Prior to disaggregation, regional needs have to compete with the other priorities of Western Power Corporation.
Horizon Power, the new Regional Power entity has been established, Horizon Power, is a Government-owned entity specifically charged with looking after the interests residential and business electricity customers outside the South West Interconnect System.
Electricity customers in regional areas will experience greater access to their electricity supplier and the Corporation will have better insight to customer requirements by being closer to the customer.
Horizon Power is required under legislation to maintain its Headquarters outside the South West Interconnected System and to ensure its Board represents the regions it serves.
Horizon Power will be required to act commercially to minimise its costs, but it will also have to take into account social, regional development and environmental issues.
Horizon Power will receive supplementary funding from a Tariff Equalisation Fund, to enable it to supply customers at the uniform tariff in regional areas where the cost of generation exceeds the revenues available.
The Tariff Equalisation Fund makes transparent the cross-subsidy that currently exists within Western Power. The Networks Corporation (retaining the Western Power brand name) will make payments into the Fund from access charges paid by network users in the South West Interconnected System (generally retailers).
Horizon Power’s creation as a separate business means it can focus on localised service delivery, with the potential for services to be expanded into new areas.
Horizon Power and State Networks (the transmission and distribution business) will be subject to technical and safety regulations to ensure adequate reliability, quality and security of supply in regional areas.
Horizon will also have an obligation to ensure it has sufficient generation capacity to maintain reliability at the lowest efficient cost.
The creation of an independent Regional Power entity and a new Networks business is likely to increase the employment prospects of its employees in rural depots. These depots primarily provide network services to rural areas inside the SWIS. Also private investment in generation capacity and development of localised generation will result in more jobs in regional areas.
If you’d like to find out more about the impact of electricity reform on regional
