Proposed Queensland Generator Merger

by Energy Action | Apr 09, 2015
Australian Competition and Consumer Commission has major concerns with the Queensland Labour government’s proposed plans to merge energy companies saying it would result in higher power prices.

Australian Competition and Consumer Commission has major concerns with the Queensland Labour government’s proposed plans to merge energy companies saying it would result in higher power prices.

Australian Competition and Consumer Commission (ACCC) chairman Rod Sims said Queensland already had the most concentrated energy market in mainland Australia and further reducing competition by merging CS Energy and Stanwell could end up costing Queensland consumers more.

Mr Sims said the ACCC was less concerned with the proposed merger of the electricity network companies PowerlinkEnergex and Ergon – which were already monopolies – than the electricity generation companies, CS Energy and Stanwell Corporation.

The ACCC was not happy with the previous Bligh Labour Government’s plan to merge the three public generators into two into 2011 – and even less so with the Palazczuk government’s plans to create one mega-generation company with 66 per cent market share in Queensland.

Mr Sims said regardless of how it was structured, the ultimate owner was still the state government. He said the approval of the merger was no certainty, but he stopped short of saying the ACCC would block the plans.

He did warn if CS Energy and Stanwell Corporation were independent and privately-owned the ACCC would still not back the merger.

The Palaszczuk Labour Government is relying on the merger of the generators, as well as the merger of Ergon, Energex and Powerlink, to save it about $150 million a year and pay down debt.

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