Economy
Power price rises worry business, welfare groups
Tasmanian householders and businesses are expected to be further stretched, with new power price increases approved by the independent Economic Regulator.
The Regulator has approved a six per cent increase in electricity prices for householders, and eight per cent for small businesses.
The increase covers a spike in transmission and distribution costs, and will come into effect on July the first.
Aurora Energy says the decision will result in power prices rising by up to $30 a quarter.
The State Government promised at the last election to cap price rises at five per cent; despite failing to keep this promise, the Premier David Bartlett says his government is doing all it can to keep power prices down.
He says the state’s energy system faces cost pressures.
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Tasmania’s Small Business Council has condemned the imminent power price rise for small businesses, saying it will end up hurting consumers.
The Chief Executive of the Small Business Council Robert Mallet says it means businesses will have to lift their prices.
“Just take for example a small supermarket, which would have a conservative power consumption of about $10,000 a year, say. That adds an extra $800 a year to their costs,” Mr Mallet said.
“Now [that will be] put on top of the price of the vegetables and groceries, that the consumer will end up having to pay.”
The Tasmanian Chamber of Commerce and Industry’s Robert Wallace says the eight per cent rise for businesses is only the start of things to come, and big power-consuming businesses may be tempted to move.
“Many businesses may go elsewhere,” Mr Wallace said.
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Tasmania’s main welfare group is concerned low income earners will go without proper food to pay for more expensive electricity bills.
The Acting CEO of the Tasmanian Council of Social Service, Martin Gibson, says some people will not be able to afford the six per cent price hike for residential customers.
“We asked a resident of the east coast last year when we were doing our consultations with low income earners in Tasmania, what it would mean for her if she were to face a $10 a week increase in her cost of living,” he said.
“And for her that would mean one more day that she would live off bread instead of more nutritious food.”
Noel Mundy from the Tasmanian branch of Mission Australia agrees low income earners will be hit hard.
“The expense of heating is becoming a great inhibitor on households,” Mr Mundy said.
He says many Tasmanians are already struggling to make ends meet.