Increasingly hefty subisides have led the Queensland Government to announced plans to explore potential electricity supply options for the Ergon Energy Queensland (EEQ) retail load, including potential supply arrangements with State-owned electricity generators CS Energy and Stanwell.

 

State Treasurer, Tim Nicholls, said the Government had an obligation to improve the efficiency of its energy portfolio for the benefit of the State Budget and Queenslanders.

 

The EEQ retail load consists of customers outside south-east Queensland that benefit from the Government’s Uniform Tariff Policy (UTP).  The UTP ensures that all non-market Queensland electricity customers of a similar type have access to electricity at the same price. 

 

Currently, the Government subsidises EEQ customers outside south-east Queensland in the form of a Community Service Obligation (CSO).

 

“In 2012-13, the cost of the CSO is budgeted to be $620 million and, by 2015-16, this cost is estimated to increase to more than $700 million,” Mr Nicholls said.

 

“This is a significant cost to the State and the Government is committed to looking at all options to improve the efficiency of current electricity supply arrangements.”

 

Mr Nicholls said the Government had not made any decision on progressing supply options.

 

“This is an internal investigation as part of the Government's responsibility to improve, where possible, the cost-effectiveness of its energy portfolio,” he said.

 

“This is not a review of the UTP, this a review aimed at achieving a more sustainable electricity generation sector in Queensland.”