Queensland Electricity Users Network

"Advocating on behalf of peak industry and social organisations for affordable and reliable electricity in Queensland"

This electricity crisis is growing daily across Queensland and Australia

CLICK HERE : to read the power bill stories of homes and businesses

By reducing power bills the economy and jobs can grow

Our survey found that if power bills fell:

  • 33% of businesses would consider employing more staff and/or increasing staff hours
  • 24% of businesses would consider expanding
  • 86% of businesses would experience an improvement in their viability

This crisis is solvable if electricity customers have a strong voice

About Us

The Queensland Electricity Users Network is a network of regional Queensland electricity users including local government, Chambers of Commerce, economic development organisations, retirees, tourism operators, irrigation farmers, dairy farmers, the mining industry and urban developers.

The aim of the QEUN is to advocate for affordable and reliable electricity for business and residential customers in Queensland.

Source: QEUN (Queensland Electricity Users Network)

Business Electricity Survey Report

DISCLAIMER “This project was funded by Energy Consumers Australia (www.energyconsumersaustralia.com.au) as part of its grants process for consumer advocacy projects and research projects for the benefit of consumers of electricity and natural gas. The views expressed in this document do not necessarily reflect the views of the Energy Consumers Australia.”

Overview:

Background

Over the period July to early October, Compass Research carried out independent surveying among businesses in four representative Queensland regions on behalf of Queensland Electricity Users Network with support from Energy Consumers Australia.

The following gives an overview of the results.

Full detailed reports for the four areas overall and for each region can be found following the overview

The Four Regions Surveyed

The four rural regions selected - Mareeba (northern agricultural, especially irrigated), Southern Downs (southern agricultural), Whitsundays (tourism) and Mt Isa (mining), are representative of the diversity of regional Queensland outside of the main regional cities.

This diversity was also represented, at the time of the surveying, in a range of economic conditions - good growth based on agricultural expansion in Mareeba, slow conditions in the Southern Downs, Mt Isa doing it tough with the collapse of the mining boom and Whitsundays struggling to recover from the effects of Cyclone Debbie. However, while there was some variation, the main results were remarkably similar.

The four regions represented a population of 109,000.

The survey sample was large at 741 and covered all industry sectors.

The Rising Costs

Almost all relied on Ergon, the Queensland Government owned near monopoly retailer/supplier in regional Queensland, and have faced major increases of the order of 15 – 20% in the last two years as regulated retail electricity prices for a typical small business rose 11.2% in 2016-17 and 4.1% in 2017-18 = 15.3% in two years.

Electricity costs of the businesses responding as a proportion of their total costs ranged from less than 5% to more than 30% with an average of 13%.

How did Businesses Adjust?

The overwhelming response (70%) was that the businesses had suffered a loss in profitability. Only 22% said they were able or willing to pass on the cost to customers – very few in full.

Some two-thirds tried to reduce electricity consumption by modifying behaviour (e.g. adjusting air-conditioners) and 42% by installing more efficient equipment.

Some 15% invested in alternative energy generation.

Resulting losses in jobs or staff hours were recorded by 15%.

Some 25% said they increased debt carried by their businesses.

The survey indicated that about 50% of businesses are experiencing bill stress and this is common across the four regions and across most industry sectors including sectors like agriculture, tourism, mining, manufacturing & retail that underpin regional economies.

What Will Happen if Electricity Costs Continue to Rise?

Some 22% of respondents indicated they were now extremely concerned about their ability to pay their electricity bills – that they were experiencing bill stress.

If electricity prices go up again, some 52% said they would experience strong to severe stress in their business. Some 30% said they would consider reducing staff/staff hours – a leap from the 15% who have already cut back.

Conversely if prices went down, 86% said it would increase the viability of their businesses and 35% said they would consider employing more staff.

Impact on the Regional Economy

Almost all said that the rises in electricity prices were adversely affecting their regional economies; some 34% recording effects as severe.

Conclusions

Businesses have tried to accommodate rising power bills by modifying electricity consumption, installing more efficient equipment and in some cases turning to alternative energy sources.

Most businesses reported they were unable to pass on the rising costs or make other compensating adjustments.

The main result has been that profitability, incomes & viability of important industry sectors have suffered. Nearly half are now reporting bill stress and about a quarter have survived by taking on more debt. The squeeze on profitability will have meant a lesser ability to pay staff higher wages.

While job and employee work hour losses have so far not been large, the reduction in employment is adversely affecting regional Queensland economies.

If the price of electricity rises again, half of businesses said they would experience strong to severe stress, more will seek to recover costs by increasing prices. Loss of employment can be expected to increase with effects on regional economies.

On the other hand, businesses clearly indicated that if electricity prices were reduced their viability would improve, with many considering employing more staff and expanding their business.

Full detailed reports for the four areas overall and for each region

Overall Report

4 Regional Reports


The Queensland Electricity Users Network would like to thank all the businesses - nearly 800 - that participated in the Regional Queensland Business Electricity Survey.

A wide range of businesses responded to the survey enabling us to estimate how rising electricity prices are impacting on various industries and communities in regional Queensland.

A copy of the survey report will be provided to:

  • Australian Competition and Consumer Commission for input into the ACCC's Inquiry into Electricity Supply and Pricing due to submit a final report to the Federal Treasurer in June 2018.
  • Australian Energy Market Operator (the federal entity responsible for ensuring there is enough electricity supply in the National Electricity Market to meet electricity demand).
  • Australian Energy Market Commission (the federal entity responsible for the National Electricity Rules that govern the National Electricity Market).

The business survey remains open on the QEUN website as we consider how to continue to provide evidence based advocacy.

QCA Submissions

Regional Queensland is paying over 20% more for household electricity bills than Southeast Queensland and businesses over 30% more.

Under the Constitution the Queensland Government is responsible for setting regulated retail electricity prices.
Since 2007 the Queensland Government has provided an annual Delegation to the Queensland Competition Authority (QCA) to set regulated retail electricity prices.
  • Twice since 2007 the Queensland Government has provided price relief to struggling electricity customers by providing a specific direction to QCA.
  • The Queensland Government can again choose to intervene and provide a direction to substantially reduce 2018-19 electricity prices for customers in regional Queensland.
  • The retail electricity prices set by the QCA will appear on residential and business power bills from 1st July 2018.
  • Ergon Energy Retail is only allowed to charge the retail electricity prices set by the Queensland Government or the QCA.
  • The Draft 2018-19 prices were announced in February and the Final 2018-19 prices will be announced by 31st May.
The QEUN has provided two submissions to the QCA; the first in response to the Consultation Paper and the other in response to the Draft 2018-19 prices.

Daintree Off Grid Survey Report

The survey was carried out in an area along the coast north of Cairns that for environmental and cost reasons was excluded by the State Government from the Queensland electricity grid (Ergon) service area, ie. the area is off the grid. Residential population not on the grid is estimated to be about 600 plus of the order of 500 visitors staying overnight during peak winter months.
Aim of the survey was to obtain information about how households and businesses actually reacted in a situation of not having grid power available, the technology adopted and questions of cost, reliability and safety.

Finkel Report

What is the Finkel Report?

The Council of Australian Governments’ (COAG) Energy Council commissioned an independent review of the National Electricity Market after the state-wide blackout of South Australia on 28 September 2016.

The aim of the review is to provide advice to COAG on a coordinated national blueprint that would provide Australia with reliable, secure and affordable electricity.

The 5 member panel of the Finkel Review is chaired by Dr Alan Finkel, the Chief Scientist of Australia. COAG did not appoint an energy consumer/customer member to the Finkel Review panel.

The Queensland Electricity Users Network provided a detailed submission and participated in a teleconference with the Finkel Review panel. The Finkel Review received 392 submissions.

The Finkel Report was presented to COAG Leaders on 9 June 2017.

What happens now that the Finkel Report has been delivered to COAG?

The 50 recommendations in the Finkel Report can be accepted or rejected by individual members of COAG.

The members of COAG are the Prime Minister, state and territory Premiers and the President of the Australian Local Government Association.

The Federal Government announced on 20 June 2017 that it will accept 49 of the 50 recommendations. The recommendation regarding the Clean Energy Target will be further considered by the Federal Government and more analysis undertaken.

Responses from other members of COAG are yet to be clarified.

For further information on the Finkel Report and to view the QEUN’s recommendations to the Finkel Review please click on the following links:

Media Releases

15June2018 Queensland Government has the power to reduce power bills
12June2018 Queensland electricity tax causes jobs losses
3April2018 People Power needed to drop power bills
28February2018 Power Bill reductions not enough and not certain
15February2018 Urgent call to register for workshops on electricity prices
9February2018 Survey reveals electricity prices harming business and jobs
5December2017 Business electricity disconnections jump 82 percent
24November2017 Brisbane needs regional Queensland
23November2017 Blackouts, job losses and higher power bills
20November2017 Regional Queensland paying up to $600 more in power bills
07November2017 Electricity financial stress soars
12October2017 3 days left to voice your opinion on power prices
09October2017 Less than one week for Mt Isa to have their say on rising electricity prices
03October2017 Business electricity survey extended in Mt Isa and Whitsundays
27September2017 More surveys on rising power bills urgently needed
25September2017 Are rising power bills impacting your business
21September2017 Businesses reveal impact of rising power bills
01September2017 Target 200 launched to reduce power prices
25August2017 Mareeba Shire businesses, only one week left to voice your opinion on rising power bills
16August2017 More voices against rising power bills needed
28June2017 Regional businesses given a voice on rising power bills
13June2017 Queensland Budget confirms power bills will rise again
07June2017 Lights out for middle Australia
06June2017 No jobs bonanza for Queensland due to yet another hike in power bills
02June2017 Energy poverty and unemployment rising again in regional Qld
26February2017 Queensland Competition Authority Draft Price - businesses
18May2016 FNQEUN calls on Queensland Government to reduce regional electricity prices

"Advocating on behalf of peak industry and social organisations for affordable and reliable electricity in Queensland"

Contact:

Queensland Electricity Users Network (QEUN)
Phone: (07) 40312 865
Email: admin@qeun.com.au
Web: http://www.qeun.com.au
38 Grafton Street, Cairns, QLD, 4870
PO Box 2148, Cairns, QLD, 4870

Menu:

Home
About Us
Media Releases
Media Mentions
Finkel Report
Daintree Survey Report
Business Electricity Survey Report
Contact

Understanding Electricity
Bills Components
Pricing
National Issues
Capacity
Electricity Flow & Prices

Extras:

Business Electricity Survey

Business Electricity Survey Print PDF

Mareeba Flyer Print PDF
Southern Downs Flyer Print PDF