Energy Consumers Australia’s research consistently demonstrates that residential and small business energy consumers’ first priority is an affordable energy system. Accordingly, effective ways to leverage the $20 billion Rewiring the Nation program and other forms of concessional finance to improve the affordability of the electricity sector and decrease the exponential increase in transmission expenditure planned within the National Electricity Market is a priority for our organisation.

The Energy Users’ Association of Australia (EUAA) – the peak body representing Australian commercial and industrial energy users – shares our perspective and concern on the use of concessional finance for transmission projects.  

Based on recent Federal Government Rewiring the Nation announcements, the clear objective of this funding is to ‘…put downward pressure on prices by funding the network build required to facilitate the necessary renewable generation for the transition.

There are multiple options available to ensure Rewiring the Nation achieves its objective to directly reduce the cost to consumers of new transmission infrastructure – from grants to equity to concessional loans, which broadly entail a trade-off between how much consumers can benefit from lower prices and the overall impact on government finances.

Energy Consumers Australia and the EUAA have collaborated to develop this submission to give a united consumer view on the importance of concessional finance in regulated electricity networks to focus on maximising direct consumer benefits through lower prices.

To help inform our response to the issues raised and provide expert evidence and analysis on ways in which concessional finance can directly reduce the prices energy consumers pay for transmission, Energy Consumers Australia commissioned Boardroom Energy to prepare the attached report. It:

•  Presents the case for the benefits of concessional funding to be allocated to consumers
•  Highlights that major recent concessional funding has benefited stakeholders other than consumers
•  Identifies and provides indicative estimates of the potential consumer benefits of different forms of concessional finance
•  Demonstrates that grants or equity injections can provide material benefits to consumers, while concessional loans will only have a marginal impact on consumer prices; and
•  Responds to the questions asked by the Australian Energy Market Commission.

Read our full submission here