Energy Minister Mark McArdle has responded to the Prime Minister’s call for the State Government’s energy assets to be sold.
This may be because the Qld Government’s energy generation asset would be difficult to sell in the current political and economic climate.
Asset sales proved to be quite unpopular for the previous Qld Government. The wholesale electricity market is over-supplied and newer gas fired assets can produce electricity more efficiently. Domestic gas prices are artificially low, as the coal seam gas industry ramps up. This paradigm may change when the liquefied natural gas industry matures and opens up to international export markets.
Mr McArdle said, in the Executive Summary of a submission to the Senate Select Committee on Electricity Pricing, compiled by the Department for Resources, Energy and Tourism in conjunction with the Department of Prime Minister and Cabinet and Treasury, the Federal Labor Government stated that:
“The Australian Government has a clear path for better-functioning energy markets through the progression of a set of critical reform issues. These include: … privatising government-owned energy assets – continued government ownership of energy businesses is impeding greater competition and efficiency, and reduces market confidence by creating uncertainty and risk for private sector investors.”
The Qld Department of Energy and Water Supply is in the process of developing a 30 year energy plan.
The terms of reference for an Inter-Departmental Committee and Independent Review Panel for Energy have been released.
The objectives of the Inter-Departmental Committee (IDC) on Electricity Sector Reform are to ensure:
1. Electricity in Queensland is delivered in a cost-effective manner for consumers;
2. Queensland has a viable, sustainable and competitive electricity industry; and
3. Electricity is delivered in a financially sustainable manner from the Queensland Government’s perspective.