Queensland Government’s electricity company merger plan to be clarified later this year

The Queensland Government’s plan to merge five state-owned power companies will be clarified later this year, with Cabinet still to decide on the mix.

Labor made an election commitment to join CS Energy and Stanwell Corporation into a single generating company, and Energex, Ergon and Powerlink into one distribution business.

Since then it has flagged possible changes to those combinations.

Treasurer Curtis Pitt will release an update with the mid-year economic figures, which are due in December.

“We have a range of options, looking at Powerlink, Ergon, Energex, CS Energy and Stanwell. All of these will form a mix of companies and options,” Mr Pitt said.

“The mergers are still ongoing. We’re just making sure we do all the due diligence to ensure we get the best outcome for Queenslanders.”

Energy Minister Mark Bailey said the mergers will be done in consultation with the Australian Competition and Consumer Commission (ACCC).

“There are a number of different ways you can do a merger process, we’re looking at all of the permutations and we’re working out way steadily through that process,” he said.

“It’s a matter of how you do it to make sure that you get the savings but also have the most efficient market place that you can.

“We always said it would be subject to competition being protected and consultation with the ACCC.

“We’ll work through this steadily for the best possible outcome in terms of both savings to the budget and also for consumers in the market place.”

But the opposition’s Energy spokesman Andrew Powell said mergers would drive up electricity prices.

“We’ve had everyone who knows anything about electricity say that the policy of merging the generators is a dud policy,” Mr Powell said.

Action to be taken for price gouging

Mr Pitt also said he would take action if the generating companies had been charging unfair prices.

The Australian Financial Review reported that industrial customers’ concerns about “price gouging” by CS Energy and Stanwell have added to the ACCC’s reservations about mergers.

The companies deny the allegation.

Mr Pitt said he had heard about the concerns but was not aware it was happening in Queensland.

“The last time this matter was considered under the National Electricity Market there was no concern raised about Queensland at that time,” Mr Pitt said.

“If of course there are concerns, I’d be the first to be interested and act on that.”

Source: ABC News