Queensland Premier Pledges State-Owned Energy Provider To Lower Electricity Bills If Re-Elected

The Labor Party in Queensland will establish a publicly owned "people's" energy provider in the state if voted back, Premier Steven Miles said Tuesday during his election campaign in the Mackay region.

Miles said the state-owned energy provider will generate cheaper electricity bills, operate statewide and compete with Ergon Energy in regional Queensland.

Ergon, a subsidiary of Energy Queensland, is run by the government with services around 97% of Queensland.

"We estimate it could save consumers up to 6% on their energy bills which is the regulated profit margin for non-publicly owned generators," ABC quoted Miles as saying. "We know more competition equals lowers prices and we know that publicly owned corporations can compete against each other to deliver that competition."

Miles promised the new energy retailer will be launched within a year and will be free of the restrictions currently faced by Ergon, which acts as distributor and retailer.

After Premier Peter Beattie sold off the retail arm of Energex in 2007, the consumers had little choice, but to opt for private operators, The Guardian reported.

"We know more competition equals lower prices," Miles said. "And we know that publicly owned government corporations can compete against each other to deliver that competition."

Treasurer Cameron Dick put the cost of setting up the energy retailer at about AU$1.4 million, adding that it would help people save up to 6% of their energy bills.

While Greens energy spokesperson Michael Berkman applauded Labor for undoing some of the "disastrous privatization of his Labor predecessors," he also demanded 100% public ownership.

"The only part of the industry that was fully privatized is retail. This is an acknowledgment that privatization is a failed policy," economics professor John Quiggin from University of Queensland said.

However, the LNP opposition leader, David Crisafulli, called the plan "a desperate thought bubble." He added that 10 years of "bad planning" had led to consumers paying more for power.

"The solution is state-owned generators running at capacity, not more state-owned retailers running off with your money," he said.

The proposal also drew criticism from the business groups. Business Chamber Queensland CEO Heidi Cooper stated the government's "interventionist policy" would not give the desired results, but create additional layers of bureaucracy and reduce competition.