Jeremy Maycock
Jeremy Maycock AGL Chairman Jeremy Maycock outlines the key challenges that the domestic energy sector in Australia is currently facing, with a focus on the efficiency of publicly owned networks, deregulated metering, reform of tariff design and scrapping the Small-scale Renewable Energy Scheme. Key points: • Australia had the second-lowest power prices among peer OECD countries in the early 2000s, but this advantage has been lost. • Flawed policy and regulatory interventions saw power prices grow faster than in any other country between 2007 and 2013. • Inefficient public ownership of networks in New South Wales and Queensland has been a significant contributor to costs. • The benefit of small-scale solar schemes should be reassessed, in light of high prices. • Smart metering and other reforms that engage customers offer real opportunities for better value.
So much discussion about energy markets and energy policy is very narrowly focused, without a broader consideration of the interrelated issues. For example, decisions relating to electricity network expenditure will influence consumer pricing. In turn, this will influence electricity demand, which will determine, at least partially, generator and retailer profitability. 70
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Another example would be where renewable energy policy not only influences consumer pricing, but can also create material social inequity, as well as prematurely stranding generation assets with remaining economic lives – another cost of scarce resources that must be borne by society.
Volume 5 Number 1
31/10/14 4:39 PM
