ALP's 'Rewiring the Nation' Proposal Could Help Shield Consumers From Future Costs and Risk

ALP’s ‘Rewiring the Nation’ Proposal Could Help Shield Consumers From Future Costs and Risk

Emily Wood | October 9, 2020

Australia’s leading advocate for commercial and industrial energy users, the Energy Users’ Association of Australia (EUAA), believes the Australia Labour Party’s (ALP) proposal Rewiring the Nation has the potential to help shield energy consumers from some of the costs and risks associated with the transition underway in energy markets, and says it warrants consideration.

“While the inevitable shift towards clean energy provides many economic, social and environmental benefits, we must recognise it also creates new challenges that need to be addressed,” said EUAA Chief Executive Officer, Mr Andrew Richards.

One of those challenges is the significant investment in our electricity networks to support new forms of generation.  This multi-billion-dollar investment is being driven by a once in a lifetime change to our electricity system identified in the Australian Energy Market Operator’s (AEMO) Integrated System Plan (ISP).

The EUAA has been raising concerns about the costs and risks to consumers of this change, especially those resulting from multi-billion dollar network investments. These investments have a life of over 50-60 years compared to the life of the renewable generation assets of 20-25 years. Under the current Australian Energy Regulator (AER) rules, consumers will be paying for the life of the network asset even if the current rapid technological change means they become stranded assets well before the end of their technical life.  Already around 40% of energy bills are from the cost of network infrastructure. The EUAA has long argued that consumers should not be required to carry the full burden of that uncertain future.

“Rapid evolution of technologies and consumer usage patterns means we are faced with a highly uncertain future, so significant financial contribution from government to support the rollout of the ISP that also helps shield energy users from risks and costs would be welcomed by the EUAA,” said Mr Richards.

“We see merit in the Rewiring The Nation proposal from the ALP and encourage governments to give it careful consideration.”

The EUAA is the peak body representing Australian commercial and industrial energy users. Our membership covers a broad cross section of the Australian economy including significant retail, manufacturing, food and materials processing industries. Combined EUAA members employ over 1 million Australians, pay billions in energy bills every year and expect to see all parts of the energy supply chain making their contribution to delivering affordable, reliable and sustainable energy supplies.

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Media Contact: Emily Wood 0421 042 121

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