Final Revenue Decisions Made for Qld Utilities

AER Sets New Revenue Limits for Energex and Ergon Energy

The Australian Energy Regulator (AER) has released its final determination on the revenue Energex and Ergon Energy can recover from customers from 1 July 2025. This decision directly impacts electricity prices for households and small businesses across Queensland over the 2025–30 period.

Striking a Balance Between Affordability and Investment

The AER emphasized that the decisions were made to ensure a balance between affordability and essential investment in a safe, reliable electricity network. Clare Savage, Chair of the AER, noted that the rising cost of living remains a key consideration, making it vital that utilities only charge what is necessary for delivering services.

Regional Coverage Across Queensland

Energex will continue serving southeast Queensland, including Brisbane and the coastal regions, while Ergon Energy will manage distribution across the north, central, and inland parts of the state. Together, these networks support a diverse and climate-sensitive population.

Total Revenue and Consumer Impact

Energex is allowed to recover $8.995 billion, and Ergon Energy $8.58 billion over five years. For the average residential customer, this translates to a yearly increase of around $48, while small business customers could see bills rise by $97 annually. Higher inflation and interest rates were major contributors to these increases.

Adjusted Capital and Operational Expenditure

Compared to 2020–25, Energex will receive $717 million more in capital expenditure, and $171.3 million more for operations. Ergon Energy sees an even larger increase, with capital expenditure up by $1.665 billion and operational costs rising $42.9 million. These adjustments support investments in network safety, climate resilience, and modernisation.

Shift to Time-of-Use Tariffs for Smart Meter Customers

In response to consumer concerns and ACCC findings, the AER’s final decision shifts new smart meter customers to a time-of-use tariff rather than a demand charge. Existing customers on demand tariffs will transition to the new model over six months beginning July 2025.

Importance of Consumer Engagement

While stakeholder feedback was acknowledged on several topics, the AER noted that engagement on core revenue drivers needs improvement. Savage stressed the necessity for transparent and thorough dialogue with consumers to ensure future expenditure and pricing models align with their expectations.

Energy Queensland Responds to the Determination

Energy Queensland CEO Peter Scott affirmed the company’s commitment to safety, reliability, and affordability. He highlighted the importance of maintaining end-of-life infrastructure and preparing for Queensland’s extreme weather. The network component, he added, accounts for only about a third of a customer’s total bill.

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