Sunday Telegraph articles ("Aircon tax" and "Turn the panels west or face tax" 25 January 2015) have raised concerns and generated some confusion in the community about electricity pricing.

 

The articles gave the impression that a new tax is being planned for air-conditioners as part of the move to cost reflective distribution network prices from 2017.

 

There is no tax on air-conditioners. 

 

The articles also said people would have to move their solar panels. That is also not the case.

Analysis suggests that under cost-reflective network prices 70-80% of people are expected to save money on their electricity bills because they will only pay for the power they use in their own homes. Average consumers could save between $28-$145 per year.

 

Right now most people pay a flat charge to cover the costs of electricity poles and wires. This means consumers who use most of their electricity at off-peak times are paying more than their share of the costs – and people who use most power at peak times are paying less than it costs.

 

Decisions to save even small amounts of power at peak times will help everyone - the more we can do to stop peak electricity demand growing, the less money has to be spent on networks - and that will lower prices for all consumers.

 

Throughout 2015 new prices will be worked out by distribution businesses. The rules require distribution businesses to consult with consumers on any changes before they submit draft proposals to the Australian Energy Regulator for approval. New prices would be phased in from 2017.

 

Network businesses may transition consumers to new prices over 5 years or more to minimise any disruption or bill shock for consumers.

 

For more information

AEMC Chairman, John Pierce (02) 8296 7800

Media: Prudence Anderson, Communication Manager (0404) 821 935 or (02) 8296 7817