Power and Water is planning a billion-dollar upgrade of ageing assets

Territorians face an increase in power and water prices in coming months. Read why costs could be going up.

Householders and business face a hike in their utilities’ bill to fund a proposed $1bn upgrade to Power and Water’s Territory assets.

Power And Water has submitted a five-year plan to the Australian Energy Regulator proposing substantial upgrades to ageing infrastructure over five years from 2024.

Power and Water’s executive general manager power services Stephen Vlahovic said a decision on the potential impact of power bills would depend on whether the plan is approved by the regulator and the NT government.

But he has clearly flagged a hike in power bills is on the agenda if the plan gets the regulatory tick-of-approval.

Power and Water Power poles and lines Picture: Glenn Campbell

“Any impact on customers’ invoices will depend on the AER’s Final Decision in April 2024 and any NT Pricing Order decisions subsequently made by the NT Government,” Power and Water said in a statement.

The regulator is expected to publish a draft decision on the submission in September.

“Over the past 18 months, we have worked closely with our customers and stakeholders to ensure their priorities for a secure and reliable electricity supply, now and into the future, are reflected in our proposed investment plans,” Mr Vlahovic said.

“Directly engaging with and listening to our customers is an important part of how we have developed our plans to invest in key areas of our electricity network.”

Power and Water is proposing to invest $987m between 2024-29 to upgrade electricity networks and systems “to ensure they are stable, reliable and ready for the renewable energy future”.

The overhaul will include replacing poles and wires in Darwin that were last upgraded almost 50 years ago after Cyclone Tracy, installation of renewables-compatible infrastructure and updated information and communications technology to enhance customer service and security.

“Customers told us they wanted to continue with our expenditure plans, partner with industry and government to facilitate renewable technologies and explore new tariff structures and pricing signals that support better energy efficiency and affordability,” Mr Vlahovic said.

“To deliver the investment plan, Power and Water is proposing to seek revenue of $996 million over the five years – about $128 million more than that expected to be spent between 2019 and 2024.”

Power and Water has been criticised for not keeping up with renewables.

The Utilities Commission last June delivered a report criticising the pace of the rollout of solar generation projects in the Territory.

It also targeted unreliable generation and described Power and Water’s capacity to meet new connection demands, ongoing operational challenges and network changes as “potentially insufficient”.

Power prices increased by 2.7 per cent from July 1 last year, meaning a householder paying an average of $300 a month for electricity would pay an additional $90 a year on their power bills.

The NT government subsidised power bills by approximately $123m a year and has committed to keeping utilities below the cost of living.

The Territory’s inflation rate is currently 7.1 per cent and the national rate is 7.8 per cent.

Treasurer Eva Lawler did not rule out price rises that matched the inflation rate.

She said the government is “committed to delivering Territorians reliable and affordable power and we will always honour that promise”.

“Upgrades and maintenance is an important part of ensuring we can continue to rpovide reliable power to Territorians,” Ms Lawler said.

Essential Services minister Selena Uibo has also been contacted for comment.