The Queensland Competition Authority (QCA) has once again carried out its annual consultation on electricity pricing for regional Queensland, without any effort to improve the situation for country people with EVs.
As a result, the time-of-use tariffs available to regional Queensland EV drivers are around 300 per cent higher than those faced by their Brisbane counterparts during night hours, and around 50 per cent higher during peak times.
Why can’t Queensland get it right?
The QCA, whose remit includes setting electricity prices for regional Queensland, continues to take an overly simplified approach to building its pricing structure, known as a ‘cost build-up’ methodology.
This approach works well for flat-rate tariffs because the state government pays a $500 million annual subsidy ($537m 2023-24) to Ergon Energy Retail, the regulated monopoly electricity distributor, to ensure regional Queenslanders pay similar electricity rates to those in southeastern parts of the state around Brisbane.
When applied to time-of-use tariffs, however, the massively higher rates paid by country EV drivers show that the system clearly isn’t working to close the gap.
While time-of-use tariffs are important for shifting consumption out of peak times to support the grid and keep electricity prices down, and critical for giving EV drivers the incentive to charge their cars off peak, the current pricing structure simply penalises regional Queenslanders who want to shift to EVs.
Part of the problem is that the Queensland government hands down the delegation of pricing to the QCA in time for a consultation over the summer holiday period.
Last year, only five submissions were received, including one from the Electric Vehicle Council. There are likely many more organisations interested in fair pricing in regional Queensland, but opening and closing the consultation over the Christmas break severely limits the amount of input that the QCA receives.
Details of the cost build-up methodology
The method to date has been to take the time-of-use tariff prices and pricing windows (9am-4pm, 4pm-9pm, 9pm-9am) from Ergon Energy Network and add the cost of retailing onto that. It’s called ‘network plus retail’ (N+R).
Obviously, this isn’t the way retailers in south-east Queensland compete. Electricity retailers in and around Brisbane can choose whatever prices and whatever pricing windows they want when designing time-of-use tariffs.
They will take network pricing and pricing windows into consideration, of course, but they’re not bound by them. Rather, their objective is to provide an attractive deal to the consumer, so they can land an account. And, course, to ensure that they’re making an overall profit.
Building retail structures for regional Queenslanders on the distributor’s one and only baseline doesn’t provide the variety that’s available in the competitive market in the south-east.
How does this play out for a driver thinking about an EV?
Imagine an Uber driver in Brisbane, driving an EV during the day and charging at night between 9pm and 7am. They drive around 60,000km/year. At an efficiency of 20kWh/100kms, they use about 12,000kWh of electricity per year.
If they’re on an EV time-of-use plan from one of the competitive retailers, they could be averaging as little as 8c/kWh, costing them around $960 in vehicle energy costs for the year.
Now compare this to someone wanting to drive for Uber in a similar way in regional Queensland, where charging over the same timeframe costs around 30c/kWh on Tariff 12B. This will cost $3,600 in energy for the car – a difference of $2,640. A driver in this situation would be far less likely to make the switch to an EV.
What needs to happen?
Postcode-level data shows that total EV sales in regional Queensland are around a tenth of Brisbane and surrounds. A lack of attractive time-of-use tariffs is not the only reason for this, but developing a fairer system would certainly be a useful step forward.
The EVC made these arguments to the QCA in the 2024-25 consultation. The response was essentially, “we can’t help, go talk to the state government”.
While the government-owned retailer in regional Queensland is not offering a retail product that has proven effective at incentivising off-peak EV charging in regional Queensland – because the QCA won’t let them – the government-owned network businesses (Ergon Energy Network and Energex) consider EVs as a sufficiently serious threat to the grid.
So much so, that their installation rules call for drivers to give up control of typical EV charging equipment in typical homes to them, without any form of consent or reward.
The power to address these problems is held by the state energy Minister. It’s the energy Minister who gives direction to the QCA in this matter, and in previous years has specifically called on it to develop retail offers to support EVs.
It’s the energy Minister who’s in charge of Ergon Energy Retail (which sells the electricity to regional Queenslanders) and Ergon Energy Networks, which runs the distribution assets and set the network tariff, both of these entities being part of Energy Queensland.
So we’re making a request of the Minister – let’s give regional Queenslanders a fair deal and help them reduce their bills by getting into an EV.
Michael is an Electric Vehicle infrastructure officer at the EV council. Starting out as a sustainability electrician, Michael has been working in energy policy for over 3 years.