LNP rejects recommendation to sell Queensland energy assets
Summary: The LNP has rejected a proposal to sell off Queensland's energy assets.....
An Australian Competition and Consumer Commission report recommended the Queensland government divide its generation assets - Stanwell and CS Energy - from two into three companies to reduce market concentration.
The ACCC is calling for a restructure of the energy sector, and for the government to back new electricity generation to drive down power prices.
Once created, the ACCC said the government should ensure they were separately owned and operated by selling at least two of the portfolios, which would maximise competition.
Asset sales were a major issue during the 2015 election, in which the Newman LNP government was swept from power.
Queensland Energy Minister Anthony Lynham said Queenslanders did not support asset sales.
"Queenslanders don't want us to sell their electricity assets - their power stations, poles and wires that deliver electricity across the state, no matter where you live," he said.
Energy Minister Anthony Lynham said Queenslanders did not support asset sales.
Dr Lynham said the report said Queensland had the lowest wholesale prices in the National Electricity Market.
"Because we own the assets, we've been able to direct prices to be lower," he said.
Dr Lynham said some of the recommendations about increased generation and retail reforms were already in line with what the government was doing, and it was open to looking at further action on retailers.
However, LNP leader Deb Frecklington said she had already ruled out selling off government-owned energy assets.
Ms Frecklington said the ACCC report endorsed the LNP's plan to break up the two Queensland generators into three.
The Palaszczuk government has proposed reinstating a third government-owned generation company, with the renewable-only CleanCo.
But the ACCC said while a third portfolio would be beneficial, it did not think a third renewable-only company was optimal for competition.
"A renewable-only portfolio is unlikely to offer the same level of competitive constraint in the market due to the way renewable generation is typically bid into the market," the report said.
"It will also take time for this third player to build scale in the market if most of its assets are yet to be developed"
Prime Minister Malcolm Turnbull told the Queensland Media Club there needed to be a more competitive market.
"People who say that privatisation of energy assets is a bad idea should consider what's happened in Queensland, where the greatest pressure to push prices up was coming from state-government-owned generators actually gaming the system," he said.
"You need to have, I think everywhere, a more competitive market, so yes, we would welcome a more competitive market in Queensland.
"Privatisation is not necessary — that's a matter for state government to determine."
Mr Turnbull said businesses did not need to be privately owned to operate in a pro-consumer and competitive manner.