulator determined that householders would enjoy a cut to network charges of around $190 last financial year.

But SA Power Networks has continued to argue that the regulator got its numbers wrong and it is seeking an increase in charges to cover its estimated costs of doing business.

One major point of contention involves labour costs.

SA Power Networks says the increase in wages, allowances and bonuses granted in the enterprise agreement with its workers were not covered by the revenue allowed by the regulator.

This includes increases in bonuses paid to staff for working with their bare hands, handling cash or doing jobs in remote regions to householders.

SA Power spokesman Paul Roberts declined to put a figure on the extra costs to customers if the company was successful at the tribunal.

However, he said: “Even if SA Power Networks is successful in winning all matters, on average South Australians will be paying less for our distribution services in 2019/20 than they were in 2014/15.”