Reform 'needed on electricity networks'

25 Sep 2012, 6:33 pm   -   Source: AAP
A Senate committee on electricity prices will hold its first public hearing on Tuesday. (AAP)

A Senate committee on electricity prices will hold its first public hearing on Tuesday. (AAP)

Consumer advocacy group Choice has called for reforms to energy networks to reduce electricity costs.

Reforms to energy networks are necessary to reduce electricity costs, a Senate inquiry has heard.

The multi-billion dollar costs associated with electricity networks have been the major driver of price rises to consumers, says Matt Levey, head of campaigns for consumer advocacy group Choice.

"All the figures show they're going to continue being a main factor if we don't actually get some reform," he told AAP on Tuesday.

Mr Levey said state and federal governments must stop blaming each other for price rises and work together to implement reform to network prices.

"It's about a co-operative approach to fix it," Mr Levey said outside the Senate inquiry into electricity prices.

He said a plethora of reforms were on the table, but the question remained whether there was the political will to carry them out.

"It hasn't been done to date and for a range of reasons it could become politicised," he said.

While he said he was not sure of the legal possibilities of national regulation of the electricity market, Mr Levey believes the idea has some merit.

"One of the reasons why electricity prices have gotten so out of control is that no one's put up their hand to own it," he said.

"It sits in this grey area between state and federal governments.

"You're much more likely to get results from a centralised process."

Earlier in the hearing, the Energy Retailers Association of Australia said it had been unfairly blamed by consumers for increasing power bills and argued government green schemes and network costs were responsible.

Mr Levey said that with the exception of Victoria, prices had been pushed up by network costs.

"It's certainly the case that the retailers are often the messenger rather than the main driver of that," he said.

Recent research by Choice revealed the main cost of living concern for Australian households were electricity bills.

The structure of the electricity market is difficult to understand and Choice will be publishing information it hopes will enable consumers to make better decisions about their electricity supplier.

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