ELECTRICITY

WA energy reform plan sparks debate over power tax

Western Australian Minister for Energy, Mr Eric Ripper, has rejected claims by the Opposition leader that the proposed reform of the electricity market in WA will result in a power tax on households and small businesses.

The electricity task force has called for a uniform tariff policy - whereby country customers pay the same rate for power as Perth residents - and this would be maintained by the imposition of a levy.

The Opposition leader, Mr Colin Barnett, said under the levy, residential customers and small businesses would be forced to pay the tax to subsidise unprofitable services.

Mr Ripper said Mr Barnett had misrepresented the contents of a discussion paper produced by the task force. "The task force simply proposes that existing subsidy costs already built into power bills should be made transparent," he said.

The task force also wants Western Power broken into three independent businesses to encourage competition in the energy market. However, it is understood that the coal-dependent Western Power is opposed to the breakup fearing it would not be able to compete for new business against privately run, gas-fired power stations.

In the wake of a decision by one French multi-national not to invest in a $5 billion aluminium smelter in WA due to high electricity costs, Mr Ripper said energy prices are a major disincentive to investment in WA and as a result is a direct threat to sustained development and jobs growth. "That's why the Government is pressing ahead with electricity market reform," he said.

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