THE State Government has created an unlevel playing field for new businesses in the Esperance region.
Due to a Horizon Power tariff, new businesses that use more than 160 megawatts of power per annum will be faced with power bills almost three times higher than that of already existing businesses.
Affected businesses at the lower end of the spectrum will face a power bill increase of at least $50,000 – while higher power consumers could end up with an increase of $100,000 or more.
Esperance Chamber of Commerce and Industry President, Sherriden Mackenzie, said the ECCI vigorously opposed the new tariff, saying it created a “totally unlevel playing field” for new businesses.
“The new tariff introduced by the Minister for Energy, Peter Collier, will significantly disadvantage the attraction of small, medium and large commercial businesses to Esperance,” Mr Tromp said.
“How can the Liberal-National Government advocate decentralisation and regional development in WA when they impose an electrical tariff that will deter businesses from setting up in regional WA and lead to more metro-centric development?”
The first new business to be affected by the tariff will be McDonalds, which will be paying more for their power usage than other fast food outlets in Esperance.
“It has created an unlevel playing field when their competitor’s electrical bill will be a third of the price,” Mr Tromp said.
Nationals Member for the Mining and Pastoral Region, Wendy Duncan, said she saw the issue as a major concern for regional WA.
“If we are a government that supports regional development, then the tariff pricing policy flies in the face of that and makes it virtually impossible for new businesses,” Ms Duncan said.
“This tariff is anti-competitive for new businesses.”
Ms Duncan said while the tariff was targeted at large businesses, it would affect the average service station, fast food outlet, or businesses that use a lot of air conditioning.
“The Nationals have indicated that we are not happy with the tariff, and Minister for Regional Development, Brendon Grylls, will be meeting with the Minister for Energy to discuss the matter.”
Ms Duncan said a uniform electricity increase across the state would be a fairer solution to the problem.
“A one or two cent increase in the metropolitan area would generate sufficient income to cover the costs. The other alternative is to give Horizon Power a larger customer base by bringing in towns like Kalgoorlie, Albany or Geraldton.”
Of even greater concern among Esperance businesses is the fear that the increased tariff may be put into place retroactively – to the detriment of local businesses.
ECCI CEO, Marcus Tromp said this was a huge concern, and said the ECCI had requested lobbying support from the Regional Chambers of WA and the Chamber of Commerce WA.
Mr Tromp said businesses that could be affected included fast-food outlets, supermarkets, seafood distributors and large businesses.
“If the government decides to introduce this retrospectively, it would cripple local medium to large businesses.”
“The initial effect is McDonalds, but this issue will stunt growth in regional WA.
“Some big businesses may relocate. Those on the threshold could face a $50,000 power bill increase.
“No medium business can handle an increase in overheads like that, and nor should they be expected to.”
Mr Tromp said any businesses concerned about this issue should contact the ECCI for more information on 9071 5142.
The Esperance Express contacted the office of Minister for Energy, Peter Collier, but had not received a reply at the time of going to print.
McDonalds Esperance licensee, David Eagles, said he had put a submission to the Minister for Energy, Peter Collier, and was awaiting a response.
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