Yesterday’s announcement by the Queensland Competition Authority (QCA) not to pass on network electricity price savings to farmers and other businesses on transitional and obsolete tariffs is a betrayal of rural and regional communities who are at breaking point from unsustainable price increases.
The QCA draft determination of 2018-19 electricity prices for regional Queensland does nothing to help farmers producing food, fibre and foliage mitigate the spiralling costs of operating essential farm infrastructure.
Queensland Farmers’ Federation (QFF) President Stuart Armitage described the shafting of the state’s farmers as unacceptable.
“While the price drop for regional households and some small businesses is good news, it does nothing to relieve Queensland’s highly productive intensive farming businesses.”
“The QCA claims that specific tariffs for some businesses and irrigators are not cost-reflective and therefore ineligible to receive the small price relief – QFF challenges this.”
“It must be demonstrated how these tariffs are not cost-reflective, particularly in light of the price decreases proposed for other industry sectors. Reasoning like ‘network congestion’ has been proven not to be true.”
“It is disappointing that despite QCA acknowledging that Ergon’s network charges and generation costs are declining, this would not be passed onto farmers on irrigation tariffs. It seems that the Queensland Government has picked its winners, and it is not irrigated agriculture.”
“Irrigation electricity tariffs in Queensland have risen a minimum of 136% over the past decade, and for some more than 200%, while CPI has increased by just 24% over the same period.”
“The number of irrigating farm businesses in Queensland has fallen by more than 42% since 2009-10 to just 5,416 in 2015-16. A major contributor to this decline has been the cost of electricity.”
“Government must act to deliver price relief now and offer suitable tariffs for the future or broader consequences like exports and local supply will be impacted,” Mr Armitage said.
According to Queensland Productivity Commission data, there are around 35,000 customers in regional Queensland on tariffs classified as transitional or obsolete. More than 35 per cent of them face bill increases in excess of 50 per cent when they are forced on to standard tariffs mid-2020.