Change of government and policies in Queensland
With the Labor Party now being declared the winners (with the support of independent Peter Wellington) in the Queensland election, a number of key policies announced by Labor before the election could impact on the energy and resources sector.
The Queensland Labor Party opposes the leasing of public assets as a means of addressing State debt. Instead it has said, it will consolidate the three electricity network businesses (Ergon, Energexand Powerlink) into a single network business and consolidate the two generation businesses (CS Energy and Stanwell) into a single generation business. This move, Labour believes, will produce savings of more than $150 million per annum and said two-thirds of the returns from any income-earning public assets will be quarantined into a trust from 2018-19 and utilised to pay down debt.
It remains to be seen whether the Australian Competition and Consumer Commission (ACCC) has concerns that a single generating entity may reduce competition and push up electricity prices.
Labour has said it will investigate the potential for electricity supply in remote areas to be opened up to competition from local government and the establishment of a Queensland Productivity Commission as an independent economic review body, initially to be tasked with conducting a public inquiry into electricity pricing.
In relation to other energy issues, a 40MW solar auction will be conducted where the government will pay the contracted generator(s) the difference between a feed in tariff rate for large-scale renewable energy generation (established through the auction process), and the prevailing wholesale price of electricity in the National Electricity Market. Labour has also flagged that the previous policy ban on uranium mining in Queensland will be reinstated.