The Minister for Resources and Energy, Martin Ferguson AM MP, has told energy supply industry CEOs that the energy market policy agenda needs re-focussing to ensure we get the investment we need in networks and generation to guarantee the high supply reliability the Australian community rightly expects.
Speaking to CEOs at a meeting in Brisbane organised by the Energy Supply Association of Australia, Minister Ferguson said electricity prices have risen by about 35 per cent over the last three years.
Minister Ferguson said: "These price rises have nothing to do with the CPRS.
"The biggest cause of higher electricity prices in Australia is the high capital cost of increased investment in electricity networks - investment that is critical to guarantee supply reliability.
"Consumers have the right to expect Governments to keep the air conditioners on in the middle of summer and to run - on demand - all the modern appliances we enjoy in the 21st century.
"While there is room for increased energy efficiency at home and at work, no-one wants brown-outs or other restrictions on supply, such as those we have faced with water for many years.
"That's why we need more investment in electricity supply infrastructure.
"At the same time, we need to invest in energy efficiency and clean energy technologies to meet our climate change objectives.
"State and Territory Governments of all political persuasions have sought from time to time to hold back necessary price increases and those decisions are now coming home to roost.
"Whilst the Australian Government is concerned about the impact of these price increases on families and businesses, in many cases they are now unavoidable if we are to guarantee supply reliability.
"For too many years, uncertainty about carbon pricing, State Government privatisation plans, retail price regulation, network regulation, and more recently, the global financial crisis, has hampered investment.
"Australia now needs to invest at least $100 billion in electricity infrastructure over the next decade just to meet growing demand and replace ageing infrastructure.
"On top of that, we need to consider how we integrate new sources of renewable generation into the existing energy market.
"I am pleased to see State and Territory Governments increasingly recognising the need to lift energy rebates for pensioners and low income earners to offset the impacts of higher electricity prices.
"Through the Ministerial Council on Energy, which I chair, Australian Governments will also legislate this year a National Energy Customer Framework to improve protections for vulnerable customers," Minister Ferguson said.
The legislation, to be introduced through the South Australian Parliament, will require retailers to have in place hardship policies for vulnerable customers that are approved by the Australian Energy Regulator, including provisions for payment plans.