Class action against state-owned power companies alleges price gouging

“This is about abuse of power. Stanwell and CS Energy are the largest two [electricity] generators in Queensland,” Mr Whyte said.

“They hold enormous market power, and they used that power to manipulate prices on the electricity market, and that has driven up prices for all consumers, residential and business.”

Mr Whyte said the class action alleged the two companies used their influence as a combined 70 per cent of the state’s energy market to inflate the price they sold their electricity on the NEM.

This extra cost would then be passed on to consumers via the power companies that bought the electricity at the allegedly inflated prices.

“The inflation to electricity costs across Queensland has been huge, we’re talking hundreds of millions of dollars over a number of years,” he said.

“For the average household, we think the loss is around a thousand dollars [each], for businesses it would be many multiples of that.”

Mr Whyte said the alleged price-gouging was occurring as early as 2014, although the claim period started from January 2015 due to statute of limitations, and extended to January 2021.

Stanwell issued a statement on its website on Wednesday saying it was yet to see the final claim lodged with the federal court, and rejected any suggestion it was gouging prices.

“We strongly refute any allegation of misuse of market power,” the company said.

“We are confident we have acted in accordance with the extensive rules which govern the National Electricity Market, and we have always been transparent in our trading activities.

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“We intend to vigorously defend the class action in court, which will no doubt be a long and complex process.”

CS Energy released a statement on Tuesday saying the claims being made in the class action had already been investigated by the competition watchdog.

“There is strict oversight of the National Electricity Market by the Australian Energy Regulator,” the company said.

“Previous investigations found price changes were due to a wide range of influencing factors, including extreme weather fluctuations.”

In 2017 the then-Queensland energy minister, Mark Bailey, stepped in and forced Stanwell to overhaul its bidding practices, following concerns raised by the ACCC and the Queensland Productivity Commission.

The Queensland government has maintained the companies did not act illegally.

Energy Minister Mick de Brenni said in a statement that the companies had worked to lower power prices.

“Queensland has the lowest wholesale energy prices in the National Electricity Market,” Mr de Brenni said.

“This is because the Palaszczuk government kept Queensland’s energy assets in state hands.”