THE sobering reality of Essential Energy’s plans to charge up to 102 per cent more to maintain its network of streetlights has hit home for cash-strapped local councils.
A week after the state-owned company’s shock announcement of its intention to overhaul its pricing structure, the figures remain for councils as alarming as ever.
Essential Energy stands accused of attempting to “gouge” councils with “exorbitant” price rises that will ultimately punish ratepayers.
Liverpool Plains Shire Council (LPSC) will be the worst-hit of the 13 local councils if Essential Energy’s re-jigged pricing structure passes the Australian Energy Regulator.
Under the plan, it faces paying an additional $34,303 a year from 2015-16 for the street light maintenance, representing a staggering 102 per cent increase.
Tamworth Regional Council (TRC) would have to find an extra $221,745 a year in its budget to cover the 89 per cent price rise Essential Energy is plumping for.
Moree Plains Shire Council and Narrabri Shire Council would be liable for rises of 72 per cent and 65 per cent respectively as the company moves to a “cost recovery model”.
Furious LPSC mayor Ian Lobsey said the proposed increases were another “kick in the guts” for communities already struggling with outrageous electricity prices.
“Essential Energy needs to develop some social conscience and think about the devastating impact exorbitant charges for electricity are already having on families and small businesses in our region,” he said.
“With the millions they already gouge out of local consumers, $34,303 will just be another blip on Essential Energy’s already bloated ledger, but in terms of LPSC’s budget it is another significant hit.”
TRC general manager Paul Bennett said the council had invested about $140,000 - at Essential Energy’s urging - within the last two years to upgrade street lights to long-life, low-energy bulbs to reduce its bills.
“We made an investment to become more efficient and make some genuine savings and now we’re going to lose all the benefits of that program we undertook because of these increased charges - it’s crazy,” he said.
“We actually thought the maintenance costs would go down because the bulbs didn’t have to be replaced so often and this sort of flies in the face of the benefits that we were told would accrue from going through that program.”
But in a statement, which emphasised the pricing proposal was only a draft, Essential Energy’s northern regional manager Ben Williams said the program was never intended to reduce maintenance costs.
“Tamworth Regional Council was among a number of councils that participated in Essential Energy’s energy efficient luminaire replacement program in late 2012,” he said.
“While this program did provide councils with energy usage savings, it was not designed to reduce the maintenance charges associated with street lighting.
“The only expected reduction in maintenance charges were where the light replaced was previously funded by Essential Energy and is now funded by council.”
Mr Bennett said TRC, through the Namoi Regional Organisation of Councils, would be making “some strong representations” against Essential Energy’s plan.
The Australian Energy Regulator is expected to hand down its draft assessment of Essential Energy’s plan in November, before making a final decision by April next year.
Essential Energy’s proposed price hikes from 2015-16
Council area Price increase Percentage increase
Armidale Dumaresq $50,670 18%
Glen Innes Severn $20,648 36%
Gunnedah $27,378 33%
Guyra $11,041 39%
Gwydir $10,896 29%
Inverell $33,127 36%
Liverpool Plains $34,303 102%
Moree Plains $79,839 72%
Narrabri $62,206 65%
Tamworth $221,745 89%
Tenterfield $19,239 37%
Uralla $9053 43%
Walcha $8078 33%
Source: Essential Energy