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Qld power merger plan causes alarm


Source: AFR, 14 Feb 2015

Heightened prospects for a merger of Queensland’s state-owned power generators under a future Labor government have triggered warnings of reduced competition in the market, with consumers to suffer through higher electricity prices.

Queensland’s Labor Party revealed a policy last month for the merger of state-owned generators CS Energy and Stanwell Corporation into one business, while the network companies Ergon, Energex and Powerlink would be combined.

Such a merger, made more likely by the huge swing against the Liberal National Party government of Campbell Newman in Saturday’s election, has caused alarm among market watchers. “It is pretty concentrated as it is in Queensland and that would create a pretty significant gorilla,” said the Grattan Institute’s energy program director, Tony Wood.