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So that means that electricity users can be ripped off for 5 years before anything can be done about it ?
Distribution network charges are around 38% of residential bills and being a monopoly (see economics 3001 "natural monopoly") the recovery rate is reviewed every 5 years by the AER, so the idea of disassociated frequent laissez faire changes to poles and wire charges seems a bit far fetched.
So what is your point? I thought your were arguing that fixed access charges were bad.FFS, they already do, just like everyone else who is on grid. (for about the forth time).
It also means the grid owners can be under paid for 5 years before anything can be done about it.So that means that electricity users can be ripped off for 5 years before anything can be done about it ?
So what is your point? I thought your were arguing that fixed access charges were bad.
So what is the answer?I accept fixed access charges as a component of the system. I'm saying that hiking these charges in response to a drop off in demand for power is contrary to the principle of rewarding consumers for more efficient use of energy (as recommended by Finkel), and is a consequence of the privatisation of networks and the desire of companies to maintain profits, when the grid is an essential service that should be managed nationally for the benefit of national interests and not to line the pockets of shareholders, many of whom probably don't even live here.
I hope that makes my position clear.
So what is the answer?
I accept fixed access charges as a component of the system. I'm saying that hiking these charges in response to a drop off in demand for power is contrary to the principle of rewarding consumers for more efficient use of energy (as recommended by Finkel), and is a consequence of the privatisation of networks and the desire of companies to maintain profits, when the grid is an essential service that should be managed nationally for the benefit of national interests and not to line the pockets of shareholders, many of whom probably don't even live here.
I hope that makes my position clear.
when the grid is an essential service that should be managed nationally for the benefit of national interests and not to line the pockets of shareholders, many of whom probably don't even live here.
The answer, (but it's probably too late) is not to have privatised networks in the first place but run the grid holistically to achieve the lowest prices.
eg hospitals have to be maintained and new ones built but we don't get slugged with these charges every quarter, and nor should we get slugged with Medicare increases because less people get sick and don't use the hospitals as much.
Well W.A hasn't privatised the network and the Government has just put up the service cost nearly 100%.
They also say, the same will be done again next year.
But that still doesn't answer the question I posed, how do you increase the cost, to reflect actual supply cost?
1. Increase the unit cost, which means those who can't afford solar and those who rent, disproportionately pay for it.
Or
2. Increase the service cost, so everyone who is connected to the supply, shares the burden.
Your question is irrelevant because you are treating electricity as another commodity that has to pay for itself when it's an essential service like health or education that we pay for with taxation.
This in effect brought about the loss of Government control, as someone has to pay for the distribution.
you are treating electricity as another commodity that has to pay for itself
As I explained earlier, the charges aren't being "Hiked", they are just being allocated more fairly,
Totally agree, which is why we are in the situation we are now and why Finkel recommends "stronger governance"; ie more regulation. Governments thought that once they could sell off their assets they were no longer responsible, but the voters will let them know otherwise.
Offcourse it should pay for itself, it makes complete sense to me that the costs of the infrastructure should be covered by those that use it.
Those with solar are still better off, as they are still mitigating their unit usage.Well the W.A Labor Government, still owns the distribution network and the majority of generation.
They have just put up the service cost nearly 100%, and are going to do the same again next year.
I'm afraid that statement is b.s. because if we go back to the orginal story :
https://thewest.com.au/news/wa/power-surge-to-hit-solar-homes-ng-b88515496z
everyone is being charged the new fixed rate not just solar users, so I can't see how you can describe this as "fair".
We all use it, we all pay tax.
Just charging solar users would be "Unfair".
"Fair" is charging everyone who connects to the grid a service charge that covers the cost of the grid existing, and then a usage charge to cover the cost of the generation capacity they consume or a usage credit for the generation capacity they supply back.
It's not that the cost of the grid has doubled, its that the artificially low grid service charge was being subsidised before hand by a usage charge that was higher than it had to be.The WA government has just almost doubled the "cost of the grid existing" by doubling the service charge.
Lets see them justify how the cost of the grid could double overnight.
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