ELECTRICITY

Ripper gives green light for WA electricity reforms

Citing high electricity prices and its negative impact on the economy, Western Australian deputy ...

"For a resource-based economy like Western Australia's, lower electricity prices are essential to improve our competitiveness and to grow our economy," Mr Ripper said.

The Deputy Premier said the Government had endorsed a range of recommendations by the Electricity Reform Task Force including the disaggregation of Western Power into four separate entities - generation, networks, retail and regional power - over the next 18 months and the establishment of a wholesale electricity market by the middle of 2005.

Other recommendations included making 12,000 Western Power customers eligible to chose their energy supplier from January 1, 2005 as well as improved consumer protection measures and steps to encourage the use of renewable energy.

The Deputy Premier however said the Government would not consider privatisation of Western Power or any of its successor entities.

In August last year, the newly-elected State Government moved to honour its election commitment by appointing the Electricity Reform Task Force to develop a framework for reform of the State's electricity supply industry.

Independent analysis suggested the benefits of reform would be an average 8.5 per cent cut in electricity prices, an increase in Gross State Product of up to $300 million a year by 2010, and the creation of 2,900 new jobs.

Gas distributor and retailer AlintaGas, which plans to plan to enter the electricity market under a co-generation deal with alumina giant Alcoa, has welcomed the Cabinet's decision.

"The speedy implementation of the recommendations was an important step in the process and we are very pleased that Cabinet has endorsed the taskforce's recommendations," said AlintaGas chief executive officer Bob Browning.

Many commentators believe Cabinet's decision to back electricity reform could make the position of Western Power chief David Eiszle increasingly tenuous as Mr Eiszle opposes the Government's disagregation plans.

However, Mr Ripper said the position of Mr Eiszle was an issue for the Western Power board and not the government. "David Eiszle is appointed by the board and as chief executive officer he has to maintain the confidence of the board," Mr Ripper said.

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