Australian Energy Council slams Chris Bowen’s surprise free power period announcement
Energy industry leaders have withdrawn support for the government’s power price reforms after Chris Bowen blindsided them with mandatory free electricity periods.
Electricity providers have withdrawn their backing for the Albanese government’s changes to pricing regulation after being blindsided by Chris Bowen’s announcement that retailers will have to offer a new tariff with three hours of free power during the day.
A gobsmacked Australian Energy Council on Tuesday said it had spent five months engaging constructively with the government on potential changes to pricing regulation and was comfortable with what the government had in mind, but the lack of consultation on the new “solar sharer” offer meant it could “no longer offer its unqualified support.”
“We were really surprised that this announcement came out,” AEC chief executive Louisa Kinnear told this masthead.
Ms Kinnear said several AEC members already had solar-sharer-like tariffs featuring a free period in the middle of the day.
Which led her to pose this question to the government: “Why do you feel the need to regulate this type of product?”
She added: “We are seeing an increase in the government’s desire to play with tariffs. It makes the industry very nervous.”
The office of Mr Bowen, who is the Climate Change and Energy Minister, was contacted for a response to the AEC’s comments.
The response did not directly address Ms Kinnear’s claims.
But later they were raised with him on ABC TV by Patricia Karvelas.
She put it to Mr Bowen that “electricity retailers have said that you didn’t consult properly over the announcement.
He replied: “That’s not correct.
“I’m pretty careful not to publicly get into a slinging match with energy companies because a lot of them are doing their best in difficult circumstances. But I put consumers first, and this is a pro-consumer reform. It’s not a pro-company reform,” Mr Bowen said.
A consultation paper published after the Minister’s solar share announcement said “the government will implement a new requirement for retailers to offer residential customers with smart meters a solar sharer offer (SSO) standing offer tariff, regardless of whether they have rooftop solar or battery systems.
“This tariff includes a free power usage period that will enable residential customers to benefit from shifting electricity consumption into defined intervals during the day.”
Getting people to use more power during the middle of the day could reduce “curtailment” of rooftop power generation, the consultation paper suggested.
Curtailment involves temporary disconnection or reduction in rooftop generation to improve balance in the grid.
“In Queensland, for example, new inverter systems above a threshold must include a generation signalling device enabling network operators to shut down a solar inverter upon direction from” the Australian Energy Market Operator (AEMO), the consultation paper said.
“Introduction of the SSO could therefore see a reduction in the need for costly AEMO market interventions and system security support actions such as” curtailment.
The government has yet to reveal details of other changes it intends to make to electricity price regulation.
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Originally published as Australian Energy Council slams Chris Bowen’s surprise free power period announcement
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