NT electricity prices: Power and Water granted permission to raise 16 per cent more revenue
Power and Water Corporation has been approved by the national regulator to recoup more than $1 billion from customers across the period 2024–29, which could result in a hit to household budgets.
Northern Territory
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Power and Water Corporation has been approved by the national regulator to recoup more than $1 billion from customers across the period 2024–29, which could result in households being forced to stump up more than $100 extra per annum.
The Australian Energy Regulator (AER) made its final revenue decision on Tuesday for six electricity network providers across Australia, including Power and Water.
Electricity transmission and distribution network businesses are required to submit revenue proposals to the regulator every five years outlining how much they intend to recover from consumers over a five-year period to provide safe, reliable and secure electricity services and address important emerging issues such as network cybersecurity, climate resilience, integration of consumer energy resources, and digitalisation.
Power and Water was approved to recoup $1.0548 billion from customers over the five-year period – an increase of 16 per cent on the current period, 2019–24.
According to the AER, this would notionally see Territory households pay an average of $116 more for electricity per annum (up 4 per cent) and $332 more per annum for small businesses (up 3 per cent).
However, it is unclear exactly how much of that would be passed on to customers, with the NT government capping retail prices for customers using 750MWh or less per annum via annual pricing orders under the Electricity Reform Act 2000.
Chief Minister Eva Lawler said the government was yet to work through the implications of the decision by the regulator.
She said the Territory government subsidises the network to the tune of $130m each year and had kept electricity prices to rises of 2.7 per cent per annum for the last two years.
“We want to see prices stay low,” she said.
Energy Minister Kate Worden said in a statement there was no possibility of electricity prices shooting up by 16 per cent – an increase that neither the regulator nor Power and Water have forecast.
She said the government’s ownership of Territory Generation and Power and Water meant Territorians can be “assured … we will keep power prices down”.
According to the regulator’s decision, over the next five-year period, Power and Water expects to plunge $537.8 million into capital expenditure, and an additional $387.2m on operating expenditure.
The regulator approved Power and Water expenditure on six significant projects that are likely to expand or alter the network across the forward period.
They are:
– Shared transmission works to transport generation from a Renewable Energy Hub in Darwin-Katherine ($120.8m).
– Holtze‐Kowandi land development ($60.8m).
– Middle Arm commercial development ($69.1m).
– Wishart commercial development ($45.6m).
– Unlocking large scale renewables on the Darwin-Katherine Transmission Line ($50m)
– Managing network voltage and system strength with an increasing proportion of inverter-based generation ($100m).
Power and Water’s executive general manager for customer, strategy and regulation, Jason Howe, said the regulator’s decision struck the right balance.
“The AER’s final decision is a balanced and excellent outcome for Power and Water’s more than 84,000 customers to ensure electricity network services can be delivered safely, securely and reliably over the next five years,” Mr Howe said.
Mr Howe said network tariff increases were “not expected to directly impact the majority of customers” who are covered by the pricing order.
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