It is really quite simple:
- The Queensland Electricity Market is part of the National Electricity Market;
- Electricity in Australia is generated by Renewables and Gas and Coal Powered electricity Generators;
- High World and Domestic Prices for Gas and Coal have forced up the cost of producing electricity from these sources;
- As a result the bid price for electricity has risen resulting in an increased price for electricity in Australia;
- This increased prices for electricity, gas and coal has resulted in higher windfall gains for the suppliers of the gas, coal and in some cases the electricity generators;
- In the case of Queensland, the Queensland Government is the owner of the electricity generators and accrues this windfall gain;
- the Queensland Government also has the following coal tax royalties:
Average price per tonne for coal sold, disposed of or used from 1 July 2022:
. First $100—7% of value
Next $50—12.5% of value
Next $25—15% of value
Next $50—20% of value
Next $75—30% of value
Balance—40% of value
- As a result of high coal prices the Qld government is also making large windfall gains in Coal Roayalties;
Hence, the high prices for gas and coal are resulting in higher prices for electricity and also large windfall gains for the Queensland Govt.
What the Queensland Government is doing is applying some of these large windfall gains from higher coal/gas prices to offset some of the increased cost to Queensland electricity consumers resulting from the same price increases.
