A planned cut in the government’s Renewable Energy Target would put billions in the power giants’ pockets while slugging mums and dads. Source: Getty Images
FAMILIES are set to be hit with another big power bill increase, as the energy companies reap a whopping $10 billion profit windfall.
A planned cut in the government’s Renewable Energy Target would put billions in the power giants’ pockets while slugging mums and dads.
A report commissioned by the Climate Institute, Australian Conservation Foundation and World Wildlife Fund Australia — which is due to be released today — shows that a proposed drop in the RET would add $30 annually on families’ power bills.
Energy Australia would be the biggest winner under such a reduction, netting a massive $2 billion.
Rival companies Origin Energy would get $1.5 billion and AGL $1 billion.
The power companies’ profits would be boosted by a 7 per cent rise in coal-fired power production, the report said.
Pollution would also increase by 150 million tonnes of carbon up to 2030, at a cost of $14 billion.
The federal government’s RET scheme aims to have 20 per cent of Australia’s energy come from renewable sources by 2020.
The scheme has been given bipartisan political support, but there is a growing view within the federal government that the scheme’s renewable energy target should be lowered.
Climate Institute executive John O’Connor said the report showed the campaign by the big energy companies to lower the RET was designed to protect their bottom line.
“This modelling highlights the cynical self-interest by power companies’ calls to weaken the Renewable Energy Target,’’ Mr O’Connor said.
The report said lowering the RET would increase prices for mums and dads.
“Reducing the RET increases the wholesale electricity price by 15 per cent on average over the years to 2030,’’ the report read.
“The increase in wholesale prices is due to reduced competition from renewables which have no fuel costs and can therefore outbid fossil generators.’’
The release of the report comes as the Abbott government awaits the findings of a review of the RET scheme.
Conducted by independent economic modelling firm Jacobs, it claims that over the next 15 years coal companies would be $8 billion better off while gas corporations would earn an extra $2 billion.
The report suggested the federal government would need to spend an extra $680 million by 2020 if it were to reach the current RET goals.
The government-authorised report is due out in the coming weeks.
If the federal government was to lower the targets, it would face serious challenges in passing the change to legislation in the Senate because Labor and the Greens would oppose the measures.
Originally published as A $10 billion power bill rip-off