Report Confirms Electricity Regulation Failing Food Producers

An independent report has confirmed that our food and fibre producers are paying up to $6,000 a year more than the real cost of supplying them power.

The report, by Sapere research group, was commissioned by the Agriculture Industries Energy Taskforce with funding from Energy Consumers Australia. It is based on a survey of irrigators aimed at pinpointing when they use power and options for ’empowering’ them to get better deals, together with analysis of detailed metering data producing consistent results for a small but diverse group of irrigators from around the NEM.

National Irrigators’ Council CEO, Steve Whan, said “the survey told us that the actual cost to supply wholesale power to irrigators was up to 40% less than the cost the electricity companies are charging.

“That’s because theyfail to provide prices based on irrigation profile characteristics, forcing irrigators to pay based on ‘average’ load profiles. Irrigators don’t have the same peaks on a hot day as other energy consumers and irrigation pumping’predominantly coincides with times when system demand is at just 30-55 per cent of system annual maximum demand’.

“When the retail component is taken into account it appears irrigators could be paying 20% more than is really justified, $6,000 per year too much on our survey’s average $30,000 a year electricity bill.

“Every Australian, who eats or wears clothes,should understand that over charging directly impacts on our capacity to produce low priced fresh food and natural fibre.

“It also directly impacts on the number of jobs in regional communities. A key example is in sugarcane, irrigation can nearly double the yield and that doubles the number of mill workers needed to crush the cane. Take it away and the jobs go.

“Irrigators produce more than 84% of Australia’s fruit and vegetables, 90% of grapes along with sugarcane, cotton, rice and dairy. When an irrigator pumps water, power becomes a key cost. Irrigators and the Ag Energy Taskforce say we must have a maximum price for electricity of 16 cents per kw/h if we are to be competitive.

“We didn’t commission this report just so we could have a whinge.

“We want this report to be used to empower irrigators to get better deals from electricity retailers; and we will use it as more ammunition to push for State and Federal action to change the regulations that let electricity suppliers make excessive profits at the expense of Australian food and fibre production.”

Media Contact: Steve Whan 0429 780 883
Tuesday 31 July 2018