This is bad news for energy consumers in NSW who enjoyed a price reduction last year. Early indications are that the networks will not only put prices up to previous levels but seek to compensate for lost revenue as well.
This double-blow for consumers vindicates the practice of 'gold-plating' the network and is a huge win for utilities. Network operators engaged in over-investment based on false projections of energy growth between 2008 and 2013 that saw electricity prices increase by 94%.
The AER is the only protective body for consumers in the massive electricity market that spans the Eastern seaboard and this ruling has rendered it toothless. Network charges make up 50% of household bills and steep increases will hit disadvantaged and vulnerable communities who will face bill shock and disconnections.
A new precedent has been set that takes fairness out of the electricity market and encourages consumers to seriously look at cheaper emerging solar and battery systems to cut power use or go off-grid altogether.
We are now rewarding inefficient network businesses and giving them a mandate to raise and set prices without respect to users of the service. Switching between retailers to find better pricing will have little effect when the majority of electricity costs can be passed on by the networks, raising all electricity prices.
Welcome to the age of corporate democracy and laws that defend their right to profit over our right to benefit from common wealth.
Time to take back your power.