Print businesses and jobs are under a direct threat from unsustainable increases in electricity prices and unreliable supply, says PIAA, in a submission to the ACCC which calls for immediate action to be taken to prevent further damage to the industry.
The submission called for members to give their take on how the retail electricity market had been affecting their businesses, with some businesses seeing price rises of 200 per cent.
Andrew Macaulay, CEO, Printing Industries’ says, “One of our large Melbourne based printers faces an increase of $120,000 to $360,000 per annum once its existing contract expires. That is three-fold and totally unsustainable.
“If the current scenario continues to play out, the consequences for employment will be dire. The sooner that Governments can force or encourage a readjustment to this conduct, the less damage will be done to the industries such as print that rely on competitive power prices.”
Many printers told Macaulay a similar story, of debilitating month on month power bill increases, despite electricity use being steady, or as is the case with others, including Lotsa Print in Queensland, the bills increasing despite energy use coming down, its bills rose by 27 per cent despite consumption decreasing by 18 per cent.
Macaulay says the impact of power price hikes have had serious knock on effects- with printers not replacing retired staff members, having to lose staff to pay for electricity.
One large printer operating across states noted increases of 67 per cent during the volatile peak hour period.
Another Melbourne based printer, a 40-year old business, will be cutting 10 per cent of its workforce to keep up. As it employs 70 people, seven would stand to lose their jobs.
Macaulay says, “It is clear that the major electricity suppliers and distribution networks have witnessed their customers’ reduced power consumption and have consequently adjusted their prices to maintain and increase their revenue against the trendline of decreasing power use.
“At this stage, the scenario looks set to continue. If so, it will inevitably lead to a crash scenario, where the owners of power and distribution assets will have to write down the value of those assets so that they can stay in business. To not do so would lead to continued increases in power costs with the consequence of otherwise-viable industries (ie their customers) going to the wall, or substantially reduce in number and size.
“In other words, either power companies take the hit in value and revenue, or the industries who are their customers will have to do so.
Mary Jo Fisher, director Government Relations, PIAA says, “One of the recommendations we hope they make is directed towards making it easier for businesses to compare the offerings of retail electricity suppliers. With each supplier arranging statements differently using different metrics, it can be confusing to make comparisons.
“A lot of our members show little trust in electricity retailers, and say one is as bad as another. Complaints and questions are seen to be not worth the hassle of chasing up.
“It is only our members who go through brokers that seem to be getting better deals, however this incurs another cost on the business regardless.”
Lotsa Print's power bill can be seen below: the red line represents KW Hours, while the blue line follows the monthly power bill. Despite electricity use on a steady decline from mid-2012, the amount spent on electricity has risen.
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