
It was predicted and it has happen: the cost of electricity is going through the roof. The price freeze bought in by the Queensland LNP government has been crushed by a massive increase this year.
The draft determination of the Queensland Competition Authority relased this week forecasts
- 21.4% price increase for the common household tariff (Tariff 11) and
- 15.7% for small business customers (Tariff 20) across Queensland.

From the reaction of the Queensland Government lead on this matter, Tim Nicolls, you would have though that this was something new and unpredictiable. The fact is that we have known that the prices would rise for many years. The Australian The Australian Energy Market Commission predicted all of this in its
2010 paper on future price rises so everyone, the Governments, the wholesalers, the retailers and the consumers knew it would happen. The LNP had no hope of shifting the deck chairs around in order to prevent the rise, its freeze promised in the election last year has melted in the face of reality. This reversed the policies of the previous government which was one of alerting us to the trend and gently pushing us, with free usage checks and encouraging solar installation, towards a sustainable use of power.
Here is the Commission's predicted breakup in order of magnitude:
- Distribution services - 41% contribution
- Wholesale electricity -19% contribution
- Retail electricity -14% contribution
- Renewable Energy Target (LRET/SRES) - 11% contribution
- Transmission services - 8% contribution
- Feed-in tariffs - 3% contribution
- Other jurisdictional schemes - 3% contribution
So its the grid and the cost of conventional (read coal-fired powerplants) that are 60% of the increase. The grid is old and needs replacement. Carbon tax and feed-in tariffs are a small percentage in comparison.
Although demonized by the entrenched suppliers, renewable energy which includes rooftop solar contributes only 4.5% to additional electricity costs.
Here on the islands, many did take notice and grabbed the generous subsidies being offered by both the State and Commonwealth to install solar panels on their roofs while they were on offer. That is why, today, we have the highest density of solar panels in the State and will be somewhat cushioned from the increase later this year.
And the good news is that the cost of putting more solar on your roof is continuing to come down. The Macquarie Group, one of the most hard headed investors in Australia has pointed out that, based on world trends,
rooftop solar is now "unstoppable" Looking at the German market, the Macquarie experts say:
"ever-increasing prices for domestic and commercial customers as well as rapid solar cost declines have brought on the advent of grid parity for German roofs. Thus, solar installations could continue at a torrid pace”
For once, the islands, thanks to the efforts of people like
+Rod Young in organising the big group buys of solar panels a few years back, is well ahead of the curve and laughing all the way to the bank with their canny investment in panels ticking up the kilowatts on our roofs. What is more we have a bunch of tradies skilled up in the installation and servicing of panels.
Now, if we could only figure a way of getting to all that power when the grid goes off the air like it did a month ago.