In a submission delivered today to the Tasmanian Economic Regulator (TER), the Tasmanian Small Business Council called for a rethink on the reform strategy and retail price determinations made when it was fully expected that there would be two new energy retailers operating in the state.
Executive Officer of the Tasmanian Small Business Council, Robert Mallett, said in Hobart today that ‘determinations made with an expectation of the sale of Aurora are now effectively out of date and new determinations with regard to Aurora’s margin and the Customer Acquisition and Retention Costs (CARC) should be made before the end of the year’.
‘Until there is genuine competition in the Tasmanian energy market, the reduction in margins and the CARC component, valued conservatively at $37.5M should be returned to the small business sector and residential power users from Jan 1st 2014.’
The submission also highlighted the issues Tasmania now has with a near monopoly generator (since the sale of the Tamar Valley power Station to Hydro Tasmania).
‘The report highlights the need for the TER to effectively regulate Hydro Tasmania’s electricity contracts by improving information and communications to the market place, adding to transparency, more effectively curbing Hydro Tasmania’s market dominance and ensuring that Hydro Tasmania is subject to enforcement powers that match the seriousness of any non-compliance.’
‘It has been very disappointing that the sale of Aurora has not gone ahead as it should have done and it is imperative that energy retailers across Australia realise that it is in fact still for sale, however the government may need to make some preconditions in the future to ensure the sale is a success’, Mr Mallett said.
The full submission is available here.