Energy Price Hike Shows We Use Too Much

Tuesday, 15 April 2003 10:00

"Electricity pricing that reflects environmental costs is long overdue, but more needs to be done to pass on the benefits of energy efficiency to the consumer. Energy companies need to lead the way in reducing Australia's excessive share of greenhouse gas emissions - electricity is almost 50% of emissions," said Jeff Angel, Director of Total Environment Centre (TEC).

Referring to plans by Energy Australia and Integral Energy to lift prices by between 5 and 7 per cent in 2004/5, TEC said that the energy retailers don't go far enough in their efforts to manage demand.

"Consumers care about global warming and are willing to alter their energy use, but they need to be given clear incentives and programs to do so, by making energy efficient appliances and buildings more affordable," said Mr Angel.

If no action is taken to reduce demand, up to $8 billion may need to be invested in the electricity system in the next decade at the consumer's expense. The State budget will also suffer as there will be less dividends from government owned electricity companies.

"Governments could do better too," Mr Angel said. "We need better regulations that ensure energy planners factor in reduced demand before building more generators and networks. The old 'build and generate' approach to energy supply is no longer workable."

Issues such as the impact on low-income consumers and the role of air conditioning are part of the debate, and can be accounted for. However, they should not prevent the price move.